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.

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

Tentative Ruling

***NOTICE: EFFECTIVE APRIL 13, 2026, THIS DEPARTMENT HAS MOVED TO THE TANI G. CANTIL-SAKAUYE COURTHOUSE LOCATED AT 500 G. ST. SACRAMENTO, CA. ALL MOTIONS NOTICED FOR DEPARTMENT 22 WILL BE HEARD IN DEPARTMENT 8B OF THE NEW COURTHOUSE. ALL PAPERS FOR THIS DEPARTMENT MUST BE FILED AT THIS NEW LOCATION. ALL HEARINGS WILL TAKE PLACE AT THIS NEW LOCATION.***

On December 24, 2025, Defendant and Cross-Plaintiff DPR Construction, A General Partnership (“DPR GP”) filed a Second Amended Cross Complaint (“SACC”). A dispute arose regarding whether DPR GP exceeded the scope of the Court’s October 17, 2025 order granting it leave to amend the First Amended Cross Complaint (“FACC”). In the interests of judicial economy and efficiency, the Parties agreed to schedule a hearing on DPR GP’s motion for leave to amend the FACC to occur concurrently with the hearing on Cross Defendant Ridge Capital, Inc.’s (“Ridge”) demurrer to DPR GP’s SACC.

Ridge demurs to all causes of action alleged as against CalSTRS in DPR GP’s SACC, pursuant to Code of Civil Procedure (“CCP”) section 430.10(e) and (f), as follows: - Demurrer to the Third Cause of Action for Professional Negligence because, as a matter of law, Ridge did not owe and does not owe DPR GP a duty of care; - Demurrer to the Fourth Cause of Action for Negligence because, as a matter of law, Ridge did not owe and does not owe DPR GP a duty of care; - Demurrer to the Sixth Cause of Action for Equitable Indemnity because DPR GP has not alleged facts demonstrating DPR GP and Ridge are jointly and severally liable in tort to Plaintiff California State Teachers’ Retirement System (“CalSTRS”) and because the cause of action is uncertain; - Demurrer to the Seventh Cause of Action for (Equitable) Contribution because DPR GP has alleged no facts to demonstrate that DPR GP and Ridge share and are under a common burden of liability to CalSTRS and for the same risk, or that Equitable Contribution is even appropriate here; - Demurrer to the Ninth Cause of Action for Declaratory Relief because, under the circumstances presented by DPR GP’s FACC, declaratory relief is neither necessary nor proper; - Demurrer to the Tenth Cause of Action for Breach of Warranty of Authority because Ridge’s authority was express and the Contract[1] contains facts inconsistent with DPR GP’s allegations and negate the element of causation; - Demurrer to the Eleventh Cause of Action for Negligent Misrepresentation because the Contract contains facts inconsistent with DPR GP’s allegations and contrary to DPR GP’s

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

allegations of reasonable reliance and also contradict and negate the element of causation; - Demurrer to the Twelfth Cause of Action for Civil Conspiracy because the claim is barred by the “agent’s immunity rule” and the Contract contains facts that are inconsistent with and contrary to DPR GP’s allegations and negate the element of causation; and - Demurrer to the Thirteenth Cause of Action for Intentional Interference with Contract because the Contract contains facts that are inconsistent with, contrary to, and belie DPR GP’s allegations and negate the element of causation.

(Demurrer Notice.) The Court notes that Ridge filed its demurrer on February 26, 2026. On March 13, 2026, Ridge filed a Notice of Errata adding an argument regarding causation as it relates to the Tenth, Eleventh, Twelfth, and Thirteenth Causes of Action that was omitted from the memorandum of points and authorities. (Notice of Errata.)

Ridge also separately moves to strike the Tenth, Eleventh, Twelfth, and Thirteenth Causes of Action and the related prayers for relief on the grounds that they were added without leave of Court. (MTS Notice.) As set forth below, the Court resolves the issues raised in Ridge’s motion to strike in the ruling on DPR’s concurrent motion for leave to amend. As such, Ridge’s motion to strike is moot and the Court declines to address it.

The Court addresses DPR GP’s motion for leave to amend, as well as Ridge’s demurrer and motion to strike in this single Tentative Ruling. [2]

Background

On January 27, 2025, DPR GP filed a Cross-Complaint against Plaintiff and Cross Defendant California State Teachers’ Retirement System (“CalSTRS”) alleging causes of action for breach of contract, breach of covenant of good faith and fair dealing, violation of the prompt payment statutes, and seeking declaratory relief. (Cross-Complaint.) On March 19, 2025, DPR GP filed a First Amended Cross-Complaint (“FACC”) adding Cross-Defendants Ridge Capital, Inc. (“Ridge”) and California Firestop Inspections LLC, and causes of action for professional negligence, statutes, equitable indemnity, contribution, and declaratory relief regarding Ridge’s duty of care. (FACC.)

On October 17, 2025, the Court sustained, in part, CalSTRS’s and Ridge’s respective demurrers to DPR GP’s FACC and granted leave to amend regarding (1) DPR GP’s fictitious business name statement, (2) DPR GP’s Fifth Cause of Action as to CalSTRS, and (3) DPR GP’s Third, Fourth, Sixth, Seventh, and Ninth Causes of Action as to Ridge. (10-17-25 Minute Orders.)

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

On December 24, 2025, DPR GP filed a Second Amended Cross-Complaint (“SACC”). The SACC dropped California Firestop Inspections LLC as a Cross-Defendant and asserts the following causes of action: (1) breach of contract; (2) breach of covenant of good faith and fair dealing; (3) professional negligence; (4) negligence; (5) violation of prompt payment statutes; (6) equitable indemnity; (7) contribution; (8) declaratory relief; (9) declaratory relief; (10) breach of warranty of authority; (11) negligent misrepresentation; (12) civil conspiracy; and (13) intentional interference with contract. (SACC.)

Request for Judicial Notice

In support of its demurrer, Ridge asks the Court to take judicial notice of the following documents: (1) DPR GP’s FACC (Exh. A); (2) the Court’s October 17, 2025 Minute Order (Exh. B); and (3) DPR GP’s SACC (Exh. C). (Ridge’s RJN ISO Demurrer.)

Ridge’s request is UNOPPOSED and GRANTED. The Court notes that Ridge’s memorandum of points and authorities suggests that Ridge intended to also seek judicial notice of its briefing in support of the earlier demurrer and includes incorrect exhibit references. (See Demurrer, p. 5:5- 21.)

