E. & J. Gallo Winery v. Pestmaster Services, Inc.

• Court: District Court, E.D. California
• Decided: March 25, 2020
• Docket: 2:19-cv-02120
• Status: Unknown

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 ----oo0oo---- 11 12 E. & J. GALLO WINERY, a No. 2:19-cv-02120 WBS KJN California corporation, 13 Plaintiff, 14 ORDER RE: MOTION TO DISMISS v. 15 PESTMASTER SERVICES, INC., a 16 California corporation, JEFFERY M. VAN DIEPEN, and UNITED STATES 17 OF AMERICA, 18 Defendants. 19 20 ----oo0oo---- 21 Plaintiff E. & J. Gallo Winery (“Gallo”) brought this 22 action against Pestmaster Services, Inc. (“Pestmaster”), its 23 president and owner, Jeffery Van Diepen (“Van Diepen”), and the 24 United States of America (“United States”) alleging violations of 25 state tort law after Pestmaster’s application of an herbicide 26 destroyed Gallo’s grape vines. (First Am. Compl. (“FAC”) (Docket 27 No. 8).) Before the court is the United States’ motion to 28 dismiss for lack of subject matter jurisdiction under Federal 1 Rule of Civil Procedure 12(b)(1). (Docket No. 13.) 2 I. Background 3 The United States, through its Bureau of Reclamation 4 (“the Bureau”) owns and operates a series of dams and canals in 5 the Central Valley Project, among them the Folsom South Canal. 6 (FAC ¶¶ 1, 10.) The Bureau contracted with Pestmaster to provide 7 weed-abatement services for facilities and properties in the 8 Central Valley Project, including Folsom South Canal, in June 9 2016. (Id.; see also Decl. of Kara A. Fleming (“Fleming Decl.”) 10 ¶ 4, Ex. 1 (Docket No. 13-2).) 11 Under the contract, Pestmaster was given discretion to 12 determine how, when, and what herbicide to apply. (Fleming 13 Decl., Ex. 2 at §§ 3.4, 3.8, 3.16.) Pestmaster was required to 14 abide by all applicable state and federal laws and submit a Spray 15 Management Work Plan before the start of work, including a plan 16 to “prevent the unauthorized release of any chemicals . . . 17 including clean-up procedures to be undertaken allowing for the 18 protection of . . . neighbors/adjoining property owners.” 19 (Fleming Decl., Ex. 2 at §§ 3.0, 3.4-3.6, 3.9.) Exercising its 20 discretion, Pestmaster decided to use Method®240SL (“Method”) to 21 prevent weeds at the Folsom South Canal in December 2016.1 (FAC 22 ¶¶ 39-40.) 23 Method is harmful to grape vines and grapes. (Id. ¶¶ 24 2, 17-18.) Its label explicitly warns users that “[a]pplications

25 1 Plaintiff correctly claims Method is not on the list of preapproved chemicals in the Scope of Work. (Opp. to Mot. 26 (“Opp.”) at 6 (Docket No. 19).) However, that list does not 27 purport to be exhaustive or exclusive. (Fleming Decl., Ex. 2 at § 3.8 (“Chemicals approved for use on Reclamation Lands include 28 the following”).) 1 made where runoff water flows onto agricultural land may injure 2 or kill crops such as . . . grapes.” (Id.; see also Decl. of 3 David Fallek (“Fallek Decl.”), Ex. A (Docket No. 20).) The 4 warning also provides users should not apply Method “during 5 periods of intense rainfall or where prevailing soils are either 6 saturated with water or of a type through which rainfall will not 7 readily penetrate.” (Id.; see also Fallek Decl., Ex. A.) 8 Despite these warnings, Pestmaster allegedly applied 9 Method on the bank of the Folsom South Canal adjacent to Silva 10 Ranch, a Gallo grape vineyard, during a period of intense 11 rainfall. (Id. ¶¶ 3, 11, 13, 20-21.) The herbicide then washed 12 down the bank and into the vineyard, where it was taken up by the 13 grapevines. (Id. ¶¶ 3, 23.) It rendered the grapes unusable in 14 the 2017, 2018, and 2019 growing seasons, resulting in a total 15 loss of more than $200,000. (Id. ¶¶ 3, 25-27, 31.) 16 Gallo presented a claim to the Bureau for $209,999.58 17 plus attorney’s fees on December 13, 2018, pursuant to the 18 administrative exhaustion requirement of 28 U.S.C. § 2675(a). 19 (Id. ¶ 31.) The Bureau failed to respond to the claim within six 20 months.2 (Id.) This suit followed. 21 II. Legal Standard 22 Rule 12(b)(1) of the Federal Rules of Civil Procedure 23 allows parties to dismiss claims against them for lack of subject 24 matter jurisdiction. Fed. R. Civ. P. 12(b)(1). An attack on 25

