Ecological Rights Foundation v. San Diego Gas & Electric Company

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 ECOLOGICAL RIGHTS FOUNDATION, Case No.: 24-cv-1614-RSH-MMP et al., 12 ORDER GRANTING JOINT MOTION Plaintiffs, 13 TO ENTER CONSENT DECREE v. 14 [ECF No. 3] SAN DIEGO GAS & ELECTRIC 15 COMPANY, 16 Defendant. 17 18 19 Before the Court is a joint motion to enter consent decree [ECF No. 3] filed by 20 plaintiffs Ecological Rights Foundation and San Diego Coastkeeper and defendant San 21 Diego Gas & Electric Company. Pursuant to Civil Local Rule 7.1(d)(1), the Court finds 22 the motion presented appropriate for resolution without oral argument. For the reasons 23 below, the Court grants the motion. 24 I. BACKGROUND 25 A. Factual Background 26 The instant case arises from Defendant’s storage and handling of chemically 27 treated wooden utility poles and cross arms at its facilities. The Complaint alleges the 28 following. 1 Defendant is “an electrical and natural gas utility corporation that supplies 2 electricity and natural gas to parts of Southern California.” ECF No. 1 ¶ 16. Defendant 3 treats its wooden utility poles or cross arms with “wood preservative formulations” that 4 contain pesticides and other chemicals, including “pentachlorophenol, chromium, arsenic, 5 copper naphthenate, and/or 4,5-Dichloro-2-n-octyl-3(2H)-isothiazolone.” Id. ¶ 2.1 The 6 treated poles or cross arms—and other wood items or fragments similarly treated—are 7 handled and stored at certain of Defendant’s Construction and Operation Facilities. Id. ¶¶ 8 2, 29. The poles are often stored outdoors in uncovered areas on racks or directly on the 9 ground. ECF No. 1-3 at 20.2 10 Plaintiff Ecological Rights Foundation is a non-profit corporation focused on 11 “protecting surface waters and groundwater from pollution and degradation.” Id. ¶ 13. 12 Plaintiff San Diego Coastkeeper is a non-profit corporation that “protects and restores 13 fishable, swimmable, and drinkable waters in San Diego County.” Id. ¶ 14. According to 14 Plaintiffs, Defendant releases chemicals into the environment through the discharge of 15 polluted storm water from Defendant’s Construction and Operations Facilities. Id. ¶ 3. 16 Plaintiffs allege their members, employees, and volunteers live or recreate in proximity to 17 these facilities and have been negatively impacted by these discharges. Id. ¶ 15. 18 B. Procedural Background 19 On September 10, 2024, Plaintiffs initiated the instant action against Defendant 20 asserting violations of the Resource Conservation and Recovery Act (“RCRA”). ECF No. 21 1. On the same day, the Parties filed a joint motion requesting that the Court enter their 22 proposed consent decree. ECF No. 3. On September 26, 2024, at the Court’s direction, 23 24

25 1 Pentachlorophenol-based wood preservatives contain several other toxic 26 chemicals, including “polychlorinated dibenzo-p-dioxins and polychlorinated 27 dibenzofurans.” ECF No. 1 ¶ 2. 2 All citations to electronic case filing (“ECF”) entries refer to the ECF-generated 28 1 the Parties filed a joint supplemental brief addressing how the proposed consent decree is 2 procedurally and substantively fair. ECF No. 10. 3 II. LEGAL STANDARD 4 “A consent decree is ‘essentially a settlement agreement subject to continued 5 judicial policing.’” United States v. Oregon, 913 F.2d 576, 580 (9th Cir. 1990) (quoting 6 Williams v. Vukovich, 720 F.2d 909, 920 (6th Cir. 1983)); see Lares v. Reliable 7 Wholesale Lumber, Inc., No. 8:18-cv-0157-JLS-AGR, 2018 U.S. Dist. LEXIS 223962, at 8 *4 (C.D. Cal. Oct. 18, 2018) (“Consent decrees are hybrids of private settlement 9 agreements and public judgements.”). “It is not a decision on the merits or the 10 achievement of the optimal outcome for all parties, but is the product of negotiation and 11 compromise.” Oregon, 913 F.2d at 580. “Before approving a consent decree, a district 12 court must be satisfied that it is at least fundamentally fair, adequate and reasonable.” Id. 13 “In applying the ‘fair, adequate and reasonable’ standard, courts examine both procedural 14 and substantive fairness.” United States v. PG&E, 776 F. Supp. 