Meet and Confer

CCP section 430.41(a) provides, “[b]efore filing a demurrer pursuant to this chapter, the demurring party shall meet and confer in person or by telephone with the party who filed the pleading that is subject to demurrer for the purpose of determining whether an agreement can be reached that would resolve the objections to be raised in the demurrer. If an amended complaint, cross-complaint, or answer is filed, the responding party shall meet and confer again with the party who filed the amended pleading before filing a demurrer to the amended pleading.”

Here, moving counsel adequately establishes that the Parties met and conferred regarding the alleged pleading deficiencies in DPR GP’s cross-complaint and were unable to reach any agreement that would resolve Ridge’s objections and otherwise avoid filing the instant demurrer. (Kahn Decl. ISO Demurrer, ¶¶ 2-5.)

Leave to Amend

1.

Legal Standard

Under Code of Civil Procedure (“CCP”) section 473, subdivision (a)(1), the Court may, in furtherance of justice, and on any terms as may be proper, allow a party to amend any pleading

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

or proceeding. As judicial policy favors resolution of all disputed matters in the same lawsuit, courts liberally permit amendments of the pleadings. (Nestle v. Santa Monica (1973) 6 Cal.3d 920, 939.) Denial is rarely justified. “If the motion to amend is timely made and the granting of the motion will not prejudice the opposing party, it is error to refuse permission to amend and where the refusal also results in a party being deprived of the right to assert a meritorious cause of action or a meritorious defense, it is not only error but an abuse of discretion.” (Morgan v. Superior Court (1959) 172 Cal.App.2d 527, 530; see also Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group, 2025) ¶ 6:639.) As long as no prejudice to defendant is shown, the liberal policy regarding the amendment prevails. (Mesler v. Bragg Mgt. Co. (1985) 39 Cal.3d 290, 297.)

A court may exercise its discretion to deny an amendment that fails to state facts sufficient to constitute a cause of action or defense or that serves no useful purpose. (California Casualty Gen. Ins. Co. v. Superior Court (1985) 173 Cal.App.3d 274, 280; Maple Properties v. Harris (1984) 158 Cal.App.3d 997, 1012.) However, judges ordinarily do not consider the validity of the proposed amended pleading in deciding whether to grant leave to amend. After leave to amend is granted, the opposing party will have the opportunity to attack the validity of the amended pleading. (Weil & Brown, Cal.

Practice Guide: Civil Procedure Before Trial (The Rutter Group, 2025) ¶ 6:644, citing Kittredge Sports Co. v. Sup.Ct. (Marker, U.S.A.) (1989) 213 Cal.App.3d 1045, 1048; Atkinson v. Elk Corp. (2003) 109 Cal.App.4th 739, 760 [“the better course of action would have been to allow [plaintiff] to amend the complaint and then let the parties test its legal sufficiency in other appropriate proceedings”].)

2.

Analysis

DPR GP seeks, albeit retroactively, leave to amend its FACC to assert additional facts learned via discovery in October 2025, as well as new causes of action against Ridge. DPR GP contends that the newly alleged factual allegations were authorized by the Court’s order granting leave to amend following the demurrers to the FACC. (Mot., p. 7:21-28.) The bulk of the new factual allegations are paragraphs 32 to 109 of the SACC. (See Merrell Decl., ¶¶ 3, 5; Exh 1.) Regarding the new causes of action against Ridge, DPR GP argues that the Court should grant leave to amend because the new factual allegations used to bolster DPR GP’s existing claims also support the additional causes of action. (Mot., p. 9:7-11)

Ridge opposes, arguing that “unless the current trial date of July 20, 2026 is continued, “Ridge[] will be prejudiced by the Court’s granting of DPR’s motion.” (Ridge’s Opp., p. 3:19-20.) Ridge asserts that the new causes of action “raise factual issues well beyond those alleged in the original five causes of action against it and that, as a result, “both written discovery as well as depositions of DPR witnesses who have knowledge of the facts supporting the four (4) new

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

causes of action will need to be propounded, noticed, and taken.” (Id., pp. 4:28-5:5.) Ridge also asserts that its “statutory right to move for summary judgment or adjudication will be interfered with or impaired, unless the current trial date of July 20, 2026 is continued.” (Id., p. 5:11-16.)

Scope of Leave

DPR GP argues that all of its amendments were within the scope of the Court’s Order granting leave to amend. (Reply re Ridge, p. 3:2-25.) The Court disagrees. The Court did not contemplate that DPR GP would pursue new, undisclosed causes of action and granted leave to allow DPR GP the opportunity to cure only the deficiencies in the FACC. But that is precisely why the Court permitted DPR GP to file the instant motion – to allow Ridge the opportunity to be heard and, if granted, to allow the Court to address the sufficiency of the allegations on the concurrent demurrers and motions to strike.

Prejudice

The Court is not persuaded that Ridge would be prejudiced by the instant amendment. DPR GP’s FACC asserted the following causes of action against Ridge: professional negligence (3rd Cause of Action); negligence (4th Cause of Action); equitable indemnity (6th Cause of Action); contribution (7th Cause of Action); and declaratory relief (9th Cause of Action). (FACC.) The SACC adds the following causes of action: breach of warranty of authority (10th Cause of Action); negligent misrepresentation (11th Cause of Action); civil conspiracy (12th Cause of Action); and intentional interference with contract (13th Cause of Action).

Putting aside any questions regarding the sufficiency of these allegations, which are better addressed in Ridge’s concurrent demurrer, the new causes of action all relate to the same general set of facts, namely Ridge’s role as CalSTRS’s agent and DPR’s point of contact throughout the construction project. “[I]t is irrelevant that new legal theories are introduced as long as the proposed amendments ‘relate to the same general set of facts.’ [Citation.]” (Atkinson v. Elk Corp. (2003) 109 Cal.App.4th 739, 761 [citing Kittredge Sports Co. v. Superior Court (1989) 213 Cal.App.3d 1045, 1048].)

The Court is also not persuaded that the need to conduct additional discovery is sufficient to warrant denial of leave to amend. As DPR GP’s moving papers make clear, these amendments were driven by information obtained during the October 6 and 27, 2025 depositions of Michelle Azevedo. (Merrell Decl., ¶ 12; SACC, ¶¶ 40, 42, 47-50.) Ms. Azevedo testified as the person most qualified to testify on behalf of Ridge. (Merrell Decl., ¶ 12.) While Ridge asserts that it would need to propound written discovery and depose DPR GP witnesses regarding the new causes of action, it is not clear how that discovery would meaningfully differ from any discovery

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

required to address the pre-existing claims.

