KFD Enterprises Inc v. City of Eureka

Filing 690

ORDER by Judge Samuel Conti denying 672 Motion for Summary Judgment; granting in part and denying in part 674 Motion for Summary Judgment (sclc1, COURT STAFF) (Filed on 5/9/2014)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

United States District Court

For the Northern District of California

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KFD ENTERPRISES, INC.,

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Plaintiff,

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v.

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CITY OF EUREKA, et al.

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Defendants.

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) Case No. 08-cv-04571-SC
)
) ORDER ON CROSS MOTIONS FOR
) SUMMARY JUDGMENT
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I. INTRODUCTION
Now before the Court are Defendant City of Eureka's ("Eureka")

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and Plaintiff KFD Enterprises, Inc.'s ("KFD") cross motions for

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summary judgment.

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684, 674, 683, 684, and appropriate for determination without oral

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argument per Civil Local Rule 7-1(b).

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below, Defendant Eureka's motion for summary judgment is DENIED.

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Plaintiff KFD's motion for summary judgment is GRANTED in part and

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DENIED in part.

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//

The motion is fully briefed, ECF Nos. 672, 675,

For the reasons set forth

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II. BACKGROUND
This case arises out of environmental contamination that

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cleaning business, Norman's Dry Cleaners ("Norman's"), there since

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1980.

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tetrachloroethylene ("PCE") during the dry cleaning process and

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disposed of wastewater containing PCE through drains on its

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United States District Court

occurred at 2907 E St., Eureka, California.

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For the Northern District of California

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property.

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is now contaminated with PCE, and the California Regional Water

ECF No. 410 ("FAC") ¶¶ 5, 17.

Id. ¶ 22(3).

KFD has operated a dry

KFD used a chemical called

The soil and groundwater around Norman's

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Quality Control Board ("RWQCB"), North Coast Region, is overseeing

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investigation and cleanup of the site.

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II") Ex. B.

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contamination by failing to properly maintain its municipal sewers.

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KFD claims that PCE leaked out of the sewers, causing the

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contamination.

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ECF No. 675-26 ("KFD RJN

KFD asserts that Eureka contributed to the

ECF No. 675 ("KFD Opp.") at 1-2.

KFD brought this action under the federal Comprehensive

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Environmental Response, Compensation, and Liability Act ("CERCLA"),

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42 U.S.C. § 9601 et seq.; the federal Resource Conservation and

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Recovery Act ("RCRA"), 42 U.S.C. § 6901 et seq.; and the California

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Hazardous Substance Account Act ("HSAA"), Cal. Health & Safety Code

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§ 25300 et seq.

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contribution, public nuisance, public nuisance per se, private

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nuisance, dangerous condition of public property, and declaratory

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relief.

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the HSAA, as well as for equitable indemnity, contribution, and

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declaratory relief.

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KFD's claims.

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for partial summary judgment on its own RCRA claim and all of

KFD also sued Eureka for equitable indemnity,

FAC ¶¶ 32-102.

Eureka has counterclaimed under CERCLA and

Eureka moves for summary judgment on all of

ECF No. 672 ("Eureka MSJ") at 1-2.

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KFD has moved

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Eureka's counterclaims, except for its claim for contribution under

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CERCLA § 113(f).

ECF No. 674 ("KFD MSJ") at 1.

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III. LEGAL STANDARD

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

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is entitled to judgment as a matter of law."

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United States District Court

Entry of summary judgment is proper "if the movant shows that

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For the Northern District of California

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56(a).

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require a directed verdict for the moving party.

Fed. R. Civ. P.

Summary judgment should be granted if the evidence would
Anderson v.

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Liberty Lobby, Inc., 477 U.S. 242, 251 (1986).

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without the ultimate burden of persuasion at trial -- usually, but

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not always, a defendant -- has both the initial burden of

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production and the ultimate burden of persuasion on a motion for

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summary judgment."

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Cos., Inc., 210 F.3d 1099, 1102 (9th Cir. 2000).

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"A moving party

Nissan Fire & Marine Ins. Co., Ltd. v. Fritz

"In order to carry its burden of production, the moving party

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must either produce evidence negating an essential element of the

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nonmoving party's claim or defense or show that the nonmoving party

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does not have enough evidence of an essential element to carry its

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ultimate burden of persuasion at trial."

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its ultimate burden of persuasion on the motion, the moving party

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must persuade the court that there is no genuine issue of material

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fact."

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all justifiable inferences are to be drawn in his favor."

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Anderson, 477 U.S. at 255.

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scintilla of evidence in support of the plaintiff's position will

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be insufficient; there must be evidence on which the jury could

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reasonably find for the plaintiff."

Id.

Id.

"In order to carry

"The evidence of the nonmovant is to be believed, and

However, "[t]he mere existence of a

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Id. at 252.

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IV. DISCUSSION

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A.

Requests for Judicial Notice

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In their briefs, both parties have submitted requests for

I"), KFD RJN II, 683-1 ("Eureka RJN II").

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judicial notice are those which are either "(1) generally known

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within the territorial jurisdiction of the trial court or (2)

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United States District Court

judicial notice.

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For the Northern District of California

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ECF Nos. 672-8 ("Eureka RJN I"), 674-21 ("KFD RJN

capable of accurate and ready determination by resort to sources

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whose accuracy cannot reasonably be questioned."

Facts subject to

Fed. R. Evid.

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201(b).

A court may not take judicial notice of a matter that is

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in dispute.

