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City of West Sacramento v. R and L Business Management
United States District Court, E.D. California
October 22, 2019
CITY OF WEST SACRAMENTO, CALIFORNIA; and PEOPLE OF THE STATE OF CALIFORNIA, Plaintiffs,
R AND L BUSINESS MANAGEMENT, a California corporation, f/k/a STOCKTON PLATING, INC., d/b/a CAPITOL PLATING, INC., a/k/a CAPITOL PLATING, a/k/a CAPITAL PLATING; CAPITOL PLATING, INC., a dissolved California corporation; ESTATE OF GUS MADSACK, DECEASED; ESTATE OF CHARLES A. SCHOTZ a/k/a SHOTTS, DECEASED; ESTATE OF E. BIRNEY LELAND, DECEASED; ESTATE OF FRANK E. ROSEN, DECEASED; ESTATE OF UNDINE F. ROSEN, DECEASED; ESTATE OF NICK E. SMITH, DECEASED; RICHARD LELAND, an individual; SHARON LELAND, an individual; ESTATE OF LINDA SCHNEIDER, DECEASED; JUDY GUESS, an individual; JEFFREY A. LYON, an individual; GRACE E. LYON, an individual; THE URBAN FARMBOX LLC, a suspended California limited liability company; and DOES 1-50, inclusive, Defendants.
ORDER RE: JOINT MOTION FOR GOOD FAITH
WILLIAM B. SHUBB, UNITED STATES DISTRICT JUDGE.
the court is a joint motion for a good faith settlement
determination filed on October 7, 2019 by the City of West
Sacramento and the People of the State of California
(“plaintiffs”), and defendant Judy Guess. (Docket
court described much of the factual and procedural background
to this lawsuit in its prior orders. (See Docket Nos. 18, 33,
44 & 63.) On August 21, 2019, plaintiffs and defendant
Judy Guess reached an agreement for the settlement of all
claims and disputes between them in this matter. (Decl. of
Kenneth Stone (“Stone Decl.”) ¶ 3 (Docket
No. 98-1); see also Stone Decl. Ex. 1 (“Settlement
Agreement”) (written agreement setting forth the terms
of the settlement) (Docket No. 98-4).) Plaintiffs have
alleged the following claims against Judy Guess: (1)
violation of the Resource Conservation and Recovery Act
(“RCRA”) § 7002(a), 42 U.S.C. §
6972(a)(1)(B); (2) violation of the Comprehensive
Environmental Response, Compensation and Liability Act
(“CERCLA”) § 107(a), 42 U.S.C. §
9607(a); (3) violation of The Gatto Act, California Health
& Safety Code §§ 25403-25403.8; (4) violation
of The Porter-Cologne Water Quality Control Act, California
Water Code § 13304(c); (5) public nuisance; (6)
trespass; (7) statutory indemnity; and (8) declaratory
relief. (See Third Am. Compl. (“TAC”) (Docket No.
45).) The TAC alleges that Guess owned the property during
the time that contaminants were disposed of at the property.
(Id. ¶ 94.)
settling parties now move for a good faith settlement
determination and an order barring all claims against them
for contribution and indemnity. Pursuant to the settlement
agreement, Guess will pay $50, 000.00 to the City. (See
Settlement Agreement § 3.1.) The settling parties also
request that the court dismiss all claims between them with
prejudice. Defendants John Clark and R&L Business
Management filed a statement of non-opposition to defendant
Guess' motion for a good faith settlement determination.
(See Docket Nos. 98 & 108.)
State Law Claims
settling parties have settled claims brought under both state
and federal law. “When a district court . . . hears
state law claims based on supplemental jurisdiction, the
court applies state substantive law to the state law
claims.” Mason & Dixon Intermodal, Inc. v.
Lapmaster Int'l LLC, 632 F.3d 1056, 1060 (9th Cir.
2011) (citation omitted). California state settlement law,
here codified in California Code of Civil Procedure Section
877, constitutes substantive law. See Id. Section
877.6 “is the procedural mechanism for implementing
[Section] 877” and making the determination of a good
faith settlement. See Coppola v. Smith, No.
1:11-CV-1257 AWI BAM, 2017 WL 4574091, at *2 (E.D. Cal. Oct.
13, 2017). Therefore, the court will apply California
settlement law to the state law claims at issue between the
settling parties. See Mason & Dixon, 632 F.3d at 1060.
plaintiffs' CERCLA claim, courts review settlements and
generally enter contribution and indemnity bars if the
settlement is “procedurally and substantively fair,
reasonable, and consistent with CERCLA's
objectives.” Arizona v. City of Tucson, 761
F.3d 1005, 1012 (9th Cir. 2014) (citation and internal
quotation marks omitted). This court has an independent
obligation to scrutinize the terms of the agreement.
Id. The court must find that the agreement is
roughly correlated with some acceptable measure of
comparative fault that apportions liability among the
settling parties according to a rational estimate of the harm
potentially responsible parties have done. Id.
under the Gatto Act turns on liability under CERCLA. The
Gatto Act provides that “if a local agency undertakes
action to investigate property or clean up . . . a release of
hazardous material, the responsible party shall be liable to
the local agency for the costs incurred in the action.”
Cal. Health & Safety Code § 25403.5. A responsible
party includes “those described in Section 107(a) of
CERCLA.” Id. Because good-faith settlement
determinations turn on the ...