Moreover, Ridge has known of these factual issues since at least October 2025, has had DPR GP’s SACC since December 2025, and was aware that its subsequent pleadings challenges could not be adjudicated until April 2026. While Ridge has responded to discovery, it has not propounded any of its own discovery to date. (Kahn Decl., ¶ 6.) That is a strategic choice. The Court is not persuaded that the unsupported assertion that more discovery is needed supports a finding of prejudice under these circumstances. If the need to conduct additional discovery alone was sufficient to warrant denial, leave to amend would become a rarity because all defendants could argue that the proposed claims would necessitate discovery.

The Court is also not persuaded that amendment would prejudice Ridge’s “right to move for summary judgment and/or adjudication.” In support, Ridge cites Mediterranean Const. Co. v. State Farm Fire & Cas. Co. (1998) 66 Cal.App.4th 257, 262, and Lokeijak v. City of Irvine (1998) 65 Cal. App. 4th 341, 344. (Ridge’s Opp., p. 6:16-23.) However, in each case, the issue was whether a superior court’s policy or practice interfered with the “detailed procedural scheme” enacted by the Legislature for motions for summary judgment or adjudication.

For example, in Mediterranean, the Court of Appeal concluded that the superior court erred in issuing a ruling on the defendant’s motion for summary judgment without permitting oral argument. (Mediterranean, supra, 66 Cal.App.4th at p. 262.) In Lokeijak, the Court of Appeal concluded that the superior court’s “policy” of “forcing a party wishing to make such a motion to consult first with the trial judge and the other party and agree on a different procedure improperly interferes with a party's right to move for summary judgment or summary adjudication of issues at any time pursuant to established statutory procedures” and was, therefore, invalid. (Lokeijak, supra, 65 Cal.App.4th at p. 344.)

These cases concern the limitation of trial judges’ authority to issue rules that conflict with any statute. Neither supports the assertion that granting leave to amend 94 days before trial is set to commence constitutes an impermissible interference with a litigant’s right to move for summary judgment. As with discovery, it appears that Ridge made a strategic choice to pursue pleadings challenges risking that the deadline to move for summary judgment would lapse. The Court is not persuaded that the consequence of that choice gives rise to prejudice under the circumstances presented here.

In any event, these concerns are moot given the Court’s ruling on Ridge’s concurrent demurrer.

***

For the reasons discussed above, and the reasons set forth in the Court’s order addressing CalSTRS’s objection to the amendment and CalSTRS’s demurrer and motion to strike, DPR GP’s motion for leave to amend is GRANTED.

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

Demurrer

1.

Legal Standard

A defendant may demur to a complaint where the complaint or any cause of action therein “does not state facts sufficient to constitute a cause of action.” (CCP, § 430.10(e).) A demurrer may only challenge defects on the face of the complaint or from matters that are judicially noticeable. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318; Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.) Consideration of extrinsic facts asserted in the memorandum supporting the demurrer is improper. (Ion Equipment Corp. v. Nelson (1980) 110 Cal.App.3d 868, 881.) However, the face of the complaint includes facts contained in exhibits attached to the complaint. (Frantz v. Blackwell (1987) 189 Cal.App.3d 91, 94.)

The pertinent question on demurrer is whether the plaintiff has alleged facts sufficient to state a cause of action under any possible legal theory. (See Gutkin v. University of Southern California (2002) 101 Cal.App.4th 967, 976.) Moreover, a general demurrer does not lie to only part of a cause of action. (PH II, Inc. v. Superior Court (1995) 33 Cal.App.4th 1680, 1682.) However, “to state a cause of action against a public entity, every fact material to the existence of its statutory liability must be pleaded with particularity.” (Lopez v.

Southern Cal. Rapid Transit Dist. (1985) 40 Cal.3d 780, 795 (quotations and citations omitted) (citing cases); see also Covenant Care, Inc. v. Super. Ct. (2004) 32 Cal.4th 771, 790 [finding “statutory causes of action must be pleaded with particularity.”].) “Plaintiff need only plead facts showing that he may be entitled to some relief, we are not concerned with plaintiff’s possible inability or difficulty in proving the allegations of the complaint.” (Highlanders, Inc. v. Olsan (1978) 77 Cal.App.3d 690, 696-97.)

“[Courts] are required to construe the complaint liberally to determine whether a cause of action has been stated, given the assumed truth of the facts pleaded.” (Picton v. Anderson Union High School Dist. (1996) 50 Cal.App.4th 726, 733 [citation omitted].) A demurrer admits the truth of all material facts properly pled, and the sole issue raised by a general demurrer is whether the facts pled state a valid cause of action – not whether they are true. (Serrano v. Priest (1971) 5 Cal.3d 584, 591.)

That said, while the Court will “accept as true the properly pleaded allegations of fact in the complaint,” it will not consider “the contentions, deductions or conclusions of fact or law.” (Canton Poultry & Deli, Inc. v. Stockwell, Harris, Widom & Woolverton (2003) 109 Cal.App.4th 1219, 1225.) The complaint will be upheld “so long as it gives notice of the issues sufficient to enable preparation of a defense.” (Doe v. City of Los Angeles (“Doe”) (2007) 42 Cal.4th 531, 549-550.)

2.

Analysis

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

Duty of Care (Third and Fourth Causes of Action)

“An action in negligence requires a showing that the defendant owed the plaintiff a legal duty, that the defendant breached the duty, and that the breach was a proximate or legal cause of injuries suffered by the plaintiff. [Citations.]” (Ann M. v. Pacific Plaza Shopping Center (1993) 6 Cal. 4th 666, 673.) A provider of professional services generally does not owe a duty to third parties. (Bily v. Arthur Young & Co. (1992) 3 Cal.4th 370.) A duty may arise from statute, contract, the character of the activity, or the relationship between parties. (J’aire Corp. v.

Gregory (1979) 24 Cal.3d 799, 803.) When considering whether a “special relationship” exists, the Court considers six factors: (1) the intended effect of the transaction on plaintiff, (2) the foreseeability of the harm, (3) the degree of certainty of plaintiff’s injury, (4) the connection between defendant’s conduct and the injury, (5) the moral blame of defendant’s conduct, and (6) the policy of preventing future harm. (Biakanja v. Irving (1958) 49 Cal.2d 647, 650.)

