California Sportfishing Protection Alliance v. Cameron et al

Filing 23

MEMORANDUM AND ORDER signed by Judge William B. Shubb on 6/19/2012 DENYING 15 Defendant USA Waste's Motion to Dismiss, and DENYING 16 Defendants USA Waste and Steve Cameron's Joint Motion for Summary Judgment. (Kirksey Smith, K)

1
2
3
4
5
6
7
UNITED STATES DISTRICT COURT
8
EASTERN DISTRICT OF CALIFORNIA
9
----oo0oo---10
11
12

NO. CIV. 2:11-2663 WBS KJN

CALIFORNIA SPORTFISHING
PROTECTION ALLIANCE, a nonprofit corporation,

MEMORANDUM AND ORDER RE:
DEFENDANTS’ MOTION TO DISMISS
AND MOTION FOR SUMMARY
JUDGMENT

13
Plaintiff,
14
v.
15
16

USA WASTE OF CALIFORNIA, INC.
a Delaware corporation, and,
STEVE CAMERON, an individual,

17
18

Defendants.
___________________________/

19
----oo0oo----

20
21

Plaintiff California Sportfishing Protection Alliance

22

(“CSPA”) brought this action against defendants USA Waste of

23

California, Inc. (“USA Waste”) and Steve Cameron arising out of

24

defendants’ alleged violations of the Clean Water Act (“CWA”), 33

25

U.S.C. §§ 1251-1387.

26

motion to dismiss the First Amended Complaint (“FAC”) pursuant to

27

Federal Rule of Civil Procedure 12(b)(1) and 12(h)(3), (Docket

28

No. 37), and USA Waste and Cameron’s joint motion for summary

Presently before the court are USA Waste’s

1

1

judgment on all claims pursuant to Rule 56.

2

I.

Factual and Procedural Background

3

A.

4

CWA Notice and Delay Compliance
On August 9, 2011, plaintiff gave notice to Cameron,

5

Art Rasmussen, and “Waste Management of Nevada County” of alleged

6

violations of the CWA.1

7

Rasmussen were notified in their respective capacities as

8

District and Facility Managers at Waste Management of Nevada

9

County.

(Id.)

(FAC Ex. A (Docket No. 6).)

Cameron and

On August 10, 2011, a courtesy copy of the notice

10

was also emailed to USA Waste’s legal counsel.

11

Ex. A (Docket No. 18-1).)

12

(Packard Decl.

On August 24, 2011, USA Waste’s legal counsel notified

13

plaintiff that “Waste Management of Nevada County” was a trade

14

name for USA Waste.

15

served a second notice, specifically naming USA Waste as a party

16

liable for the CWA violations.

17

(Id. Ex. B.)

Later that day, plaintiff

(FAC Ex. B.)

USA Waste’s counsel, Mr. Kenefick, responded to the

18

notice served on USA Waste by email on September 7, 2011.

19

(Packard Decl. Ex. D.)

20

“assume[d] that the 60-day period will expire at the end of

21

October based on USA Waste’s receipt of the Notice on August

22

30th” and that he “intend[ed] to use the next 50 or so days to

23

complete [] assessment of [plaintiff’s] letter and the facility.”

24

(Id.)

In this email, Kenefick stated that he

25
1

26
27
28

Plaintiff further claims that it served notice on CT
Corporation System on August 9, 2011. (Pl.’s Mem. in Opp’n to
Def.’s Mot. to Dismiss at 2:13-16 (Docket No. 17);FAC Ex. A.)
During oral arguments, defendant disputed this claim and stated
that plaintiff did not attempt to serve CT Corporation System
with notice until August 22, 2011.
2

1

On October 8, 2011, sixty days after serving the

2

initial notice and forty-five days after serving the second

3

notice, plaintiff filed a complaint in federal court against

4

Cameron and Rasmussen alleging violations of the CWA.

5

No. 1.)

6

served its second notice, plaintiff filed its FAC, which added

7

USA Waste as a party to the action.

8

(Docket

On October 24, 2011, sixty-one days after plaintiff

B.

(Docket No. 6.)2

Parties’ Prior Litigation and Settlement Agreements
The parties have previously been engaged in litigation

9
10

regarding CWA violations at different facilities on at least four

11

separate occasions.3

12

No.19-3); Butler Decl. ¶¶ 4-7, Exs. E, G (Docket No. 16).)

