City of Lodi v. Unigard Insurance Co

Filing 151

ORDER signed by Judge Garland E. Burrell, Jr on 12/15/14: The Clerk of the Court shall close Case No. 2:01-cv-01718-FCD-JFM.(Kaminski, H)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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UNIGARD INSURANCE COMPANY,
UNIGARD SECURITY INSURANCE
COMPANY,

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DISMISSAL ORDER

Plaintiffs,

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No. 2:98-cv-01712-GEB-JFM

v.
CITY OF LODI, CALIFORNIA,

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Defendant.

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Plaintiff,

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v.

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Related Case No. 2:01-cv-01718FCD-JFM

CITY OF LODI, CALIFORNIA,

UNIGARD INSURANCE COMPANY,
Defendant.

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On

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September

12,

2014,

following

completion

of

the

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terms of a provisional settlement agreement, the parties filed a

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Stipulation

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related1

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Stipulation, inter alia, entry of judgment that “confirm[s] the

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permanent injunction” entered on December 22, 2003, in Case No.

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for

cases.

Entry
(ECF

of
No.

Judgment
168.)

The

in

the

parties

above-referenced
sought

in

the

The parties state the referenced cases are consolidated. However, review
of the docket in Case No. 2:01-cv-01718-FCD-JFM reflects that case was
“restored to a separate[, related] action” in 2003. (See Mem. & Order 1:232:8, June 5, 2013, ECF No. 132 (ordering the Clerk to vacate the consolidation
order and reopen Case No. 2:01-cv-01718-FCD-JFM as a separate action).)

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2:98-cv-01712-GEB-JFM and dismisses with prejudice Case No. 2:01-

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cv-01718-FCD-JFM. (Proposed Judgment 2:12-3:15, ECF No. 169.)

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The

referenced

injunction

enjoins

Defendant

City

of

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Lodi (“Lodi”) and its officers from enforcing certain provisions

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of

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Liability Ordinance (“MERLO”). (See Mem. & Order, Dec. 22, 2003,

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ECF No. 101.)

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No. 1755, which repealed MERLO.2 (See Notice of Repeal of MERLO,

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ECF

Lodi‟s

Comprehensive

No.

Municipal

Environmental

Response

and

However, on March 16, 2005, Lodi enacted Ordinance

171,

filed

in

Case

No.

2:98-cv-01489-FCD-JFM.)

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Accordingly, on September 25, 2014, the Court declined to enter

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the

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ordered the parties to show cause (“OSC”) why each referenced

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action should not be dismissed. (Order Re Proposed Judgment, ECF

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No. 171.)

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proposed

judgment

in

Case

No.

2:98-cv-01712-GEB-JFM

and

On October 6, 2014, Plaintiffs responded to the OSC.

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Plaintiffs

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entered” in Case No. 2:98-cv-01712-GEB-JFM, arguing:

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contend

“an

injunction,

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should

be

(b) An
affirmative
injunction
is
appropriate in light of the history of the
ordinances, the massive litigation, and the
results obtained, so that [Plaintiffs] can
have the fruits of a hard-won victory;

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(c) Dismissal would effectively reenter an order that was reversed by the Ninth
Circuit;

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(d) Denial of relief would be contrary
to the law of the case, because it would be

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dismissal,

(a) The parties have stipulated for it,
and the Court cannot unilaterally modify a
consent decree;

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not

The Court takes judicial notice of Ordinance 1755. Fed. R. Evid. 201(c)
(“The court . . . may take judicial notice on its own.”); see also Tollis,
Inc. v. Cnty. of San Diego, 505 F.3d 935, 938 n.1 (9th Cir. 2007) (“Municipal
ordinances are proper subjects for judicial notice.”).

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contrary to the rulings of the Ninth Circuit;
[and]

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(e) Denial
of
relief
would
be
inconsistent with the result of the parallel
Fireman‟s Fund case, Fireman‟s Fund v. City
of Lodi, 296 F. Supp. 2d 1197 (E.D. Cal.
2003), and the determination in both cases
that
the
insurers
were
entitled
to
a
permanent injunction.

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(Pls.‟

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Plaintiffs do not dispute in their response to the OSC that MERLO

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was repealed in 2005, nor do they state they oppose dismissal of

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Mem.

P.&A.

in

Resp.

to

OSC,

1:12-25,

ECF

No.

172.)

related Case No. 2:01-cv-01718-FCD-JFM.
For the reasons that follow, each case is dismissed.

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A.

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Dismissal of Case No. 2:98-cv-01712-GEB-JFM
Plaintiffs

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seek

in

Case

No.

