do you have any legal recourse against this job or is it too long ago?
You know, its hard to give hard advice on this with out doing an exploratory operation if you will. Most leaks in showers are the bottom two feet of the stall and especially where the water directly hits the opposite wall from the force of the shower head. But, that does not mean they could be as high as four feet up and trickled down.
Anyway, I would set my goal on fixing this once and forall and not have to go back in again.
I would start at 4 feet from the floor and tear it all out. Make a nice straight line where you start so that you can put it back and have a line that cannot be seen. Stick to a grout line.
Now, the backer board is probably compromised. No telling what you have, could be drywall, could be green board, could be cementious board. What ever it is, go back with cementious board for sure. Be sure to use taping and bedding that is water proof, and water proof mastic.
Now, look at your floor plates and all wall studs. Surely a good drying out and spraying down with pure bleach will assist allot, but if you can drive an ice pick or awl into the studs and it goes in easy, the studs are gone. I do hope not.
The insulation is for sure gone and should be taken out immediately. Replace ONLY with new and fresh insulation.
Pull off all base moldings and let the drywall dry out in these places. If the rock is mushy and lost all composure, this will have to go. You could cut the rock off about 2 feet from the floor and only replace that area, IF you are a good tape and bedder and texturer.
You may have to "sister" some of the wall studs if so, come back and get further instructions, DO NOT cut off any wall studs at this time.
Let it dry and apply as many fans as possible to dry out and vent the area once opened up. Do not be in a hurry to put it back until its dry and nothing growing back there. Spraying pure bleach out of a mister will stop and retard any growths and will not hurt anything.
When you go back, be sure to use cementious backer board, water proof mastic, stainless steel nails, same tile, and do a good grout job. then seal the grout with silicon.
Remember, let the tile mastic dry or cure for 24 hours before applying grout. Then do not let the grout get wet for 4 days after that grouting. Then seal the grout.
Do the corners if there are any cracks in the grout, with 100% silicon caulking.
Come back to us when you open the area up and see what you have.