Lee v. City of Los Angeles, 250 F.3d 668, 690 (9th

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Cir. 2001).

Eureka's first request for judicial notice refers only

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to an order issued by Judge Chesney in this case.

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in its request, that order is already part of the record.

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therefore unnecessary for the Court to take notice of the order.

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Eureka's second request for judicial notice was made in

As Eureka notes

Eureka RJN II.

It is

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support of its opposition to KFD's motion.

Eureka

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requests that the Court take notice of a series of letters from the

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RWQCB to Eureka.

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Eureka failed to produce the documents to be noticed in discovery.

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ECF No. 684 ("KFD Reply") at 4.

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these documents are matters of public record, so the objection is

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OVERRULED.

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that it received a copy of RWQCB's reimbursement process and an

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agreement that the city would participate in the cost recovery

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program.

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it appears to be undisputed that Eureka has agreed to reimburse

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some of RWQCB's costs, the Court takes judicial notice of Exhibit

KFD objects that the request is untimely and that

However, Eureka is correct that

The first letter (Ex. 1) is an acknowledgment by Eureka

Because the document is an act of the city government and

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1.

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to Norman's for the 2012/2013 fiscal year.

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only of the fact that these estimates were made.

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letter detailing suggested changes to a report prepared by an

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environmental consultant for Eureka's attorneys.

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notice only of the document's existence and that the findings and

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recommendations therein were made.

United States District Court

For the Northern District of California

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The second letter is an estimate of the RWQCB's costs related
The Court takes notice
Exhibit 3 is a

The Court takes

KFD's first request for judicial notice comes in support of
its motion.

The Court takes notice of Facts 2-5 and 8.

Facts 2-5

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refer to documents that have been filed publicly, and KFD requests

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only that the Court notice their existence.

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Fact 8 is a reference to the Code of Federal Regulations, and the

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Court takes notice of that fact as well.

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however, are technical documents and opinions, and KFD apparently

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seeks judicial notice of the facts contained therein.

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9 refer to documents issued by the RWQCB, a public agency.

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Court takes notice of those documents solely for the purpose of

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establishing that the RWQCB has made the findings or

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recommendations therein.

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considered established for the purposes of this litigation, as the

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Court is not persuaded that the expert findings are capable of

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immediate and accurate determination by a source whose accuracy

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cannot reasonably be questioned, or that they are not in dispute.

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Fact 7 refers to a draft remedial action plan prepared by an

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environmental consultant retained by KFD's attorneys on behalf of

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Norman's.

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document was submitted to the RWQCB and is therefore a matter of

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public record.

The Court does so.

Facts 1, 7, and 9,

Facts 1 and
The

The findings themselves are not

KFD argues that judicial notice is proper because the

However, submission of a document by a private

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an official act of that agency.

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contained in the report are in dispute, which alone renders the

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document inappropriate for judicial notice.

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only that the document exists, but takes no notice of its contents.

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Fact 5 is a reference to KFD's original complaint in this matter.

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Again, that document is already part of the record, and judicial

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United States District Court

party to a government agency does not transform the document into

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For the Northern District of California

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notice is unnecessary.

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Additionally, many of the facts

The Court takes notice

KFD's second request for judicial notice was made in support

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of its opposition to Eureka's motion.

KFD RJN II.

The Court takes

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notice of Facts 2, 3, 4, and 5.

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only insofar as it recognizes that the RWQCB has created a draft

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plan, but does not take notice of any of the facts contained

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therein.

The Court takes notice of Fact 1

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B.

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The parties have also made a number of evidentiary objections.

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KFD first objects to Exhibits 35, 38, 39, and 58 to the declaration

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of Charles Bolcom in support of Eureka's motion (ECF No.672-3) on

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grounds of lack of foundation and lack of personal knowledge.

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Opp. at 29-30.

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met the personal knowledge and foundational requirements by

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supplying deposition testimony.

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Evidentiary Objections

KFD

Eureka has provided the necessary foundation and

Those objections are OVERRULED.

In the same brief, KFD objects to the declaration of Bruce

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Young (ECF No. 672-2) as a sham declaration.

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the Ninth Circuit is that a party cannot create an issue of fact by

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an affidavit contradicting his prior deposition testimony."

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Kennedy v. Allied Mut. Ins. Co., 952 F.2d 262, 266 (9th Cir. 1991).

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"The general rule in

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The Ninth Circuit has added two additional requirements that must

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be met before a declaration can be stricken as a sham.

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district court must make a factual determination that the

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contradiction was actually a 'sham.'"

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inconsistency between a party's deposition testimony and subsequent

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affidavit must be clear and unambiguous . . . ."

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Int'l Game Tech., 577 F.3d 989, 998 (9th Cir. 2009).

United States District Court

For the Northern District of California

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Id. at 267.

First, "the

Second, "the

Van Asdale v.

KFD takes issue with Mr. Young's statement in his declaration
that "[i]f [KFD] had informed the City that it was disposing PCE

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and/or PCE waste into the City sewer system at any time, that

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information would be documented in a City record."

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4 (emphasis added).

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Mr. Young's deposition testimony that Eureka's record retention

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policy is "mostly current year plus two years."

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("Graben Decl.") Ex. E at 49:10-21.

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exhibit purported to contain Mr. Young's contradicted testimony is

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not even a deposition of Mr. Young.

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of Jan Greben, Exhibit C (ECF No. 675-4), which is a deposition of

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David Parson and includes no discussion of the issue.

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at 30.

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(ECF No. 675-6), which appears to be the correct deposition of Mr.

