CALIFORNIA STATE TEACHERS’ RETIREMENT SYSTEM v. DPR CONSTRUCTION, et al.

24CV013090: CALIFORNIA STATE TEACHERS' RETIREMENT SYSTEM, A PART OF CALIFORNIA'S GOVERNMENT OPERATIONS AGENCY vs DPR CONSTRUCTION, A GENERAL PARTNERSHIP, A CALIFORNIA GENERAL PARTNERSHIP, et al. 03/06/2026 Hearing on Joinder to Motion for Summary Judgment / Adjudication for Frank M. Booth's in Department 22

Tentative Ruling

Defendant Frank M. Booth, Inc. (“FMB”) moves for summary judgment, or in the alternative, summary adjudication of the following issues: - Issue 1 – FMB Is Entitled to Summary Adjudication of CalSTRS’s Cause of Action Against FMB For Fraud Because CalSTRS Cannot Establish Multiple Elements of That Cause of Action - Issue 2 – FMB Is Entitled to Summary Adjudication of CalSTRS’s Cause of Action Against FMB For Civil Conspiracy Because CalSTRS Cannot Establish Multiple Elements of That Cause of Action - Issue 3 – FMB Is Entitled to Summary Judgment Because CalSTRS’s Only Causes of Action Against FMB Have No Merit

(Notice.)

*** If oral argument is requested, the Parties should be prepared to point to specific material facts and supporting evidence claimed to show the existence or non-existence of a triable issue of material fact. ***

REQUEST FOR JUDICIAL NOTICE

FMB requests the Court take judicial notice of the underlying construction contract between CalSTRS’s and DPR Construction (Exh. 1); DPR’s Applications for Payment Nos. 35, 43, 46-53, 55-58, 62, and 67 (Exhs. 2-17); Owner Change Order No. 024 (Exh. 18); Owner Change Order No. 029 (Exh. 19); FMB’s Change Order Request No. 98 (Exh. 20); Owner Change Order No. 035 (Exh. 21); FMB’s Change Order Request No.148 (Exh. 22); CalSTRS’s Second Amended Complaint (Exh. 23); this Court’s March 14, 2025, Ruling on FMB’s demurrer (Exh. 24); this Court’s June 27, 0025, Ruling on DPR Construction’s motion for summary judgment or adjudication (Exh. 25); and DPR’s original cross-complaint in this matter, without exhibits, filed on or about January 27, 2025 (Exh. 35.) FMB’s request is UNOPPOSED and GRANTED.

OBJECTIONS

FMB’s objections are ruled on as follows: - Objection No. 1 – OVERRULED - Objection No. 2 – OVERRULED

The Court need not rule on Objection No. 3 as the Court declined to reach CalSTRS’s new

24CV013090: CALIFORNIA STATE TEACHERS' RETIREMENT SYSTEM, A PART OF CALIFORNIA'S GOVERNMENT OPERATIONS AGENCY vs DPR CONSTRUCTION, A GENERAL PARTNERSHIP, A CALIFORNIA GENERAL PARTNERSHIP, et al. 03/06/2026 Hearing on Joinder to Motion for Summary Judgment / Adjudication for Frank M. Booth's in Department 22

licensure argument as it relates to FMB.

BACKGROUND

Plaintiff initiated this action on July 1, 2024, alleging causes of action for disgorgement, fraud, civil conspiracy, breach of contract, and declaratory relief. (Complaint.) Plaintiff alleges that it entered into a written agreement with DPR Construction (“DPR”) effective as of February 22, 2018 for DPR to act as its general contractor to “provide construction management at risk services consisting of preconstruction, construction and post-construction services in connection with the new CalSTRS Headquarters Phase II” project (the “Project”). (Id. ¶ 30.) To assist DPR in the construction of the Project, DPR retained various subcontractors, including movant FMB. (Id., ¶ 22.)

After the Court sustained demurrers brought by several subcontractors, Plaintiff filed a First Amended Complaint (“FAC”) on December 16, 2024. (See 11-1-24 Minute Order; FAC.) On March 14, 2025, the Court (1) overruled the joint demurrer of several subcontractors, but (2) sustained the sureties’ demurrer. (3-14-25 Minute Orders.) Plaintiff filed a Second Amended Complaint (“SAC”) on April 29, 2025. (SAC.) The subcontractors are only named in the Second Cause of Action for fraud and the Third Cause of Action for conspiracy.