26 2 The statute provides “[t]he failure of an agency to make final disposition of a claim within six months after it is 27 filed shall, at the option of the claimant any time thereafter, be deemed a final denial of the claim for purposes of this 28 action.” 28 U.S.C. § 2675(a). 1 subject matter jurisdiction may be facial or factual. “In a 2 facial attack, the challenger asserts that the allegations 3 contained in a compliant are insufficient on their face to invoke 4 federal jurisdiction. By contrast, in a factual attack, the 5 challenger disputes the trust of the allegations that, by 6 themselves, would otherwise invoke federal jurisdiction.” Safe 7 Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004). 8 Where, as here, the defendant has mounted a factual 9 attack, the plaintiff must present “affidavits or any other 10 evidence necessary to satisfy its burden of establishing that the 11 court, in fact, possesses subject matter jurisdiction.” Edison 12 v. United States, 822 F.3d 510, 517 (9th Cir. 2016) (citing 13 Colwell v. Dep’t of Health & Human Servs., 558 F.3d 1112, 1121 14 (9th Cir. 2009)). The district court may consider the parties’ 15 evidence without converting the motion to dismiss to a motion for 16 summary judgment. Id. (citing White v. Lee, 227 F.3d 1214, 1242 17 (9th Cir. 2000). Disputed facts must be resolved in favor of the 18 plaintiff. Id. 19 III. Discussion 20 “A party may bring an action against the United States 21 only to the extent that the government waives its sovereign 22 immunity.” Valdez v. United States, 56 F.3d 1177, 1179 (9th Cir. 23 1995). The Federal Tort Claims Act (“FTCA”), 28 U.S.C. § 24 1346(b), represents “a limited waiver of that sovereign 25 immunity,” that makes the United States liable “to the same 26 extent as a private party for certain torts of federal employees” 27 under “the law of the place where the act or omission occurred.” 28 Edison, 822 F.3d at 518 (internal citations omitted). The FTCA 1 and its exceptions must be strictly construed, with all 2 ambiguities resolved in favor of the sovereign. United States v. 3 Nordic Village, Inc., 503 U.S. 30, 33 (1992). 4 The United States cannot be held vicariously liable for 5 the negligent acts of its independent contractors. United States 6 v. Orleans, 425 U.S. 807, 813-14 (1976) (quoting 28 U.S.C. § 7 2671) (noting the statute’s definition of federal “employees” 8 excludes “any contractor with the United States”). This is 9 referred to as the “independent contractor” exception. In its 10 complaint, plaintiff does not allege that the United States or 11 one of its federal employees is directly liable for the damage to 12 its grapes; indeed, its allegations are confined to vicarious 13 liability alone. (See FAC ¶¶ 41, 46, 54.) Accordingly, 14 plaintiff’s claims against the United States fail on their face. 15 Nevertheless, “[t]he independent contractor exception . 16 . . has no bearing on the United States’ FTCA liability for its 17 own acts or omissions.” Edison, 822 F.3d at 518 (emphasis 18 original). If the United States exercised control over 19 Pestmaster such that Pestmaster cannot be said to be 20 “independent,” the United States could be found liable for 21 Pestmaster’s actions. See Orleans, 425 U.S. at 814. Such a 22 relationship requires “substantial supervision over the day-to- 23 day operations of the contractor.” Autery v. United States, 424 24 F.3d 944, 957 (9th Cir. 2005) (quoting Letnes v. United States, 25 820 F.2d 1517, 1519 (9th Cir. 1987)). 26 Here, it does not appear that the United States 27 exercised the degree of substantial control necessary for 28 Pestmaster or its employees to be considered employees of the 1 government. As the Ninth Circuit has recognized, “[c]ontractual 2 provisions directing detailed performance generally do not 3 abrogate the contractor exception.” Id. at 957. While the Scope 4 of Work provides Pestmaster must submit a Spray Management Work 5 Plan before the start of work, Pestmaster retains ultimate 6 discretion about when to spray, what to spray, and how to spray. 7 (Fleming Decl., Ex. 2 at §§ 3.4-3.6, 3.8, 3.16.) While the 8 contract and the Scope of Work establish a broad, general 9 compliance framework, there is no showing that the United States 10 controled the day-to-day operations of Pestmaster. See Letnes, 11 820 F.2d at 1519 (holding “detailed regulations and inspections 12 are [not] evidence of an employee relationship.”) Accordingly, 13 the United States cannot be held liable for Pestmater’s actions. 