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Young.

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ECF No. 672-2 ¶

KFD asserts that that statement contradicts

ECF No. 675-1

The Court first notes that the

KFD cites to the declaration

See KFD Opp.

The Court presumes that KFD intended to refer to Exhibit E

The Court finds that paragraph four of Mr. Young's declaration

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is a sham.

Mr. Young's declaration was made in March 2014.

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deposition testimony indicates that Eureka keeps records for the

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current year, plus two years.

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most of the conduct giving rise to this case occurred between 1980

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and 2003, it seems highly unlikely that Eureka would have a record

That means 2012-2014.

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His

Given that

policy.

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would have a record of KFD informing it about the PCE at any time,

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which is clearly contrary to the city's retention policy.

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response, Eureka claims that the city records vary by circumstance.

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However, the only exception to the current year plus two year

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policy that Mr. Young notes in his deposition is for maps.

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United States District Court

of the type Mr. Young discusses if the city follows its retention

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For the Northern District of California

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Decl. Ex. E at 49:16.

Indeed, Mr. Young claims in his declaration that Eureka

In

Graben

Mr. Young's assertion that Eureka would retain a record

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indefinitely clearly and unambiguously contradicts his deposition

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testimony that Eureka typically retains only a few years of

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records.

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a record of the type he discusses is inexplicable except as an

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attempt to create an issue of material fact by contradicting his

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deposition testimony.

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objection and STRIKES paragraph four of Mr. Young's declaration.

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However, KFD's objection on the same grounds to paragraph five of

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the declaration, which states that Mr. Young was unable to find

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such a document in his search of the city records, is OVERRULED.

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That statement does not contradict his deposition testimony.

Mr. Young's conclusive statement that the city would have

Accordingly, the Court SUSTAINS KFD's

KFD also objects to the declaration of Eric Price, ECF No.

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674-15, and Exhibit 1 thereto.

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corresponding exhibit, deals only with an element of KFD's RCRA

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claim that does not affect the Court's analysis of these motions.

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Consequently, the Court declines to rule on that objection at this

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time.

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This objection, and the

Eureka objects to all of the exhibits attached to the
declaration of Brett Boon (ECF No. 674-2 Exs. A-N) in support of

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hearsay.

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based on lack of personal knowledge are OVERRULED.

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hearsay objections, it appears from Eureka's brief that it objects

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to the testimony of Mr. Young and Mr. Parson during their

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depositions as hearsay.

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survive summary judgment, a party does not necessarily have to

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United States District Court

KFD's motion on the grounds of lack of personal knowledge and

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For the Northern District of California

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produce evidence in a form that would be admissible at trial, as

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long as the party satisfies the requirements of Federal Rules of

ECF No. 683 ("Eureka Opp.") at 23-24.

The objections
Regarding the

Those objections are OVERRULED.

"To

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Civil Procedure 56."

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418–19 (9th Cir. 2001).

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admissible form of the evidence that KFD could present at trial.

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Block v. City of Los Angeles, 253 F.3d 410,
The live testimony of the deponents is an

Finally, Eureka objects to certain invoices detailing payments

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owed by KFD to its environmental consultant.

That objection is

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disposed of in the fuller discussion of that evidence in Part

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IV.C.2, below.

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C.

KFD's CERCLA Claims

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CERCLA provides for recovery of "necessary costs of response"

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(known as response costs) from certain potentially responsible

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parties ("PRPs") for releases of hazardous substances.

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9607(a).

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must prove that (1) the site at issue is a "facility" as defined in

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the law; (2) a release or threatened release of hazardous materials

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from the facility has occurred; and (3) the plaintiff incurred

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response costs "consistent with the national contingency plan"

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("NCP") as a result.

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F.2d 1149, 1152 (9th Cir. 1989).

42 U.S.C. §

To establish liability under that provision, a plaintiff

Ascon Properties, Inc. v. Mobil Oil Co., 866
Each party has moved for summary

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judgment on the other's CERCLA claims.
1.

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Potentially Responsible Party

CERCLA provides for recovery of response costs from four

facility; (2) a past owner or operator of a facility; (3) a person

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who arranged for disposal, treatment, or transport of a hazardous

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substance; and (4) any person who accepts hazardous substances for

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United States District Court

classes of "PRPs": (1) the current owner and operator of a

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For the Northern District of California

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transport to disposal or treatment facilities.

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9607(a).

42 U.S.C. §

KFD claims that Eureka is liable as a transporter under

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subsection (4), as an arranger under subsection (3), and as an

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owner or operator of the sewer system (also potentially a CERCLA

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facility) under subsection (1).

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focus on Eureka's status as an arranger or transporter.

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the Court finds that there is a genuine issue of material fact as

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to whether Eureka may be considered an owner or operator.

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Consequently, the Court need not decide whether Eureka may be

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liable as a transporter or arranger to deny summary judgment on

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this ground.

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Most of the parties' pleadings
However,

The case most on point is Adobe Lumber, Inc. v. Hellman, 658

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F. Supp. 2d 1188 (E.D. Cal. 2009).

As here, Adobe Lumber involved

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a dry cleaner that disposed of PCE through a floor drain that

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connected to a municipal sewer.

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the property on which the dry cleaner operated alleged that leaks

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in the municipal sewer had contributed to the site's contamination.

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The city in Adobe Lumber argued that (1) CERCLA exempts public

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sewers from its definition of "facility," and (2) the site had to

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be construed as a single facility, so the city could not be

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considered the owner of a separate facility.