13

November 2010, the parties entered into a consent agreement to

14

resolve litigation regarding USA Waste’s North Valley facility in

15

California Sportfishing Protection Alliance v. USA Waste of

16

California, Inc., Case No. 2:10-CV-01096-GEB-KJN (E.D. Cal.)

17

(“North Valley”).

18

language:

19
20
21
22

(Lozeau Decl. ¶¶ 3-4, Exs. A, B (Docket
In

The consent agreement includes the following

14. CSPA Waiver and Release. Upon Court approval and
entry of this Consent Agreement, CSPA, on its own behalf
and on behalf of its members, subsidiaries, successors,
assigns,
directors,
officers,
agents,
attorneys,
representatives, and employees, releases Defendants and
their officers, directors, employees, shareholders,
parents, subsidiaries, and affiliates, and each of their

23
2

24
25

Rasmussen was not listed as a defendant in the FAC
because he was no longer employed by USA Waste. (Def.’s Reply in
Supp. of Mot. to Dismiss at 7:16-17 (Docket No. 20).)
3

26
27
28

Defendants raise fifteen evidentiary objections to
statements regarding the parties’ prior consent agreements
contained in the Declarations of Andrew Packard and Michael
Lozeau. (Docket No. 21-2.) Because the court does not rely on
any of the evidence objected to by defendants, the objections are
overruled as moot.
3

1

predecessors, successors, and assigns, and each of their
agents, attorneys, consultants, and other representatives
(each a “Released Defendant Party”) from, and waives all
claims which arise or could have arisen from or pertain
to the Action, including, without limitation, all claims
for injunctive relief, damages, penalties, fines,
sanctions, mitigation, fees (including fees of attorneys,
experts, and others), costs, expenses or any other sum
incurred or claimed or which could have been claimed in
this Action, for the alleged failure of USA Waste to
comply with the Clean Water Act and Proposition 65 at the
Facility, up to the Effective Date of this Consent
Decree.
During the term of the Consent Agreement, CSPA
agrees that neither CSPA, its officers, executive staff,
or members of its governing board nor any organization
under the control of CSPA, its officers, executive staff,
or member of its governing board, will file any lawsuit
against USA Waste seeking relief for alleged violations
of the Clean Water Act, General Permit or Proposition 65.

2
3
4
5
6
7
8
9
10
11
12

(Butler Decl. Ex. E (“North Valley Consent Agreement”) ¶ 14.)

13

The North Valley Consent Agreement term expires on September 30,

14

2012.

15

II.

16

(Id. ¶ 18.)
Legal Standards
A.

17

Motion to Dismiss
Rule 12(h)(3) of the Federal Rules of Civil Procedure

18

provides that “[i]f the court determines at any time that it

19

lacks subject-matter jurisdiction, the court must dismiss the

20

action.”

21

Rule 12(h)(3) motion and a Rule 12(b)(1) motion is simply that

22

the former may be asserted at any time and need not be responsive

23

to any pleading of the other party.”

24

M.V. Hakusan II, 954 F.2d 874, 880, n.3 (3d Cir. 1992); see also

25

Kairy v. SuperShuttle Int’l, Inc., 721 F. Supp. 2d 884, 885 (N.D.

26

Cal. 2009) (applying a single standard to a motion to dismiss

27

pursuant to Rules 12(b)(1) and 12(h)(3)).

28

Fed. R. Civ. P. 12(h)(3).

“The distinction between a

Berkshire Fashions, Inc. v.

Under Federal Rule of Civil Procedure 12(b)(1), a
4

1

complaint must be dismissed once it is determined that a court

2

lacks subject matter jurisdiction to adjudicate the claims.

3

R. Civ. P. 12(b)(1).

4

until the party asserting jurisdiction proves otherwise, and,

5

once subject matter jurisdiction has been challenged, the burden

6

of proof is placed on the party asserting that jurisdiction

7

exists.

8

376 (1994);

9

(holding that “the party seeking to invoke the court’s

Fed.

The court presumes a lack of jurisdiction

Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375,
Scott v. Breeland, 792 F.2d 925, 927 (9th Cir. 1986)

10

jurisdiction bears the burden of establishing that jurisdiction

11

exists”).

12

Ordinarily, when a Rule 12(b)(1) motion is ruled upon,

13

“no presumptive truthfulness attaches to plaintiff’s allegations,

14

and the existence of disputed material facts will not preclude

15

the trial court from evaluating for itself the merits of

16

jurisdictional claims.”

