United States District Court, N.D. California
ORDER RE MOTION TO DISMISS FOURTH AMENDED COMPLAINT ORDER RE MOTION TO INTERVENE Dkt. Nos. 106, 121 INTRODUCTION
MARIA-ELENA JAMES, Magistrate Judge.
Plaintiff Northern California River Watch ("RW") brought this action pursuant to the federal Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq. ("RCRA"), and the federal Clean Water Act, 33 U.S.C §1251 et seq. ("CWA" or "the Act"), against Defendant Fluor Corporation, alleging violations of both statutory schemes arising out of Fluor's past industrial use of real property located in Windsor, California. Thereafter, The Shiloh Group ("TSG"), which owns 28 acres situated on the western-most portion of the property, filed a motion on October 24, 2013, seeking to intervene as a plaintiff in this action pursuant to Federal Rule of Civil Procedure ("Rule") 24. Dkt. No. 121. Also pending before the Court is Fluor's Motion to Dismiss ("MTD") RW's Fourth Amended Complaint ("FAC"). Having carefully considered the papers submitted and the pleadings in this action, and for the reasons set forth below, the Court hereby GRANTS TSG's Motion to Intervene and GRANTS IN PART and DENIES IN PART Fluor's Motion to Dismiss.
A. Motion to Dismiss
This is a citizen's enforcement action brought by RW, a non-profit organization dedicated to protecting, enhancing, and helping to restore the water environs of California, including its drinking water sources, groundwater, rivers, creeks and tributaries. FAC ¶ 11. RW brings this suit under the citizen suit enforcement provisions of the RCRA, specifically RCRA § 7002(a)(1)(B), 42 U.S.C. § 6972(a)(1)(B), and RCRA § 4005; 42 U.S.C. § 6945, to stop Fluor from alleged ongoing violations of the RCRA. Id. ¶ 1. RW also seeks relief under the CWA, specifically 33 U.S.C. §§ 1311, 1342, and 1365, to stop Fluor from alleged and ongoing violations of the CWA. Id. ¶ 5.
RW alleges that Fluor has violated various provisions of the RCRA and the CWA with respect to a site located on a portion of the Shiloh Industrial Park in Windsor, California (the "Site"). Id. ¶ 22. RW seeks declaratory and injunctive relief to prevent future violations, the imposition of civil penalties, and other relief based on Fluor's alleged violations of the RCRA and CWA. Id. ¶¶ 4, 8.
RW alleges that Fluor owned and operated the Site from 1955 to 1972, during which time it operated several industrial manufacturing and chemical treatment operations. Id. ¶ 23. Two sites are specifically identified in the FAC. The first is the Tower Site, which is currently being remediated by Ecodyne Corporation under the supervision of the Regional Water Quality Control Board ("RWQCB"). Id. ¶ 26. The second is the Pond Site, which is being remediated by Fluor, under the supervision of the California Department of Toxic Substances Control ("DTSC"). Id. ¶¶ 26, 46.
In the FAC, RW alleges that Fluor used the Pond Site to manufacture processing tanks, cross arms, and cooling towers, as well as to treat wood products. Id. ¶ 23. RW alleges that Fluor manufactured and treated these materials on the Pond Site in a dip treatment shed and a kiln building. Id. RW further alleges that the treatment shed contained two tanks that held pentachlorophenal ("PCP"), two tanks containing creosote, and four tanks containing lead. Id. RW alleges that wooden or metal platforms were built around the tanks, and that a concrete slab existed approximately two feet below these platforms, which was angled towards the southwest end of the building, though the slab did not run the entire length of the shed. Id. RW alleges that the slab was bermed around the perimeter of the shed, with openings on the southwest end, allowing spilled liquids to drain off the end of the slab onto the dirt floor. Id. ¶ 24. RW alleges that these spilled chemicals were then pumped to unlined evaporation ponds, and that these ponds, along with tanks, equipment, and drying tower, were the original sources of hazardous waste that was introduced into the soil at the Pond Site. Id. RW further alleges that the PCP, creosote, lead, arsenic turned the soil into solid hazardous waste, which is still discharging toxins into a waterway of the United States. Id. ¶¶ 23, 40.
RW also alleges that Fluor operated a paint shop outside of the Pond Site from 1962 to 1970, and that the operation of the paint shop introduced toxins such as lead, cadmium, mercury, tin, copper, arsenic, asbestos, DDT, and polychlorinated biphenyls ("PCBs") into the environment. Id. ¶ 25.