LEGAL STANDARD

In evaluating a motion for summary judgment or summary adjudication, the Court engages in a three-step process. The Court first identifies the issues framed by the pleadings. The pleadings define and limit the scope of the issues on a motion for summary judgment or summary adjudication. (FPI Dev. Inc. v. Nakashima (1991) 231 Cal.App.3d 367, 381-382; Lewis v. Chevron (2004) 119 Cal.App.4th 690, 694.) Therefore, all evidence submitted in support of or in opposition to the motion must address the claims and defenses raised in the pleadings. (Roth v. Rhodes (1994) 25 Cal.App.4th 530, 541.) The papers filed in response to a defendant's motion for summary judgment may not create issues outside the pleadings. (Tsemetzin v. Coast Federal Savings & Loan Assn. (1997) 57 Cal.App.4th 1334, 1342.)

Second, the Court is required to determine whether the moving party has met its burden. A plaintiff bears the burden of persuasion that “each element of” the “cause of action” in question has been “proved,” and hence that “there is no defense” thereto. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850 (Aguilar); CCP, § 437c, subd. (p)(1).) A defendant bears the burden of persuasion that “one or more elements of” the “cause of action” in question “cannot be established,” or that “there is a complete defense” thereto. (Aguilar, supra, 25 Cal.4th at p. 850;

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

24CV013090: CALIFORNIA STATE TEACHERS' RETIREMENT SYSTEM, A PART OF CALIFORNIA'S GOVERNMENT OPERATIONS AGENCY vs DPR CONSTRUCTION, A GENERAL PARTNERSHIP, A CALIFORNIA GENERAL PARTNERSHIP, et al. 03/06/2026 Hearing on Joinder to Motion for Summary Judgment / Adjudication for Frank M. Booth's in Department 22

CCP § 437c, subd. (p)(2).) A defendant is not required to conclusively negate one or more elements of the plaintiff’s cause of action. (Saelzer v. Advanced Group 400 (2001) 25 Cal.4th 763, 780-781.) Rather, to meet its burden, the defendant is required only to show that the plaintiff cannot prove an element of its cause of action, i.e., that the plaintiff does not possess and cannot reasonably obtain evidence necessary to show this element. (Aguilar, supra, 25 Cal.4th at pp. 853-855.)

Finally, once the moving party has met its burden, the burden shifts to the opposing party to show that a material factual issue exists as to the cause of action alleged or a defense to it. (CCP, § 437c, subd. (p); Bush v. Parents Without Partners (1993) 17 Cal.App.4th 322, 326-327.) “There is a genuine issue of material fact if, and only if, the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion in accordance with the applicable standard of proof.” (Aguilar, supra, 25 Cal.4th at p. 845.)

In ruling on the motion, the court must consider the evidence and inferences reasonably drawn from the evidence in the light most favorable to the party opposing the motion. (Id., at p. 843.) “Where the essence of the opposition to a motion for summary judgment is that the opposing party draws a different legal conclusion than movant from the facts to which the parties agree, resolution of the matter may be held on summary judgment as a matter of law.” (Niederer v. Ferrerira (1987) 189 Cal.App.3d 1485, 1499.)

While a summary adjudication motion is treated largely the same as one for summary judgment, there are a few important differences. CRC Rule 3.1350(b) mandates that issues presented for summary adjudication be stated in the notice of motion and repeated verbatim in the separate statement. Also, summary adjudication cannot be granted unless it “completely disposes” of a cause of action, affirmative defense, claim for punitive damages, or question of duty. CCP section 437c(f)(1) states: “A party may move for summary adjudication as to one or more causes of action within an action, one or more affirmative defenses, one or more claims for damages, or one or more issues of duty, if that party contends that the cause of action has no merit or that there is no affirmative defense thereto, or that there is no merit to an affirmative defense as to any cause of action, or both, or that there is no merit to a claim for damages, as specified in Section 3294 of the Civil Code, or that one or more defendants either owed or did not owe a duty to the plaintiff or plaintiffs.

A motion for summary adjudication shall be granted only if it completely disposes of a cause of action, an affirmative defense, a claim for [punitive] damages, or an issue of duty.”

ANALYSIS

FMB relies on 61 identical Undisputed Material Facts (“UMF”) in support of each issue. (FMB’s

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Sep. Stmt.) Issue Nos. 2 and 3 are effectively derivative of Issue No. 1 – CalSTRS’s conspiracy claim is dependent upon CalSTRS’s fraud claim and Issue No. 3 encompasses both claims. (Notice.)