Ridge again demurs to the Third and Fourth Causes of Action alleged against it on the basis that Ridge does not owe DPR GP a duty of care because Ridge owed its allegiance to and its duty of care solely and exclusively to CalSTRS, as well as the other factors addressed in Ratcliff Architects v. Vanir Construction Management, Inc. (2001) 88 Cal.App.4th 595. (Demurrer, p. 11:22-27.) Ridge further argues that the additional allegations contending that Ridge owed DPR GP a duty of disclosure are “ineffectual and do not create or even address the primary duty of care that would support a claim for professional negligence of breach of duty of care.” (Id., pp. 11:27-12:2.)

DPR GP opposes, arguing that the Biakanja factor analysis, when viewed in light of its new allegations, weigh in DPR GP’s favor. Specifically, DPR GP asserts that the foreseeability of harm analysis is fundamentally different where “CalSTRS rescinded Ridge’s authority (1) to review and approve DPR’s payment applications and (2) to approve or issue any change orders that would increase the Contract’s [Guaranteed Maximum Price (“GMP”)] – and that Ridge failed to disclose this lack of authority to DPR.” (Opp., pp. 9:25-10:7.)

DPR GP further contends that the contractual terms “cannot govern where Ridge no longer had” the contractual authority. (Id., p. 10:20-22.) DPR GP contends that these allegations similarly shift the moral blame analysis. (Id., p. 10:22-27.) Finally, DPR GP argues that Ridge’s “same harm” arguments are not persuasive because, citing case law regarding anticipatory breach, DPR would have been within its rights to stop work in light of CalSTRS’s repudiation of its payment obligations. (Id., pp. 10:28-11:20.)

The Court remains persuaded that Biakanja factors weigh against a finding of duty here and incorporates its discussion from the October 17, 2025 Minute Order. (10-17-25 Minute Order re

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

Ridge.) Moreover, Ratcliff remains analogous and persuasive. (Ibid.)

First, while Ridge’s services affected DPR GP and some degree of harm is foreseeable given Ridge’s position,[3] it remains clear that Ridge’s principal responsibility was to CalSTRS. DPR GP’s new allegations focus on Section 4.4 of the Contract and assert that Ridge had a “duty to disclose” that CalSTRS would no longer approve payment applications or change orders. (SACC, ¶¶ 127-133, 134 (f), 139, 140(g).) But as the Court previously explained, even Section 4.4 demonstrates that Ridge’s obligations to review payment applications was for the benefit of CalSTRS: “The approval of a Certificate for Payment will constitute a representation by Ridge Capital to CalSTRS, based on the Ridge Capital’s observations at the site, evaluation of the Work and the data comprising the Application for Payment, that the Work has progressed to the point indicated and that, to the best of the Ridge Capital’s knowledge, information and belief, the quality of the Work is in accordance with the Contract Documents The approval of a Certificate for Payment will further constitute a representation that the Contractor is entitled to payment in the amount certified.” (SACC, Exh. 1, § 4.4 [emphasis added].)

And DPR GP’s SACC ignores the impact of Section 4.5, which the Court quoted in its prior order. That provision clearly identifies Ridge “as the agent of CalSTRS” who’s role is to “protect CalSTRS” and more specifically, as it relates to withholding certification for payment, to “protect CalSTRS from loss for which the Contractor is responsible.” (SACC, Exh. 1, § 4.5.)

In support of the instant demurrer, Ridge also points to additional contract provisions from the Contract’s “Restated Exhibit A to Amendment No. 5.” (SACC, Exh. 2.) Under Section 8.01, DPR GP agreed that it “shall not be relieved from its obligations to perform the Work in accordance with the Agreement and/or the Construction Documents either by the activities or duties of CalSTRS’s Representative in their administration of the Project or by inspections, tests or approvals (or the lack thereof) required or performed under Article 9 by persons other than the Contractor.” (SACC, Exh. 2. § 8.01.)

Under Section 15.01, DPR GP agreed that no change orders would be made “except pursuant to a written Change Order or Proposed Change Order, signed by CalSTRS, or by a Directive (signed by either CalSTRS or CalSTRS’s Representative) stating that the extra work or change is authorized, and no claim for any addition to the Guaranteed Maximum Price or Contract Time shall be valid unless so authorized; provided, however, that nothing in this Article shall excuse the Contractor from proceeding with the prosecution of the work so changed.” (Id., § 15.01.)

More explicitly, DPR GP agreed that “No verbal agreement or conversation with any officer, agent, or employee of CalSTRS, either before, during, or after execution of the Agreement and/or the Construction Documents shall affect or modify any term or condition contained in the Agreement and/or Construction Documents, nor shall such verbal agreement or conversation entitle the Contractor to any additional payment or time to perform whatsoever under the terms thereof.” (Id., § 24.02.) These terms make clear that continuation of the work is paramount. (Id., § 23.05 [“In the event of a

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

dispute between the parties as to performance of the Work or the interpretation of the Construction Documents, or payment or nonpayment for Work performed or not performed, the parties shall attempt to resolve the dispute. Pending resolution of this dispute, the Contractor agrees to continue the Work diligently to completion. If the dispute is not resolved, except as provided otherwise in the Agreement, the Contractor agrees it will neither rescind the Agreement, nor stop the progress of the Work on the Project.”].)

While it remains plausible that DPR GP would also rely on Ridge’s representations, the gravamen of the contractual terms provides CalSTRS with the benefit of Ridge’s review and management. The Court is not persuaded that DPR GP’s new allegations warrant disregarding these contractual provisions. And DPR GP offers no authority to support the assertion that its new allegations mean that the contract terms “cannot govern.” (See Badie v. Bank of America (1998) 67 Cal.App.4th 779, 784-785 [“When [a party] fails to raise a point, or asserts it but fails to support it with reasoned argument and citations to authority, we treat it as waived.”].)

Considering Ratcliff’s discussion of connection and moral blame, these factors still weigh in favor of finding no duty here: “[W]hen a defendant’s liability rests partially under the control of another party’s conduct and the plaintiff is free to contract with the other party, the defendant’s ‘moral blame’ and connection to the plaintiff’s alleged injury is too remote to justify imposition of a tort duty.” (Ratcliff, supra, at pp. 606-607.) Here, the ultimate decision on whether and when to pay DPR GP and/or accept DPR GP’s work belonged to CalSTRS, not Ridge, and DPR GP freely contracted with CalSTRS in negotiating the Contract.

