For now, the posture is weird. The parties are fighting over whether closing up the existing beach access is a "development" that requires a Coastal Development Permit ("CDP"). The appellate court confirmed that it is and that Khosla closed up the existing access without the required permit.

The Constitutional issue is whether it's a taking to force Khosla to provide the level of access that the State wants. While it's clear that the State owns the land up to the mean high tide line, what it actually wants here is for Khosla to maintain the existing public access. That not only includes a pathway to the public shore, but access to the sandy beach, the existing provision of parking, etc. Khosla asserted the Constitutional issue, but the appellate court ruled that it was not yet ripe. In other words, Khosla can't argue there was a taking until the State actually denies his permit to close up the beach access. (The theory is that there is no reason to resolve a Constitutional question until we actually see what position the State takes.)

I think Khosla is actually right on the Constitutional point--if the State does make him keep the existing beach access (parking and all) that's a taking. That said, Khosla had full notice of what the State wanted before he bought the property. He basically tried to arbitrage on the fact that other potential buyers wouldn't engage in an extended legal battle with California to exercise the full extent of their private property rights. If he loses on that arbitrage bid, he'll have deserved it.