CalSTRS asserts numerous Additional Undisputed Material Facts (“AUMF”) (Nos. 62-346), as well as several “Additional Material Facts” that were offered in support of disputes of fact or in response to FMB’s UMFs. (CalSTRS’s Separate Statement.) Specifically, CalSTRS disputes the following UMFs: 4, 7, 12, 13, 14, 15, 19, 20, 21, 22, 25, 27, 28, 34, 35, 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 50, 51, 55, 56, 57, 58, 60, and 61.

The presence of a single triable issue of material fact mandates denial of a summary judgment motion. (CCP, § 437c(c); Weil & Brown, Cal. Prac. Guide Civ. Proc. Before Trial, Ch.10:28, 10:88.)

Issue 1 – FMB Is Entitled to Summary Adjudication of CalSTRS’s Cause of Action Against FMB For Fraud Because CalSTRS Cannot Establish Multiple Elements of That Cause of Action

FMB’s Categorical Approach “A motion for summary adjudication shall be granted only if it completely disposes of a cause of action, an affirmative defense, a claim for damages, or an issue of duty.” (CCP, § 437c(f)(1).) As a moving defendant, FMB must prove that “one or more elements of” the “cause of action” in question “cannot be established,” or that “there is a complete defense” thereto. (Aguilar, supra, 25 Cal.4th at p. 850; CCP § 437c, subd. (p)(2).) Moreover, “[a]s the party moving for summary judgment, defendant has the burden to show it is entitled to judgment with respect to all theories of liability asserted by plaintiff.” (Weil & Brown et al., Cal.

Prac. Guide: Civil Procedure Before Trial (The Rutter Guide 2025), § 10:241 [emphasis original] [citing Lopez v. Superior Court (1996) 45 Cal.App.4th 705, 717 [failure to “properly to define and address all theories of liability” is a failure to meet initial burden]].) “When a summary judgment motion ‘did not negate theories of [defendant’s] liability, the trial court should have held that [the defendant] failed to carry [its] initial burden and stopped there.’ [Citation.] When, as here, the defendant ‘did not move in the alternative for summary adjudication of specified issues, we will not address whether [it] may have prevailed on some issues in this case.’ [Citation.]” (Hedayati v.

Interinsurance Exch. of the Auto. Club (2021) 67 Cal.App.5th 833, 846.)

FMB argues that the Court should grant summary judgment and/or adjudication as to CalSTRS’s Second Cause of Action for Fraud because “CalSTRS simply cannot prove multiple elements of the causes of action it has asserted against FMB because the undisputed material facts show that

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FMB did not knowingly make any false representations, [and] CalSTRS could not justifiably rely on any alleged misrepresentations by FMB.” (Mot., p. 1:10-12.) Specifically, FMB argues that (1) CalSTRS cannot demonstrate reliance on any misrepresentation by FMB in the change orders, payment applications, or retention payment application as a result of CalSTRS’s (and Ridge’s) review process (Mot., pp. 9:3-11:19, 16:1-16, 18:17-19:3); (2) CalSTRS cannot demonstrate that FMB knowingly made false representations regarding the change orders or payment applications (id., pp. 11:20-14:3, 16:17-18:16); and (3) fraud claims do not lie for promises of future performance (id., pp. 14:4-22).

CalSTRS opposes, arguing that FMB has failed to meet its burden. CalSTRS emphasizes that FMB’s motion “can be granted only if it completely disposes of each and every claim, cause of action, and claim for damages alleged against FMB” in CalSTRS’s operative complaint. (Opp., p. 2:3-8.) CalSTRS further argues that “[t]o succeed on its instant Motion, FMB must show the absence of any disputed issue of material fact as to each and every instance of fraudulent conduct as alleged against it.” (Id., p. 4:5-6.)

FMB summarizes CalSTRS’s fraud allegations and identifies the following categories: (1) submission of change order requests to DPR and DPR’s submission of those requests to CalSTRS; (2) payment applications by FMB to DPR for the acceleration and schedule update costs included in the approved Owner Change Orders (“OCOs”); and (3) FMB’s retention payment application to DPR. (UMF No. 50.) FMB’s briefing follows this categorical approach. FMB even identifies its categorical summary as a UMF, which CalSTRS disputes. (See FMB’s Sep.