17

1074, 1077 (9th Cir. 1983) (quoting Thornhill Publ’g Co. v. Gen.

18

Tel. Corp., 594 F.2d 730, 733 (9th Cir. 1979)).

19

free to “review any evidence, such as affidavits and testimony,

20

to resolve factual disputes concerning the existence of

21

jurisdiction.”

22

Cir. 1988).

23

B.

24

Augustine v. United States, 704 F.2d

The court is

McCarthy v. United States, 850 F.2d 558, 560 (9th

Summary Judgment
Summary judgment is proper “if the movant shows that

25

there is no genuine dispute as to any material fact and the

26

movant is entitled to judgment as a matter of law.”

27
28
5

Fed. R. Civ.

1

P. 56(a).4

2

of the suit, and a genuine issue is one that could permit a

3

reasonable jury to enter a verdict in the non-moving party’s

4

favor.

5

(1986).

6

burden of establishing the absence of a genuine issue of material

7

fact and can satisfy this burden by presenting evidence that

8

negates an essential element of the non-moving party’s case.

9

Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986).

A material fact is one that could affect the outcome

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
The party moving for summary judgment bears the initial

10

Alternatively, the moving party can demonstrate that the

11

non-moving party cannot produce evidence to support an essential

12

element upon which it will bear the burden of proof at trial.

13

Id.

14

Once the moving party meets its initial burden, the

15

burden shifts to the non-moving party to “designate ‘specific

16

facts showing that there is a genuine issue for trial.’”

17

324 (quoting then-Fed. R. Civ. P. 56(e)).

18

the non-moving party must “do more than simply show that there is

19

some metaphysical doubt as to the material facts.”

20

Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986).

21

“The mere existence of a scintilla of evidence . . . will be

22

insufficient; there must be evidence on which the jury could

23

reasonably find for the [non-moving party].”

24

at 252.

Id. at

To carry this burden,

Matsushita

Anderson, 477 U.S.

In deciding a summary judgment motion, the court must

25
26
4

27
28

Federal Rule of Civil Procedure 56 was revised and
rearranged effective December 1, 2010. However, as stated in the
Advisory Committee Notes to the 2010 Amendments to Rule 56,
“[t]he standard for granting summary judgment remains unchanged.”
6

1

view the evidence in the light most favorable to the non-moving

2

party and draw all justifiable inferences in its favor.

3

255.

4

and the drawing of legitimate inferences from the facts are jury

5

functions, not those of a judge . . . ruling on a motion for

6

summary judgment . . . .”

7

III. Discussion

8
9

Id. at

“Credibility determinations, the weighing of the evidence,

A.

Id.

Motion to Dismiss
The Clean Water Act (“CWA”) authorizes citizen suits

10

under 33 U.S.C. § 1365(1).

11

33 U.S.C. § 1365(b)(1)(A), authorizes citizen suits with the

12

following limitation: “No action may be commenced prior to sixty

13

days after the plaintiff has given notice of the alleged

14

violation . . . to any alleged violator of the standard,

15

limitation, or order.”

16

“such a manner as the Administrator [of the EPA] shall prescribe

17

by regulation.”

18

regulation states that the 60-day notice must include information

19

sufficient to allow the alleged violator

20
21
22
23
24
25

The subsection that is relevant here,

The required notice must be given in

33 U.S.C. § 1365(b).

The corresponding federal

to identify the specific standard, limitation, or order
alleged to have been violated, the activity alleged to
constitute a violation, the persons or person responsible
for the alleged violation, the location of the alleged
violation, the date or dates of such violation, and the
full name, address, and telephone number of the person
giving notice.
40 C.F.R. § 135.3(a).
In Hallstrom v. Tillamook County, 493 U.S. 20 (1989),

26

the United States Supreme Court addressed the 60-day notice

27

requirement as it applied to citizen suits under the Resource

28

Conservation and Recovery Act of 1976 (“RCRA”).
7

The Court held

1

that “the notice and 60-day delay requirements are mandatory

2

conditions precedent to commencing suit under the RCRA citizen

3

suit provision.”

4

district court may not disregard these requirements at its

5

discretion,” id., and that when a citizen suit fails to meet the

6

notice and 60-day delay requirement, “the district court must

7

dismiss the action as barred by the terms of the statute.”

8

at 33.

9

Id. at 31.

The Court further held that “a

Id.

The Ninth Circuit Court of Appeals extended Hallstrom’s

10

holding to the notice and delay provision of the CWA, which

11

imposes similar statutory notice and delay requirements.

