City of San Jose v. Monsanto Co.

231 F. Supp. 3d 357
CourtDistrict Court, N.D. California
DecidedFebruary 3, 2017
DocketCase No. 5:15-cv-03178-EJD, Case No. 5:15-cv-05152-EJD, Case No. 5:16-cv-00071-EJD
StatusPublished
Cited by2 cases

This text of 231 F. Supp. 3d 357 (City of San Jose v. Monsanto Co.) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
City of San Jose v. Monsanto Co., 231 F. Supp. 3d 357 (N.D. Cal. 2017).

Opinion

ORDER DENYING DEFENDANTS’ MOTIONS TO DISMISS PLAINTIFFS’ FIRST AMENDED COMPLAINTS

EDWARD J. DAVILA, United States District Judge

In these related cases, Plaintiffs City of San Jose, City of Oakland, and City of Berkeley (the “Cities”) seek damages from Defendants Monsanto Company, Solutia Inc., and Pharmacia LLC (“Monsanto”). From the 1930s to the 1970s, Monsanto manufactured and sold products containing environmental contaminants called poly-chlorinated biphenyls (“PCBs”). The Cities allege that Monsanto’s PCBs pollute the San Francisco Bay (the “Bay”) through stormwater and dry weather runoff from the Cities, forcing the Cities to spend money to reduce PCB discharge in order to comply with state and federal regulations.

The Cities each allege a single cause of action for public nuisance. Before the Court are Monsanto’s motions to dismiss the Cities’ first amended complaints. Case No. 15-cv-3178, Dkt. No. 103; Case No. 15-cv-5152, Dkt. No. 81; Case No. 16-ev-71, Dkt. No. 71 (together, “MTD”; these motions are identical). The Cities have filed a single joint opposition. Case No. 15-cv-3178, Dkt. No. 106; Case No. 15-cv-5152, Dkt. No. 84; Case No. 16-cv-71, Dkt. No. 74 (“Opp.”).

The Court finds that the Cities have stated a claim for public nuisance. Monsanto’s motion to dismiss will be DENIED.

I. BACKGROUND

A. Facts

The Cities’ allegations are largely identical, with some variations (discussed below) regarding their use of captured stormwa-ter and their trusteeship of public land. Case No. 15-cv-3178, Dkt. No. 91 (“San Jose FAC”); Case No. 15-cv-5152, Dkt. No. 81 (“Oakland FAC”); Case No. 16-cv-71, Dkt. No. 71 (“Berkeley FAC”) (together, “FACs”).

PCBs are synthetic chemical compounds that have become notorious as global environmental contaminants. Id. ¶ 1. PCB exposure can cause a number of health issues in humans, including cancer. Id. ¶ 2. PCBs also destroy populations of fish, birds, and other animal life. Id ¶¶ 2, 4, 36-46. Until they were banned in the 1970s, PCBs were used in a variety of applications, including paint, caulking, electrical equipment, sealants, inks, and lubricants. Id. ¶¶ 5, 33.

The Cities operate municipal stormwater and dry weather runoff systems, which collect runoff and discharge it into the Bay. Id. ¶ 13. When it rains, PCBs often leach into stormwater runoff, causing the Cities to discharge PCBs into the Bay Id. ¶¶ 5-6, 35. As a result, the Bay has become contaminated with PCBs. Id. ¶¶ 7-10.

The U.S. Environmental Protection Agency (“EPA”) has approved a PCB Total Maximum Daily Load (“TMDL”) for the Bay, which defines the maximum amount of PCBs that the Bay can receive while still meeting water quality standards. Id Because they discharge storm-[361]*361water into the Bay, the Cities are required to obtain Municipal Regional Stormwater Permits from the San Francisco Bay Regional Water Quality Control Board. Id ¶ 13. Each of the Cities has received such a permit, which includes a TMDL that limits the amount of PCBs the Cities may discharge into the Bay through stormwa-ter. Id ¶¶ 14-15. In 2015, the Water Quality Control Board increased the PCB TMDL, which forced the Cities to spend money to meet the stricter requirements. Id. ¶¶ 17-19. The Cities now seek damages from Monsanto.

B. Monsanto’s First Motion to Dismiss

In their original complaints, the Cities alleged causes of action against Monsanto for public nuisance and equitable indemnity. Case No. 15-ev-3178, Dkt. No. 1; Case No. 15-cv-5152, Dkt. No. 1; Case No. 16-cv-71, Dkt. No. 1. This Court granted Monsanto’s motions to dismiss, finding that (1) the Cities lacked standing to claim public nuisance because they failed to show that they have a property interest in polluted stormwater, and (2) the Cities did not state a claim for equitable indemnity because their costs arose from regulatory requirements rather than from an adverse judgment. Case No. 15-cv-3178, Dkt. No. 85. The Court granted leave to amend only as to the cause of action for nuisance. Id.

C. The Cities’ First Amended Complaints

The Cities filed their FACs on September 13, 2016, each bringing a single cause of action for public nuisance. The Cities now allege damage to three property interests:

(1)contamination of the Cities’ storm-water and dry weather runoff systems, which must be retrofitted to remove PCBs;
(2) contamination of tidelands and submerged lands in the Bay that the Cities hold as trustees; and
(3) contamination of stormwater and dry weather runoff that the Cities capture and use.
See Opp. at 1 (summarizing the three property interests at issue in the FACs).

II. LEGAL STANDARD

A motion to dismiss under Fed. R. Civ. P. 12(b)(6) tests the legal sufficiency of claims alleged in the complaint. Parks Sch. of Bus., Inc. v. Symington, 51 F.3d 1480, 1484 (9th Cir. 1995). Dismissal “is proper only where there is no cognizable legal theory or an absence of sufficient facts alleged to support a cognizable legal theory.” Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). The complaint “must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)).

III. DISCUSSION

A. The Cities’ Public Nuisance Claims

i. The Cities allege a property interest in captured stormwater under AB 2594.

A public entity can bring a non-representative nuisance action for damages only if “it has a property interest injuriously affected by the nuisance.” Cty. of Santa Clara v. Atl. Richfield Co., 137 Cal.App.4th 292, 314, 40 Cal.Rptr.3d 313 (2006) (quoting Selma Pressure Treating Co. v. Osmose Wood Preserving Co., 221 Cal.App.3d 1601, 1616, 271 Cal.Rptr. 596 (1990)).

[362]*362This Court granted Monsanto’s earlier motion to dismiss because the Cities failed to show that they have a property interest in stormwater that flows through municipal pipes to the Bay. Dkt. No. 85 at 6-8. Under the California Water Code, public water belongs to the State of California, not to the Cities. Id.; see also Cal. Water Code §§ 1201 (“All water flowing in any natural channel,” unless used or appropriated, “is hereby declared to be public water of the State and subject to appropriation in accordance with the provisions of this code.”), 10574 (exempting rainwater from the permitting requirements, which implies that rainwater falls within § 1201 and thus belongs to the State); California v. United States, 438 U.S. 645, 652 n.7, 98 S.Ct.

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231 F. Supp. 3d 357, Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-of-san-jose-v-monsanto-co-cand-2017.