A decade ago, a residents' group called the Harvard Square Defense Fund began a series of legal challenges to the development of the property at One Brattle Square.

Leaders of the defense fund felt the six-story, 76-foot tall building planned for One Brattle, which now houses the HMV music store, would be simply too big for its surroundings.

Fund President G. Pebble Gifford predicted the project would be an "eyesore" and worried that the building was more likely to house large chain shops than the mom-and-pop stores that gave the Square its traditional character.

The fund's strategy in defeating the project had been successful in the past. They would file lawsuits, fight zoning changes and threaten all forms of legal action until the developer relented.

This time, however, the strategy backfired. Despite the costs imposed by fighting the defense fund, developers persevered until a court struck down the zoning appeal and awarded them the right to build.

Legal fees, however, drove up the price of the project, according to those familiar with the dispute. When it came time to lease the new property, the developer had little choice but to turn the site over to a major chain, HMV, because no sole proprietor store could afford to cover the costs.

"A lot of people on the Defense Fund don't know anything about simple economics like supply and demand," charges Tod Beaty, president of the Harvard Square Business Association. "Their plan for a mom-and-pop flavor actually backfired on them."

Gifford, however, says she doesn't see it that way. She says it was important for the fund to fight the project because city officials wouldn't ask tough questions about its impact. The financial difficulties of the developer had to do with the declining real estate market in 1991, not the legal costs, she says.

"They'd love to say that we caused the problem, but the fact is, the real estate business went bust at that time," Gifford says.

For 15 years, Gifford and the fund have been synonymous with efforts to preserve Harvard Square as a few small, historic, and unique blocks of greater Boston. In this view, mom-and-pop stores should be the Square's lifeblood; fast-food franchises are the enemy.

But as the fund's legal losses mount, it is becoming clear that Gifford's preservationist vision does not square with economic reality. The area is, in some sense, a victim of its historic success. With merchants clamoring for space here, rents are now among the highest in the state--so high that small, owner-operated stores can no longer afford them.

Since the One Brattle development became reality three years ago, various chains have made inroads into the Square, and historic institutions like Elsie's sandwich shop, a 30-year fixture, have quietly gone out of business. Harvard Square has become, in some ways, more like an open-air mall than a quaint shopping district, and that worries traditionalists.

"Harvard Square is a unique place that is world-recognized as a center for thinking, creativity and diversity," says Frank S. Kramer, owner of the Harvard Bookstore. "So if Harvard Square were to be filled with the same stores that you would see in a mall, it would be the very opposite of what it stands for."

Even Gifford and other defense fund members acknowledge that their influence has waned. Change in the Square is inevitable, Gifford concedes, and the defense fund has subtly lowered its horizons.

"We must be realistic: pressures on the Square will continue and change is inevitable," Gifford wrote in a recent letter to defense fund members, which was obtained by The Crimson. "Our goal is not to stop development but to provide assurance that new development does not jeopardize the viability of the Square."

Efforts to preserve the Square's historical look are almost as old as the area itself.

The Square's growth has been fueled largely by the presence of Harvard College, founded in 1636. Cattle ran through the Square during the 17th century, and Harvard Yard got that name because it was where cows and sheep were kept.

Horse-drawn coaches brought Bostonians to the Square in the years after the American Revolution, and a flourishing business district quickly sprung up.

Store owners soon clashed with the government over efforts to extend transportation to the Square. The state proposed an elevated railway during the 1870s, but local entrepreneurs fought the plan. Eventually, the entrepreneurs won a compromise, and an underground subway system, which had the principal advantage of not being an eyesore, was built between 1909 and 1912, according to the Cambridge Historical Commission.

The Square rose to national prominence in the 1960s, as Western Cambridge became a hotbed of street entertainment, coffee houses and, of course, radical political activity.

But the bad feelings on Harvard's politically charged campus frequently spilled over into the Square. Crime rose. Pictures from the late '60s and early '70s frequently show bars over the windows of shops and restaurants.

"It was scary," Kramer says. "The anger students felt was taken out against retailers."

"My most vivid memory from the period is one night in 1970 when there was almost a riot in the Square," Kramer adds. "I can remember watching three busloads of police marching in close formation down Mass Ave. I could not believe it."

The increasingly run-down condition of the Square sparked new activism among local residents. That, along with the building of the MBTA's Red Line, created a Renaissance of sorts in the area.

The past two decades of Square history have seen intermittent fights between residents and the University over Harvard's expansion into the city. Many residents have complained that the University grew at the expense of local neighborhoods.

In 1972, residents secured the establishment of a "red line" boundary that the University was not allowed to cross. The line's restrictions are believed to have expired in 1979, according to local officials.

It was in that year that the Harvard Square Defense Fund was founded by a group of city residents. The fund's charter says the group is dedicated to preventing the "further environmental and ecological deterioration of the Harvard Square area."

During its short history, the group has eclipsed two other local groups--the Harvard Square Business Association and the Harvard Square Advisory Committee--in influence by using strong-armed, confrontational tactics. Most prospective developments and businesses in the Square are likely to contend with the non-profit group's legal challenges and zoning appeals.

Gifford says such tactics are necessary to counter-balance the greed of developers. The advantage that the fund, which is supported by private contributions, holds over developers is that its only significant expense is legal fees.

"What the developers are seeking is a package that maximizes their financial return," Gifford says. "We believe we should get something back. We go in and fight for the public sector."