12

Waterkeepers N. Cal. v. AG Indus. Mfg., Inc., 375 F.3d 913, 916

13

(9th Cir. 2004); Natural Res. Def. Council v. Sw. Marine, Inc.,

14

236 F.3d 985, 995 (9th Cir. 2000).

15

provision of the CWA is a jurisdictional prerequisite to filing

16

suit, and failure to strictly comply with the notice requirement

17

acts as an absolute bar to bringing a citizen suit under the CWA.

18

Sw. Marine, Inc., 236 F.3d at 995.

19

suit notice requirements cannot be avoided by employing a

20

‘flexible or pragmatic construction.’”

21

Badgley, No. 02-5376, 2002 WL 43236869, at *7 (E.D. Cal. Oct. 10,

22

2002) (quoting Hallstrom, 493 U.S. at 26).

See

Compliance with this

Accordingly, “[t]he citizen

Kern Cnty. Farm Bureau v.

The legislative policy underlying the notice and delay

23
24

requirement is that it affords the alleged violator an

25

opportunity to bring itself into compliance with the CWA, as well

26

as giving the enforcer of first resort, the EPA or the

27

appropriate state agency, time to institute an enforcement

28

action.

See Hallstrom, 493 U.S. at 26.
8

“The provision therefore

1

provides an opportunity for settlement or other resolution of a

2

dispute without litigation.”

3

v. U.S. Bureau of Reclamation, 143 F.3d 515, 520 (9th Cir. 1998)

4

(quoting Forest Conservation Council v. Espy, 835 F. Supp. 1202,

5

1210 (D. Idaho 1993)).

6

sufficiently specific to inform the alleged violator about what

7

it is doing wrong, so that it will know what corrective actions

8

will avert a lawsuit.”

9

(quoting Atl. States Legal Found., Inc. v. Stroh Die Casting Co.,

10
11

Sw. Cntr. for Biological Diversity

“In practical terms, the notice must be

Sw. Marine, Inc., 236 F.3d at 996

116 F.3d 814, 819 (7th Cir. 1997)).
In this case, plaintiff served two separate notices on

12

defendants -- the first on August 9, 2011, naming Cameron as a

13

defendant and the second on August 24, 2011, naming USA Waste.

14

Plaintiff similarly filed two separate versions of the complaint,

15

each filed sixty days or more after the relevant notice.

16

parties dispute whether plaintiff “commenced” this action against

17

USA Waste pursuant to § 1365(b)(1)(A) when it filed its original

18

complaint against Cameron on October 8, 2011, or when it filed

19

its FAC, in which USA Waste was named as a defendant for the

20

first time.

21

The

An action alleging violations of the CWA is “commenced”

22

when the CWA claim appears in the complaint.

See Zands v.

23

Nelson, 779 F. Supp. 1254, 1258 (S.D. Cal. 1991); College Park

24

Holdings, LLC v. Racetrac Petroleum, Inc., 239 F. Supp. 2d 1322,

25

1330 (N.D. Ga. 2002).

26

situation because the claims for violations of the CWA appear in

27

the original complaint, but USA Waste was not a party to the

28

suit, and therefore the CWA claims, until the FAC.

This case presents an unusual factual

9

The parties

1

have not provided, and the court is unable to find, any authority

2

that addresses how the notice and delay requirement should be

3

applied when a defendant is added to a suit through an amended

4

complaint.

5

developed areas of caselaw regarding the CWA’s notice and delay

6

requirements.

7

This case instead appears to fall between two

On the one hand, when an amended complaint merely

8

reiterates the claims in the original complaint in an attempt to

9

remedy the original complaint’s failure to comply with the notice

10

and delay requirement, courts have held that the action was

11

“commenced” on the date the original complaint was filed.

12

Envirowatch, Inc. v. Fukino, No. 07-00016, 2007 WL 1933132, at *3

13

(D. Haw. June 28, 2007) (“This court has found no case decided

14

after Hallstrom in which the court looked to the amended

15

complaint, rather than the original complaint, in determining

16

whether a plaintiff had satisfied the sixty-day notice provision

17

. . . when the two complaints contain the same claims.”); K.C.

18

1986 P’ship v. Reade Mfg., 33 F. Supp. 2d 1143, 1155-56 (W.D. Mo.

19

1998); cf. Hallstrom, 493 U.S. at 29 (holding that a stay

20

intended to remedy plaintiff’s failure to comply with the notice

21

and delay requirement as to notifying the EPA could not be used

22

to remedy plaintiff’s deficient original complaint).