2:98-cv-01712-GEB-JFM,

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“declaratory and injunctive relief . . . to prevent Lodi from

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enforcing [MERLO] . . . which permits the City to investigate and

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remediate

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groundwater.” Fireman‟s Fund Ins. Co. v. City of Lodi, Cal., 302

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F.3d 928, 934 (9th Cir. 2002) (consolidated appeals concerning

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the district court‟s granting of dismissal motions in related

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Cases

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Plaintiffs

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Comprehensive Environmental Response, Compensation and Liability

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Act (“CERCLA”) . . . and by various state laws.” Id.

the

Nos.

hazardous

waste

contamination

2:98-cv-01489-FCD-JFM
allege

“MERLO

is

and

of

its

soil

and

2:98-cv-01712-GEB-JFM).

preempted

by

the

federal

In November of 2004, the parties notified the Court

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they

entered

into

a

conditional

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annual status conference. (See Minute Order, ECF No. 124). The

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parties state in their November 10, 2005 Joint Status Conference

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Statement:
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settlement

and

requested

an

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In October of 2004, Unigard Insurance
Company, Unigard Security Insurance Company
(collectively “Unigard”) and [Lodi] entered
into a contingent settlement whereby two
insurers, Unigard Insurance Company and MSI
Insurance Company, are funding a “Pay-ForPerformance” contract in connection with the
remediation of the Busy Bee Site, located in
Lodi, California. Once a “no further action”
letter[] or its equivalent is received for
the Busy Bee Site from the lead state agency
overseeing the remediation, the settlement
contingency will be eliminated. Once the
settlement contingency has been removed,
under the terms of the settlement agreement
between
the
parties,
Unigard
Insurance
Company will file a dismissal in City of Lodi
v. Unigard Ins. Co., Case No. [2:01-cv-01718FCD-JFM] and judgment will be entered in
Unigard Ins. Co. v. City of Lodi, Case No.
[2:98-cv-01712-GEB-JFM]
confirming
the
permanent injunction granted [in the December
22, 2003 Memorandum and
Order granting
Plaintiffs‟ motion for summary judgment and
permanent injunction, (ECF No. 101),] in that
case.

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(JSR 1:24-2:6, ECF No. 126.)

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However,
MERLO

during

pendency

enacted Ordinance No. 1755, which repealed MERLO. Ordinance No.

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1755 became effective on April 15, 2005.
was]

March

repealed,

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conditional

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[MERLO

On

the

settlement,

“Because

repealed.

of

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was

the

2005,

[the

the

Court]

City

must

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determine whether this case is moot.” Log Cabin Republicans v.

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United States, 658 F.3d 1162, 1165 (9th Cir. 2011). “A c[ase] is

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moot when the issues presented are no longer live or the parties

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lack a legally cognizable interest in the outcome. The basic

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question is whether there exists a present controversy as to

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which effective relief can be granted.” Outdoor Media Grp., Inc.

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v. City of Beaumont, 506 F.3d 895, 901 (9th Cir. 2007) (internal

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quotation

marks

and

citation
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omitted).

“Applying

[these

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principles],

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repeatedly held that a case is moot when the challenged statute

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is repealed, expires, or is amended to remove the challenged

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language.” Log Cabin Republicans, 658 F.3d at 1166; see also

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Outdoor

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change . . . is usually enough to render a case moot, even if the

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legislature possesses the power to reenact the statute after the

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lawsuit is dismissed.” (internal quotation marks and citation

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omitted)).

the

Media

Supreme

Grp.,

Court

Inc.,

506

and

[the

F.3d

at

Ninth

901

Circuit]

(“A

have

statutory

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“This [case] became moot when the repeal of [MERLO]

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took effect on [April 15, 2005]. . . . There is no longer „a

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present, live controversy of the kind that must exist‟ . . . .”

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Log Cabin Republicans, 658 F.3d at 1166 (quoting Hall v. Beals,

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396 U.S. 45, 48 (1969)). Further, Plaintiffs have not shown in

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their response to the OSC “an exception to mootness.” Id. at

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1167.

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For the stated reasons, Case No. 2:98-cv-01712-GEB-JFM
is dismissed as moot.

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B.

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Dismissal of Case No. 2:01-cv-01718-FCD-JFM
Case

No.

2:01-cv-01718-FCD-JFM

does

not

seek

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declaratory or injunctive relief to enjoin enforcement of MERLO.

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Rather, “the City brought the . . . action against Uniguard . . .

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to establish whether there is coverage under Uniguard‟s contract

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of

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obtained against [its insureds].” (Id.) Therefore, it does not

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liability

insurance

for

[a]

state

court

judgment3

[Lodi]

The state court judgment was entered in a “state court civil enforcement
action” filed by the City against Uniguard‟s insureds “to obtain compliance
with” an administrative abatement order issued under MERLO. (Mem. & Order on
Uniguard‟s dismissal motion in Case No. 2:01-cv-01718-FCD-JFM 1:23-2:4, 3:1116; ECF No. 17.)

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appear the action became moot once MERLO was repealed. However,

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in light of the parties‟ referenced settlement of this action and

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agreement

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further action letter was obtained, (Proposed Judgment 2:12-18,

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3:11-12, ECF No. 168), this action is dismissed with prejudice.

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See Eitel v. McCool, 782 F.2d 1470, 1472-73 (9th Cir. 1986)

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(explaining

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parties had the requisite mutual intent to dismiss the action

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with prejudice” when the court “f[ound] that the parties‟ . . .

to

dismiss

that

this

“[t]he

the

court

with

prejudice

reasonably

court

agreeing

to

once

concluded

a

the

that

dismissal

no

the

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representations

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prejudice constituted a voluntary stipulated dismissal under Rule

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41(a)(1)(ii)”).

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to

action

with

The Clerk of the Court shall close Case No. 2:98-cv-

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01712-GEB-JFM and Case No. 2:01-cv-01718-FCD-JFM.

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Dated:

December 15, 2014

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