In addition, RW alleges that the only area of the Site that Fluor has "remediated, or ever attempted to remediate" is the Pond Site. Id. ¶ 26. Historical photos show "teepee" burners, which were used to burn wood and debris, being operated outside of the Pond Site. Id. RW alleges that residual solid and hazardous materials from the paint shop and teepee burners remain in the soil and groundwater. Id. Product was moved and stored throughout the Site, causing chemicals to be deposited in areas outside of the Pond and Tower Sites, and those locations have yet to be investigated or remediated. Id. Recent samplings of the canal connecting to Pruitt Creek demonstrate the presence of lead, copper, zinc, and polynuclear aromatic hydrocarbons ("PAHs"). Id. RW alleges that Fluor, in the course of doing business on the Site, has discharged, and continues to discharge, pollutants to surface and ground water at the Site. Id. ¶ 27.
Sometime in November of 2011, the RWQCB informed TSG, the current owners of the Site, that hazardous levels of lead and copper were found in the canal downstream from the former Pond Site, which leads to Pruitt Creek. Id. A February 27, 2012 Trans Tech report, entitled "Summary Report of Findings" by Trans Tech Consultants, prepared for TSG, strongly implied Fluor's prior operations as the source of the lead. Id.
RW alleges that Fluor's handling, use, transport, treatment, storage, or disposal of pollutants at the Site occurred in a manner which has allowed significant quantities of hazardous constituents to be discharged to soil, ground, and surface waters beneath and around the Site and adjacent properties off site. Id. ¶ 28. At present, RW alleges that the levels of pollutants in the groundwater at the Site remain high above the allowable Maximum Contamination Levels, Water Quality Objectives, and Public Health Goals for these constituents, and thus may be creating an imminent and substantial endangerment to public health or the environment. Id. ¶ 29. RW further alleges that the pollutants in the soils remain above the applicable Environmental Screening Levels and thus may be creating an imminent and substantial danger to public health or the environment. Id.
RW further alleges that Fluor has discharged or is continuing to discharge hazardous waste on the Site in violation of the RCRA. Id. ¶ 30. RW believes that Fluor has known of the contamination at the Site for more than 30 years, and is also aware that continuing discharges or failure to remediate the pollution allows the contamination to migrate through the soils and ground water at or adjacent to the Site, or to continually contaminate actual or potential sources of drinking water, as well as ground or surface waters. Id. It alleges that the violations are continuing to this day. Id.
Last, RW alleges that Fluor has discharged pollutants from the Site to waters of the United States without a National Pollutant Discharge Elimination System ("NPDES") permit, in violation of CWA § 301(a), 33 U.S.C. § 1311(a) and CWA § 402(a) and (b), 33 U.S.C. § 1342 (a) and (b). Id. ¶¶ 31, 32. RW alleges that Fluor is discharging pollutants, including lead, copper, zinc, and PAHs from the Site and various point sources within the Site to waters of the United States. Id. ¶ 33. The originating point sources were the tanks, teepee burners, equipment and ponds described above. Id. ¶¶ 26, 33. The Pond Site is directly adjacent to the canal on the Site and to wetlands adjacent to the canal. Id. ¶ 33. Materials are alleged to have moved from the Waste Pond to the canal. Id. The canal is directly connected to a water of the United States (Pruitt Creek). Id. Moreover, RW alleges these point sources continue to discharge to discrete conveyances connected to waters of the United States. Id. These point sources include roads, sewer lines (including a lateral that runs through the plume), and drainage ditches on the Site which discharge directly to the culvert adjacent to the Site, which in turn discharges to Pruitt Creek. Id. RW further alleges that these additional point sources also continue to discharge from the Site to surface waters adjacent to the Site. Id. It alleges that the violations are continuing to this day. Id.
The range of dates covered by the allegations is the period between August 1, 2007 and August 1, 2012, as designated by the August 1, 2012 Notices of Violations and Intent to File Suit Under the RCRA and CWA attached to the FAC. Id. ¶¶ 30, 33. The violations of the CWA, including discharging pollutants to waters of the United States without an NPDES permit, failure to obtain an NPDES permit, failure to implement the requirements of the CWA, and failure to meet water quality objectives, are alleged to be continuous and ongoing. Id. ¶ 34.