2d 1007, 1024–25 (N.D. 15 Cal. 2011) (citing United States v. Cannons Eng’g Corp., 899 F.2d 79, 86 (1st Cir. 16 1990)); see United States v. Coeur D’Alenes Co., 767 F.3d 873, 877 (9th Cir. 2014) 17 (“[W]e require a district court to review a proposed consent decree for the purpose of 18 determining whether it is fair—not only procedurally, but also substantively.”). “In 19 addition, because it is a form of judgment, a consent decree must conform to applicable 20 laws.” Oregon, 913 F.2d at 580. When reviewing a consent decree, a court must 21 independently review its terms and avoid “rubber stamp approval.” See United States v. 22 Montrose Chem. Corp., 50 F.3d 741, 747 (9th Cir. 1995). The approval of a proposed 23 consent decree rests within the sound discretion of the court. See Oregon, 913 F.2d at 24 580. 25 III. ANALYSIS 26 A. The Consent Decree 27 Under the proposed consent decree, Defendant is required to implement Best 28 Management Practices (“BMPs”) for waste handling and pollution prevention at six of its 1 Construction and Operation Facilities. ECF Nos. 3-3 ¶¶ 6, 5–24; 10 at 4–5. Specifically, 2 the consent decree requires Defendant to implement either “Source Control BMPs” or 3 “Treatment/Structural BMPs” that “are designed to ensure that the facilities will not 4 discharge waste-based pollutants above agreed-upon Pollutant Action Levels.” ECF No. 5 10 at 4; see ECF No. 3-3 ¶¶ 16, 21–22. The “Source Control BMPs” require Defendant to 6 remove all utility poles treated with pentachlorophenol from its facilities and then either 7 sufficiently clean the affected areas so that runoff leaving the facilities no longer exceed 8 Pollutant Action Levels3 or repave the affected areas. See ECF Nos. 3-3 ¶ 16; 10 at 4. 9 Alternatively, if Defendant elects to implement “Treatment/Structural BMPs,” it must 10 implement structural improvements and filters designed to ensure that storm water 11 flowing from its facilities does not contain pollutants exceeding Pollutant Action Levels. 12 See ECF Nos. 3-3 ¶ 21; 10 at 5. Defendant may also elect not to implement either the 13 “Source Control BMPs” or “Treatment/Structural BMPs” for any given facility if: (1) 14 Defendant can demonstrate that existing structural BMPs at the facility are sufficient to 15 prevent discharges of pollutants above the Pollutant Action Levels; or (2) Defendant 16 develops and implements alternative BMPs that meet the requirements of the consent 17 decree. See ECF Nos. 3-3 ¶¶ 17–20, 23; 10 at 5. 18 In addition to the above BMPs, the proposed consent decree imposes a number of 19 other requirements on Defendant, including: (1) the preparation of stormwater maps for 20 each facility; (2) “housekeeping” measures, such as site sweeping and cleaning; 21 (3) inspection and sampling requirements to assess pollutant levels of stormwater leaving 22 the facilities; (4) the preparation and submission of annual reports; and (5) allowing 23 Plaintiffs to inspect Defendant’s facilities. See ECF Nos. 3-3 ¶¶ 4–15, 27–30; 10 at 5. 24 // 25

26 27 3 Pollutant Action Levels are defined in the consent decree as specific amounts of pentachlorophenol, polychlorinated dibenzo-p-dioxins, and polychlorinated 28 1 Finally, the consent decree provides that Defendant will submit a payment to 2 Plaintiffs in the amount of $302,500 “to defray Plaintiffs’ claimed investigative, expert, 3 consultant, and attorneys’ fees and costs” and $60,000 for Plaintiffs’ costs in monitoring 4 Defendant’s compliance with the consent decree going forward. See ECF Nos. 3-3 ¶¶ 31– 5 32; 10 at 6. Under the consent decree, the Court will retain jurisdiction to enforce the 6 decree until it terminates. ECF No. 3-3 ¶¶ 1, 3. 