I think you have a reasonable point about the beach still being public. In this case, the point of the permit battle is to make this land worth less to him since he won't be able to redevelop it. The California Coast Commission has a point of view which is to try and ensure public access to public beaches and will use their power to try and force him to negotiate.

In regards to what the tech community can do about this, how about organizing a large beach party and get some boats to ferry people in?