The City of San Diego leased several floors of a downtown high-rise office building in 2017 where it stationed many employees. The City knew the building contained asbestos. That July, the building owner began a window renovation project that would involve the removal of approximately 40 tons of asbestos-containing materials. The City notified employees by email about the project, explained that air quality would be monitored daily, and designated Karen Johnson, a manager in its Real Estate Asset Department, as the liaison between employees and the building owner and renovation contractors.
Within days, employees began expressing concerns. Over the following months, they reported to Johnson and other City officials that they were experiencing respiratory problems. Employees also reported that renovation workers were wearing protective masks, that plastic barriers meant to contain dust and debris were failing, and that a ventilator for a sealed asbestos-containing area was blowing exhaust into the employee parking structure. Johnson relayed these complaints to the building owner, the contractors, and Ronald Villa, the City’s deputy chief operating officer. Despite the ongoing complaints, the City decided not to relocate employees because it had no legal grounds to break its lease and no alternative space available.
That changed on January 25, 2018, when the San Diego County Air Pollution Control District received a complaint and took samples from multiple floors of the building. The samples tested positive for asbestos the following day. On January 26, the City notified its employees of the results and instructed them to stay out of the building. Over the next several weeks, the District confirmed widespread asbestos contamination throughout the building and found that air samples collected between February 1 and 5 contained asbestos fibers exceeding permissible levels.
On March 2, 2018, City officials held a meeting with affected employees. Villa told them the asbestos found on January 25 was not airborne and that prior air testing had shown levels within EPA tolerances. George Katsikaris of the City’s Environmental Services Department similarly told employees that air samples collected before the evacuation were within safe, breathable levels and that dust samples had come back clean. A toxicologist told employees they should not worry about adverse health effects. Nevertheless, Villa acknowledged employees’ concerns and encouraged anyone worried about cancer to take whatever steps they needed, and a workers’ compensation manager explained how to file claims.
Alina Cadena and other City employees who had worked in the building during the renovations sued the City and Villa in his official capacity. They alleged the City intentionally exposed them to asbestos and concealed the extent of the exposure because it determined their health and safety were not worth the cost of breaking the lease. They asserted causes of action for intentional infliction of emotional distress and fraudulent concealment, sought compensatory damages, costs, and attorney fees, and sought punitive damages against Villa.
The City moved for summary judgment, arguing that workers’ compensation was the employees’ exclusive remedy under Labor Code section 3602, subdivision (a), and that the employees could not establish the fraudulent concealment exception to that exclusivity rule under subdivision (b)(2). The City alternatively sought summary adjudication of the emotional distress claim and the punitive damages claim against Villa. In support, the City submitted declarations from Johnson and Villa stating they had no knowledge of loose or uncontrolled asbestos before January 26, 2018, and that the renovation project manager had regularly reported air samples at normal background levels. The City also submitted deposition testimony, including from employees themselves, who admitted they had no evidence the City knew of loose asbestos debris before that date.
The court granted summary judgment, finding the fraudulent concealment exception did not apply and workers’ compensation was the exclusive remedy. The Court of Appeal affirmed the judgment in its entirety, reviewing the summary judgment de novo in the unpublished case of Cadena v. City of San Diego, – D084784 (February, 2026).
The court explained that under the workers’ compensation exclusivity rule, when an employee suffers an injury arising out of and in the course of employment, workers’ compensation is the sole and exclusive remedy against the employer. (Charles J. Vacanti, M.D., Inc. v. State Comp. Ins. Fund (2001) 24 Cal.4th 800, 812–813.) The fraudulent concealment exception in Labor Code section 3602, subdivision (b)(2), requires the employee to prove three elements: the employer knew of the employee’s work-related injury, the employer concealed that knowledge, and the concealment aggravated the injury.
The court found the employees failed to raise a triable issue on the first element – actual prior knowledge of their injuries. Citing Ashdown v. Ameron Internat. Corp. (2000) 83 Cal.App.4th 868, 880, and Hughes Aircraft Co. v. Superior Court (1996) 44 Cal.App.4th 1790, 1797, the court emphasized that constructive or imputed knowledge is insufficient; only actual knowledge will do. The City’s evidence showed it did not know about loose asbestos debris until January 26, 2018, the same day it notified employees. The employees themselves admitted they had no evidence the City knew earlier. Moreover, since employees had the same information the City did, the fraudulent concealment exception did not apply, because the exception requires the employer to have known of the injury before the employee.
The employees argued their emotional distress claim should proceed to trial because the City’s conduct in knowingly exposing them to a known carcinogen was not a normal part of the employment relationship. The court disagreed, surveying a line of California Supreme Court decisions holding that workers’ compensation is the exclusive remedy for intentional infliction of emotional distress claims against employers.
The court further relied on Johns-Manville Products Corp. v. Superior Court (1980) 27 Cal.3d 465, 474–475, where the California Supreme Court held that even if an employer knowingly concealed asbestos dangers from employees, workers’ compensation was the only remedy.