14 Finally, Gallo argues California law imposes three 15 separate duties of care on the United States for which it may be 16 held directly liable: (1) as a “pesticide user”; (2) as a 17 landowner; and (3) under the peculiar risk doctrine, which makes 18 landowners liable for the actions of an independent contractor 19 when the work involves a “special risk” of harm. (Opp. to Mot. 20 (“Opp.”) at 11-13 (Docket No. 19).) “Even where an employer has 21 delegated some responsibilities to an independent contractor, the 22 employer may still be held separately and directly liable for its 23 own negligence.” Edison, 822 F.3d at 518 (citing Logue v. United 24 States, 412 U.S. 521, 532-33 (1973)). “Only upon a finding that 25 the government delegated its entire duty of care may the court 26 dismiss the claim for lack of jurisdiction under the FTCA’s 27 independent contractor exception.” Id. 28 As for the first claimed duty, California Food & 1 Agriculture Code § 12972 states that pesticides must be applied 2 in “such a manner as to prevent substantial drift to nontarget 3 areas.” Cal. Food & Agric. Code § 12972. But this duty could 4 only be breached by Pestmaster, because only Pestmaster employees 5 applied the herbicides. (FAC ¶¶ 3-4.) For the reasons stated 6 above, Pestmaster employees cannot be considered government 7 employees, and the United States cannot be held liable for their 8 actions. 9 The second claimed duty is the United States’ duty as a 10 landowner. (Opp. at 11-12.) Under California Civil Code Section 11 1714, “[e]veryone is responsible . . . for an injury occasioned 12 to another by his or her want of ordinary care or skill in the 13 management of his or her property or person, except so far as the 14 latter has, willfully or by want of ordinary care, brought the 15 injury upon himself or herself.” Cal. Civ. Code § 1714(a). 16 Plaintiff relies on a misreading of the Ninth Circuit’s 17 interpretation of California law in Edison v. United States, 822 18 F.3d 510 (9th Cir. 2016), to suggest that the United States may 19 be held directly liable as a landowner in this case. (Opp. at 20 12.) In Edison, a group of prisoners sought to hold the United 21 States directly liable for failing to take actions in response to 22 a coccidioidomycosis epidemic in a federal prison, claiming 23 breaches of duty “outside the scope of [the United States’] 24 relationship” with the independent contractors responsible for 25 the prison’s daily operations. 822 F.3d at 518. Here, however, 26 the alleged breaches are attributable to Pestmaster’s actions 27 alone. Accordingly, these claims are precluded by the FTCA 28 because the United States cannot be held vicariously liable for 1 Pestmaster’s breach.3 2 With regard to the third claimed duty under the 3 peculiar risk doctrine, a “peculiar risk” is a risk particular to 4 “the work to be done, arising either from the nature or the 5 location of the work and against which a reasonable person would 6 recognize the necessity of taking special precautions.” Privette 7 v. Superior Court, 5 Cal 4th 689, 692 (1993) (internal quotations 8 omitted). California’s peculiar risk doctrine is “an exception 9 to the general rule that [the government] is not liable for torts 10 committed by an independent contractor.” Myers v. United States, 11 652 F.3d 1021, 1034 (9th Cir. 2011) (citing Yanez v. United 12 States, 63 F.3d 870, 872 (9th Cir. 1995)). The United States can 13 be found directly liable for its own negligence when “it fails to 14 ensure that an independent contractor takes adequate safety 15 precautions” when the work to be performed involves “special 16 dangers.” Id. (internal citations omitted). 17 Pestmaster does not cite any California authority to 18 support its contention that spraying herbicides involves a 19 “special danger” or is an inherently dangerous activity that 20 would trigger application of the peculiar risk doctrine. (Opp. 21 at 13.) While plaintiff cites cases from other jurisdictions, 22 3 In a footnote in its motion to dismiss, the United 23 States cautioned that “any claim that the United States was negligent in delegating weed abatement to Pestmaster or in 24 training or supervising these independent contractors would be barred by the FTCA’s discretionary-function exception.” (Mot. at 25 6 n.2.) This prompted a response from the plaintiff, arguing the discretionary-function exception does not apply. (Opp. at 15- 26 19.) The United States agrees. (Reply at 5 (Docket No. 21).) 27 Accordingly, the court does not express any opinion as to the applicability of the discretionary-function exception to this 28 case. 1 | most are over sixty years old and are of minimally persuasive 2 value. (Id.) Accordingly, plaintiff’s peculiar risk theory 3 fails because the application of pesticides has not been 4 recognized as a “special danger” under California law. Because 5 the FTCA’s independent contractor exception applies, this court 6 cannot exercise subject matter jurisdiction over plaintiff’s 7 claims. 8 IT IS THEREFORE ORDERED that defendant United States’ 9 motion to dismiss (Docket No. 13) be, and the same thereby is, 10 GRANTED. 11 Dated: March 24, 2020 tte a 4 jb sé. 12 WILLIAM B. SHUBB UNITED STATES DISTRICT JUDGE 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28