23

cases, the fact that the notice and delay requirement was not met

24

in the original complaint was critical because it meant that the

25

court did not have subject matter jurisdiction over the case when

26

it was originally filed.

27

*3.

28

because USA Waste does not challenge the court’s jurisdiction

See

In these

See Envirowatch, 2007 WL 1933132, at

These cases are distinguishable from the present case

10

1

over the claims pled in the original complaint, but instead

2

argues that the court lacks jurisdiction over the claims pled

3

against USA Waste in the FAC.

4

On the other hand, courts have held that for the

5

purposes of determining compliance with a notice and delay

6

provision relating to a claim that appears for the first time in

7

the amended complaint, the court should look to the filing of the

8

amended complaint to determine when the action was commenced.

9

See id. at *4 (“After Hallstrom, courts have consistently held

10

that jurisdiction may be based on an amended complaint filed more

11

than sixty days after the notice of intent to sue only if the

12

claim requiring sixty-day notice is brought for the first time in

13

the amended complaint.”); Zands, 779 F. Supp. at 1259; College

14

Park Holdings, 239 F. Supp. 2d at 1330.

15

CWA claims are raised in the original complaint and the FAC, the

16

FAC is the first time that USA Waste was named in the pleadings

17

and therefore the first time that the CWA claims were brought

18

against it.

19

similar to those in the line of cases permitting amendment to

20

plead new claims.

21

Here, although the same

The circumstances in this case therefore appear more

“‘Absent a clearly expressed legislative intention to

22

the contrary,’ the words of the statute are conclusive.”

23

Hallstrom, 493 U.S. at 28 (quoting Consumer Prod. Safety Comm’n

24

v. GTE Sylvania, Inc., 447 U.S. 102, 108 (1980)).

25

the Court noted that strict compliance with the notice and delay

26

requirement would “further the congressional purpose of giving

27

agencies and alleged violators a 60-day nonadversarial period to

28

achieve compliance with RCRA regulations.”
11

In Hallstrom,

Id. at 32.

Although

1

USA Waste was not a party to the original complaint, it argues

2

that because the CWA claims allege violations at its facilities

3

and against its employee, the filing of the original complaint

4

effectively raised claims against it and prematurely ended the

5

nonadversarial sixty-day period intended under § 1365(b)(1)(A).

6

Section 1365(b)(1)(A) makes no reference to the purpose

7

of the notice and delay requirement being to allow the parties to

8

have a nonadversarial period before suit is filed.

9

the Hallstrom Court’s discussion of the legislative purpose of

Relying on

10

the notice and delay requirement, some courts have held that the

11

relationship between the parties must remain nonadversarial

12

during the delay period.

13

Pollution, Inc. v. Heritage Grp., 760 F. Supp. 1338, 1342 (N.D.

14

Ind. 1991).

15

bring multiple claims, only some of which are subject to a notice

16

and delay requirement, the plaintiff should be allowed to proceed

17

with those claims that are not subject to a notice and delay

18

requirement without forfeiting their right to bring those claims

19

that are.

20

position is predicated upon the opinion that “[e]ven in the face

21

of other causes of action, alleged . . . violators still have the

22

opportunity, and the incentive, to take measures to stop

23

commencement of the . . . citizen suit action which has not yet

24

been added to the lawsuit.”

25

nonadversarial period is mandated would require the court to hold

26

that a complaint could never be amended to bring an otherwise

27

properly noticed CWA claim.

28

See, e.g., Supporters to Oppose

Others have held that where a plaintiff seeks to

See, e.g., Zands, 779 F. Supp. at 1259-60.

Id. at 1257.

The latter

A finding that a

Assuming for the purpose of this order that § 1365
12

1

requires a nonadversarial period, USA Waste fails to show that

2

such a period was lacking here.

3

claims against it in the FAC relate back to the original

4

complaint such that it was effectively being sued when the first

5

complaint was filed.

6

to defend and indemnify Cameron under his employment agreement,

7

it could not have been held liable as an entity under the

8

original complaint.

9

directly contradict its position in opposition to plaintiff’s

USA Waste never argues that the

Although USA Waste may have been obligated

USA Waste’s suggestions to the contrary

10

request to amend the FAC to allege that USA Waste received actual

11

notice of the proposed CWA claims on August 9, 2011, when Cameron

12

was served notice.