B. Motion to Intervene
TSG owns 28 acres of real property in Windsor, California. Nelson Decl. ¶ 1, MTI, Dkt. No. 121. TSG's property lies on the western-most portion of the former Fluor site. Id. When TSG purchased the property in 1999, TSG was aware that Fluor was in the process of cleaning up the area known as the Pond Site under the supervision of the DTSC, which lies on the property. Id. at ¶ 1. This site exhibits mainly lead contamination. Id. ¶ 5. TSG believes that Fluor caused the lead and other contamination at the Pond Site. Id. ¶ 1. TSG was also aware that Ecodyne was also cleaning up the adjacent Tower Site under the supervision of the RWQCB. Id. The Tower Site exhibits mainly hexavalent chromium contamination. Id. ¶ 5.
On August 19, 2013, TSG informed Fluor it intended to file a motion to intervene in order to oppose the pending Motion to Dismiss the FAC. Donnelly Decl. ¶ 1, Ex. 1, Opp'n to MTI, Dkt. No. 123. On August 21, 2013, Fluor's counsel participated in a conference call with counsel for TSG and RW, at which Fluor proposed a stipulation to continue the hearing on the Motion to Dismiss until after the Court decided TSG's proposed Motion to Intervene. Id. ¶ 4. Fluor then drafted and emailed the Stipulation and Proposed Order to TSG and RW. Id. ¶ 5. On August 23, 2013, TSG declined to enter into the stipulation. Id. ¶ 6. On September 9, 2013, TSG served a Notice of Violation and Intent to File Suit under the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"). Id. ¶ 7.
The basis for TSG's claims arose from its discovery in late 2011 that a RWQCB employee had detected lead and other metals at elevated levels in storm water exiting a concrete lined ditch ("Ditch") that forms the western boundary of the TSG property. Id. ¶ 3. The RWQCB "urged" TSG to promptly cleanup the earth and material in the Ditch. Id. The cleanup of the contaminated earth cost TSG over $117, 000.00 to complete. Id. TSG requested reimbursement from Fluor and Ecodyne because it believed they were responsible for the contamination, but both refused. Id.
TSG asserts that Fluor refused to reimburse TSG because Fluor believes that the lead in the soil at the Pond Site is firmly attached to the soil, beneath a thick layer of clean fill and capped by asphalt. Id. ¶ 5. TSG contends that the asphalt is cracked and does not fully cover the site. Id. TSG's environmental consultant conducted independent tests in June of 2013 that showed elevated lead in multiple locations. Id. TSG provided these test results to Fluor, and again requested reimbursement, but Fluor refused. Id. TSG then sent Fluor a CERCLA notice/demand letter. Id.
TSG additionally asserts that it believes the DTSC's supervision of Fluor's cleanup efforts are deficient, given that the site has been under DTSC supervision since 1989, yet lead was still found in elevated levels in 2011. Id. ¶ 6. TSG thus intends to send CWA and RCRA notice/demand letters to Fluor to address this issue. Id. TSG is aware that RW has asserted claims against Fluor under both the RCRA and CWA; however, TSG maintains that RW is not capable of seeking recovery of TSG's expenses to remove the hazardous, contaminated earth from the Ditch. Id. ¶ 7.
TSG now seeks to intervene in order to (1) participate in the litigation and/or resolution of RW's claims against Fluor, (2) to enforce against Fluor TSG's rights and state law claims within this Court's pendent jurisdiction, and (3) to enforce against Fluor TSG's rights and claims under federal law once those claims are ripe. TSG asserts the following causes of action: (1) contribution for cleanup costs (Cal. Health & Safety § 25363); (2) negligence; (3) trespass; (4) private nuisance; (5) declaratory relief; (6) tortious breach of covenant of good faith and fair dealing; and (7) to obtain injunctive relief. MTI, Dkt. No. 121.
A. Motion to Dismiss
On November 10, 2010, RW filed this lawsuit pursuant to the RCRA and CWA against Ecodyne, alleging that Ecodyne violated various provisions of these statutory schemes with respect to the Site. Dkt. No. 1. On April 19, 2011, RW filed its First Amended Complaint. Dkt. No. 31. Ecodyne moved to dismiss the First Amended Complaint, which the Court granted in part and denied in part. Dkt. No. 46. On August 10, 2011, RW filed its Second Amended Complaint. Dkt. No. 47. On July 26, 2012, RW advised Ecodyne that it intended to file an amended complaint to add Fluor as a defendant and sought Ecodyne's consent, which Ecodyne declined.
