Citizens Development Corporation, Inc. v. San Diego, County of

• Court: District Court, S.D. California
• Decided: April 7, 2020
• Docket: 3:12-cv-00334
• Status: Unknown

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 CITIZENS DEVELOPMENT Case No. 12CV334 GPC(KSC) CORPORATION, INC., a California 12 Corporation, ORDER DENYING JOINT Plaintiff, MOTION TO STAY 13 v. [ECF No. 371] 14 COUNTY OF SAN DIEGO, a 15 California municipal corporation, CITY OF SAN MARCOS, a California 16 municipal corporation, CITY OF ESCONDIDO, a California municipal 17 corporation, VALLECITOS WATER DISTRICT, a California municipal 18 corporation, HOLLANDIA DAIRY, INC., a California corporation, and 19 DOES 1 through 100, inclusive, 20 Defendants. 21 22 23 Before the Court is the Joint Motion to Stay filed by Plaintiff and Counter- 24 Defendant Citizens Development Corporation, Inc. (“CDC”), Defendant and 25 Counter-Claimant County of San Diego (“County”), and Defendants, Counter- 26 Claimants, and Cross-Claimants City of San Marcos (“San Marcos”), City of 27 Escondido (“Escondido”), and Vallecitos Water District (“Vallecitos”) 28 (collectively, “the Parties”). ECF No. 371. 1 I. Background 2 Plaintiff filed the Complaint in this action in February 8, 2012. ECF No. 1. 3 Parties have been working in private mediation to reach a settlement since 4 approximately March 2013. ECF No. 91 at 3-4. Based upon these settlement 5 efforts, the Court has granted a number of stays from January 8, 2014 through 6 October 11, 2016 to allow the Parties to pursue settlement. ECF Nos. 94, 180. 7 Since settlement was not reached, the stay was lifted as of February 10, 2017. ECF 8 No. 180. 9 On June 5, 2017, the San Diego Regional Water Quality Control Board 10 (“RWQCB”) originally approved the parties’ submitted report that outlined 11 measures that the parties would undertake to remedy the water pollution that gives 12 rise to this action. ECF No. 371 at 4-5. Parties now seek to stay this case for ninety 13 days until after the RWQCB rules on the parties’ application for a variance. ECF 14 No. 371 at 5. The parties allege that this stay is necessary since the magnitude of 15 damages currently cannot be ascertained until RWQCB issues its decision on the 16 variance application since, if the parties’ application is granted, the cost estimates – 17 currently at around $11.3 million – will likely remain unchanged, but if their 18 application is denied, the cost estimates will likely increase. Id. at 4. 19 Parties assert that the need for this variance stems from the discovery of 20 groundwater wells containing chemical constituents in the “latter part of 2019.” Id. 21 at 5. The RWQCB told parties that they must resolve this issue of the groundwater 22 wells before taking further steps. As a result, the parties state they must make an 23 application for a variance to address this issue, but the parties have yet to apply for 24 the variance and anticipate that it would be “submitted in the next three (3) weeks.” 25 ECF No. 371 at 8. The parties estimate that the process for deciding the variance 26 would take “many months, possible as much as a year to complete.” Id. The 27 parties further state that “[w]hile the Parties continue to hold monthly calls with the 28 1 RWQCB, the Parties have no control over the RWQCB’s approval process or 2 timeline.” Id. 3 II. Discussion 4 A court has the inherent power to stay proceedings. See Landis v. North Am. 5 Co., 299 U.S. 248, 254 (1936). The Ninth Circuit has noted the following three 6 considerations that a district court should take into account before entering a stay: 7 (1) “the possible damage which may result from the granting of a stay,” (2) “the 8 hardship or inequity which a party may suffer in being required to go forward,” and 9 (3) “the orderly course of justice measured in terms of the simplifying or 10 complicating of issues, proof, and questions of law which could be expected to 11 result from a stay.” CMAX, Inc. v. Hall, 300 F.2d 265, 268 (9th Cir. 1962) 12 (citing Landis v. N. Am. Co., 299 U.S. 248, 254–55 (1936)). “[T]he suppliant for a 13 stay must make out a clear case of hardship or inequity in being required to go 14 forward.” Id. at 268. 