Skanska-Shimmick-Herzog, a Joint Venture v. LAN/TYLIN, a Joint Venture, et al.

By the time of settlement, SSH had spent over $9 million in attorneys’ fees, expert fees, and costs. (Ibid.) SSH maintains that it would have recovered more on its affirmative defenses but for the VTA’s threat of $96 million in liquidated damages and design defect remediation costs. (FAC at ¶ 31.) On October 4, 2024, SSH filed suit against LTYL. In its First Amended Complaint, SSH alleges LTYL was under the obligation to defend, indemnify, and hold harmless SSH from and against claims arising out of LTYL’s performance on the Project. (FAC at ¶ 33.)

SSH further alleges it “suffered harm under the VTA Settlement in the form of reduced payment for its otherwise valid claims against VTA. But for the design claims against SSH made by VTA, such as short-stopping, SSH would have received far more compensation.” (Id. at ¶ 50.) SSH alleges LTYL was obligated to indemnify it for all such damages, costs, and fees incurred from

the global settlement with VTA. (Id. at ¶ 54.) SSH further alleges, “[u]nder the global settlement, VTA was paid a large sum for design issues that it alleged was the responsibility of SSH. While SSH vigorously disputed VTA’s allegations, SSH is informed and believes that the vast majority, if not all, of VTA’s claims related to the LTYL scope of work under the SSH- LTYL Subcontract. Defendants promised to perform such design work under the SSH-LTYL Subcontract.” (Id. at ¶ 58.) Based on these allegations, SSH brings claims against LTYL for (1) professional negligence; (2) breach of contract; (3) express contractual indemnity; and (4) equitable indemnity.

On May 21, 2025, LTYL in turn filed a cross-complaint against Anil Verma Associates (AVA), Inc. and Hatch Associates Consultants, Inc. (Hatch) as successor in interest to LTK Engineering Services (LTK). LTYL alleges that AVA and Hatch were subconsultants to LTYL on the Project and that it entered into written contracts with them for certain design services necessary to the Project. (First Amended Cross-Complaint [“FACC”] at ¶¶ 12-15.) LTYL alleges that AVA and Hatch “were obligated to perform their design work for the Project, and to defend, indemnify, and hold harmless LAN from and against claims arising out of their performance or failure in performance of their work on the Project.” (FACC at ¶ 25.)

LTYL sues AVA and Hatch for (1) breach of contract; (2) express indemnity; and (3) equitable indemnity. LTYL, AVA, and Hatch (LTYL/AVA/Hatch) jointly move to designate this matter complex. Having reviewed the matter before the Court and in consideration of California Rule of Court, rule 3.400, the Court will deny the motion. LEGAL STANDARD A “complex case” is an action that requires exceptional judicial management to avoid placing unnecessary burdens on the court or the litigants and to expedite the case, keep costs reasonable, and promote effective decision making by the court, the parties, and counsel. (Cal.

Rules of Court, rule 3.400(a).) In deciding whether an action is a complex case under (a), the court must consider, among other things, whether the action is likely to involve:

(1) Numerous pretrial motions raising difficult or novel legal issues that will be time-consuming to resolve; (2) Management of a large number of witnesses or a substantial amount of documentary evidence; (3) Management of a large number of separately represented parties; (4) Coordination with related actions pending in one or more courts in other counties, states, or countries, or in a federal court; or (5) Substantial postjudgment judicial supervision. (Cal. Rules of Court, rule 3.400(b).) ANALYSIS As an initial matter, the court notes that this is not a construction defect case requiring provisional designation under California Rules of Court, rule 3.400(c)(2).

LTYL/AVA/Hatch liken this case to a construction defect case because it involves many parties and structures under the Project. (Mtn. to Designate Complex at p. 10:8-11:9.) However, at the same time, LTYL/AVA/Hatch concede that the claims here arise from design errors rather than construction defects. (Id. at p. 10:15-16.) In the absence of provisional designation, the Court considers whether this case satisfies the factors set forth under California Rules of Court, rule 3.400(b). First, there are eight pretrial motions currently pending before the court.

