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Obispo Coastkeeper v. U.S. Department of Interior

United States District Court, N.D. California

June 26, 2019

SAN LUIS OBISPO COASTKEEPER, et al., Plaintiffs/Petitioners,
v.
U.S. DEPARTMENT OF THE INTERIOR, et al., Defendants/Respondents.

          ORDER GRANTING FEDERAL DEFENDANTS' MOTION TO DISMISS AND REMANDING CASE TO STATE COURT; AND DENYING PETITIONERS' MOTION TO AMEND THE COMPLAINT DOCKET NOS. 15, 29

          EDWARD M. CHEN UNITED STATES DISTRICT JUDGE.

         The present case was removed from Santa Clara County Superior Court after the U.S. Department of Interior (“DOI”), the Bureau of Reclamation (“BOR”), and Brenda Burman, the Commissioner of the BOR[1] (“the Federal Defendants”) were added as necessary parties to this action. Pets.' RJN, Ex. B (Order at 7).[2] San Luis Obispo Coastkeeper and Los Padres Forestwatch (“Petitioners”) bring this action “to allow sufficient water flows in the Santa Maria River to maintain fish stocks in good condition as required by [California] Fish and Game Code § 5937.” Opposition to Defendants' Motion to Dismiss (“Opp'n”) at 6. To maintain fish stocks, Petitioners want the Federal Defendants to adjust its release of water to achieve sufficient water flows for Steelhead to maintain fish stocks.

         The Federal Defendants argue they have not waived sovereign immunity to be sued in this case. Petitioners contend that the McCarran Amendment applies to this action thereby waiving sovereign immunity.

         For the reasons explained herein, the Court finds that the circumstances presented here do present a waiver of sovereign immunity under the McCarran Amendment, and thus the Federal Defendants must be dismissed for lack of subject matter jurisdiction. As the joinder Federal Defendants were the only basis for jurisdiction, the Court remands the remainder of the proceeding to state court.

         I. FACTUAL AND PROCEDURAL BACKGROUND

         Petitioners initially filed their case in the Santa Barbara Superior Court in 2017. At that time, the only Respondent named was the Water District. Apparently, the parties stipulated to coordinate their case with several existing cases known as the Santa Maria Groundwater Litigation, pending in the Santa Clara Superior Court since 1997. The stipulation was granted. Petitioners' case and the Santa Maria Valley Groundwater Litigation were coordinated into Judicial Council Coordination Proceeding No. 4948 (Twitchell Dam Cases), and Petitioners' case was transferred to the Santa Clara Superior Court. See Pets.' RJN, Ex. A (order granting stipulated petition to coordinate).

         In 2018, the Santa Clara Superior Court ruled on a demurrer filed in this suit by the Water District. The Water District argued that the BOR was “an indispensable party because [it] is the ‘owner' of the dam as well as the holder of a construction and operation contract that prohibits [the Water District] from disposing of and/or releasing water ‘for use outside the District' without prior consent of the [BOR].” Pets.' RJN, Ex. B (Order at 5). The superior court held that the BOR “has a significant interest in the operation of the Twitchell Dam and the outcome of this litigation and [thus] should be joined as a party.” Pets.' RJN, Ex. B (Order at 7). Accordingly, in an amended petition, Petitioners added the BOR as a respondent to the case at bar. Thereafter, the BOR filed a notice of removal to federal court. See 28 U.S.C. § 1442 (providing that “[a] civil action . . . that is commenced in a State court and that is against [the United States or any agency thereof or any officer] may be removed by them to the district court of the United States”).

         Currently pending before the Court is the Federal Defendants' motion to dismiss. The Federal Defendants contend that they have sovereign immunity from Petitioners' action which asserts only state law claims.

         The issue of sovereign immunity in this case draws from the context of other litigation which were coordinated with the suit at bar. That context is described below.

         A. Santa Maria Project: Twitchell Dam and Reservoir

         In 1954, Congress passed a law authorizing the Secretary of the DOI “to construct [a] project for irrigation and the conservation of water, flood control, and for other purposes, on Santa Maria River.” Jackson Decl., Ex. A (Public Law 774). A BOR fact sheet on the Santa Maria Project describes the project as follows: “A joint water conservation and flood control project, it consists of the Twitchell Dam where construction began in July 1956 and was completed in October 1958.” Jackson Decl., Ex. A (Fact Sheet at 1). The dam

is located on the Cuyama River about 6 miles upstream from its junction with the Sisquoc River. The dam regulates flows along the lower reaches of the river and impounds surplus flows for release in the dry months to help recharge the ground-water basin underlying the Santa Maria Valley, thus minimizing discharge of water to the sea at Guadalupe.

         Jackson Decl., Ex. A (Fact Sheet at 1). The affiliated Twitchell Reservoir

stores flood-waters of the Cuyama River for release as needed to recharge the ground-water basins, preventing saltwater intrusion. All water used within the area is obtained by pumping from the ground-water reservoirs. Twitchell Reservoir impounds winter floodwaters for later release down the river channel at a predetermined rate to permit maximum percolation into the ground-water basins; from these ground-water basins individual landholders pump water according to their needs.

         Jackson Decl., Ex. B (Fact Sheet at 1).

         B. Contract Related to Water Rights and Operation of Dam

         In 1956 the BOR and the Santa Barbara County Water Agency entered into a contract regarding construction of the Santa Maria Project. See Jackson Decl., Ex. D (Contract ¶ 1(b)) (defining the project as the Twitchell Dam and Reservoir “as authorized by the Act of Congress of September 3, 1954 . . ., and related and appurtenant works and equipment”).

         The contract provided that the BOR would commence construction of the Twitchell Dam and Reservoir:

Provided, That in no event shall the United States be obligated to commence construction or perform any other act in pursuance of this contract until and unless water rights for project purposes satisfactory to the Secretary of the Interior have been acquired or assured and a permit or permits in terms satisfactory to the Secretary of the Interior shall have been issued by the Division of Water Resources of the Department of Public Works of the State of California for the appropriation of unappropriated water with reasonable assurances and commitment satisfactory to the Secretary of Interior for the ultimate issuance of an appropriate license or licenses.

         Jackson Decl., Ex. D (Contract ¶ 2(c)).

         The contract also provided that,

[s]ubject to the prior right of the United States to utilize the works for flood control purposes, the satisfaction of existing vested rights, and compliance by the Agency and the [Water] District with the terms of this contract, the Agency, upon behalf of the [Water] District, shall have the perpetual right to use all water that becomes available through the construction and operation of the Project. Subject to the operation of the Project works for flood control purposes, the United States shall, during the time that the Project works are being operated and maintained by the United States, release water from the Project works for the use and benefit of the District in accordance with written schedules submitted by the [Water] District on forms prescribed by the United States.

         Jackson Decl., Ex. D (Contract ¶ 6) (emphasis added).

         In addition, the contract provided that,

[u]pon the completion of the Project, . . . the United States will transfer to the Agency the care, operation and maintenance of the [Twitchell] Dam and Reservoir and real and personal property used or useful for operation and maintenance of the Project ...

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