Stmt., UMF No. 50 [“CalSTRS contends that FMB’s ‘fraud’ consists of three distinct categories of acts: (1) submission of change order requests to DPR and DPR’s submission of those requests to CalSTRS, which were reviewed and approved by CalSTRS; (2) pay applications by FMB to DPR for the acceleration and schedule update costs included in the approved OCOs; and (3) FMB’s retention pay application to DPR, which CalSTRS has not paid.”]; CalSTRS’s Sep. Stmt., Response to UMF No. 50 “[Disputed. CalSTRS contends that FMB committed at least 43 separate and distinct fraudulent acts as specifically alleged in the Second Amended Complaint.”].)

FMB maintains that UMF No. 50 is “supported” because its categorization is a “fair and accurate” summary, but it does not follow that CalSTRS’s dispute is unfounded or that FMB’s categorical approach is appropriate on a summary judgment/adjudication motion. (See FMB Resp. Sep. Stmt., UMF No. 50.)

The Court struggles to understand how FMB can insist on the specific articulation of each alleged fraudulent incident at the pleadings stage and then paint with a broad, categorical brush on summary judgment, despite asking this Court to take judicial notice of the specific pay applications and change orders. (See RJN.) Given this approach, the Court is not persuaded that

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FMB has met its initial burden because it fails to address all theories of liability – meaning all of the fraudulent representations alleged in CalSTRS’s operative complaint. Nor is the Court persuaded that it should do the work of parsing CalSTRS’s allegations and the thousands of pages of evidence where the Parties have failed to meaningfully do so in the first instance.

FMB’s Evidentiary Burden

A defendant is not required to conclusively negate one or more elements of the plaintiff’s cause of action. (Saelzer v. Advanced Group 400 (2001) 25 Cal.4th 763, 780-781 [“a moving defendant need not support his motion with affirmative evidence negating an essential element of the responding party's case. Instead, the moving defendant may point to the absence of evidence to support the plaintiff’s case.” (emphasis original)].) To meet its burden, the defendant is required to show that the plaintiff cannot prove an element of its cause of action, i.e., that the plaintiff does not possess and cannot reasonably obtain evidence necessary to show this element. (Aguilar, supra, 25 Cal.4th at pp. 853-855.)

However, a defendant moving for summary judgment must “present evidence, and not simply point out that the plaintiff does not possess, and cannot reasonably obtain, needed evidence.” (Aguilar, supra, 25 Cal.4th at pp. 854-855.) “For the defendant must ‘support[]’ the ‘motion’ with evidence including ‘affidavits, declarations, admissions, answers to interrogatories, depositions, and matters of which judicial notice’ must or may ‘be taken.’” (Id., at p. 855 [citing CCP, § 437c(b)].) As the Rutter Guide succinctly summarizes: “The ‘tried and true’ way for defendants to meet their burden of proof on summary judgment motions is to present affirmative evidence (declarations, etc.) negating, as a matter of law, an essential element of plaintiff's claim.” (Weil & Brown et al., Cal. Prac. Guide: Civil Procedure Before Trial (The Rutter Guide 2025), § 10:241 [emphasis original].)

“The elements of fraud, which give rise to the tort action for deceit, are (1) misrepresentation (false representation, concealment or nondisclosure); (2) knowledge of falsity (or ‘scienter’); (3) intent to defraud, i.e., to induce reliance; (4) justifiable reliance; and (5) resulting damage.” (Orient Handel v. United States Fid. & Guar. Co. (1987) 192 Cal.App.3d 684, 693.) FMB’s motion challenges the knowledge of falsity and reliance elements. To recover on a cause of action for fraud, the plaintiff must allege and prove that the false representations were made with knowledge of their falsity or without reasonable grounds for believing it to be true. (Civ.

Code, §§ 1710(2), 1572(2).) “Reliance exists when the misrepresentation [] was an immediate cause of the plaintiff's conduct which altered his or her legal relations, and when without such misrepresentation [] he or she would not, in all reasonable probability, have entered into the contract or other transaction. (Alliance Mortgage Co. v. Rothwell (1995) 10 Cal.4th 1226, 1239

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(Rothwell).)

To be clear, CalSTRS will bear the burden at trial to prove fraud, including justifiable reliance and knowledge of falsity. But FMB bears the burden on this motion and has failed to demonstrate – with citation to relevant evidence – that CalSTRS does not possess and cannot reasonably obtain the evidence necessary to support its claims.