7 B. Fairness 8 1. Procedural Fairness 9 The Court first considers whether the proposed consent decree is the “product of a 10 procedurally fair process.” Montrose, 50 F.3d at 746. “To measure procedural fairness, a 11 court should ordinarily look to the negotiation process and attempt to gauge its candor, 12 openness, and bargaining balance.” Cannons, 899 F.2d at 86; see United States v. 13 Electron Hydro, LLC, No. C20-1746-JCC, 2024 U.S. Dist. LEXIS 121368, at *4 n.3 14 (W.D. Wash. July 10, 2024) (“When measuring procedural fairness, the candor, 15 openness, and bargaining balance in the negotiation process are at issue.”); San Diego 16 Unified Port Dist. v. Gen. Dynamics Corp., No. 07-cv-01955-BAS-WVG, 2017 U.S. 17 Dist. LEXIS 95076, at *19 (S.D. Cal. June 20, 2017). “The district court’s role in 18 reviewing the essentially private agreement among the parties is ‘limited to the extent 19 necessary to reach a reasoned judgment that the agreement is not the product of fraud or 20 overreaching by, or collusion between, the negotiating parties.’” Oregon, 913 F.2d at 586 21 (quoting Officers for Justice v. Civil Serv. Com., 688 F.2d 615, 625 (9th Cir. 1982)). 22 Here, according to the Parties, the proposed consent decree is the result of almost a 23 year of extensive negotiations. ECF No. 10 at 8. Prior to filing suit, Plaintiffs investigated 24 Defendant’s facilities for years, including through site inspections and by analyzing 25 samples of Defendant’s storm water discharges in December 2018, May 2019, and March 26 2022. ECF No. 1-3 at 28. The Parties were represented by experienced outside counsel, 27 in-house attorneys, and technical staff and consultants. ECF No. 10 at 8. There is nothing 28 in the record to suggest the consent decree resulted from anything other than “good faith, 1 arms-length negotiations.” See Oregon, 913 F.2d at 581; see U.S. S.E.C. v. Volkswagen 2 AG (In re Volkswagen "Clean Diesel" Mktg., Sales Pracs., & Prods. Liab. Litig.), No. 19- 3 cv-01391-CRB, 2024 U.S. Dist. LEXIS 61787, at *4 (N.D. Cal. Apr. 3, 2024) (finding 4 consent decree procedurally fair under similar circumstances); SEC v. Rothenberg, No. 5 18-cv-05080-JST, 2018 U.S. Dist. LEXIS 177980, at *5 (N.D. Cal. Oct. 16, 2018) 6 (same). 7 2. Substantive Fairness 8 The Court next considers whether the proposed consent decree is “substantively 9 fair to the parties in light of a reasonable reading of the facts.” Montrose, 50 F.3d at 746. 10 “Substantive fairness introduces into the equation concepts of corrective justice and 11 accountability: a party should bear the cost of the harm for which it is legally 12 responsible.” Cannons, 899 F.2d at 87. “In evaluating the substantive fairness of a 13 consent decree in an environmental case, it is important for the district court to be fully 14 informed regarding the costs and benefits of the decree.” United States v. Chevron U.S.A. 15 Inc., 380 F. Supp. 2d 1104, 1113 (N.D. Cal. 2005). The relevant standard is not whether 16 the settlement “is one which the court itself might have fashioned, or considers as 17 ideal[.]” Cannons, 899 F.2d at 84. “Rather, the court’s approval is nothing more than ‘an 18 amalgam of delicate balancing, gross approximations and rough justice.’” Oregon, 913 19 F.2d at 581 (quoting Officers for Justice, 688 F.2d at 625)). “As long as the consent 20 decree comes within the general scope of the case made by the pleadings, furthers the 21 objectives upon which the law is based, and does not violate the statute upon which the 22 complaint was based, the parties’ agreement may be entered by the court.” Sierra Club, 23 Inc. v. Elec. Controls Design, Inc., 909 F.2d 1350, 1355 (9th Cir. 1990) (internal 24 quotation marks omitted). 25 Under this standard, the Court concludes the proposed consent decree is 26 substantively fair as it “comes within the scope of the pleadings, furthers the broad 27 objectives upon which the complaint was based and does not violate the RCRA.” Sierra 28 Club, 909 F.2d at 1355. Plaintiffs’ Complaint alleges Defendant violates the RCRA 1 through its handling and storage of chemically treated wooden utility poles and cross 2 arms. See ECF No. 1. The Complaint includes a request for injunctive relief preventing 3 Defendant from: (1) handling, storing, treating, transporting, or disposing of “any solid or 4 hazardous waste which may present an imminent and substantial endangerment to health 5 or the environment”; or (2) “violating the substantive and procedural requirements of the 6 RCRA[.]” Id. at 21. 