Attorneys Mackenroth & Laird LLP has a well written tip about the requirement to settle with all defendants in "good faith"
2009 California Rules of Court Rule 3.1382. Good faith settlement and dismissal
We recommend reading the full tip. It begins with the following:
Cases involving multiple defendants have special procedures which relate to settlements between the plaintiff and one of the defendants. In cases with multiple defendants, it is not uncommon for a defendant to file a "cross-complaint" against another defendant for "equitable indemnity," or "equitable contribution." In filing such a cross-complaint, the defendant (who is now also considered a cross-complainant) alleges that another party is responsible and liable for the plaintiff's damages.
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2009 California Rules of Court Rule 3.1382. Good faith settlement and dismissal
California Code of Civil Procedure 877.6 Good faith