Contractors may be appearing in court more often as they become involved in lawsuits on both sides of issues, including fraud, construction defects, and even TV appearances.
Here’s a roundup of some of the latest litigation involving the building trades:
Extortion and slander
Homebuilding giant Lennar won a $1 billion judgment earlier this month against a San Diego developer whom a Florida jury found guilty of defaming the Miami-based company and conspiring with a convicted felon to extort money from it.
It appears unlikely that the firm will collect the money, however, because the defendant in the case, Nicolas Marsch III, has filed for bankruptcy. After the ruling from a Florida appeals court, Lennar’s lawyers reportedly are investigating Marsch’s claim that he has no money.
In a statement in December 2013, when the original decision was issued, the homebuilder said: “The true value of the verdict is the validation of our integrity, credibility and transparency.”
Marsch allegedly sullied that reputation. The case began when Marsch, who owns Briarwood Capital, claimed Lennar cheated him out of $200 million in the development of a southern California golf community on which the two companies had partnered. Marsch hired a now-convicted con man to back up the accusations. That accomplice, Barry Minkow, is serving five years in prison on an unrelated fraud charge, and has been ordered to pay Lennar $583.6 million.
In 2009, Minkow published an online report that said Lennar was running a Ponzi scheme and called the builder “a financial crime in progress.” Lennar’s stock price tumbled 20% as a result, prompting the the firm to sue the pair.
Minkow confessed that he was hired to defame Lennar, but Marsch has said he may try to appeal the ruling again.
Out of court
A years-long construction-defects lawsuit involving more than 1,500 homes was dismissed this month after big builder Shea Homes settled with 900 homeowners in a 55-plus Washington community.
The amount of the settlement has not been disclosed, but the lawsuit, brought by the owners in Shea’s Trilogy at Redmond Ridge development, had asked for $60 million to resolve problems ranging from leaky roofs to rodent infestations.
The residents, whose suit is the largest class-action ever filed in Seattle, complained of rot and mold, and said the cause was inadequate waterproofing and improper installation of water-barrier measures during construction. The builder responded that the lawsuit was “misleading, intentionally inflammatory and unnecessary.”
Shea had offered to make repairs in the past, but a lawyer for the homeowners said the effort was inadequate. Lawyers also said some homes might experience damage in the future that has not shown up yet.
Of note
Buried evidence: The Utah Department of Transportation earlier this month sued the company that added commuter lanes to a six-lane Salt Lake City highway, claiming the builder missed the agreed-upon deadline for completing the $150 million project and did not do quality work. The $29.4 million suit alleges there were cracks in the concrete and gaps underneath the road, and accuses the Flatiron/Harper Joint Venture of making cosmetic repairs to mask structural problems.
No good reason: The city of Anna Maria, FL, has ended a six-month legal battle with a property owner by issuing a permit for a five-bedroom home. The owner claimed the city, which enacted a moratorium on homes with more than three bedrooms after demolition and renovation work had already begun on the home, never explained the reason for denying the permit.
Can’t catch this: A Los Angeles contractor is suing Spike TV’s "Catch A Contractor" for allegedly trapping him in a house and forcing him to appear on the show. Contractor Jeff Dillman said when he arrived at the home of a former client, he was ambushed by TV cameras and the homeowners, who accused him of doing shoddy work and threatened to sue him. He said the show’s producers forced him to sign a release form “under extreme duress,” and is asking for more than $25,000 for fraud, false imprisonment and defamation.