13

original complaint commenced a suit against it,

14

that the August 9, 2011, notice sufficiently alerted it to

15

plaintiff’s proposed CWA claims.5

16

exclusion of USA Waste from the August 9, 2011, notice rendered

17

that notice insufficient, then the original complaint similarly

18

would have been insufficient to commence an action against it.

19

Under either scenario, plaintiff fulfilled its notice and delay

20

obligation pursuant to § 1365(b)(1)(A) because it waited at least

21

sixty days after each notice before filing the respective

22

complaint.

If the

then it follows

Conversely, if the nominal

Consistent with the purpose of the notice delay

23
24

USA Waste cannot have it both ways.

requirement, USA Waste retained an incentive to avoid litigation

25
26
27
28

5

The court in Two Rivers Terminal, L.P. v. Chevron USA
Inc., 96 F. Supp. 2d 426 (M.D. Pa. 2000), suggested that actual
notice was sufficient to fulfil § 1365(b)(1)(A)’s notice
requirement. Id. at 431. In that case, plaintiff inadvertantly
served the notice upon defendant’s parent corporation.
13

1

on the CWA claims against it up until the moment that it was

2

named as a defendant in the present suit.

3

Biological Diversity, 143 F.3d at 520.

4

period leading up to the filing of the FAC, USA Waste was free to

5

negotiate with plaintiff and avoid suit by remedying the alleged

6

violations at its facility.

7

plaintiff followed the letter of the law and the court has

8

subject matter jurisdiction over this action.

9

court will deny USA Waste’s motion to dismiss.6

10
11

B.

See Sw. Cntr. for

During the sixty-day

It appears to the court that

Accordingly the

Motion for Summary Judgment
Under California law, a party alleging promissory

12

estoppel must show: (1) the existence of a promise “clear and

13

unambiguous in its terms”; (2) “reliance by the party to whom the

14

promise is made”; (3) that any reliance was both “reasonable and

15

foreseeable”; and (4) that the party asserting the estoppel was

16

injured by his reliance.

17

App. 4th 887, 901 (4th Dist. 2005) (quoting Laks v. Coast Fed.

18

Sav. & Loan Ass’n, 60 Cal. App. 3d 885, 890 (2d Dist. 1976)).

19

Defendants argue that plaintiff is estopped from bringing the

20

present suit pursuant to its waiver in paragraph 14 of the

21

parties’ prior North Valley Consent Agreement.

US Ecology, Inc. v. State, 129 Cal.

22

“The fundamental rules of contract interpretation are

23

based on the premise that the interpretation of a contract must

24

give effect to . . . ‘the mutual intention of the parties at the

25
26
27
28

6
Because the court finds that plaintiff did not violate
the notice and delay provision of the CWA when it filed its FAC,
the court need not address plaintiff’s request to amend the FAC
to allege that USA Waste received actual notice on August 9 when
plaintiff mistakenly served “Waste Management of Nevada County,”
which is a trade name of USA Waste. (Packard Decl. Ex. B.)

14

1

time the contract is formed . . . .’”

Waller v. Truck Ins.

2

Exch., Inc., 11 Cal. 4th 1, 18 (1995) (quoting Cal. Civ. Code §§

3

1636, 1639).

4

properly interpret a contract as a matter of law only if the

5

meaning of the contract is unambiguous.

6

Prods., Inc., 454 F.3d 975, 990 (9th Cir. 2006) (citation

7

omitted).

On a motion for summary judgment, a court may

Miller v. Glenn Miller

Language in a contract must be construed in light of

8
9

the instrument as a whole and in the circumstances of the case.

10

Monaco v. Bear Stearns Residential Mortg. Corp., 554 F. Supp. 2d

11

1034, 1040 (C.D. Cal. 2008).

12

reasonably susceptible of more than one application to material

13

facts.”

Dore v. Arnold Worldwide, Inc., 39 Cal. 4th 384, 391

14

(2006).

When a contract provision is ambiguous, therefore,

15

“ordinarily summary judgment is improper because differing views

16

of the intent of parties will raise genuine issues of material

17

fact.”

18

1993) (quoting United States v. Sacramento Mun. Util. Dist., 652

19

F.2d 1341, 1344 (9th Cir. 1981)).

20

Language is ambiguous if it “is

Maffei v. N. Ins. Co. of N.Y., 12 F.3d 892, 898 (9th Cir.

