Californians for Alternatives to Toxics v. Kernen Construction Co. et al

Filing 37

ORDER GRANTING DISCOVERY RE: REMEDIES re 30 First Discovery Letter BriefRE Remedies Pursuant to Court Order, ECF No. 29 filed by Californians for Alternatives to Toxics Joint Statement due by 10/30/2020. Compliance deadline is set for Friday, 11/6/2020 09:01 AM before Judge Yvonne Gonzalez Rogers. Signed by Judge Yvonne Gonzalez Rogers on 9/9/2020. (fs, COURT STAFF) (Filed on 9/9/2020)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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CALIFORNIANS FOR ALTERNATIVES TO
TOXICS,
Plaintiff,

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vs.
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CASE NO. 20-cv-01348-YGR
ORDER GRANTING DISCOVERY
RE: REMEDIES
Re: Dkt. No. 30

KERNEN CONSTRUCTION CO., ET AL.,
Defendants.

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United States District Court
Northern District of California

Plaintiff Californians for Alternatives to Toxics brings the instant action for violations of
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the Federal Water Pollution Control Act, 33 U.S.C. §§ 1251–1387 (the “Clean Water Act” or the
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“CWA”) and the State of California’s General Industrial Permit for storm water discharges (the
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“General Permit”) since November 14, 2017. Defendants Kernen Construction Co., Bedrock
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Investments LLC, Scott Farley, and Kurt Kernen have admitted liability on all causes of action.
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At issue is what, if any, discovery is needed for the Court to assess civil penalties.
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33 U.S.C. § 1319(d) provides, in relevant part, that “[a]ny person who violates . . . any
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permit condition or limitation . . . shall be subject to a civil penalty not to exceed $25,0001 per day

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for each violation.” In calculating appropriate penalties, courts apply either a top-down or bottom20
up approach. The top-down approach requires the Court to first calculate the maximum penalty,
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and then, if necessary, to adjust that penalty downward in consideration of six statutory factors:
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(1) the seriousness of the violation, (2) any economic benefit that resulted from the violation, (3)
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any history of violations by the party to be penalized, (4) that party’s good faith efforts to comply
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with the applicable requirements, (5) the economic effect of the penalty on the violator, and (6)
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“such other matters as justice may require.” 33 U.S.C. § 1319(d). The bottom-up approach
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requires the Court first to calculate the economic benefit realized by the defendant as a result of its
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The maximum penalty amount has been increased to $55,800 as adjusted for inflation.

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non-compliance, and then adjust that amount upward or downward based on the same six factors.

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Because the bottom-up approach would require significant discovery to determine the full extent

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of defendants’ economic benefit, if any, from non-compliance, the Court finds the top-down

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approach to be the best method for calculating penalties in this case.

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As to the six statutory factors, the Court has read and considered the arguments raised in

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the briefs and at the hearing regarding the appropriate amount of penalties to be awarded in this

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case. In exercising its considerable discretion to award penalties in this case, the Court intends to

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do a complete analysis of the factors. In the meantime, the Court is persuaded that some discovery

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is warranted to aid the Court in performing said analysis. At the same time, the Court is mindful
of the burden discovery places on defendants and defendants’ efforts to come into compliance

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United States District Court
Northern District of California

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with their obligations regarding storm water discharge. As such, the Court finds it appropriate to

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cabin discovery to the issues most critical to the analysis on penalties.

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Accordingly, the Court hereby ORDERS that the parties shall engage in discovery regarding

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the amount of civil penalties to be awarded in this case, with such discovery limited to topics

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relevant to the six relevant statutory factors. The Court also SETS a compliance deadline for 9:01

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a.m. on Friday, November 6, 2020. Five (5) business days prior to said date, the parties shall

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file a joint statement updating the Court on the status of (i) the discovery process, and (ii) the

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process of defendant being certified as a “no discharge” operation. If compliance is complete, the

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compliance deadline will be taken off calendar.

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Further, the Court hereby STAYS the case it relates to injunctive relief, which will be

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addressed as necessary following a decision on penalties.

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This Order terminates Docket Number 30.

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IT IS SO ORDERED.

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Dated: September 9, 2020
YVONNE GONZALEZ ROGERS
UNITED STATES DISTRICT COURT JUDGE

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