15 Parties argue that the doctrine of primary jurisdiction applies because the 16 amount of CDC’s alleged damages depends on the RWQCB’s decision. ECF No. 17 371 at 11. “The primary jurisdiction doctrine allows courts to stay proceedings or 18 to dismiss a complaint without prejudice pending the resolution of an issue within 19 the special competence of an administrative agency.” Clark v. Time Warner 20 Cable, 523 F.3d 1110, 1114 (9th Cir.2008). Primary jurisdiction is a “prudential” 21 doctrine that permits a court to stay or dismiss a case if an “otherwise cognizable 22 claim implicates technical and policy questions that should be addressed in the first 23 instance by the agency with regulatory authority over the relevant industry rather 24 than by the judicial branch.” Id. (citing Syntek Semiconductor Co. v. Microchip 25 Tech. Inc., 307 F.3d 775, 780 (9th Cir. 2002)). “[I]t is to be used only if a claim 26 requires resolution of an issue of first impression, or of a particularly complicated 27 issue that Congress has committed to a regulatory agency, and if protection of the 28 integrity of a regulatory scheme dictates preliminary resort to the agency which 1 administers the scheme.” Id. (internal citations and quotation marks omitted). “No 2 fixed formula exists for applying the doctrine of primary jurisdiction.” Davel 3 Commc'ns, Inc. v. Qwest Corp., 460 F.3d 1075, 1086 (9th Cir. 4 2006) (quoting United States v. W. Pac. R.R. Co., 352 U.S. 59, 64, 77 S.Ct. 161, 1 5 L.Ed.2d 126 (1956)). Ninth Circuit courts, however, weigh four factors in 6 determining whether to apply the doctrine: (1) [whether] the issue is not “within the conventional experiences of 7 judges,” (2) [whether] the issue “involves technical or policy considerations 8 within the agency's particular field of expertise,” (3) [whether] the issue “is particularly within the agency's discretion,” or (4) [whether] “there exists a 9 substantial danger of inconsistent rulings. 10 Maronyan v. Toyota Motor Sales, U.S.A., Inc., 658 F.3d 1038, 1048–49 (9th Cir. 11 2011) (quoting Brown v. MCI WorldCom Network Servs., Inc., 277 F.3d 1166, 12 1172–73 (9th Cir. 2002)). A court must balance the parties’ need to resolve the 13 action expeditiously against the benefits of obtaining the agency's expertise on the 14 issues. Maronyan, 658 F.3d at 1049. 15 Courts in the Ninth Circuit have similarly found that a stay exercise of 16 primary jurisdiction was not warranted where there was no indication that an 17 agency’s decision would be made in a timely fashion. Molnar v. NCO Fin. Sys., 18 Inc., 2015 WL 1906346, at *6 (S.D. Cal. Apr. 20, 2015) (denying motion to stay 19 where a third-party agency had given “no indication that imminent clarification is 20 forthcoming”); Jordan v. Nationstar Mortg. LLC, No. 14-CV-00787-WHO, 2014 21 WL 5359000, at *1 (N.D. Cal. Oct. 20, 2014) (denying application of primary 22 jurisdiction doctrine and denying stay where there was no indication that outside 23 agency would rule “imminently” on the pending petitions). Here, the parties have 24 failed to show that the RWQCB’s decision will issue within a reasonable time 25 frame, and have additionally failed to establish that obtaining the benefits of the 26 RWQCB’s decision outweighs the need to resolve this litigation that has languished 27 on the Court’s docket for over eight years. 28 1 Ultimately, the Court finds that the need to resolve this action in a timely 2 || fashion weighs heavily against issuing a stay. Granting a further stay and delay of 3 || this litigation nearing a decade in age would certainly disrupt the “orderly course of 4 || justice.” CMAX, 300 F.2d at 268. 5 The Parties’ Joint Motion to Stay is DENIED. 6 4 IT IS SO ORDERED. 9 C)roato Ok Dated: April 7, 2020 Hon. Gonzalo P. Curiel 10 United States District Judge 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -5- 3:12-cv-334-GPC-KSC