On August 1, 2012, RW served Notices of Violation and Intent to File Suit Under the CWA and RCRA on Ecodyne and Fluor. Dkt. No. 73. RW then moved to amend the complaint to add Fluor as a defendant on August 6, 2012. Dkt. No. 53. In its motion, RW advised the Court that it would seek leave to further amend its complaint to add the new allegations contained in the August 1 Notice once the 90-day notice period expired. Id. Because the Court found that evaluating a full version of RW's proposed amendments was more efficient than addressing two separate motions to amend, it denied the motion without prejudice. Dkt. No. 59. Accordingly, on November 14, 2012, RW filed a motion seeking leave to file a Third Amended Complaint ("TAC") adding Fluor as a defendant. Dkt. No. 72. The Court granted RW's motion, and RW filed its TAC on January 15, 2013. Dkt. No. 73.
In its TAC, RW asserted claims against both Fluor and Ecodyne for: (1) imminent and substantial endangerment to health or to the environment pursuant to 42 U.S.C. § 6972(a)(1)(B); (2) creating an imminent and substantial endangerment to health or the environment pursuant to 42 U.S.C. § 6972(a)(1)(B) based on open dumping in violation of 42 U.S.C. § 6945(a); and (3) violation of the CWA § 301 (discharge of pollutants from a point source without a NPDES permit - 33 U.S.C. §1342(a) and (b), 33 U.S.C. § 1311). Id.
Fluor thereafter moved to dismiss the TAC on the grounds that: (1) RW failed to plead sufficient facts showing that Fluor released, disposed of, or discharged any chemicals causing any imminent or substantial endangerment to health or the environment in violation of the RCRA; (2) RW failed to satisfy the jurisdictional prerequisites for CWA and RCRA claims under Rule 12(b)(6); and (3) dismissal was appropriate under the doctrine of primary jurisdiction due to the current supervision of the Site by the DTSC. Dkt. No. 81. The Court granted Fluor's motion to dismiss regarding the lack of sufficient facts in RW's TAC, simultaneously granting RW leave to file a Fourth Amended Complaint. Dkt. No. 105. The Court admonished RW that it was disinclined to grant any further leave to amend given that this action has been pending for over two years and has yet to move past the initial pleading stage. Id.
On June 24, 2013, RW filed the operative FAC. Dkt. No. 106. RW again asserts the following claims against Fluor for: (1) imminent and substantial endangerment to health or to the environment pursuant to 42 U.S.C. § 6972(a)(1)(B); (2) creating an imminent and substantial endangerment to health or the environment pursuant to 42 U.S.C. § 6972(a)(1)(B) based on open dumping in violation of 42 U.S.C. § 6945(a); and (3) violation of the CWA § 301 (discharge of pollutants from a point source without an NPDES permit - 33 U.S.C. § 1342(a) and (b), 33 U.S.C. § 1311). FAC ¶ 1.
Fluor now moves to dismiss the FAC on several grounds. As to RW's first claim under the RCRA, it argues that RW has again failed to plead sufficient facts alleging an imminent and substantial endangerment regarding both the Pond Site, which is currently being remediated under a Consent Order by the DTSC; and the Tower Site, currently under the supervision of the RWQCB. MTD at 2. Fluor contends that because both the Tower Site and the Pond Site are currently under supervised remediation, RW cannot meet their burden of showing imminent and substantial endangerment as required under the RCRA. Id. Fluor next argues that RW's second RCRA claim for open dumping fails because § 6945 does not apply to wholly past activities by prior owners or operators, and Fluor ceased all operation and ownership of the site in 1972. Id. Last, Fluor argues that this Court lacks jurisdiction over RW's third claim under the CWA because it does not create liability for wholly past violations. Id. at 2-3. Fluor further argues that even if this Court did have jurisdiction, Plaintiff has failed to state a claim because the CWA does not hold defendants liable for unpermitted discharges prior to the implementation of the NPDES permit. Id. at 3. Fluor additionally argues that dismissal is appropriate pursuant to Rule 12(b)(1) as to RW's RCRA and CWA claims outside of the Pond and Tower Sites, because RW failed to satisfy the jurisdictional notice prerequisites for these claims. Id. at 10, 12, and 14.
