Bill Gross, His Neighbors and a Battle Over Chihuly

When Amy Gross’s mother fell ill, Amy’s husband, the investor Bill Gross, bought his wife a $1 million Dale Chihuly: a 9-foot-high-by-22-foot-long sculpture made up of spheres and wispy blown-glass tubes in cobalt and teal blue. Blue is her mother’s favorite color.

They installed it in the backyard of their cliffside Laguna Beach home. Amy said she and her mother started praying to it. “Since I have no children of my own, they are like my babies,” she added. So it was upsetting when a sphere got damaged.

Odd, it seemed to her, because “the ball is very, very thick and the glass is strong, like if I kicked it nothing would happen,” she texted their neighbor to the north, who in turn suggested that a falling palm frond might have been the culprit. To protect the piece, the Grosses installed steel poles and a net—a soccer goal, more or less.

Their neighbors, tech entrepreneur Mark Towfiq and his wife Carol Nakahara, then noticed that to enjoy the full span of their ocean view from their primary bedroom, they would need to look out over the Grosses’ backyard. Over the Chihuly. And its uplighting. And the net. They asked the Grosses to remove the shield, and when they didn’t comply, the neighbors complained to the city.

And so began a yearslong public battle, waged in court and municipal hearings, that situates the Grosses in a long line of collectors going to astonishing lengths to defend their most precious belongings. These cases often spin out of control because art is always more than its component parts. It can become a manifestation of personal identity and control. Sometimes the art itself becomes a cudgel.

For one type of collector—often from the world of finance—“their drive to collect is not economic,” says Evan Beard, executive vice president at the art investment firm Masterworks. “For them it’s cultural capital, it’s a source of status. It’s objectified capital. And because of that, it’s an extension of their power, their legacy.”

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The triumph of Julius Caesar by Andrea Andreani.

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That’s been true for as long as people have collected. In ancient Rome, generals showcased plundered art in “triumphal processions,” writes John Jay College associate professor Erin Thompson in Possession: The Curious History of Private Collectors from Antiquity to the Present; when the parade ended, they would execute the conquered rulers whose treasures they’d seized.

Modern collectors prefer to kill opponents by racking up billable hours, as when Alec Baldwin went to the mattresses against gallerist Mary Boone over a copy of a Ross Bleckner painting she sold him, even after she agreed to refund his money. (A settlement was eventually reached for at least $1 million.) Or billionaire Ron Perelman, who challenged dealer Larry Gagosian over the valuation of a Popeye sculpture by Jeff Koons, among other works. After a judge said the two should just “get themselves together at a cocktail party in the Hamptons” and sort it out, a court tossed Perelman’s claims. Years later, he reportedly financed someone else’s lawsuit against Gagosian, claiming failure to deliver another Koons.

These quarrels get tricky when art meets an outsider’s eye, when clashing opinions over beauty sharpen the question of who owns the air: the right to the space outside a private home, above a lawn, or outside a bedroom window—the right to pollute or adorn a shared landscape.

Neighbors tend to complain about nontraditional aesthetic choices. Julian Schnabel’s reddish­-pink towering Palazzo Chupi, just outside the bounds of historic preservation in the West Village, is unevenly appreciated. Hillsborough, California, recently lost a bid to force retired publisher Florence Fang to remove a bunch of dinosaur statues, a “Yabba Dabba Doo” sign, and other accoutrements from her property, known as the “Flintstone House.”

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Outside view of Palazzo Chupi in New York City.

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Fine art is not exempt from being an eyesore. In 2014, real estate investor Aby Rosen decorated his front lawn in Old Westbury, on Long Island, with a Damien Hirst—a 33-foot-tall bronze, nude, pregnant woman with an anatomical cross section that included her fetus. It was visible only from a private road that led to his 1938 Modernist A. Conger Goodyear house, but neighbors weren’t fans.

The local government considered an ordinance restricting new accessory structures to 25 feet in height. During negotiations The Virgin Mother was covered with a net tarp. Eventually Rosen agreed to move and pivot the statue so her more upsetting angles were hidden, to add screen planting around the property, and to not add lighting.

“Mr. Rosen really appreciates his artwork,” says Peter MacKinnon, who represented Rosen in the dispute. “It was important to have as part of this historic house, which has a history of showcasing iconic art. And he was most accommodating to the neighbors.”

Such cases underline why collectors throughout history go to extremes to cordon off their acquisitions from public scrutiny. The Renaissance marchioness of Mantua Isabella d’Este didn’t want many people looking at her art collection, “because they’d wear it out with their eyes,” Thompson says. Her book quotes Gilded Age oil magnate Calouste Gulbenkian saying that his “children”—his ­artworks—needed privacy, so he built them “a mansion in Paris with barricades, watchdogs, and a private secret service”; he wouldn’t loan the works out, and no one could visit them because “[his] children mustn’t be disturbed.”

The art itself can be a weapon, as in the divorce of the billionaire Harry Macklowe and his wife Linda, whose split resulted in Sotheby’s liquidation-by-animosity of much of their vast, museum-qual­ity­ ­collection­—to the tune of $676 million so far (a second auction is to take place in May). A century earlier the estranged brothers Robert Sterling and Stephen Carlton Clark, heirs to the Singer Sewing fortune, became the blue bloods who competed for blue-chip Impressionist works—apparently out of pure spite. In cases like these, “artwork is used as a tool to snub a competitor, exact revenge on an ex, file high-profile and widely publicized charges against an enemy, or simply make someone jealous,” says Leila Amineddoleh, an adjunct law professor at Fordham University and the founder of a namesake law firm specializing in art and intellectual property. “It is surprising that some collectors have sophisticated and refined taste in art, but then use their art in vindictive or childish ways.”