And, as in this case, owners of

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Id. at 1193, 1202.

The district court rejected both arguments.

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Following

owned sewers are CERCLA facilities.

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Westfarm Assocs. Ltd. P'ship v. Wash. Suburban Sanitary Comm'n, 66

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F.3d 669, 678 (4th Cir. 1995)).

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"the primary source for determining the number of relevant

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facilities is the plaintiff's complaint."

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United States District Court

precedent developed in the Fourth Circuit, it found that publicly

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For the Northern District of California

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the site at issue in Adobe could be "reasonably or naturally

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divided into multiple parts" (the sewer and the property above it),

Id. at 1193-1202 (discussing

The district court also held that

Id. at 1203-04.

Because

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the city could be construed as the owner of a separate facility.

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Id.

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facie case against the city.

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the Fourth Circuit nor the Eastern District of California, it finds

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the logic followed in those cases persuasive.

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exempt publicly owned treatment works, including sewers, from its

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definition of facility.

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The Adobe court held that the plaintiff had made its prima
Though this Court is bound by neither

CERCLA did not

A Ninth Circuit case complicates the picture.

In Fireman's

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Fund Insurance Co. v. City of Lodi, the Court of Appeals noted that

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"it is doubtful whether [the city of] Lodi may be considered a PRP

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merely as a result of operating its municipal sewer system."

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F.3d 928, 945 (9th Cir. 2002).

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support of that proposition was another case from the Eastern

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District of California: Lincoln Properties, Ltd. v. Higgins, 823 F.

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Supp. 1528 (E.D. Cal. 1992).

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applicable here, because much of the sewer system in that case was

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owned by the plaintiff, the holder of the private property where

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the contamination occurred.

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302

However, the only case cited in

Lincoln Properties is not entirely

Id. at 1533-34.

For the section of sewer that was owned by the defendant, San

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owner for purposes of CERCLA liability.

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also held that leakage from the County's sewers constituted a

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release under CERCLA.

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County may be liable for releases from its facilities -- viz its

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portion of the sewer and its wells.").

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even determined that there was "evidence of releases from County's

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United States District Court

Joaquin County, the Lincoln court determined that the County was an

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For the Northern District of California

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facilities sufficient to withstand summary judgment."

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The Lincoln court's decision to grant summary judgment for the

Id. at 1535.

The court

Id. at 1536-38 ("[A]s a matter of law, the

Finally, the Lincoln court

Id. at 1538.

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County was not based on a finding that the County was not a PRP,

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but rather a decision that the County had proved that it was

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entitled to the "innocent third party defense."

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("[T]he County has established by uncontroverted evidence all the

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elements of the third party defense.

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subject to liability on the CERCLA claims against it.").

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defense requires the defendant to prove (1) that the release was

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caused solely by a third party; (2) that the defendant exercised

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due care with respect to the hazardous substance; and (3) that the

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defendant took precautions against the foreseeable acts or

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omissions of the third party. 42 U.S.C. § 9607(b)(3).

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not made those showings.

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Id. at 1544

Thus . . . the County is not
That

Eureka has

Eureka owned and operated the sewer, which may qualify as a

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CERCLA facility.

The clear weight of authority indicates that the

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owner of a municipal sewer may be liable under CERCLA for

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contamination caused by leakage therefrom.

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issues of material fact as to whether and to what extent Eureka is

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liable for releases of PCE from its sewer.

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summary judgment on the ground that it is not a PRP is DENIED.

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There remain genuine

Eureka's motion for

2.

1
2

KFD's Response Costs

Eureka argues that KFD has not incurred any response costs

Eureka Mot. at 15.

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appropriate where appellants have no expert witnesses or designated

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documents providing competent evidence from which a jury could

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fairly estimate damages."

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United States District Court

and, therefore, is not entitled to any recovery under CERCLA.

4

For the Northern District of California

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802, 808 (9th Cir. 1988).

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On the issue of damages, "[s]ummary judgment is

McGlinchy v. Shell Chem. Co., 845 F.2d

KFD claims that it has incurred response costs because it paid

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consultants to investigate environmental contamination on its

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property.

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Winzler & Kelly ("Winzler") and West Environmental Services and

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Technology ("WEST") -- to assess contamination of its property.

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KFD Opp. at 17-19; ECF No. 675-20 ("Daer Decl.").

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this claim, KFD offers (1) a series of invoices from Winzler (Daer

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Decl. Ex. A); (2) the declaration of Kenneth Daer, founder and

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owner of KFD (EDaer Decl.), that KFD paid those invoices; (3)

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invoices from WEST (ECF No. 672-3 Exs. 53-55); and (4) a

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declaration from Peter Krasnoff, Principal Engineer at WEST,

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stating that KFD remains liable for WEST's unpaid invoices (ECF No.

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675-15, "Krasnoff Decl.").

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Specifically, KFD claims that it paid two firms --

Eureka makes two arguments in response.

In support of

First, Eureka objects

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to the Winzler invoices on the grounds that they are not properly

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authenticated and are hearsay.

25

costs have either been paid or reimbursed by its insurance

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companies, administrators, or attorneys.

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reimbursed or not paid directly are unrecoverable under CERCLA.

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Second, Eureka argues that KFD's

Eureka claims that costs

The Court finds that the Winzler invoices have been properly

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ground.

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knowledge who testifies that the item is what it is claimed to be.

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Fed. R. Evid. 901(b)(1).

