Peter Morton’s Ex-Wife Claims Fraud, Harassment

In a trial that begins Monday, ex-wife Tarlton says she is owed $10M

Last Updated: March 24, 2009 @ 8:48 PM

The 21st century hasn’t been too kind to Peter Morton.
 
He remains one of the town’s richest people – but the one-time king of Hollywood’s social whirl has lost, or sold, almost everything that once made him who he was.

 

Now comes the worst blow yet. On Monday, the press-shy Morton is being taken to court by his ex-wife Tarlton, who claims that he defrauded her out of more than $10 million in stock in Vegas’ Hard Rock Hotel and Casino.

 

Moreover, she claims that after she cried foul, he hired private investigators including a disgraced ex-cop from L.A.’s scandal-ridden Rampart district to harass her, break into her house and rifle through her prescription drugs, Anthony Pellicano-style, in an effort to scare her into dropping the suit.

 

The accusations are not pretty, and the case promises not to be, either.
 

For a long time, Peter Morton was synonymous with the high-flying Hollywood scene. But the Hard Rock Café chain he co-founded was sold in 1995; the Hard Rock Hotel & Casino in Las Vegas sold in 2006.

 

Even Morton’s, the iconic power dining spot in West Hollywood that he threw open to the annual Vanity Fair Oscars party, closed in 2007.
 
Then he ventured into movie production, which hasn’t worked out too well. Yes, there was “Snatch.” But there was also “Stardust,” Paramount’s big-budget extravaganza from 2007, a flop.

 

The lawsuit adds to the list of unwelcome developments. 

  
One member of the team of investigators hired by Morton to trail Tarlton is a disgraced former detective with the Los Angeles Police Department’s notorious Rampart anti-gang team. Another, team leader Scott Ross, previously dug up dirt on the woman Robert Blake was accused of murdering — and thus helped secure the actor’s acquittal.
 
With a jury about to be empanelled in Los Angeles Superior Court, neither side is interested in playing nice.
 
“Defendant Peter Morton abused his vast wealth and superior financial advantage to intimidate and humiliate Plaintiff in a purposeful and deliberate attempt to coerce Plaintiff into dropping her lawsuit against him,” the complaint reads. “At all times, Defendant Peter Morton acted with a malicious intent to cause Plaintiff substantial harm.”
 
The Mortons ended their seven-year marriage in 1997, and for the best part of a decade the split was relatively amicable. That, though, was before Tarlton decided she needed more money and asked her ex to buy her out of the fractional stake in the casino that Peter had pledged to her as part of an amended prenuptial agreement back in the early 1990s.
 
Morton had his accountants, Ernst & Young, do a valuation of her share — the exact percentage is a matter of dispute, though it is somewhere between 1 and 1.67 per cent — and the valuation came out at $451,000.

That is what she was paid when the stock sale was completed in late 2005.
 
Peter’s vice president, Brian Ogaz, told her this was the true market value, but according to the complaint, omitted to show her a cover letter from Ernst & Young explaining that the assessment was for tax purposes — not an attempt to assess the stock’s likely value at sale.
 
Indeed, when the casino was sold two years later, the Morgans Hotel Group paid $770 million. Tarlton says in her complaint her share was, in fact, worth more than $11 million, and she claims her ex deliberately misled her to cheat her out of the money.
 
The suit was first filed in January 2007, at which point the relationship between the former spouses truly went to hell. Peter obtained custody of their two children, pointing to evidence of Tarlton’s addiction to prescription drugs and alcohol.

 

She, in turn, complained that Scott Ross and his employees had broken into her house, interfered with her luggage and tampered with her medications, including Botox, the anti-depressant Effexor and the painkiller Norco.
 
The complaint has been amended twice since — most recently last November — to reflect Tarlton’s new grievances against her ex.
 
Lawyers for both parties declined all comment before the opening of the trial. Sources familiar with Tarlton’s side said their lawyers did not want to say anything that could be used against them in court.
 
They also said that Tarlton was keen to avoid turning the trial into a belated divorce proceeding. For that reason, she was suing for invasion of privacy, not intentional infliction of emotional distress.
 
Even if Peter successfully rebuts some or all of the accusations, he is unlikely to come out of the trial unscathed. It is an ignominious episode, to say the least, for a man who began the Hard Rock cafés in London at the age of 25 and built a business empire combining the hottest Hollywood buzz with old-fashioned American entrepreneurial skill.
 
Morton’s in West Hollywood became the see-and-be-seen eaterie during the 1980s and 1990s. It closed, in part, because of a lease dispute between Morton and his sister.

 

Some battles Tarlton has lost already.
 

A source close to her described the private investigators’ behavior as coming “straight out of the Anthony Pellicano playbook.”

 

But, on Friday, Judge Amy Hogue accepted a defendants’ motion barring any mention of Pellicano during the proceedings.

She also barred any reference to the Rampart police scandal — even though investigator Michael Buchanan was tried and convicted at the time on charges of obstruction of justice and falsifying police reports.
 
That conviction was subsequently overturned, in large part thanks to investigative work into the jury carried out by Scott Ross.