Having already spent millions of dollars on a now vacant high-rise in downtown San Diego, the city faces costly litigation from employees and city contractors who allege the city exposed them to high levels of asbestos without warning.
NBC 7 Investigates obtained summaries of two new legal claims, considered precursors to lawsuits, through a public records request. One of the claims was filed on behalf of six contractors alleging “negligent asbestos contamination and exposure of workers.”
The city purchased the 101 Ash Street building in January 2017 in a 20-year lease-to-own agreement from Cisterra Development for a total of $202 million.
The city purchased the building on an “as-is” basis. Inspection reports done during Cisterra's purchase of the property showed that the former Sempra headquarters required only $10,000 in routine maintenance.
The price tag surged as the city prepared to move thousands of workers into 101 Ash Street.
In addition to having to conduct large-scale renovations, city staff learned the building had “substantial asbestos” contamination inside.
Marlon Perez was one of the city employees who warned the city of major safety concerns inside 101 Ash Street.
Perez told NBC 7 in a Feb. 20 interview the city ignored his warnings of asbestos contamination and what he felt were “significant” fire safety issues inside. Despite those warnings, according to a letter he sent to the City Attorney’s Office, city staff designated the building as “free of asbestos and 100 percent safe for workers to enter.”
Workers were moved in and within weeks evacuated after San Diego County Air Pollution Control District declared the building unsafe due to high levels of asbestos.
Now, as the building sits vacant, employees and contractors are pursuing legal action against the city for exposing them to the contamination, potentially leaving taxpayers on the hook for large settlements.
One of the three total claims that the city has received over the Ash Street building was filed by Antonio Castillo and five other contractors on Feb. 6, accusing the city of negligence.
Those workers say the city was "aware of the existence of the dangerous condition" inside Ash Street but still hired outside trades workers to work inside. The six workers allege that the city owes up to $10 million a piece for negligence, assault and battery resulting from asbestos contamination, and for dangerous condition of public property.
More recently, civil engineer Marlon Perez, the whistleblower who warned of safety hazards at Ash Street also filed a legal tort claim on Feb. 26 for “bodily injury” associated with 101 Ash Street.
Perez, Castillo, and others now join Jose Luis Guerrero in filing claims against the city over asbestos exposure.
In a statement a city spokesperson said the city was "unable to respond to the formal claims as they are precursors to litigation and will be handled by the City Attorney's Office."
In regards to claims that the city failed to conduct due dilligence when purchasing the property, the spokesperson told NBC 7 that "the city worked in conjunction with active downtown developer Cisterra to perform due dilligence on [remediating] the asbestos and worked with well-known architect Gensler during the space-planning phase to minimize the disruption of asbestos during construction."
Added the spokesperson, "The City assumed any tenant improvement could result in disrutpion of asbestos. For this reason, the City ensured the due dilligence and construction floor plans developed by Gensler addressed the potential for disruption."
*This story was updated to include additional information from the claim by the six city contractors.*