Although the parol evidence rule prohibits the use of

21

extrinsic evidence where the contract “is intended to be a final

22

expression of that agreement and a complete and exclusive

23

statement of the terms,” extrinsic evidence is admissible to

24

explain or interpret ambiguous language.

25

LLC v. Goldentree Asset Mgmt., LP, 201 Cal. App. 4th 368, 376 (2d

26

Dist. 2011) (citing Cal. Code Civ. Proc. § 1856(b), (d)).

27

there is no material conflict over extrinsic evidence, the court

28

may interpret an ambiguous term as a matter of law.
15

Lonely Maiden Prods.,

If

Id. at 377.

1

Summary judgment is inappropriate, however, if the court cannot

2

determine the parties’ intent at the time of contracting without

3

judging the credibility of the extrinsic evidence.

4

Hope Nat. Med. Ctr. v. Genentech, Inc., 43 Cal. 4th 375, 395

5

(2008).

6

See City of

The contract dispute in this case concerns the

7

interpretation of the phrase, “During the term of the Consent

8

Agreement, CSPA agrees that neither CSPA, its officers, executive

9

staff, or members of its governing board . . . will file any

10

lawsuit against USA Waste seeking relief for alleged violations

11

of the Clean Water Act . . . .”

12

¶ 14.)

13

filing suit against USA Waste for CWA violations at any of its

14

facilities until September 2012.

15

Defs.’ Mot. for Summ. J. at 1:12-14 (Docket No. 16-1).)

16

Plaintiff counters that the clause only bars it from bringing

17

suit against USA Waste for CWA violations at the North Valley

18

facility, which was the subject of the Consent Agreement, and

19

that it does not bar actions against other facilities owned or

20

operated by USA Waste.

21

at 1:6-11 (Docket No. 19).)

22

(North Valley Consent Agreement

Defendants argue that this clause bars plaintiff from

(Mem. of P. & A. in Supp. of

(Pl.’s Mem. in Opp’n to Mot. for Summ. J.

The court begins by evaluating whether the disputed

23

contract term is unambiguous.

When read in isolation, the

24

dispute term neither specifies that the waiver is limited to the

25

North Valley facility, nor does it specify that it extends to

26

other facilities owned by USA Waste.

27

the context of the agreement as a whole, the court would likely

28

conclude that the provision serves to bar plaintiff from bringing
16

Absent knowledge regarding

1

any suit against USA Waste for the term period.

2

interpretation of statutes, however, contract provisions should

3

not be read in isolation but must be construed in light of the

4

instrument as a whole.

5

a contract is to be taken together, so as to give effect to every

6

part, if reasonably practicable, each clause helping to interpret

7

the other.”); Monaco, 554 F. Supp. 2d at 1040.

8
9

Like the

See Cal. Civ. Code § 1641 (“The whole of

The contested term comprises the second paragraph of
paragraph fourteen of the Consent Agreement, which is titled

10

“CPSA Waiver and Release.”

11

fourteen “releases [USA Waste] from, and waives all claims which

12

arise or could have arisen from or pertain to the Action” based

13

on “the alleged failure of USA Waste to comply with the Clean

14

Water Act . . . at the Facility.”

(North Valley Consent

15

Agreement ¶ 14 (emphasis added).)

Read in its entirety,

16

plaintiff urges the court to interpret paragraph fourteen’s

17

waiver and release to only apply to claims arising from CWA

18

violations at the North Valley facility with the first paragraph

19

releasing the claims that plaintiff raised in the contested

20

action, and the second paragraph limiting plaintiff from filing

21

additional claims related to the facility during the consent

22

agreement term.

23

The first paragraph of paragraph

Plaintiff argues that interpreting paragraph fourteen

24

in light of the entire Consent Agreement lends itself to a

25

similar conclusion.

26

Agreement outline USA Waste’s obligations under the agreement.

27

USA Waste’s obligations under each paragraph specify that they

28

are limited to actions and obligations taken with regard to the

Paragraphs one through nine of the Consent

17

1

North Valley facility.

(See, e.g., id. ¶ 1 (USA Waste “shall

2

commence all measures needed to operate the Facility in full

3

compliance with the General Permit and the Clean Water Act”)

4

(emphasis added); id. ¶ 2 (USA Waste shall “improve the

5

effectiveness of the Facility’s existing infiltration basin” and

6

“install Triton Cartridge filters in all Facility storm water

7

drains”) (emphasis added); id. ¶ (“USA Waste shall amend the SWPP

8

for the Facility”) (emphasis added).)