The Court focuses principally on FMB’s arguments regarding CalSTRS’s review process and completion deadlines to conclude that FMB has failed to meet its evidentiary burden as to both reliance and knowing falsity.

CalSTRS’s Purported Review Process

FMB argues that CalSTRS cannot demonstrate justifiable reliance on any alleged misrepresentations in the change orders and payment applications because “CalSTRS utilized a rigorous and multi-lawyered review process for change orders and payment applications.” (Mot., p. 9:3-7.) FMB argues that, “if a plaintiff performs an independent investigation of the subject matter of the representation, the plaintiff will not be allowed to claim reliance on the defendant’s allegedly false representations” and “the plaintiff will be deemed to have relied on its own investigation as to the subject matter of the representations.” (Id., p. 9:11-18.)

However, the cases upon which FMB relies concern the purchase of property (mostly real property and one concerning the purchase of a business). The Court is not persuaded that the situation here – a dispute over dozens of representations made in payment applications and change orders pursuant to a construction contract – is “exactly the scenario” covered by these cases. (See id., pp. 9:22- 10:5.)

CalSTRS cites Beckwith v Dahl for the proposition that “[e]xcept in the rare case where the undisputed facts leave no room for a reasonable difference of opinion, the question of whether a plaintiff's reliance is reasonable is a question of fact.” (Beckwith v. Dahl (2012) 205 Cal.App.4th 1039, 1067 [quoting Rothwell, supra, 10 Cal.4th at p. 1239].)

In reply, FMB does not dispute that reliance is a factual question, but, instead, argues that “the facts are all before the Court” and the “Court is equipped to rule on the reliance issues given the factual record.” (Reply, p. 7:2-9.)

The Court is not persuaded that the facts establish, as a matter of law, that CalSTRS cannot demonstrate justifiable reliance because of CalSTRS’s review and investigation. Here, FMB relies on the following UMFs:

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- UMF No. 32. “After DPR bundled subcontractor proposals together, Ridge, CalSTRS, ZGF and DPR discussed the same at weekly PCI meetings, in which each PCI was discussed ‘ad nauseum,’ ‘picked through,’ and ‘hashed through’ and then provided to CalSTRS for its review.” - UMF No. 33 “For the ‘large ones,’ which included the PCIs that were included in OCOs 24, 29, and 35, they were also ‘discussed at [CalSTRS’] executive steering committee meetings and were approved.’” - UMF No 37. “On or around the 25th of each month, DPR submitted a ‘pencil draft’ invoice to CalSTRS, which Ms.

Azevedo would review with her partner, Dave Higgins, Jr., and the architect to make sure that the invoice matched the work in the field, including the work performed by DPR’s subcontractors.” - UMF No. 38. “Once everything in a pay application was acceptable to Ridge, Ms. Azevedo ‘would forward it to CalSTRS in a bundle in [Ridge’s] monthly invoice reporting package for their review, approval and payment.’” - UMF No. 39. “Ms. Azevedo testified that Ridge did not approve any pay application that had a change order within it without preapproval from CalSTRS.” - UMF No. 40. “Ms.

Azevedo testified that: ‘If there was a change order on a pay application – A change order is a roll-up of multiple PCIs that have already been approved. There’s probably 10 to 15 PCIs included in that change order. Each one of those PCIs has already been reviewed and approved. And some of the change orders were large because the PCIs involved were large. Any PCI that had to do with permit delay, for example, or schedule updates were discussed ad nauseum, picked through, reviewed by me, Dave [Higgins, Jr.], the architect sitting down with DPR to review the numbers, the subcontractor numbers, auditing tags to whatever.

And those were discussed with CalSTRS well in advance of them hitting the change order. So – and the change order getting rolled into the payment application. So again, once a change order got to the payment application it, for all intents and purposes, had already been hashed through individual PCIs and approved. Any PCI that was not approved has never been included in a change order.’” - UMF No. 41. “Ms. Azevedo testified that: ‘There was no unapproved PCIs pass through a change order passed on to a payment application Everything on a payment application had previously been approved as far as change orders/PCIs that were rolled up into it.’” - UMF No.