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Mr. Daer (to whom the invoices are addressed) includes the

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statement that the documents are "invoices I paid to my then

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consultant, Winzler, relating to costs incurred investigating the

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United States District Court

authenticated and accordingly OVERRULES Eureka's objection on that

2

For the Northern District of California

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environmental contamination."

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sufficient to authenticate the documents.

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An item or document may be authenticated by a witness with

In this case, the sworn declaration of

Daer Decl. ¶ 6.

That testimony is

In response to the hearsay objection, KFD asserts that the

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invoices are not offered for the truth of the matters asserted

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therein, such as "specific work conduct or amounts," but for the

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limited purpose of demonstrating that KFD's costs were not

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reimbursed by its insurers.

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the documents for that purpose alone may be insufficient to defeat

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summary judgment.

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that some recovery is possible is not enough; a plaintiff must

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establish a basis for estimating damages.

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Because KFD has not argued or laid proper foundation for a hearsay

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exception, the Court cannot consider the documents as though they

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had been admitted into evidence.

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ECF No. 682 at 3.

However, admitting

As McGlinchy indicates, merely demonstrating

854 F.2d at 808.

Nonetheless, a party seeking to avoid summary judgment need

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not produce evidence in an admissible form, so long as the contents

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would likely be admissible at trial.

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satisfied that the invoices combined with Mr. Daer's sworn

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statement provide a basis for estimating damages that would likely

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be admissible at trial.

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evidence for a competent trier of fact to estimate damages and that

In this case, the Court is

The Court finds that there is sufficient

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Eureka is not entitled to summary judgment on this basis.

recoverable because they were paid, or reimbursed, by third

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parties.

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that its insurance liability has not been settled, and that it may

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be required to reimburse its insurers with any recovery it may

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secure in this case.

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United States District Court

Eureka next argues that any costs KFD incurred are not

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For the Northern District of California

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even of costs that were paid or reimbursed by its insurers.

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Court finds it unnecessary to rule on the complex issues of

KFD replies that some of its costs were not reimbursed,

Therefore, KFD claims, it may seek recovery
The

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insurance payment and reimbursement at this point because KFD has

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shown that at least some of its costs have not been paid or

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reimbursed by any third party.

13

a genuine issue of material fact as to whether it incurred recovery

14

costs.

15

that KFD has not incurred response costs.

Eureka is not entitled to summary judgment on the grounds

3.

16
17

KFD has demonstrated that there is

Eureka's Response Costs

Eureka has counterclaimed for recovery costs under CERCLA,

18

both for recovery of response costs under § 107(a) and for

19

contribution under § 113(f).

20

that Eureka has not incurred any response costs.

21

Eureka has produced two letters.

22

the City Manager that Eureka agrees to "reimburse the [RWQCB]'s

23

costs associated with oversight" of the cleanup at Norman's Dry

24

Cleaners.

25

RWQCB geologist estimating some of the costs for which the RWQCB

26

might seek reimbursement.

27

correct that the evidence it has produced in support of its

28

counterclaim is similar to that which KFD produced in support of

ECF No. 355 at 19-21.

ECF No. 683-1 Ex. 1.

KFD argues

In response,

First is an acknowledgment from

The second is a letter from an

ECF No. 683-1 Ex. 2.

15

While Eureka is

1
2

its initial claim, the law nonetheless bars Eureka's recovery.
The Supreme Court has made it clear that a party seeking

response costs.

5

suffice: "[B]y reimbursing response costs paid by other parties,

6

the PRP has not incurred its own costs of response and therefore

7

cannot recover under § 107(a)."

8

United States District Court

recovery of response costs under CERCLA § 107(a) must incur its own

4

For the Northern District of California

3

Corp., 551 U.S. 128, 139 (2007).

9

costs is limited to its reimbursement of the RWQCB, and it

Reimbursing costs paid by someone else does not

United States v. Atl. Research
Eureka's evidence of response

10

therefore cannot recover under § 107(a).

11

judgment on Eureka's first claim for relief in its fourth amended

12

counterclaim is GRANTED.

13

contribution under § 113(f) survives.

14

though eligible to seek contribution under § 113(f)(1), the PRP

15

cannot simultaneously seek to recover the same expenses under

16

§ 107(a).").

17

4.

18

KFD's motion for summary

However, Eureka's counterclaim for
See id. ("As a result,

The National Contingency Plan

CERCLA also requires that a response to a release of hazardous

19

materials be consistent with the NCP.

A private party's response

20

is consistent with the NCP if the response, "when evaluated as a

21

whole, is in substantial compliance with the applicable

22

requirements [of the NCP], and results in a CERCLA-quality

23

cleanup."

24

KFD's response costs are inconsistent with the NCP and are

25

consequently unrecoverable.

26

assertion that KFD has failed to obtain public comment concerning

27

the response action.

28

comment requirement is an essential element in demonstrating

40 CFR § 300.700(c)(3)(I) (2014).

Eureka alleges that

Eurkea's argument is based on the

Substantial compliance with the public

16

1

consistence with the NCP.

See City of Oakland v. Nestle USA, Inc.,

2

C-98-3963 SC, 2000 WL 1130066 (N.D. Cal. Aug. 8, 2000) (holding

3

that "[f]ailure to comply with the public participation requirement

4

alone is enough" to find lack of substantial compliance with the

5

NCP).
KFD has produced evidence of its compliance with the public

6

United States District Court

comment requirements.