This includes LTYL’s motion for summary judgment where it contends that SSH’s damages methodology is improper and that SSH has no viable indemnity claim. The motion for summary judgment brought by LTYL and Hatch concerns the claims released by SSH upon settling their prior lawsuit. LTYL/AVA/Hatch maintain this motion is fact-intensive and requires an inquiry as to what SSH knew at the time it signed the settlement agreements. (Reply at p. 5:14-18.) While there are a significant number of pretrial motions pending before the Court, the adjudication of these motions is not inherently complex.

The motion to compel is based on mediation privilege governed under Evidence Code section 1119. Additionally, the underlying issues of

indemnity and the interpretation of settlement agreements are governed by ordinary contract law. (Continental Heller Corp. v. Amtech Mechanical Services, Inc. (1997) 53 Cal.App.4th 500, 504 [“Indemnity agreements are construed under the same rules which govern the interpretation of other contracts.”]; Weddington Productions, Inc. v. Flick (1998) 60 Cal.App.4th 793, 810-811 [“A settlement agreement is a contract and the legal principles which apply to contracts generally apply to settlement contracts.”].)

As SSH aptly notes, noncomplex courts routinely try professional negligence, design, indemnity, and contract damages involving technical expert testimony. (Opposition at p. 12:24-26.) Thus, while the number of pretrial motions is large and possibly fact-intensive, they do not hinge on any difficult or novel issues. Second, LTYL/AVA/Hatch contend there is a large number of witnesses and documentary evidence. The parties have collectively retained 11 expert witnesses whose testimony focuses on the design defects and damages alleged by SSH. (Reply at p. 3:21-22.)

The summary of their opinions spans 150 pages. (Id. at p. 4:1-2.) According to SSH the parties will require the testimony of fact witnesses including current and former employees of each of the parties to this action, as well as the testimony of multiple non-parties such as Aldridge/Rosendin, Alstom, VTA, and BART. (Id. at p. 6:16-19.) The parties have produced 283,687 pages of documents to date, amounting to more than 2 terabytes of evidence. (Id. at p. 7:9-10.) While not all documents may be relevant to this litigation, there is still a substantial amount of documentary evidence that may require exceptional judicial management.

Accordingly, this factor weighs in favor of designating this matter complex. Third, contrary to LTYL/AVA/Hatch’s assertion, there are not a substantial number of parties to this action. Although LTYL/AVA/Hatch submit an organizational chart showing the vast number of entities involved with the Project, that is not reflective of the parties to this litigation. (Declaration of Austin Benner [“Benner Decl.”], Ex. B.) As LTYL/AVA/Hatch note, there are six entities that are parties to this action. SSH is the sole plaintiff.

LTYL consisting of LAN and TYL are direct defendants in this action and are represented by the same counsel. AVA and Hatch/LTK are cross-defendants who are each represented by their own counsel. Arguably, this is not a “large number of separately represented parties” compared to typical complex cases.

Fourth, there are no pending related actions in other jurisdictions. LTYL/AVA/Hatch refer the Court to Skanska-Shimmick-Herzog, a Joint Venture v. Santa Clara Valley Transportation Authority, 20-CIV-02854 filed in San Mateo County. (Benner Decl., Ex. E.) There, SSH concurred that the case meets the criteria for complex designation. (Ibid.) However, this matter has since been resolved and dismissed with prejudice. The posture in this case is different and was filed after the prior litigation resolved.

The issues presented by this action are different from the prior litigation. In the absence of any pending related cases requiring coordination, this factor weights against complex designation. Lastly, the parties make no arguments regarding whether this action requires substantial postjudgment supervision. The Court assumes then that substantial postjudgment supervision is not needed. Thus, the only factor weighing in support of complex designation is the management of a large number of witnesses or substantial amount of documentary evidence.

Nevertheless, as SSH notes, the parties have been able to exchange and manage discovery under the existing schedule, there is no ESI protocol, and no document management issues have been identified that would overwhelm the parties or the Court. (Opposition at p. 14:6-11.) Thus, while extensive, the documentary evidence is currently manageable. The instant action represents what might be the tail end of a long, complicated, litigious history concerning the Project. But the Court is not persuaded that this action requires complex treatment.

Therefore, the motion to designate this action as complex is DENIED. CONCLUSION The motion to designate this action complex is DENIED. The Court will prepare the order.

- oo0oo -

5