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NATIONAL SEMICONDUCTOR

October 18, 2005.

NATIONAL SEMICONDUCTOR (MAINE), INC., a Delaware corporation, formerly known as Fairchild Semiconductor Corporation; and SCHLUMBERGER TECHNOLOGY CORPORATION, a Texas corporation, Plaintiffs,
v.
NCH CORPORATION, a Delaware corporation, Defendant.



The opinion of the court was delivered by: RONALD WHYTE, District Judge

ORDER GRANTING NCH'S MOTION TO DISMISS NATIONAL'S FOURTH CAUSE OF ACTION AND DENYING NCH'S MOTION FOR SANCTIONS
National Semiconductor (Maine), Inc. and Schlumberger Technology Corporation (collectively "National") have sued NCH Corporation ("NCH") for alleged groundwater contamination. NCH moves to dismiss National's fourth cause of action for violation of the Hazardous Substance Account Act ("the HSAA"), Cal. Health & Safety Code §§ 25300 et seq. NCH also moves for sanctions under Federal Rule of Civil Procedure 11 ("Rule 11"). National opposes the motions. The court has read the moving and responding papers and considered counsels' arguments. For the reasons set forth below, the court grants NCH's motion to dismiss and denies NCH's motion for sanctions. I. BACKGROUND

This case concerns alleged groundwater contamination on two parcels of land in Sunnyvale: the Arques Parcel and the Kifer Parcel. FAC ¶ 1. According to National, NCH has operated a chemical blending plant at the Kifer Parcel since 1967. Id. at ¶ 9. National contends that NCH's activities caused industrial solvents to migrate from the Kifer Parcel to the Arques Parcel. Id. at ¶¶ 10-11. National asserts that NCH has not taken adequate remedial measures to stop this migration. Id. at ¶ 11.

  National alleges that the California Regional Water Quality Control Board ("the Regional Board") issued a series of Orders to NCH, including (1) a Site Cleanup Requirement Order on September 17, 1997, (2) a Notice of Violation on September 28, 1998, and (3) a revised Site Cleanup Requirements Order on October 18, 2000. Id. at ¶¶ 12-15. National claims that its predecessor, Fairchild Semiconductor Corporation ("Fairchild"), owned the Arques Parcel until 1972, when it sold the land to Hewlett-Packard Corporation ("HP"). Id. at ¶ 16. National contends that both Fairchild and HP have taken environmental remedial actions at the Arques Parcel. Id. According to National, despite the fact that the Regional Board's Orders name NCH as a responsible party, NCH has contributed nothing to this effort. Id. at ¶ 19. National's fourth cause of action seeks treble damages under Cal. Health & Safety Code § 25359.4.5 ("section 25359.4.5").

  II. ANALYSIS

  A. Motion to Dismiss

  Dismissal under Federal Rule of Civil Procedure Rule 12(b)(6) is proper only when a complaint exhibits either a "lack of a cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory." Balistreri v. Pacifica Police Dept., 901 F.2d 696, 699 (9th Cir. 1988). The court must accept the facts alleged in the complaint as true. Id. "A complaint should not be dismissed `unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.'" Gilligan v. Jamco Dev.Corp., 108 F.3d 246, 248 (9th Cir. 1997) (quoting Conley v. Gibson, 355 U.S. 41, 45-46 (1957)).

  B. Statutory Interpretation

  The California Supreme Court has explained that a court construing a statute must start with its plain meaning and only examine extrinsic sources if necessary to resolve an ambiguity: [W]e first examine the words of the respective statutes: `If there is no ambiguity in the language of the statute, then the Legislature is presumed to have meant what it said, and the plain meaning of the language governs. Where the statute is clear, courts will not interpret away clear language infavor of an ambiguity that does not exist.' If, however, the terms of a statute provide no definitive answer, thencourts mayresort to extrinsic sources, including the ostensible objects to be achieved and the legislative history.

 People v. Coronado, 12 Cal. 4th 145, 151 (1995) (quoting Lennane v. Franchise Tax Bd., 9 Cal. 4th 263, 268 (1994)). At the same time, however, a court may disregard "[t]he literal meaning of the words of a statute . . . to avoid absurd results. . . ." County of Sacramento v. Hickman, 66 Cal. 2d 841, 849, n. 6 (1967).

  1. National's Fourth Cause of Action

  The HSAA provides for treble damages when a polluter ignores a clean-up order:
A responsible party who has entered into an agreement with the department and is in compliance withthe terms of that agreement, or who is in compliance withan order issued by the department, may seek, in addition to contribution, treble damages from any contribution defendant who has failed or refused to comply with any order or agreement, was named inthe order or agreement, and is subject to contribution. . . . A party seeking treble damages pursuant to this section shall show that the party, the department, or another entity provided notice, by means of personalservice or certified mail, of the order or agreement to the contribution defendant from whom the party seeks treble damages.
Cal. Health & Safety Code § 2539.4.5(a) (emphasis added). Section 2539.4.5(a) expressly defines "the department" to mean "the Department of Toxic Substances Control," not the Regional Board. See Cal. Heath & Safety Code § 25312. National does not allege that it has (1) "entered into an agreement" with or (2) "is in compliance with an order issued by" the Department of Toxic Substances Control. Thus, under the plain meaning of section 2539.4.5(a), National cannot state a cause of action for treble damages.

  National offers several reasons why, in its view, "the department" means either the Department of Toxic Substances Control or the Regional Board. National cites Lungren v. Deukmejian, 45 Cal. 3d 727 (1988) and People v. Sup. Ct., 14 Cal. 4th 294 (1996) for the proposition that courts cannot adopt a statute's literal language without examining its purpose. However, unlike this case, both Lungren and People involved ambiguous statutes. Lungren resolved whether Article V, section 5(b) of the California Constitution, which provides that a nominee for state office who "is neither confirmed nor refused confirmation by both the Senate and the Assembly within 90 days of the submission of the nomination . . . shall take office" meant that confirmation occurs if one house votes on the nomination and one fails to vote within 90 days. Lungren, 45 Cal. 3d at 734. As the court acknowledged, the provision was equally susceptible to multiple meanings. Id. at 735. People involved the issue of whether the term "present source of drinking water" included facet water. People, 14 Cal. 4th at 301-02. Like Lungren, People interpreted a phrase that gave rise to "two reasonable inferences" about its meaning. Id. at 302. Both cases thus looked to extrinsic evidence in order to shed light on a patent ambiguity. Here, on the other hand, "the department" is a defined term and does not include the Regional Board. Because section 2539.4.5(a) is not ambiguous, the court need not consider National's arguments that extrinsic evidence elucidates that "the department" means either the Department or the Regional Board. Nevertheless, the court briefly discusses each below.

  a. Overlapping Jurisdiction

  The California Department of Environmental Protection oversees both the Department and the Regional Boards. See Cal. Gov't Code § 12812. The Department primarily enforces the HSAA. See Cal. Health & Safety Code § 58000 et seq. The Regional Boards largely administers the ...


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