8
For the Northern District of California

7

It has (1) participated in preparing and

mailing a fact sheet describing investigation into the

9

environmental contamination and inviting public comment, KFD RJN II

10

Ex. B; (2) published information on the investigation in the Eureka

11

newspaper, Krasnoff Decl. ¶ 7 Ex. B; (3) made available WEST's

12

feasibility study at the Humboldt County Library and online,

13

Krasnoff Decl. ¶ 8; (4) met with interested parties; and (5)

14

presented information at a public meeting held in 2007, Krasnoff

15

Decl. ¶ 9; KFD RJN II Exs. D, E.
Nonetheless, Eureka argues that KFD's efforts at compliance

16
17

are insufficient because KFD has not sought public comment on its

18

proposed remediation plan.

19

comment would be premature because the RWQCB has not approved the

20

plan.

21

remediation plan is chosen.

22

still seek public comment on the plan to make a CERCLA claim, even

23

though no plan has been approved at this point.

24

However, as KFD points out, such

Eureka agrees that public comment may be sought only after a
But Eureka still insists that KFD must

Eureka's argument seems to be that KFD must wait until the

25

RWQCB has approved a remediation plan and seek public comment on

26

the approved before filing a CERCLA action.

27

explicitly rejected that reading of CERCLA: "[T]here is nothing in

28

the plain language of section 107(a) that indicates that a party

17

The Ninth Circuit has

1

seeking to recover its costs of response must await approval of or

2

action by a state or local government entity. . . . Indeed, there

3

is no indication in the statute that prior approval or action by a

4

state or local government is either necessary or desirable."

5

Cadillac Fairview/California, Inc. v. Dow Chemical Co., 840 F.2d

6

691, 694-95 (9th Cir. 1988).
None of the cases Eureka cites can be interpreted as creating

7

United States District Court

For the Northern District of California

8

a requirement that government approval of a remedial plan is an

9

element of a CERCLA § 107(a) claim.

KFD has produced evidence that

10

it has sought public comment on remedial actions it has taken so

11

far, and the parties agree that public comment on proposed plan

12

would be premature.

13

existence of a genuine issue of material fact as to whether KFD has

14

substantially complied with the CERCLA public comment requirements.

15

Eureka is not entitled to summary judgment on these grounds.

16

Eureka's motion for summary judgment is DENIED as to KFD's § 107(a)

17

CERCLA claim.
5.

18

Those facts are sufficient to establish the

Declaratory Relief and Timing of Review

Eureka next argues that KFD's lack of a viable § 107(a) claim

19
20

defeats KFD's declaratory relief claim and divests this Court of

21

jurisdiction.

22

has no viable § 107(a) claim.

23

§ 107(a) claim survives summary judgment, Eureka's arguments

24

regarding the declaratory relief claim and lack of jurisdiction are

25

unavailing.

26

//

27

//

28

//

Those arguments depend on the assumption that KFD
Because the Court finds that KFD's

18

1

D.

RCRA

2

The Resource Conservation and Recovery Act (RCRA) authorizes

present transporter, or past or present owner or operator of a

5

treatment, storage, or disposal facility, who has contributed or

6

who is contributing to the past or present handling, storage,

7

treatment, transportation, or disposal of any solid or hazardous

8

United States District Court

private suits against "any past or present generator, past or

4

For the Northern District of California

3

waste which may present an imminent and substantial endangerment to

9

health or the environment."

42 U.S.C. § 6972(b).

KFD seeks to

10

recover costs from Eureka under RCRA, and both KFD and Eureka move

11

for summary judgment on this claim.

12

Both motions are DENIED.

Eureka claims that it did not contribute to the handling,

13

storage, treatment, transportation, or disposal or any hazardous

14

waste.

15

"contribute" means for the purposes of RCRA.

16

district have held, following direction from the Seventh Circuit,

17

that "contributed to" means "that some affirmative action is

18

required on the part of the defendant, rather than merely passive

19

conduct."

20

8077086 at *3 (N.D. Cal. Jan. 26, 2011); see also Gregory Vill.

21

Partners, L.P. v. Chevron U.S.A., Inc., 2012 U.S. Dist. LEXIS 32644

22

at *25 (N.D. Cal. Mar. 12, 2012).

The parties present competing interpretations of what
Courts in this

Sullins v. Exxon/Mobil Corp., 08-04927 CW, 2011 WL

23

KFD has produced evidence that Eureka's sewer was poorly

24

designed and has leaked for decades, that Eureka has known of the

25

leaks since the 1980s, and that Eureka has failed to fix the sewer.

26

See ECF No. 674-18 Ex. A at 10-15, 21.

27

contrary expert evidence to contest those assertions.

28

design of the sewer, any leakage that occurred, and Eureka's

19

Eureka has produced
Whether the

1

knowledge of that leakage constitute affirmative acts sufficient to

2

render Eureka a contributor to the contamination is an unresolved

3

question of fact.

4

judgment on the RCRA claim are DENIED.

Accordingly, both parties' motions for summary

5
E.

6

1.

7

United States District Court

For the Northern District of California

KFD's HSAA Claim Against Eureka

Eureka makes two arguments regarding KFD's claim under the

8
9

HSAA

California Hazardous Substance Account Act (HSAA).

First, Eureka

10

argues that, because the HSAA incorporates CERCLA liability

11

standards, the HSAA claim fails because the CERCLA claim fails.

12

Again, because Eureka's CERCLA claim survives summary judgment,

13

that argument is unpersuasive.

14

that CERCLA's double recovery prohibition bars the HSAA claim.