The Court struggles to see how CalSTRS’s alleged direction not to review and approve pay applications and/or change orders changes this analysis. In fact, CalSTRS’s alleged direction reinforces it – CalSTRS was the ultimate decision maker, not Ridge. As Ratcliff notes, the third party “may protect itself against losses that the construction manager causes in its contract with ‘the owner.’” (Ratcliff, supra, 88 Cal.App.4th at p. 607.)

Ultimately, duty is a question of public policy. (Ratcliff, supra, 88 Cal.App.4th at p. 605.) Policy considerations weigh against finding a duty here. Citing Ratcliff, the Supreme Court has acknowledged that “[i]n a variety of contexts, California courts have held that a professional or other business entity that enters into a contract to provide services to an individual or entity does not owe a tort duty of care to a third party with respect to an economic loss allegedly incurred by the third party when recognition of such a duty of care to the third party would create a potential conflict of obligations for the professional or business entity in light of its responsibility to the individual or business with which it has contracted.” (Goonewardene v.

ADP, LLC (2019) 6 Cal.5th 817, 840, fn 8 [concluding that “the imposition on a payroll company of a duty of care to an employee may improperly distort the payroll company’s performance of its obligations to the employer”; collecting cases].) The Court agrees that any duty to DPR GP would represent a

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

potential conflict of loyalty for Ridge, as it was CalSTRS’s agent. (Demurrer, p. 12:7-10; Ratcliff, supra, 88 Cal.App.4th at p. 606.) While DPR GP acknowledged that the Court raised this concern in its prior Order, DPR GP fails to meaningfully address it here. (Opp., pp. 9:26- 10:7.)

Ridge’s demurrer to the Third and Fourth Causes of Action is SUSTAINED.

Equitable Indemnity (Sixth Cause of Action)

“It is well-settled in California that equitable indemnity is only available among tortfeasors who are jointly and severally liable for the plaintiff's injury.” (Stop Loss Ins. Brokers, Inc. v. Brown & Toland Medical Group (2006) 143 Cal.App.4th 1036, 1040.)

Ridge demurs to the Sixth Cause of Action on the grounds that DPR GP still has not alleged joint and several tort liability by Ridge to CalSTRS. (Demurrer, pp. 12:23-13:11.)

When the Court granted Ridge’s initial demurrer on this issue, the Court encouraged DPR GP “to clarify Ridge’s alleged tort liability to CalSTRS, how Ridge and DPR GP are jointly and severally liable, and carefully consider whether Ridge’s alleged misconduct violates a duty independent of the contracts at issue.” (10-17-25 Minute Order re Ridge [emphasis original].) However, DPR GP simply reiterates the same conclusory assertion that “any damages or losses for which DPR is found to be liable to CalSTRS is due to the negligence, willful misconduct, carelessness, failure to act, breaching conduct, or otherwise unlawful conduct of Ridge.” (SACC, ¶ 155; compare FACC, ¶ 72.)

The SACC’s additional allegations at paragraph 156 do not assist DPR GP. (SAAC, ¶ 156 [“Ridge is responsible to indemnify DPR, at least in part, for the period of delay damages claimed by CalSTRS against DPR based on delays caused by DPR’s performance of one or more of the extra work directives that Ridge issued to DPR.”]; ¶ 159.) These allegations fail to explain how Ridge’s alleged conduct (issuing extra work directives when it knew or should have known it was not authorized to issue change orders, and failing to disclose that lack of authority to DPR) results in liability to CalSTRS.

DPR GP, pointing to the Biakanja analysis above, asserts that DPR has pleaded a duty of care, which states a cognizable claim upon which to seek equitable indemnity. (Opp., pp. 11:28-12:5.) However, having granted Ridge’s demurrer on the issue of duty, DPR GP’s derivative equitable indemnity claim must also fail. Accordingly, Ridge’s demurrer on this ground is SUSTAINED.

Equitable Contribution (Seventh Cause of Action)

Equitable contribution is “the right to recover, not from the party primarily liable for the loss, but

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

from a co-obligor who shares such liability with the party seeking contribution.” (Fireman's Fund Ins. Co. v. Maryland Casualty Co. (1998) 65 Cal.App.4th 1279, 1293.) “Equitable contribution allows for loss sharing among [co-obligors] that share the same level of liability on the same risk as to the same [principal].” (Morgan Creek Residential v. Kemp (2007) 153 Cal.App.4th 675, 684 [internal quotations omitted].)

Ridge contends that DPR has still not alleged facts demonstrating that it shares the “same level of liability on the same risk as to the same principal” with Ridge. (Demurrer, p. 13:12-21, citing Morgan Creek, supra, 153 Cal.App.4th at p. 684.)

DPR GP contends that it has sufficiently pleaded this cause of action to “clarify Ridge’s tort liability to CalSTRS, as well as how Ridge and DPR are jointly and severally liable.” (Opp., p. 12:16-18.) DPR GP points to a single allegation in support: “Ridge is responsible to provide contribution to DPR, at least in part, for the period of delay damages claimed by CalSTRS against DPR based on delays caused by DPR’s performance of one or more of the extra work directives that Ridge issued to DPR at a time when Ridge knew or reasonably should have known that it was not authorized to issue any change orders to increase the Contract’s GMP, but failed to disclose that lack of authority to DPR.” (SACC, ¶ 164.)

However, as with DPR GP’s Equitable Indemnification claim, this allegation fails to demonstrate Ridge’s tort liability to CalSTRS, let alone that Ridge and DPR GP share the same level of liability.

Ridge’s demurrer to the Seventh Cause of Action is SUSTAINED.

Declaratory Relief (Ninth Cause of Action)

Invoking the Court’s ruling on Ridge’s earlier demurrer, Ridge argues that if the Court again sustains the demurrer to the Third and Fourth Causes of Action, the Court should sustain the demurrer to the Ninth Cause of Action for the same reasons because there would be no underlying theory of liability on which DPR GP’s derivative declaratory relief cause of action could stand. (Demurrer, pp. 13:24-14:5.)

The Court agrees. Since the Court sustains the demurrer to the Third and Fourth Causes of Action, it also SUSTAINS Ridge’s demurrer to the Ninth Cause of Action.

Breach of Warranty of Authority (Tenth Cause of Action)

Citing to Civil Code section 2342,[4] Ridge argues that the tort of breach of warranty of authority only occurs when an agent acts without authority or in excess of its authority. (Demurrer, p. 14:10-13.) Ridge further contends that DPR has failed to allege that Ridge did not have the

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

authority to take the actions alleged in the SACC or that CalSTRS did not authorize the actions taken by Ridge. (Demurrer, p. 14:17-27.)