42. Ms. Azevedo testified that neither she nor anyone else at Ridge Capital were aware of any facts or evidence that would support CalSTRS’ allegations of fraudulent billings or conspiracy to bill against DPR or its subcontractors.” - UMF No. 43. “Ms. Azevedo testified that at no time during construction of the Project did anyone from CalSTRS notify Ridge that DPR’s pay applications looked inflated or

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contained overbillings.” - UMF No. 44. “Ms. Azevedo testified that nobody within Ridge was aware of any inaccuracies or misstatements in the ‘big four’ change orders, which included 24, 27, 29 and 35.” - UMF No. 45. “Ms. Azevedo testified that nobody within Ridge was aware of any conspiracy between DPR and any of its subcontractors with respect to billings, any subcontractor engaging in conspiracy to overbill or defraud CalSTRS, or of any subcontractor engaging in fraudulent billing practices or submitting a fraudulent billing to DPR or CalSTRS.” - UMF No. 46. “Ms. Azevedo testified that the retention billing, which CalSTRS has withheld, has merit and should be paid.”

CalSTRS asserts that “[e]ven in case of a mere negligent misrepresentation, a plaintiff is not barred unless his conduct, in the light of his own information and intelligence, is preposterous and irrational.” (Opp., pp. 9:28-10:3, citing Public Employees’ Retirement System v. Moody’s Investors Service, Inc. (2014) 226 Cal.App.4th 643, 673 [internal quotations and citations omitted].) That case further asserts that a “plaintiff will be denied recovery only if his conduct is manifestly unreasonable in the light of his own intelligence or information.

It must appear that he put faith in representations that were preposterous or shown by facts within his observation to be so patently and obviously false that he must have closed his eyes to avoid discovery of the truth. [Citation.].” (Public Employees’ Retirement System, supra, 226 Cal.App.4th at p. 673.) While it occurs in the context of a negligent misrepresentation claim considering the effectiveness of certain disclosures, the Court finds the First Appellate District Court of Appeal’s discussion regarding fraud and justifiable reliance helpful.

FMB’s UMFs principally rely on the deposition testimony of Ms. Azevedo and Mr. Isham, and generally describe the review process at Ridge and CalSTRS. However, as a generalized description, they do not address the level of review associated with any particular representation and they do not establish that CalSTRS’s or Ridge’s review precludes reliance as a matter of law as to all of the fraudulent representations alleged.

FMB also repeatedly relies on CalSTRS’s review and approval to argue that CalSTRS cannot prove FMB knowingly made false representations. (Mot., pp. 13:9-14:3.) FMB contends that “it is clear that DPR and FMB had a good faith belief that the compensation was appropriate and therefore could not have ‘knowingly’ misrepresented their entitlement to additional time and compensation,” and that CalSTRS’s review “negates any showing that FMB ‘knowingly’ submitted false change order requests.” (Id., p. 13:23-28 [citing UMF Nos. 32-33, 37-41].) At most, however, these facts show that CalSTRS and Ridge reviewed the requests during contract

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performance. They shed no light on FMB’s state of mind. That CalSTRS and Ridge reviewed the submissions and did not identify issues at the time does not establish that FMB itself held a good faith belief in the truth of the representations it was making. A review process – particularly one conducted during the contract performance – does not necessarily uncover all potential inaccuracies or misstatements, especially if the relevant information was incomplete, obscured, or not fully disclosed. And, again, the record does not identify what specific materials CalSTRS and Ridge actually reviewed, or the scope and depth of that review for each change order and payment application.

In fact, CalSTRS disputes, at least in part, almost all of facts listed above.[1] CalSTRS maintains that, notwithstanding Ms. Azevedo’s testimony, the review “was not nearly as comprehensive as FMB suggests.” (Opp., p. 10:14-24.) For example, CalSTRS does not dispute that Ms. Azevedo made the statements identified in UMF Nos. 42 and 44 in her deposition. But it does dispute that this testimony supports the conclusion “that there were no inaccuracies or misstatements in Change Orders 24, 27, 29, and 35” or that Ms.

Azevedo and Ridge were otherwise unaware of any facts or evidence that would support CalSTRS allegations of fraud and conspiracy. In support, CalSTRS relied on other testimony from Ms. Azevedo’s deposition. (CalSTRS’s Sep. Stmt., UMF Nos. 42 and 44, citing CalSTRS’s Appendix of Evidence, Exh. 1 at p. 73:19-20 and Exh. 4; FMB’s Appendix of Evidence, Exh. 36 at pp. 120:11-25, 123:5-21.) This testimony evidences concerns over completion deadlines and additional costs.