7 The Parties contend the proposed consent decree “timely address[es] the alleged 8 ongoing RCRA violations at Defendant’s various facilities.” ECF No. 10 at 9. The Court 9 agrees. Under the decree, Defendant must take specified, concrete steps to reduce the 10 chemical discharges from its facilities to agreed-upon levels. This is substantively 11 equivalent to the relief sought by Plaintiffs in the Complaint. Saint John’s Organic Farm, 12 574 F.3d at 1060 (relief provided in settlement agreement not to engage in spraying of 13 adulticides or truck fogging equivalent to request for injunctive relief). In return, 14 Plaintiffs have agreed to release their claims. Further, by entering this agreement, the 15 Parties have avoided the time, expense, and risk of litigating this case to a trial on the 16 merits and appeal. 17 The proposed decree also “furthers the objectives upon which the [RCRA] is 18 based.” Sierra Club, 909 F.2d at 1355 (internal quotation marks omitted). The RCRA “is 19 a comprehensive environmental statute that governs the treatment, storage, and disposal 20 of solid and hazardous waste.” Meghrig v. Kfc W., 516 U.S. 479, 483 (1996). The 21 statute’s “primary purpose is to reduce the generation of hazardous waste and to ensure 22 the proper treatment, storage, and disposal of that waste which is nonetheless generated, 23 so as to minimize the present and future threat to human health and the environment.” 24 Hinds Invs., L.P. v. Angioli, 654 F.3d 846, 850 (9th Cir. 2011) (internal quotation marks 25 omitted). Here, the ameliorative measures Defendant is required to undertake under the 26 consent decree fall squarely within the range of solutions contemplated by the RCRA. 27 See Ctr. for Cmty. Action & Envtl. Justice v. BNSF Ry. Co., 764 F.3d 1019, 1026 (9th 28 Cir. 2014) (the RCRA “was intended to provide two possible solutions to the discarded 1 materials problem” including “resource conservation [achieved] by reducing the amount 2 of waste generated[.]”) (internal quotation marks). 3 The Parties’ negotiated resolution as to Plaintiffs’ request for attorneys’ fees and 4 costs is also aligned with the RCRA’s objectives. The RCRA provides that a court “may 5 award costs of litigation (including reasonable attorney and expert witness fees) to the 6 prevailing party or substantially prevailing party[.]” 42 U.S.C. § 6972(e). “The threshold 7 for sufficient relief to confer prevailing party status is not high.” Saint John’s Organic 8 Farm, 574 F.3d at 1059. “‘If the plaintiff has succeeded on any significant issue in 9 litigation which achieve[d] some of the benefit the parties sought in bringing suit, the 10 plaintiff has crossed the threshold to a fee award of some kind.’” Id. (quoting Tex. State 11 Teachers Ass'n v. Garland Indep. Sch. Dist., 489 U.S. 782, 791 (1989)). Here, as the 12 Court already noted above, the measures the Parties have agreed to are equivalent to the 13 relief Plaintiffs sought in their Complaint and consistent with the RCRA’s goals. For 14 these reasons, awarding costs and fees in this case is warranted. Id. at 1061 (“‘The 15 purpose of an award of costs and fees is . . . to encourage the achievement of statutory 16 goals.’”) (quoting Ruckelshaus v. Sierra Club, 463 U.S. 680, 706 (1983)). 17 Finally, the Court “need not enter the minefield of hours, rates, and lodestar 18 calculations and adjustments because no fee petition is at issue.” Lares v. Reliable 19 Wholesale Lumber, Inc., No. 8:18-cv-0157-JLS-AGR, 2018 U.S. Dist. LEXIS 223962, at 20 *9 (C.D. Cal. Oct. 18, 2018). The negotiated award of $302,500 in fees and costs and 21 $60,000 in future oversight costs is not, on its face, unreasonable. The negotiated amount 22 was reached only after Defendant reviewed Plaintiffs’ attorney time records and costs. 23 ECF No. 10 at 6. The Parties further represent this amount is only a portion of the fees 24 and costs Plaintiffs’ counsel expended. Id. at 6. 25 /// 26 /// 27 /// 28 /// 1 CONCLUSION 2 For the reasons stated above, the Court GRANTS the Parties’ joint motion. 3 IT IS SO ORDERED. 4 || Dated: October 15, 2024 Jekut C Ehoxew 5 6 Hon. Robert S. Huie United States District Judge 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28