15

42 U.S.C. § 9614(b) ("Any person who receives compensation for

16

removal costs or damages or claims pursuant to this chapter shall

17

be precluded from recovering compensation for the same removal

18

costs or damages or claims pursuant to any other State or Federal

19

law.").

20

CERCLA and HSAA, summary judgment is not the appropriate time to

21

consider that issue.

22

in CERCLA precludes concurrent liability under state law.

23

in support of its own state law counterclaims in addition to its

24

CERCLA counterclaims, Eureka reminds the Court that a claimant has

25

a "right to pursue multiple, different legal theories, in which to

26

seek its relief."

27

summary judgment on the HSAA claim is DENIED.

28

//

In the alternative, Eureka argues
See

Though KFD may not recover the same costs under both

CERCLA prohibits double recovery, but nothing

See ECF No. 683 at 22.

20

Indeed,

Eureka's motion for

2.

1

Eureka's HSAA Claim Against KFD

KFD argues that Eureka's HSAA claim against it must fail based

2

claim.

5

from CERCLA, resulting in similar standards for liability.

6

Cal. Health & Saf. Code §§ 25310, 25323.3.

7

section that forms the basis of Eureka's claim provides relief only

8

United States District Court

on the same argument it made against Eureka's CERCLA § 107(a)

4

For the Northern District of California

3

for "[a]ny person who has incurred removal or remedial action

9

costs."

The HSAA incorporates many of its standards and definitions

Id. § 25363(e).

See

Most importantly, the

Though § 25363(e) is analogous to CERCLA

10

§ 113(f) in that both provide rights to contribution, the key

11

difference is that HSAA § 25363(e) limits recovery to costs

12

"incurred", while CERCLA § 113(f) does not.

13

was the key distinction in Atlantic Research, and the Supreme Court

14

left no doubt that "incurred" excludes payments to reimburse the

15

costs of others.

16

liability standards from CERCLA, the meaning of the word "incurred"

17

creates the same requirement for recovery under § 25363(e) as it

18

does for § 107(a).

19

reimburse the RWQCB's costs, and therefore it cannot seek

20

contribution under that section.

21

on Eureka's fourth and fifth claims for relief in its fourth

22

amended counterclaim is GRANTED.

551 U.S. at 139.

The word "incurred"

Because the HSAA adopts

Eureka has produced evidence only that it might

KFD's motion for summary judgment

23
24

F.

KFD's Other State Law Claims

25

KFD has brought both public and private nuisance claims and

26

claim for dangerous condition of public property under California

27

law.

28

//

Eureka moves for summary judgment on all state law claims.

21

1.

1
2

Statute of Limitations

Eureka alleges that the statute of limitations period has run

claim is both California's general three year statute of

5

limitations, Cal. Civ. Proc. Code § 338, and California's

6

requirement that a plaintiff suing a public entity present an

7

administrative claim "not later than one year after accrual of the

8

United States District Court

on KFD's state law claims, including nuisance.

4

For the Northern District of California

3

cause of action."

9

requirement was the basis of Judge Chesney's 2011 order dismissing

10

all of KFD's state law claims that accrued prior to March 6, 2007.

11

See ECF No. 458 at 4-5.

12

damages since March of 2007.

13

sewer continues to leak, and has produced evidence that the sewer

14

remains in poor condition.

15

has been leaking for decades, with no indication that it has been

16

fixed, a reasonable trier of fact could find that KFD's state law

17

claims are based on continuing leakage and that the statute of

18

limitations has not expired.

19

on the ground that the statute of limitations has run on KFD's

20

state law claims is DENIED.
2.

21
22

The basis of this

Cal. Gov. Code §§ 911.2(a), 945.4.

That latter

Eureka argues that KFD cannot prove any
However, KFD argues that Eureka's

Based on the evidence that the sewer

Eureka's motion for summary judgment

Preemption

Eureka next argues that CERCLA preempts KFD's state law

23

claims.

But "CERCLA does not completely occupy the field of

24

environmental regulation."

25

Dep't of Health & Envtl. Quality, 213 F.3d 1108, 1114 (9th Cir.

26

2000).

27

Congress's desire to avoid interfering with state law claims.

28

42 U.S.C. § 9614(a) ("Nothing in this chapter shall be construed or

ARCO Envtl. Remediation, L.L.C. v.

Indeed, CERCLA includes several provisions indicating

22

See

liability or requirements with respect to the release of hazardous

3

substances ..."); 42 U.S.C. § 9652 ("Nothing in this chapter shall

4

affect or modify in any way the obligations or liabilities of any

5

person under other Federal or State law, including common law, with

6

respect to releases of hazardous substances or other pollutants or

7

contaminants.").

8

United States District Court

interpreted as preempting any State from imposing any additional

2

For the Northern District of California

1

hazardous substance regulation, Eureka's preemption claim must be

9

based on conflict preemption.

Because CERCLA does not occupy the field of

Conflict preemption exists "where 'compliance with both the

10
11

federal and state regulations is a physical impossibility,' or when

12

the state law stands as 'an obstacle to the accomplishment and

13

execution of the full purposes and objectives of Congress.'"

14

Fireman's Fund Ins. Co. v. City of Lodi, 302 F.3d 928, 943 (9th

15

Cir. 2002) (quoting Cal. Fed. Sav. and Loan Ass'n v. Guerra, 479

16

U.S. 272, 281 (1987)).

17

applies to the causes of action that KFD brings, Ninth Circuit has

18

expressly held that CERCLA does not preempt state law contribution

19

claims, despite the existence of CERCLA's own contribution scheme.