CalSTRS also disputes other, related facts. For example, CalSTRS disputes that “Jeff Isham, as CalSTRS’ Director of Facilities Management, reviewed Ridge’s review of all PCIs” and that Mr. Isham “authorized Ridge to proceed with formal execution of any PCIs, OCOs, or pay Applications.” (CalSTRS’s Sep. Stmt., UMF No. 21.) While Mr. Isham testified that he “reviewed the review” performed by Ridge and confirmed that Ridge did not have latitude to approve any change order requests on its own without his approval, he also testified that he, for example, would not review “page by page” and would “spot check” Ridge’s reviews of payment applications.

He also testified that if Ridge rejected change orders or pay applications, those reviews and decisions did not need to be reviewed by CalSTRS. (FMB’s Appendix of Evidence, Exh. 34, pp. 156:8-157:22, 164:1-165:22, 231:2-15, 234:1-235:15, 269:21-270:16.) While FMB characterizes these disputes as “a semantic and legal characterization of his role, not a genuine factual contradiction of the core point,” (see FMB’s Resp. Sep. Stmt., UMF No. 21); the Court views these as disputes about the scope and extent of the review conducted.

The Court is persuaded that the scope and extent of the review are relevant to any determination regarding whether CalSTRS’s can demonstrate justifiable reliance. And FMB has made CalSTRS’s review a material fact with respect to negating knowledge of falsity. As a result,

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these disputes preclude the Court from granting FMB’s motion.

Completion Dates

FMB’s completion date arguments raise similar concerns as to both reliance and knowledge. Regarding the OCO and the extensions of completion deadlines, FMB asserts that “CalSTRS clearly did not rely on any supposed representation by FMB that it was going to achieve any of these substantial completion deadlines because CalSTRS kept approving further schedule extensions with full awareness that the previous deadlines had not been met.” (Mot., p. 10:6-16.) In arguing that any representations regarding completion dates were not knowingly false, FMB further argues that it “made no representations that it would complete the Project by a particular date” and this “is reenforced by the fact that CalSTRS kept approving more change orders, which further extended the completion date.” (Id., pp. 12:1-13:8.)

FMB offers no support for its claim that CalSTRS’ later extensions of the substantial-completion deadline show, as a matter of law, that CalSTRS could not have relied on FMB’s earlier representations. FMB’s reliance on Brakke v. Economics Concepts, Inc. is also unpersuasive. In Brakke, the defendant represented that certain pension plans would receive favorable tax treatment, even though that issue had not yet been resolved. (Brakke v. Economic Concepts, Inc. (2013) 213 Cal.App.4th 761, 769.) The court, relying on prior tax cases, held that “it simply was not reasonable for plaintiffs to rely on representations concerning how the IRS would treat their pension plan in the future.” (Ibid.)

That situation is markedly different from this case. Here, the representations concerned a specific substantial-compliance date and Defendants’ ability or willingness to meet it – not a prediction about how a third party like the IRS might act in the future.

FMB’s assertion that – as a subcontractor with a discrete scope of work – it could not be responsible for guaranteeing other subcontractors’ work and ensuring timely completion of the entire headquarters expansion construction project makes practical sense. But it does not follow that FMB had no obligation to complete its work consistent with DPR’s project schedule, including any extensions afforded by the OCOs, which plainly incorporated substantial and final completion deadlines. CalSTRS’s interrogatory responses provide some missing nuance: “both the Prime Contract and Responding Party’s subcontract reflect Responding Party’s express agreement to provide and pay for all materials, products, articles, processes, labor, tools, equipment, and installation, and all associated superintendence of every nature whatsoever necessary to coordinate, execute, and complete Responding Party’s Work such that the entire PROJECT would achieve completion within the Contract Time; as well as Responding Party’s commensurate duty to coordinate its Work with that of CONTRACTOR and all other contractors

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

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and subcontractors, in a manner that will facilitate the timely and efficient completion of the entire PROJECT.” (See Thompson Decl., ¶ 6 [emphasis added].) That contractors and subcontractors would have to ensure their own work was timely and coordinate to ensure timely project completion also makes practical sense.

FMB’s own UMFs demonstrate that the OCO’s extended the substantial completion deadline to a new date certain. (See FMB’s Sep. Stmt, UMF Nos. 9 [regarding OCO 24], 10 [regarding OCO 29], and 11 [regarding OCO 35].) CalSTRS does not dispute these facts, and adds several additional facts regarding the contractual significance of completion dates and FMB’s obligations to promptly perform the work in accordance with the project schedule. (See CalSTRS’s Sep. Stmt., AUMF Nos. 9.1, 9.2, 9.3, 10.1-10.3, 11.1-11.3.)

