Confidential
Settlement – $4,500,000Court
L.A. Superior Central
Attorneys
Plaintiff
Experts
Plaintiff
Kenneth Kunishima
(technical)
John Opsal
(technical)
Gerald M. Halweg
(technical)
Edwin I. Narahara
(technical)
John J. Nicholas
(technical)
Robert D. Byrd
(technical)
Rodney B. Spears
(technical)
Michael Earl Dillon
(technical)
Facts
The plaintiff is a homeowners' association that represents an approximate 300 unit condominium development in the San Fernando Valley. Homes are generally three bedrooms, with some larger and some smaller. The development was built in the 1980s by defendant builder and its subcontractors. The plaintiff alleged construction defects mainly focused on defective and leaking roofs and decks, defective tiling in the bathrooms resulting in mold, defective fireproofing (e.g., delaminating fire doors), and other defects in design and construction. Builder cross-complained against approximately 30 subcontractors for indemnity and contribution.
Settlement Discussions
The plaintiff demanded $11 million. The defendant initially offered $1.4 million. After discovery involving the review of documents and evaluations by experts, including all-day presentations made by the plaintiff's experts, as well as multiple mediation sessions, defendant builder agreed to guarantee $4.5 million to the plaintiff. A number of the subcontractors contributed to this sum. As part of the settlement, the plaintiff agreed to name certain non-settling subcontractors as defendants. The plaintiff and defendant builder will equally share the proceeds from trial and/or further settlement above defendant builder's recovery of $3.2 million against the subcontractor cross-defendants, until such time as defendant builder is made whole and any sums exceeding the guaranteed $4.5 million will go to the plaintiff. If remaining portions ultimately go to trial, defendant builder's total exposure will not exceed $4.6 million.
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