A lawsuit can be filed where the plaintiff resides or where the defendant resides or where the claim arose.  The lawsuit will most likely be filed in CA since the plaintiff resides in CA.  You could be sued for negligence for damage to the contents of the neighbor's condo.  It would be advisable to contact your homeowner's insurance carrier and have the insurance carrier handle the matter.  If the case is settled with the insurance carrier, no lawsuit is filed.  If the case is not settled with the insurance carrier and a lawsuit is filed against you, your insurance carrier will provide you with an attorney at no cost to you and the insurance carrier will handle the case for you.