In opposition, DPR GP asserts that it has stated sufficient facts to allege a claim under Civil Code section 2343.[5] (Opp., p. 13:14-19.) DPR GP contends that, as a result of CalSTRS’s directions, Ridge’s authority was withdrawn and Ridge acted in excess of its authority when it directed DPR GP to perform extra work. (Id., pp. 13:20-14:5.)

Here, the Contract expressly sets forth Ridge’s authority: “Whenever under the provisions of this Agreement the approval of the Contractor or CalSTRS is required, or the Contractor or CalSTRS is required to take some action at the request of the other, such approval or such request shall be given for the Contractor by the Contractor’s Representative and for CalSTRS by CalSTRS’s Representative, and any party hereto shall be authorized to rely upon any such approval or request.” (SACC, Exh. 1, § 10.6.)

Section 15.05, which DPR GP cites in the SACC, does not support its position. Section 15.05 provides that it “is the intent of CalSTRS that all Directives[6] will be converted to a Change Order.” (SACC, Exh. 2, Exh. A, § 15.05.) However, elsewhere, the Contract provides that “[n]o extra work shall be performed, and no change shall be made, except pursuant to a written Change Order or Proposed Change Order, signed by CalSTRS, or by a Directive (signed by either CalSTRS or CalSTRS’s Representative) stating that the extra work or change is authorized, and no claim for any addition to the Guaranteed Maximum Price or Contract Time shall be valid unless so authorized; provided, however, that nothing in this Article shall excuse the Contractor from proceeding with the prosecution of the work so changed.” (Id., § 15.01.)

The Contract makes clear that notwithstanding this statement of intent, “[a]ll adjustments to the Guaranteed Maximum Price or the Contract Time must be approved by the Teachers’ Retirement Fund Board.” (Id., § 15.02.)

Moreover, under Section 8.01, DPR GP agreed that it “shall not be relieved from its obligations to perform the Work in accordance with the Agreement and/or the Construction Documents either by the activities or duties of CalSTRS’s Representative in their administration of the Project or by inspections, tests or approvals (or the lack thereof) required or performed under Article 9 by persons other than the Contractor.” (Id., § 8.01.) DPR GP also agreed that “No verbal agreement or conversation with any officer, agent, or employee of CalSTRS, either before, during, or after execution of the Agreement and/or the Construction Documents shall affect or modify any term or condition contained in the Agreement and/or Construction Documents, nor shall such verbal agreement or conversation entitle the Contractor to any additional payment or time to perform whatsoever under the terms thereof.” (Id., § 24.02.)

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

The Court is not persuaded that CalSTRS’s directive not to approve any change orders to increase the Contract’s GMP[7], as alleged, constitutes a withdrawal of Ridge’s authority as CalSTRS’s agent. Nor does it indicate that Ridge acted in excess of its authority by taking certain actions, such as directing DPR GP to perform certain work. As explained in the duty discussion above, CalSTRS was the ultimate decision maker. DPR GP acknowledges this reality elsewhere by alleging that CalSTRS interfered “with the proper administration of the Contract based on CalSTRS’ directives to Ridge not to approve any more change orders that would increase the GMP despite CalSTRS’ issuance of directives, by and through Ridge, to perform additional work.” (See SACC, ¶¶ 114(m), 121(i) [emphasis added].)

Simply put, DPR GP’s allegations demonstrate that CalSTRS decided not to approve certain change orders despite issuing directives for DPR GP to perform additional work, instructed Ridge accordingly, and Ridge followed its principal’s directions.

DPR GP’s allegations are contrary to the plain terms of the Contract and, therefore, they do not state a cause of action for breach of warranty of authority. Accordingly, Ridge’s demurrer on this ground is SUSTAINED.

Negligent Misrepresentation (Eleventh Cause of Action)

The elements of a negligent misrepresentation claim are “(1) the misrepresentation of a past or existing material fact, (2) without reasonable ground for believing it to be true, (3) with intent to induce another’s reliance on the fact misrepresented, (4) justifiable reliance on the misrepresentation, and (5) resulting damage.” (Apollo Capital Fund LLC v. Roth Capital Partners, LLC (2007) 158 Cal.App.4th 226, 243.)

Ridge contends, in part, that DPR GP has not and cannot allege reliance. (Demurrer, p. 15:21- 22.) The Court agrees. The Contract provides that “[n]o verbal agreement or conversation with any officer, agent, or employee of CalSTRS, either before, during, or after execution of the Agreement and/or the Construction Documents shall affect or modify any term or condition contained in the Agreement and/or Construction Documents, nor shall such verbal agreement or conversation entitle the Contractor to any additional payment or time to perform whatsoever under the terms thereof.” (SACC, Exh. 2, Exh.

A, § 24.02.) DPR GP’s allegations here specifically rely on Ms. Azevedo’s email communications and alleged statements therein that applications had been approved and that directives would be converted to change orders. (SACC, ¶¶ 184-196.) But even if those representations were false, DPR GP was still obligated to comply with Ridge’s directives: “Upon receipt of a Directive, the Contractor shall promptly proceed with the change in the Work involved.” (SACC, Exh. 2, Exh. A, § 15.05.) DPR GP fails to engage with Section 24.02, which was specifically cited by Ridge, and only conclusively asserts that is has alleged that it reasonably relied on Ridge’s representations. (See Demurrer Opp., p. 14:15-

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

20.)

DPR GP’s allegations are contrary to the plain terms of the Contract and, therefore, they do not state a cause of action for negligent misrepresentation. Accordingly, Ridge’s demurrer on this ground is SUSTAINED.

Civil Conspiracy (Twelfth Cause of Action)

Ridge contends that DPR GP’s conspiracy claim is barred by the agent’s immunity rule. (Demurrer, p. 16:11-20.) DPR GP opposes, arguing that the rule does not apply because DPR alleges that Ridge exceeded its authority. (Demurrer Opp., pp. 14:21-15:5.)

As the Supreme Court explained:

The agent’s immunity rule emanates from a further holding in Wise that: “Agents and employees of a corporation cannot conspire with their corporate principal or employer where they act in their official capacities on behalf of the corporation and not as individuals for their individual advantage.” (Wise, supra, 223 Cal.App.2d at p. 72.) The rule “derives from the principle that ordinarily corporate agents and employees acting for or on behalf of the corporation cannot be held liable for inducing a breach of the corporation’s contract since being in a confidential relationship to the corporation their action in this respect is privileged.” (Id. at pp. 72-73.)