In Bill Gross’s case, it may be somewhat less surprising. I spent seven years researching and writing a book about him and the bond market—The Bond King, published this spring by Flatiron Books—and, if anything, the Great Chihuly War is emblematic of his single­-minded focus, in business as in life, to get what he wants. Worth an estimated $1.5 billion, the collector and philanthropist is the co-founder and former chief investment officer of PIMCO (Pacific Investment Management Co.), which today manages over $2 trillion in assets.

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The investor Bill Gross in 2004.

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After the city of Laguna Beach served the Grosses with a notice of violation on July 28, 2020, for failing to apply for permits for their sculpture and its protective netting, the couple started playing music, loudly, late into the night. According to court filings they would blast the same songs, on repeat, including 50 Cent’s “In Da Club” and the theme songs to Green Acres and Gilligan’s Island.

Towfiq texted Amy: Could they keep it down? Court records show a reply came back, apparently from Bill on Amy’s phone: “Peace on all fronts or well[sic] just have nightly concerts big boy.”

There was no peace. That October the neighbors filed dueling lawsuits: Towfiq and Nakahara accused the Grosses of harassment and nuisance in retaliation for the complaint to the city. The Grosses fired back, alleging they were being recorded and surveilled at home and at their pool. Both parties denied the other’s charges, volleying phrases like “emotional distress” and “invasion of privacy.”

At a trial two months later Bill testified that his text was to “solicit a friendly ‘peace’ environment in which [Towfiq] would stop taking pictures and stop peeping into our backyard and our pool.” A video Towfiq took that was submitted as trial evidence showed Gross crouched near the property line in his swim trunks, at times dancing to 50 Cent and at others apparently trying to hide. Among the texts submitted was an exchange between Amy and Towfiq, in which he called the sculpture “really beautiful.” The judge tossed the Grosses’ claims, though she noted filming Gross on his own property was inappropriate. Moreover, she sided with Towfiq and Nakahara, issuing a three-year civil harassment restraining order against the Grosses and requiring them to abide by city ordinances and to stop playing music when they weren’t outside to hear it.

When Gross was at PIMCO, he wrote monthly “Investment Outlook” missives that would start with a quirky anecdote and then turn abruptly toward market forecasts. These drops were keenly awaited across the industry, and journalists, myself included, wrote them up religiously. Naturally, Gross would use this latest brouhaha as fodder too; he joked about “the Gilligan’s Island trial” in a letter titled “Little Bit Softer Now.”

Somehow the saga continued. About six months after the judge’s initial ruling, the bickering Californians were back in court. Towfiq and Nakahara complained that the Grosses played music at night, loudly, by the pool, where Amy filmed herself and Bill as she sang, “We’re outside.” At the hearing the Grosses said they felt imprisoned in their home and feared using their backyard. Bill said he wanted his legacy to be about his business achievements and his philanthropic giving—not this: “I’ve been trying to have a reputation to die with, and this is not constructive.” Amy argued she was documenting their time outside as a form of protection, but the judge found this explanation “preposterous.” They were sentenced to five days in jail for contempt of court, three of which were suspended because of the pandemic. (They served the remainder with community service.) Also: no more music outdoors.

Bill called the trial “a travesty of justice” and, in another “Investment Outlook,” detailed his community service at a soup kitchen—­raising his eyebrow at the apparent comfort of the community receiving the service. In November the Grosses “had to go to Caesars Las Vegas,” Bill tweeted, “to hear Sting perform live so I wouldn’t cause any neighborly disturbances!”

In January of this year, the Laguna Beach Design Review Board considered the Grosses’ project over Zoom. Board members shared that they visited the sculpture to check sightlines; Towfiq, Nakahara, and their lawyer called in. Nakahara asked that the matter be treated “objectively, and not be influenced by who the applicant is.”

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Board member Jessica Gannon expressed surprise at her unexpected role as a cultural critic. “I’m big on property rights,” she said, “so to have the power…over this art installation on private property is just baffling to me, but here I am with a magic wand.” She approved: “Tasteful art, whether you like it or not, it’s in the eye of the beholder. Not to be subjective, [but] I think this is a beautiful piece of art. I wish I could look at this outside of my window.”

For the board the real hitch was a proposed glass cover, because it risked creating a glare and infringing on the neighbors’ “view equity.” It was Towfiq and Nakahara’s “primary, but not sole, concern,” too, says John Flynn, their lawyer.

At the hearing the Grosses’ representative said they would kill the enclosure idea. So the sculpture, naked and risking palm fronds, was unanimously approved, with two more stipulations: that the lights be shut off by 10 p.m. and that they be on a manual timer so they’re on only when the Grosses are home. Was it all worth it over a home where the Grosses say they don’t spend more than 25 days a year? “Mr. Gross is happy that Laguna Beach lived up to its reputation as a haven for art and artists, and looks forward to enjoying his art for many years to come,” his spokesperson tells T&C.

In the end the Grosses can’t play music at the legal level in their own backyard—sonically, they’ve been reduced to second-class ­citizens—and Bill may feel his prestige has been tarnished. But their blue babies stand, vindicated, two feet closer to the bluff than before. For the neighbors, the sculpture may legally mar their view but not as much as it might have. They have appealed the board’s decision to the Coastal Commission. But at least it’s quiet now. And as far as the artist is concerned? A representative for Chihuly declined to comment.

This story appears in the May 2022 issue of Town & Country. SUBSCRIBE NOW

Lead image: Mark Towfiq and Carol Nakahara, by MediaNews Group via Getty Images; a rendering of a Dale Chihuly sculpture, provided by Bill Gross; Bill and Amy Gross, by Mary Hurlbut.

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