RW filed an Opposition on August 26, 2013 (Dkt. No. 113), and Fluor filed a Reply on September 3, 2013 (Dkt. No. 117). Fluor also filed objections to the declaration of RW's counsel, Jack Silver, and a motion to strike portions thereof. Dkt. No. 119. The Court heard oral argument on September 26, 2013, and took the matter under submission.
B. Motion to Intervene
On October 3, 2013, TSG filed a motion seeking to intervene as a plaintiff in this action pursuant to Federal Rule of Civil Procedure 24. Dkt. No. 121. Fluor filed an Opposition on October 17, 2013 (Dkt. No. 122), and TSG filed a Reply on October 24, 2013 (Dkt. No. 126). Fluor also filed a Motion to Strike Portions of the Declarations supporting the Motion to Intervene and the Reply. Dkt. Nos. 124, 128. TSG filed an Opposition to the first Motion only (Dkt. No. 127), to which Fluor filed a Reply (Dkt. No. 129).
MOTION TO DISMISS
A. Request for Judicial Notice
As part of its Motion, Fluor seeks judicial notice of Exhibits A through H, regarding the ongoing remediation the Pond Site. RJN, Dkt. No. 111. Generally, on a motion to dismiss, courts limit review to the contents of the complaint and may only consider extrinsic evidence that is properly presented to the court as part of the complaint. Lee v. City of Los Angeles, 250 F.3d 668, 688-89 (9th Cir. 2001) (court may consider documents physically attached to the complaint or documents necessarily relied on by the complaint if their authenticity is not contested). However, a court may take notice of undisputed "matters of public record" subject to judicial notice without converting a motion to dismiss into a motion for summary judgment. Id. (citing Fed.R.Evid. 201; MGIC Indem. Corp. v. Weisman, 803 F.2d 500, 504 (9th Cir. 1986)).
Under Rule 201, a district court may take notice of facts not subject to reasonable dispute that are capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned. Fed.R.Evid. 201(b); see also Lee, 250 F.3d at 689. These judicially noticed documents may only be considered for the limited purposes of proving their existence and content, but not for the truth of the matters asserted therein. Allstate Ins. Co. v. Pira, 2012 WL 1997212, at *4(N.D. Cal. June 4, 2012).
Exhibits A, B, E, and F contain consent orders and remediation requirements issued by the DTSC and RWQCB. These exhibits are public agency records, which are incorporated by reference into RW's Complaint, and RW does not dispute their authenticity. RW does not oppose the request with respect to these exhibits. Accordingly, the Court GRANTS Fluor's request and takes judicial notice of Exhibits A, B, E, and F.
RW objects to Fluor's request with respect Exhibits C, D, G, and H. Opp'n to RJN, Dkt. No. 115. Exhibits C and D are letters from the DTSC to TSG's counsel, Brian Carter of Carter, Momsen, and Knight LLP, dated August 15, 2012 and November 19, 2012 respectively. Exhibits G and H are letters from Beth Lamb of the RWQCB to Ray Avendt of the Ecodyne Corp./The Marmon Group, dated October 7, 2010 and February 29, 2012 respectively. RJN at 2. RW argues that Exhibits C, D, G, and H do not fulfill the requirements of Rule 201(b) because they contain factual assumptions and conclusions open to question, are hearsay, and are unreliable. Opp'n to MTD at 2-3. Thus, while potentially admissible, RW argues that these exhibits are not judicially noticeable. Id. (citing Keith v. Volpe, 858 F.2d 467, 481 (9th Cir. 1988)). Fluor, in its Reply, clarifies that it does not seek notice of the truth of any of the matters contained in the letters, only the fact that the agencies have drawn certain conclusions, relied on certain findings, or identified plans regarding the Tower and Pond Site remediation, which as a matter of public record are not reasonably subject to question. Reply to RJN, Dkt. No. 118.
Because these documents are matters of public record, the Court finds that the letters contained in the DTSC and RWQCB's publicly accessible files, as set forth in Exhibits C, D, G, and H, are proper subjects of judicial notice under Rule 201. The Court will consider the letters for the limited purpose of establishing that: (1) the DTSC has investigated site conditions; (2) the DTSC has concluded that groundwater remediation is unnecessary at the Pond Site, (3) the DTSC is overseeing a soil remediation plan at the Pond Site, and (4) that the RWQCB is overseeing Ecodyne's approved groundwater remediation plan at the Tower Site. The Court will not consider whether the statements, test results, or conclusions contained in the letters are true. Coal. for a Sustainable Delta v. ...