We have endorsed and applied the agent’s immunity rule as expressed in Wise (e.g., Shoemaker v. Myers (1990) 52 Cal.3d 1, 24-25 [276 Cal.Rptr. 303, 801 P.2d 1054]; Gruenberg, supra, 9 Cal.3d at p. 576; Doctors’ Co., supra, 49 Cal.3d at p. 45).

(Applied Equipment Corp. v. Litton Saudi Arabia Ltd. (1994) 7 Cal.4th 503, 512, fn 4.) As explained above, the Court disagrees that DPR GP’s allegations support the assertion that Ridge was acting without authority or in excess of its authority. DPR GP’s own allegations demonstrate that Ridge was CalSTRS’s agent and acting at CalSTRS’s direction in that capacity. (SACC, ¶¶ 16-19, 114(m), 121(i).) The Contract also makes clear that Ridge has the authority to issue directives, which DPR GP was required to comply with, even in the absence of a formal Change Order. (SACC, Exh. 2, Exh. A, §§ 1.05, 15.05.)

DPR GP also fails to acknowledge Ridge’s additional argument that DPR GP has not alleged that Ridge was acting for its own account or advantage, which the Court treats as a concession. (See

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

D.I. Chadbourne, Inc. v. Super. Ct. (1964) 60 Cal.2d 723, 728, fn. 4 [where nonmoving party fails to oppose a ground for a motion “it is assumed that [nonmoving party] concedes” that ground].)

Accordingly, the Court concludes that the agent’s immunity rule bars DPR GP’s claim against Ridge. Ridge’s demurrer on this ground is SUSTAINED.

Intentional Interference with Contract (Thirteenth Cause of Action)

DPR GP alleges that Ridge, by issuing directives for additional work knowing that CalSTRS would not convert those directives into change orders or approve DPR GP’s payment applications, “prevented DPR’s performance of the Subcontracts or made DPR’s performance under the Subcontracts substantially more expensive or difficult” because “portions of those payment applications were earmarked for payment to DPR’s subcontractors.” (SACC, ¶¶ 210- 213.)

A cause of action for intentional interference with contract requires (1) a valid contract between plaintiff and a third party; (2) defendant’s knowledge of the contract; (3) defendant’s intentional acts which are designed to induce a breach or disruption of the contractual relationship; (4) actual breach or disruption of the contractual relationship; and (5) damage. (Pacific Gas & Electric Co. v. Bear Stearns & Co. (1990) 50 Cal.3d 1118, 1126.)

Ridge contends that DPR GP’s intentional interference claim fails in light of the express terms of the Contract, including that the Contract creates distance between Ridge, CalSTRS, and DPR’s subcontractors and that DPR GP could not have relied on Ridge’s statements to allege that DPR would not have engaged its subcontractors or performed the balance of the work were it not for Ridge’s conduct. (Demurrer, p. 17:5-14.) DPR GP suggests that it has adequately dealt with reliance elsewhere and contends that Ridge’s remaining arguments are unclear. (Demurrer Opp., p. 15:6-14.)

The Court agrees with DPR GP as to Sections 6.01 and 6.03. Those provisions do not demonstrate, as a matter of law, that Ridge cannot interfere with DPR’s subcontract. But the Court does not agree that DPR GP has stated a claim for intentional interference. Regardless whether Ridge knew that CalSTRS would not convert Ridge’s additional work directives into change orders or approve DPR GP’s payment applications, DPR GP was obligated to perform the additional work as directed. How can it be that Ridge intentionally acted to induce a breach of DPR GP’s subcontracts when DPR GP was obligated to perform the work (and, therefore, engage with its subcontractors as necessary to perform the work)? (See SACC, Exh. 2, Exh. A, §§ 1.35, 6.01, 8.01, 15.01, 15.05, 24.02.) DPR GP’s prior arguments fail to adequately address

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

this issue.

Accordingly, Ridge’s demurrer on this ground is SUSTAINED.

Causation (Tenth, Eleventh, Twelfth, and Thirteenth Causes of Action)

Finally, in addition to the arguments addressed above, Ridge further demurs to the “new” causes of action on the grounds that DPR GP has not and cannot allege causation. (Demurrer, pp. 14:28- 15:13, 16:4, 16:21-27, 17:15-17; Errata, pp. 3:2-4:20.) Ridge contends that the principal harm alleged – that DPR was forced to fund the completion of the Project at an additional cost of at least approximately $45 million” – would have been sustained regardless of any alleged act or omission by Ridge. (Errata, p. 3:13-20.)

Under the terms of the Contract, DPR was obligated to complete the Work and/or promptly proceed with any change in the Work, regardless of any dispute, nonpayment, any act by Ridge, and any “agreement or conversation with any agent of CalSTRS.” (SACC, Exh. 2, Exh. A, §§ 8.01, 12.04,15.01, 15.05, 23.05, 24.02.)

In response, DPR GP contends that it has established “but for” causation, citing general case law regarding anticipatory breach and asserting its right to “stop work on the Project given CalSTRS’ repudiation of its payment obligations.” (See Demurrer Opp., p. 11:5-26.) However, this argument is premised on DPR GP’s unsupported assertion that the contract provisions are irrelevant because they did “not contemplate CalSTRS repudiation of its obligations under the Contract.” (Id., p. 11:7-9.) That simply cannot be squared with the Contract’s language.

For example, Section 12.04 provides that “Neither the payment, the withholding, nor the retention of all or any portion of any Payment claimed to be due and owing to the Contractor shall operate in any way to relieve the Contractor from its obligations under the Agreement and/or the Construction Documents. Except to the extent provided otherwise in the Agreement or applicable law, in the event of a CalSTRS default, the Contractor shall continue diligently to prosecute the Work without reference to the payment, withhold, or retention of any Payment.

Except as provided in the Agreement or applicable law, the payment, withhold, or retention of any Payment shall not be grounds for an extension of the Contract Time.” (SACC, Exh. 2, Exh. A, § 12.04.) Section 23.05 further provides that “[i]n the event of a dispute between the parties as to performance of the Work or the interpretation of the Construction Documents, or payment or nonpayment for Work performed or not performed, the parties shall attempt to resolve the dispute. Pending resolution of this dispute, the Contractor agrees to continue the Work diligently to completion.