For example, CalSTRS points to the subcontractor agreement which provides that “Time is of the essence in the performance of Subcontractor’s Work and other obligations under this Agreement. [] Subcontractor’s proposed schedule shall conform to the Project Schedule and all revisions or changes made to it from time-to-time.” (CalSTRS’s Sep. Stmt., AUMF Nos. 9.1- 9.3, 10.1-10.3, 11.1-11.3, citing FMB’s Appendix of Evidence, Exh. 26, § 5.1.) CalSTRS further asserts that “FMB never intended to perform its Work in such a manner that the Project would be substantially completed” by the revised deadline. (CalSTRS’s Sep.

Stmt., AUMF Nos. 9.4, 10.4, 11.4, citing FMB’s Appendix of Evidence, Exh. 32, ¶ 10 [“FMB never promised, or intended to promise, that its work would ensure that the Project would reach a particular overall completion date.”].) As a result, CalSTRS asserts that it “paid [FMB] for an accelerated schedule, which it did not receive.” (CalSTRS’s Sep. Stmt., AUMF No. 13.8.)

FMB disputes these additional AUMFs, drawing different conclusions from the evidence and emphasizing completion of the entire “Project.” (See FMB’s Resp. Sep. Stmt., AUMF Nos. 9.1- 9.4, 10.1-10.4, 11.1-11.4, 13.8.)

Having considered the Parties’ briefing, the Court is not persuaded that it is appropriate to resolve the Parties’ material factual disputes over the existence of substantial compliance deadlines, upon which FMB bases its knowledge of falsity argument, or CalSTRS’s reliance on representations regarding those deadlines on the instant motion.

***

Again, the presence of a single triable issue of material fact mandates denial of a summary judgment motion. (CCP, § 437c(c); Weil & Brown, Cal. Prac. Guide Civ. Proc. Before Trial, Ch.10:28, 10:88.) By including these facts in its separate statements, FMB concedes each fact is

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

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material to the disposition of these motions. (Nazir v. United Airlines, Inc. (2009) 178 Cal.App.4th 243, 252.) As the Nazir court noted, the facts enumerated in a moving separate statement have a due-process dimension in that they define for the opposing party the facts which, if disputed with admissible evidence, may result in the motion being denied. (Id. at p. 252 [citation omitted].)

Assuming FMB met its initial burden, the disputes summarized above are sufficient to require the denial of FMB’s motion. Accordingly, FMB’s motion for summary adjudication as to Issue No. 1 is DENIED.

Because Issue Nos. 2 and 3 are essentially derivative and based upon the same UMFs (and disputed AUMFs), FMB’s motion for summary adjudication on those issues must also be DENIED.

DISPOSITION

FMB’s motion for summary judgment/adjudication is DENIED in its entirety.

Having so ruled, the Court need not reach the Parties remaining arguments.

This minute order is effective immediately. No formal order pursuant to CRC Rule 3.1312 or other notice is required.

[1] The Court acknowledges that some of these are not true disputes and/or not supported by

CalSTRS cited evidence.

To request oral argument on this matter, you must call Department 22 at (916) 874-5762 by 4:00 p.m., the court day before this hearing and notification of oral argument must be made to the opposing party/counsel. If no call is made, the tentative ruling becomes the order of the court. (Local Rule 1.06.)

Parties requesting services of a court reporter may arrange for private court reporter services at their own expense, pursuant to Government code §68086 and California Rules of Court, Rule 2.956. Requirements for requesting a court reporter are listed in the Policy for Official Reporter Pro Tempore available on the Sacramento Superior Court website at https://www.saccourt.ca.gov/court-reporters/docs/crtrp-6a.pdf. The list of Court Approved

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

24CV013090: CALIFORNIA STATE TEACHERS' RETIREMENT SYSTEM, A PART OF CALIFORNIA'S GOVERNMENT OPERATIONS AGENCY vs DPR CONSTRUCTION, A GENERAL PARTNERSHIP, A CALIFORNIA GENERAL PARTNERSHIP, et al. 03/06/2026 Hearing on Joinder to Motion for Summary Judgment / Adjudication for Frank M. Booth's in Department 22

Official Reporters Pro Tempore is available at https://www.saccourt.ca.gov/courtreporters/docs/crtrp-13.Pdf.

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