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Chevron Environmental Management Company v. Environmental Protection Corp.

United States District Court, E.D. California

September 13, 2019

CHEVRON ENVIRONMENTAL MANAGEMENT COMPANY, et al., Plaintiffs,
v.
ENVIRONMENTAL PROTECTION CORPORATION, Defendant.

          FINDINGS AND RECOMMENDATION TO GRANT MOTION FOR DEFAULT JUDGMENT (DOC. 20)

          JENNIFER L. THURSTON, UNITED STATES MAGISTRATE JUDGE

         Plaintiffs seek default judgment (Doc. 20), and the Defendant has not opposed this motion. For the following reasons, the Court recommends the motion for default judgment be GRANTED.

         I. Procedural History

         On June 7, 2019, Plaintiffs filed its complaint against the Environmental Protection Corporation. (Doc. 1.) On June 24, 2019, Defendant was personally served through its registered agent, Thomas Johnson, pursuant to Federal Rule of Civil Procedure 4. (Doc. 12.) Defendant failed to file a responsive pleading as required by Federal Rule of Civil Procedure 12(a)(1)(A)(i).

         Upon motion by Plaintiffs, the Court entered the Clerk's Certificate of Entry of Default against Defendant on July 22, 2019. (Docs. 15, 16.) On August 21, 2019, Plaintiffs filed the motion now pending before the Court seeking default judgment against Defendant. (Doc. 20.)

         II. Legal Standards Governing Entry of Default Judgment

         The Federal Rules of Civil Procedure govern the entry of default judgment. After default is entered because "a party against whom a judgment for relief is sought has failed to plead or otherwise defend," the party seeking relief may apply to the court for a default judgment. Fed.R.Civ.P. 55(a)-(b). Upon the entry of default, well-pleaded factual allegations regarding liability are taken as true, but allegations regarding the amount of damages must be proven. Pope v. United States, 323 U.S. 1, 11 (1944); see also Geddes v. United Financial Group, 559 F.2d 557, 560 (9th Cir. 1977). In addition, "necessary facts not contained in the pleadings, and claims which are legally insufficient, are not established by default." Cripps v. Life Ins. Co. of North Am., 980 F.2d 1261, 1267 (9th Cir. 1992) (citing Danning v. Lavine, 572 F.2d 1386, 1388 (9th Cir. 1978)).

         Entry of default judgment is within the discretion of the Court. Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). The entry of default “does not automatically entitle the plaintiff to a court-ordered judgment.” Pepsico, Inc. v. Cal. Sec. Cans, 238 F.Supp.2d 1172, 1174 (CD. Cal 2002), accord Draper v. Coombs, 792 F.2d 915, 924-25 (9th Cir. 1986). The Ninth Circuit determined:

Factors which may be considered by courts in exercising discretion as to the entry of a default judgment include: (1) the possibility of prejudice to the plaintiff, (2) the merits of plaintiffs substantive claim, (3) the sufficiency of the complaint, (4) the sum of money at stake in the action, (5) the possibility of a dispute concerning material facts, (6) whether the default was due to excusable neglect, and (7) the strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits.

Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). As a general rule, the issuance of default judgment is disfavored. Id. at 1472.

         III. Plaintiffs' Allegations

         The Court accepts Plaintiffs' factual assertions as true because default has been entered against Defendant. See Pope, 323 U.S. at 12. Plaintiffs filed the instant action against Defendant on June 7, 2019, under §§ 107(a) and 113(g)(2), 42 U.S.C. §§ 9607(a) and 9613(g)(2), of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended (CERCLA), for cost recovery and declaratory judgment from Defendant for response costs Plaintiffs have incurred and will incur in connection with the investigation and remediation of the EPC Eastside Disposal Facility (EPC Site). Plaintiffs also seek contribution and/or indemnity under Health and Safety Code §§ 25325.5 and 25363(e).

         The EPC Site is a landfill located on Round Mountain Road about 15 miles northeast of Bakersfield in Kern County, California. (Doc. 1 at 3.) The EPC Site operated as a waste disposal facility from approximately 1971 to 1985 and received millions of gallons of wastes, which were land farmed from 1971 to 1979 and, thereafter, disposed of in unlined impoundments. (Doc. 1 at 3.) Plaintiffs allege that the EPC Site is a “facility” within the meaning of 42 U.S.C. § 9601(9). (Doc. 1 at 3.) From 1970 until 1992, during the time of Defendant's ownership of the EPC Site, in addition to daily and routine disposals of hazardous substances, multiple releases of hazardous substances occurred when liquid waste from the unlined surface impoundments was suddenly and accidentally released into the environment. (Doc. 1 at 3-4.) Consequently, Plaintiffs allege, there were and are “releases” and threatened “releases” within the meaning of 42 U.S.C. § 9601(22), and these releases resulted in discharges of “hazardous substances” into the environment within the meaning of 42 U.S.C. § 9601(14). (Doc. 1 at 5.)

         The California Department of Toxic Substances Control (DTSC), determined that the EPC Site must be cleaned up, and issued an Imminent and Substantial Endangerment Determination and Consent Order to that effect. (Doc. 1 at 5.) Chevron agreed to take the lead in cleaning up the EPC Site. (Doc. 1 at 5.) On February 1, 2008, DTSC approved the Remedial Action Plan for the EPC Site (RAP). (Doc. 1 at 5.) Since that time, response efforts at the EPC Site have been substantial and Chevron has conducted multiple removal actions to prepare the EPC Site for closure. (Doc. 1 at 5.) On March 26, 2019, the DTSC concurred with proposed modifications to the RAP that would permit closure of impoundments at the EPC Site through installation of a structured geomembrane cap. (Doc. 1 at 5.) Plaintiffs allege that, as a result, Chevron has taken “response” actions at the EPC Site, within the meaning of 42 U.S.C. § 9601(25), and has incurred reasonable and necessary costs consistent with the National Contingency Plan in connection with taking those “response” actions. (Doc. 1 at 5.)

         IV. ...


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