The defense fund won several early victories. A neighborhood group whose members eventually helped form the defense fund defeated a proposal to build the John F. Kennedy Presidential Library and Museum in the Square. And the fund itself successfully fought for changes in the design of the Carpenter development, just west of the Kennedy School of Government.

Gifford says the Carpenter development, which was originally scheduled to be larger than the Prudential Center, was the kind of "big, bad and ugly" development that the fund was intended to prevent. The fund successfully appealed the zoning changes needed to establish the development in Cambridge.

The defense fund considers people like Paul A. Corcoran, owner of the Harvard Shop, as important constituents. Corcoran has lived in the Square area for 38 years.

He inherited his father's department store, Corcoran's, but it closed in 1987. The store closed for the same reason many owner-operated businesses are finding it difficult to cope in today's Square: Corcoran couldn't pay the rent.

"We had a store in Harvard Square since 1949 until 1987 when it closed," Corcoran said. "We were the last of the general merchandise stores, except for the Coop."

The Coop, too, is having problems. For the first time in its history, the student cooperative failed to offer a rebate to its members this year. Corcoran says that's because department stores can't survive in today's Square.

"In order to survive, you need to specialize," he says.

Corcoran has taken his own advice. When Corcoran's closed down, he started the Harvard shop, which sells Harvard-labeled gear. "By specializing in only Harvard products, we've been able to be profitable," he says.

Specialization, however, has been the driving force in turning the Square into something approaching a mall, Corcoran says. Slowly but surely, the Square has lost its unique atmosphere.

"[The Square] used to be a small little village with no chains at all except Woolworth's," Corcoran says. "We're becoming more and more like a shopping center."

"Personally, I think we've lost a little flavor," he adds.

As it fights more battles, the fund has come under increasing criticism.

The family of real estate developer John DiGiovanni has been doing business in the Square for more than 50 years. He says the fund's main problem is its arrogance. Fund members, he charges, believe the Square belongs to them.

"[The Defense Fund] wants Harvard Square to be private," DiGiovanni says during an interview in his third-floor office in The Garage. "They want it to be their Square."

In particular, DiGiovanni accuses the fund of using its legal and political power for "elitist" ends. While it allows some stores into the Square, it has fought against potentially popular fast food outlets, he says.

"When does zoning cross the line into 'snob-zoning?'" DiGiovanni asks.

DiGiovanni says he encountered such elitism when he tried to develop the site next to Bruegger's Bagels on Mt. Auburn St. in 1992. He had several offers from businesses who wanted the spot, but he eventually tried to place a Dunkin' Donuts franchise owned by a Portuguese man.

"It just was right for the place," DiGiovanni says.

But the defense fund had other ideas. Gifford says fast food places bring "traffic, litter and negative impact on public safety and good." The group had defeated a bid by Boston Chicken to locate a franchise in the Square the year before.

The fund fought DiGiovanni through two long years of appeals to the Cambridge Board of Zoning Appeals. Exhausted, DiGiovanni finally dropped his attempt to locate Dunkin' Donuts in the Square.

"I was prepared to fight to the end," DiGiovanni says, but good business dictated that he retreat.

"I don't want to spend my time fighting the defense fund," DiGiovanni says. "That's bullshit."

But he maintains that the fund's argument against fast food outlets is flawed. He says with fast food available in so many other locations, it is unlikely that outlets will attract new business to the Square.

"There are fast food places in Central Square, Porter Square and across the river," he says. "Who's going to particularly drive in and just get donuts?"

DiGiovanni says he has tried to put the past behind him. He even attempted to join the defense fund.

"I live in the Square and genuinely care about it, so according to their missions statement, I should be allowed to join," DiGiovanni said.

But DiGiovanni charges he was effectively barred from joining by Gifford. He says he was told that he could become a member of the group by donating money, but even then he could not attend meetings.

"I tried to attend their monthly meetings, but they said I couldn't," DiGiovanni says.

The developer says he was told that only those on the board are allowed at the meetings.

"What kind of group is it if members aren't even allowed to sit in on board meetings?" DiGiovanni asks.

The developer also charges that there is a significant discrepancy between the group's goal of diversity for the Square and the reality of its membership.

"I would suggest to you that this is not at all a diverse group," DiGiovanni said.

In fact, a Boston Globe feature that ran in the fall suggested that the Defense Fund may have opposed the Dunkin' Donuts franchise on the basis of the proprietor's ethnicity. The article claims that the group has no Portuguese-American, African-American or Italian-American members.

Gifford says that charge was fabricated. She says the fund has studied the possibility of suing the Globe over the story.

DiGiovanni and other critics of the fund offer a different vision of how the Square should be shaped. The market should decide, they say.

"No matter what we do, it's the students and the people who decide who stays," DiGiovanni says.

Tod Beaty, president of the Harvard Square Business Association, agrees. He says the defense fund would be better served by attempting to work with developers and the business community. That approach has worked well for the business association, he says.

"It's not healthy for there to be a split in the community," Beaty says.

Kristin S. Demong, president of Harvard Real Estate, says she hopes the next decade will see an increase in cooperation between the Square's competing interests.

"The confrontational style of the 80s has not served us well," Demong said during a forum on the Square last month. "A cooperative process will help us produce better results."

Kramer agrees. "We need talking, not fighting," he says.

But Gifford vehemently disagrees. She says those who advocate cooperation ignore the greedy intentions of local developers. "That attitude is a very utopian and simplistic view of reality," Gifford says.

"There's nothing benign about capitalism," she says.CrimsonAndrew K. Sacha