20

City of Emeryville v. Robinson, 621 F.3d 1251, 1262 (9th Cir. 2010)

21

(holding that the text of CERCLA "precludes any finding of

22

preemption as to state law claims for contribution").

23

state law tort claims in addition to, or instead of, CERCLA claims

24

neither makes compliance with CERCLA impossible nor stands as an

25

obstacle to its goals. 1

26

1

27
28

Though it has not ruled on preemption as it

Recognizing

The Court finds that CERCLA does not

District courts are divided as to whether CERCLA preempts these
types of state law claims, but most have held that CERCLA does not
preempt state law claims. See, e.g., Carolina Cas. Ins. Co. v.
Oahu Air Conditioning Serv., Inc., CIV. 2:13-1378 WBS A, 2014 WL

23

1

preempt these claims -- notwithstanding CERCLA's prohibition on

2

double recovery -- and DENIES Eureka's motion for summary judgment

3

on this ground.
3.

4

Private Nuisance

Eureka argues that it cannot be liable for nuisance because

5

failing to maintain its sewer.

8

United States District Court

its involvement in the contamination, if any, was limited to

7

For the Northern District of California

6

contamination may be sufficient to sustain a nuisance action under

9

California law.

However, knowledge of the

See Redevelopment Agency of City of Stockton v.

10

BNSF Ry. Co., 643 F.3d 668, 674 (9th Cir. 2011) (interpreting

11

California nuisance law as requiring that contamination be "active,

12

affirmative, or knowing" to constitute nuisance) (emphasis added).

13

KFD has presented some evidence that Eureka was aware that its

14

sewer was leaking and that PCE was reaching its wastewater

15

treatment plant.

16

is sufficient to prove Eureka's liability is an issue for the trier

17

of fact.

18

DENIED.

19

//

20

//

21

309557 at *5-*6 (E.D. Cal. Jan. 28, 2014) (CERCLA did not preempt
common law claims for apportionment of fault, contribution,
indemnity, and subrogation); Bd. of Cnty. Comm'rs v. Brown Grp.
Retail, Inc., 598 F. Supp. 2d 1185, 1192-95 (D. Colo. 2009) (CERCLA
did not preempt state law negligence and abnormally dangerous
activity claims); Quapaw Tribe v. Blue Tee Corp., 03-CV-0846-CVEPJC, 2009 WL 455260 (N.D. Okla. Feb. 23, 2009) (CERCLA did not
preempt nuisance, strict liability, or trespass claims) ; City of
Waukegan, Ill. v. Nat'l Gypsum Co., 587 F. Supp. 2d 997, 1011 (N.D.
Ill. 2008) (CERCLA did not preempt claim under Illinois Water
Pollutant Discharge Act); S. Cal. Water Co. v. Aerojet-Gen. Corp.,
CV 02-6340ABCRCX, 2003 WL 25537163 at *6-*7 (C.D. Cal. Apr. 1,
2003) (CERCLA did not preempt state law claims for nuisance,
trespass, and negligence per se).

22
23
24
25
26
27
28

Graben Decl. Ex. E at 166.

Whether that evidence

Eureka's motion for summary judgment on this ground is

24

4.

1
2

Public Nuisance

Eureka claims that KFD has failed to show that it has suffered

this case is that KFD's property has been contaminated.

5

discussed previously, the contamination of KFD's private property

6

has required it to conduct environmental assessments of its

7

property.

8

United States District Court

harm different in kind to that of the public.

4

For the Northern District of California

3

But the reason for

investigations.

9

property that differs in kind from the health risk to the general

As

The public at large has not been responsible for those
KFD therefore may have suffered damage to its

10

public.

11

establish a claim of public nuisance, and whether it is

12

attributable to Eureka's actions remain genuine issues of fact.

13

Eureka's motion for summary judgment on this claim is DENIED.
5.

14
15

Whether this damage is sufficiently different in kind to

Dangerous Condition of Public Property

Eureka contests the dangerous condition claim on much the same

16

grounds as the nuisance claim: that Eureka lacked actual or

17

constructive knowledge of the release of PCE.

18

KFD has produced evidence sufficient to create a genuine issue of

19

material fact on this issue.

20

on this claim is DENIED.

As discussed above,

Eureka's motion for summary judgment

21
22

G.

Eureka's Other State Law Claims

23

Eureka brings claims under state law for equitable indemnity,

24

contribution and declaratory relief.

KFD argues that these claims

25

are preempted by CERCLA.

26

face, CERCLA § 113(f)(1) expressly authorizes claims for

27

contribution, and includes a 'saving' clause that precludes any

28

finding of preemption as to state law claims for

The Ninth Circuit disagrees: "On its

25

1

contribution . . . ."

City of Emeryville, 621 F.3d at 1262.

2

KFD's

motion for summary judgment on these claims is DENIED.

3
4
5

V. CONCLUSION
For the foregoing reasons, Defendant Eureka's motion for

respect to Eureka's first claim for relief under CERCLA § 107 and

8

United States District Court

summary judgment is DENIED.

7

For the Northern District of California

6

Eureka's fourth and fifth claims for relief under the HSAA.

9

motion is DENIED with respect to all other claims and

10

Plaintiff KFD's motion is GRANTED with

KFD's

counterclaims.

11
12

IT IS SO ORDERED.

13
14

Dated: May 9, 2014

15

UNITED STATES DISTRICT JUDGE

16
17
18
19
20
21
22
23
24
25
26
27
28

26