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UNITED STATES v. ALAMEDA GATEWAY

August 1, 1996

UNITED STATES OF AMERICA, Plaintiff,
v.
ALAMEDA GATEWAY, LTD., Defendant.



The opinion of the court was delivered by: PATEL

 Plaintiff United States of America brought this action against defendant Alameda Gateway, Ltd., ("Gateway") alleging that Gateway's refusal to remove portions of two piers in Oakland's Inner Harbor is a violation of the Rivers and Harbors Act of 1899 ("RHA"), 33 U.S.C. §§ 403, 406. Now before the court is the United States' motion for an injunction barring Gateway from obstructing, hindering or interfering with the Army Corps of Engineers' plans to remove the ends of the two piers in order to create a new turning basin.

 Having considered the parties' arguments and submissions, and for the reasons set forth below, the court enters the following memorandum and order.

 Findings of Fact

 Gateway is a California limited partnership based in Alameda, California. Gateway owns a 29 acre marine industrial site on the Alameda side of the Oakland Inner Harbor. When Gateway acquired the site from Todd Shipyards in 1983, it acquired two piers, a western and an eastern pier, each extending approximately 600 feet into the Harbor. *fn1" The western pier stands in large part on submerged portions of Gateway's property and in part on submerged land which Gateway leases from the City of Alameda. The eastern pier stands entirely on submerged portions of Gateway's property and is badly deteriorated.

 In 1985, Gateway sought a permit from the Army Corps of Engineers ("the Corps") to develop the property into a marina that would house various commercial and industrial facilities. The Corps refused to issue the permit to Gateway, claiming that it would eventually need the property for a proposed development project in the Oakland Harbor. Gateway sued the Corps over denial of the development permit in case number C-85-8802 MHP. The court has determined that the instant action is related to C-85-8802. Gateway contends that certain factual issues determined during the prior action are relevant to this dispute. *fn2"

 In 1986 Congress formalized the proposed "Harbor Improvement Project" when it authorized the Corps to widen and deepen the shipping channels of the Oakland Inner and Outer Harbors. Defendants' Request for Judicial Notice, Ex. E (Water Resources Development Act of 1986 § 202, P.L. 99-662, 100 Stat. 4082, 4092 (November 17, 1986)). The project provides the City of Oakland with federal support in its efforts to maintain a competitive port. In recent years Oakland has lost twenty-three percent of its shipping contracts to other Pacific ports that offer better conditions to a new generation of deep-draft cargo vessels. Brien Dec. at P 2. Currently, deeper vessels can only enter the Oakland Harbor during high tide and when they are not fully loaded. By increasing the Port's accessibility to these deeper vessels, the United States and Oakland hope to increase the volume of cargo coming into Oakland and to create revenue and jobs.

 Pursuant to this Harbor Improvement Project, the Corps will dredge a new turning basin in the portion of the Inner Harbor in which Gateway's piers stand. The turning basin currently used by cargo vessels making their way back to the Pacific is located several miles upstream and is not easily accessible. Brien Dec. at P 6. After extensive research and testing to identify a location in the Inner Harbor that would require minimal interference, the Corps determined that the planned site is the only space wide enough to allow ships to turn around safely without the inconvenience of travelling one and one-half hours upstream to the existing turning basin. Plaintiffs estimate that the turning basin will be approximately 1,200 feet in diameter, slightly below the diameter ordinarily required by the Corps. Rakstins Dec. at PP 4 and 6. In order to accommodate the turning basin, the western pier will need to be shortened by three hundred feet and the eastern pier by two hundred feet.

 Gateway currently leases the western pier to third parties but makes only minimal use of the eastern pier. After the Corps denied Gateway's marina development proposal in the mid-1980's, Gateway sought a permit for maintenance work on the eastern pier. The Corps agreed to grant the maintenance permit only on the condition that the pier be removed once the Corps was prepared to proceed with dredging to create the turning basin. Beery Dec. at P 4. Gateway chose to defer the maintenance work until resolution of this dispute. Short and long term leases of the western pier and limited leases of the eastern pier currently generate revenues of up to $ 40,000 each month.

 On August 21, 1995, the Corps informed Gateway that it was moving the harbor line shoreward pursuant to the sections 10 and 11 of the RHA, 33 U.S.C. §§ 403 and 404, and that portions of the two piers would need to be removed in order to create the new turning basin. Fong Dec., Ex. D-1 at 1. *fn3" Corps officials subsequently determined that the removal would not be a regulatory taking because it is an exercise of a navigational servitude to which the piers have always been subject. *fn4" Fong Dec., Ex D-1 at 4. The Corps directed Gateway to submit a plan for the removal of portions of the piers that interfere with the turning basin, at no cost to the Corps, by June 2, 1995. *fn5" Gateway refused to submit the plan, and the Corps determined that in order to follow the strict schedule of the dredging project, it would solicit bids on its own for the pier removal. *fn6"

 The Corps has determined that the pier ends must be removed by September 14, 1996, when the dredging of the new turning basin is set to begin. Accordingly, the United States filed the instant action seeking a preliminary injunction barring Gateway from interfering with the Corps' plans to remove the pier ends. Gateway has not objected to the proposed injunction on the ground that no obstruction has yet occurred. Gateway admitted at a hearing on July 12, 1996 that it will obstruct the Corps' efforts to remove the pier ends unless the Corps obtains court authorization for the removal. Gateway also has impeded the Corps' efforts to remove the piers by refusing to allow prospective contractors access to the piers. This has caused the estimated cost of removal to rise considerably.

 On May 17, 1996, the United States filed its motion for a preliminary injunction. Gateway responded by filing an ex parte motion to continue the hearing and for leave to commence discovery. Prior to any court rulings, the parties agreed to continue the June 21, 1996 hearing date in order to allow Gateway to conduct discovery. The hearing was reset for July 12, 1996, and on May 17, 1996, Gateway filed an opposition to the United States' motion for a preliminary injunction. *fn7"

 The foregoing factual summations are deemed to be findings of fact for the purposes of Federal Rules of Civil Procedure 52 and 65. To the extent that the discussion below contains factual conclusions, they are deemed findings of fact for these purposes as well.

 LEGAL STANDARD

 In order to obtain a preliminary injunction in this circuit, the moving party is required to demonstrate either: (1) probable success on the merits and a significant threat of irreparable harm or (2) serious questions on the merits and the balance of hardships tipping in its favor. See United States v. Nutri-Cology, Inc., 982 F.2d 394, 397 (9th Cir. 1992); Fund for Animals, Inc. v. Lujan, 962 F.2d 1391, 1400 (9th Cir. 1992); United States v. Odessa Union Warehouse Co-op, 833 F.2d 172, 174 (9th Cir. 1987). As the likelihood of irreparable harm increases, the required degree of probable success decreases. Odessa, 833 F.2d at 176.

 In statutory enforcement actions, however, the standard for granting a preliminary injunction differs. When the government demonstrates that it will probably prevail on the merits, it is entitled to a presumption of irreparable injury. Nutricology, 982 F.2d at 398. The court only inquires as to the possibility of irreparable harm when the government fails to establish a likelihood of success on the merits. Where the government makes only a "colorable evidentiary showing" of a statutory violation, however, ...


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