If the dispute is not resolved, except as provided otherwise in the Agreement, the Contractor agrees it will neither rescind the Agreement, nor stop the progress of the Work on the Project.” (Id., § 23.05.) DPR GP makes no attempt to reckon with these provisions or support the

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

assertion that they are immaterial to the sufficiency of their claims.

Accordingly, Ridge’s demurrer is SUSTAINED on this ground.

Leave to Amend

“If the plaintiff has not had an opportunity to amend the complaint in response to the demurrer, leave to amend is liberally allowed as a matter of fairness, unless the complaint shows on its face that it is incapable of amendment.” (City of Stockton v. Superior Court (2007) 42 Cal.4th 730, 747.) The burden is on Plaintiff to show in what manner he can amend the pleading and how that amendment will change the legal effect of the pleading. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 349; see also Chiatello v. City and County of San Francisco (2010) 189 Cal.App.4th 472, 480 [“The plaintiff bears the burden of demonstrating a reasonable possibility to cure any defect by amendment.”].)

As to the Third, Fourth, Sixth, Seventh, and Ninth Causes of Action, because this is the second pleadings challenge on these claims and DPR GP has had the opportunity to amend to state a claim, but failed to do so, leave to amend is DENIED. Moreover, DPR GP fails to explain how any amendments would address the issues discussed above and therefore fails to carry its burden. (See Goodman v. Kennedy (1976) 18 Cal.3d 335, 349.)

As to the new Tenth, Eleventh, Twelfth, and Thirteenth Causes of Action, while this is only the first pleadings challenge to these claims, leave to amend is DENIED. DPR GP fails to explain how any amendments would address the issues or resolve the inconsistencies between DPR GP’s allegations and the express terms of the Contract. The Court sees no reasonable possibility that DPR GP could do so.

Disposition

For the reasons stated above, DPR GP’s motion for leave to amend is GRANTED. Accordingly, Ridge’s motion to strike is moot. Ridge’s demurrer is ruled upon as follows: - Third and Fourth Causes of Action – SUSTAINED, without leave to amend - Sixth Cause of Action – SUSTAINED, without leave to amend - Seventh Cause of Action – SUSTAINED, without leave to amend - Ninth Cause of Action – SUSTAINED, without leave to amend - Tenth Cause of Action – SUSTAINED, without leave to amend - Eleventh Cause of Action – SUSTAINED, without leave to amend - Twelfth Cause of Action – SUSTAINED, without leave to amend - Thirteenth Cause of Action – SUSTAINED, without leave to amend

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

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

[1] The Court uses “Contract” to refer to the February 2018 agreement between CalSTRS and

DPR GP for the headquarters expansion project. (SACC, Exh. 1.) [2] The Court has also concurrently scheduled a hearing on CalSTRS’s demurrer and motion to

strike the SACC. The Court addresses CalSTRS’s opposition to DPR GP’s motion for leave to amend the FACC in its ruling on CalSTRS’s concurrent motions. [3] As Ratcliff explained, courts place “little importance on the factor of foreseeability” because

foreseeability “is endless” and “proves too much” in the context of a non-physical injury. (Ratcliff, supra, 88 Cal. App.4th at p. 606.) [4] Civil Code section 2342 provides that “[o]ne who assumes to act as an agent thereby warrants,

to all who deal with him in that capacity, that he has the authority which he assumes.” (Civ. Code, § 2342.) [5] Civil Code section 2343 provides that “[o]ne who assumes to act as an agent is responsible to

third persons as a principal for his acts in the course of his agency [] [w]hen his acts are wrongful in their nature.” (Civ. Code, § 2343.) [6] A Construction Change Directive or “Directive” means “a written order to the Contractor,

issued after execution of the Agreement, signed by CalSTRS or a CalSTRS Representative directing a change in the Work and stating a proposed basis for adjustment, if any, in the Guaranteed Maximum Price or Contract Time, or both, and which shall be used in the absence of total agreement with the Contractor on the terms of a Change Order or when time does not permit processing of a Change Order prior to implementation of the change.” (SACC, Exh. 2, Exh. A, § 1.09.) In turn, a “Change Order” means a written order to the Contractor signed by CalSTRS and the Contractor or signed unilaterally by CalSTRS, issued after execution of the Agreement, authorizing a change in the Work and/or an adjustment in the Guaranteed Maximum Price and/or the Contract Time.

A Change Order shall be memorialized as an ‘Amendment’ to the Agreement.” (Id., § 1.06.) [7] DPR GP’s Tenth Cause of Action specifically focuses on Ridge’s issuance of Construction

Change Directives (“CCDs”), Owner Allowed Transfers (“OATs”), and Direction to Proceed (“DTPs”), DPR GP’s expectation that those CCDs, OATs, and DTPs would be converted into change orders, and Ridge’s failure to disclose CalSTRS’s direction to the contrary. (SACC, ¶¶ 173-182.) Elsewhere in the SACC, DPR GP alleges that the OATs and DTPs should be treated as CCDs, as a CCD is the only contractually valid means of directing DPR to perform additional work. (Id., ¶¶ 55-57.)

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. 04/23/2026 Hearing on Demurrer (Ridge Capital) in Department 8B

To request oral argument on this matter, you must call Department 8B 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 Official Reporters Pro Tempore is available at https://www.saccourt.ca.gov/courtreporters/docs/crtrp-13.Pdf.

If you are not using a reporter from the Court’s Approved Official Reporter Pro Tempore list, a Stipulation and Appointment of Official Reporter Pro Tempore (CV/E-206) must be signed by each party, the private court reporter, and the Judge. The signed form must be filed with the clerk prior to the hearing.

If a litigant has been granted a fee waiver and requests a court reporter, the party must submit a Request for Court Reporter by a Party with a Fee Waiver (CV/E-211). The form must be filed with the clerk at least 10 days prior to the hearing or at the time the hearing is scheduled if less than 10 days away. Once approved, the clerk will forward the form to the Court Reporter’s Office and an official reporter will be provided.

If oral argument is requested, the Parties are encouraged to appear via Zoom with the links below:

To join by Zoom link - https://saccourt-ca-gov.zoomgov.com/j/16184738886 To join by phone dial (833) 568-8864 ID 16184738886

Counsel for Ridge is directed to notice all parties of this order.

Please note that the Complex Civil Case Department now provides information to assist you in managing your complex case on the Court website at https://www.saccourt.ca.gov/civil/complex-civil-cases.aspx. The Court strongly encourages parties to review this website regularly to stay abreast of the most recent complex civil case procedures. Please refer to the website before directly contacting the Court Clerk for information.