9

Defendants rely on the principal of contract

10

interpretation that “[w]hen one part of a statute contains a term

11

or provision, the omission of that term or provision from another

12

part of the statute indicates the Legislature intended to convey

13

a different meaning.”

14

J. at 4:10-13 (quoting Klein v. United States, 50 Cal. 4th 68, 80

15

(2010)).)

16

Agreement to the North Valley facility suggests that the parties

17

were capable of limiting the contract’s terms to the facility

18

when they so desired.

19

specify that it was limited to the North Valley facility,

20

defendants claim that the parties clearly intended the waiver

21

provision to apply more generally to suits against USA Waste at

22

any of its facilities.

23

no need for plaintiff to sue USA Waste for further violations at

24

the North Valley facility because the consent agreement outlined

25

dispute resolution procedures.

26

(Defs.’ Reply in Supp. of Mot. for Summ.

They argue that the specificity of the Consent

Because the contested term does not

Defendants further argue that there was

(Id. at 5:21-28.)

The contested term therefore appears to be open to two

27

reasonable interpretations.

Because the term is ambiguous, under

28

California law the court must consider relevant extrinsic
18

1

evidence that can prove a meaning to which the contract is

2

reasonably susceptible to determine the intention of the parties.

3

United States v. King Features Entm’t, Inc., 843 F.2d 394, 398

4

(9th Cir. 1988).

5

The parties have an extensive litigation history and

6

have entered into three consent agreements other than the North

7

Valley Consent Agreement.

8

of them were drafted and signed prior to the North Valley Consent

9

Agreement and contain language that is identical to the

Of these three consent agreements, two

10

applicable language in this case with the exception that the

11

agreements also release claims “known and unknown” under

12

California Civil Code section 1542.

13

B.)

14

North Valley Consent Agreement and explicitly limits plaintiff’s

15

waiver to claims arising out of the facility.

16

G ¶ 15.)

17

during the term of a consent agreement and thus the

18

interpretation of the subject provision has not yet been

19

addressed by the parties or the court.

20

Mot. for Summ. J. at 8:18-20.)

21

light on what the parties intended in the North Valley Consent

22

Agreement and do not provide the court with assistance in

23

interpreting the contested term.

(Lozeau Decl. ¶ 5, Exs. A,

The third consent agreement was signed six months after the

(Butler Decl. Ex.

This case is the first action that has been filed

24

(Def.’s Reply in Supp. of

None of these agreements shed

“Interpretation of a written instrument becomes solely

25

a judicial function only when it is based on the words of the

26

instrument alone, when there is no conflict in the extrinsic

27

evidence, or when a determination was made based on incomplete

28

evidence.”

City of Hope Nat’l Med. Cntr., 43 Cal. 4th at 395.
19

1

The court may properly interpret the contract in this case

2

because it does so based on the words of the instrument alone.

3

In determining which inference is more reasonable, the

4

court is persuaded that the more reasonable interpretation is

5

that the parties’ obligations in the North Valley Consent

6

Agreement were limited to the North Valley facility.

7

of the consent agreement was to resolve the claims arising out of

8

plaintiff’s legal action in that case and the most logical

9

conclusion is that the obligations would be similarly limited.

The purpose

10

The North Valley Consent Agreement dispute resolution procedures

11

only extended to USA Waste’s conduct at the North Valley facility

12

and did not provide plaintiff with any monitoring or redress for

13

CWA violations occurring at USA Waste’s other facilities.

14

more reasonable interpretation of the contested provision when

15

read in light of the entire contract is that plaintiff did not

16

forebear from bringing suit against other facilities.

17

contested provision was intended by the parties to waive

18

plaintiff’s right to sue USA Waste at any of its facilities for

19

the term period, the court would expect the provision to be more

20

specific and thoroughly discussed.

21

at the end of a paragraph which, for the most part, limited its

22

waiver and release obligations to the North Valley facility.

23

Accordingly, the court will deny defendants’ motion for summary

24

judgment.

25
26
27
28

The

If the

The term was instead buried

IT IS THEREFORE ORDERED that defendant USA Waste’s
motion to dismiss be, and the same hereby is, DENIED.
IT IS FURTHER ORDERED that defendants USA Waste and
Cameron’s joint motion for summary judgment be, and the same
20

1

hereby is, DENIED.

2 DATED:

June 19, 2012

3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
21