San Diego Unified Port Dist., Corp. v. Monsanto Co.
| Decision Date | 28 September 2016 |
| Docket Number | CASE NO. 15-cv-578-WQH-JLB |
| Parties | SAN DIEGO UNIFIED PORT DISTRICT, a public corporation; and CITY OF SAN DIEGO, a municipal corporation, Plaintiffs, v. MONSANTO COMPANY; SOLUTIA INC.; and PHARMACIA LLC, Defendants. |
| Court | U.S. District Court — Southern District of California |
The matters before the Court are the Motion to Dismiss the City of San Diego's Amended Complaint (ECF No. 31) and the Motion to Dismiss the San Diego Unified Port District's Amended Complaint (ECF No. 32) filed by Defendants.
On March 13, 2015, Plaintiffs San Diego Unified Port District (the "Port District") and City of San Diego (the "City") commenced this action by filing the Complaint. (ECF No. 1). On August 3, 2015, the City and the Port District filed separate First Amended Complaints ("FACs") against Defendants Monsanto, Solutia, and Pharmacia ("Monsanto"), which are the operative pleadings in this case. (ECF Nos. 24, 25).
On August 31, 2015, Monsanto filed a Motion to Dismiss the City's FAC. (ECF No. 31) and a Motion to Dismiss the Port District's FAC. (ECF No. 32). On September 21, 2015, the Port District and the City filed responses. (ECF Nos. 33, 34). On October 10, 2015, Monsanto filed replies. (ECF Nos. 37, 38).
On May 25, 2016, the Court held oral argument on the Motions to Dismiss. (ECF No. 61). On June 3, 2016, the Port District filed a sur-reply in opposition to Monsanto's Motion to Dismiss addressing the issue of standing. (ECF No. 65). On June 10, 2016, Monsanto filed a response to the sur-reply. (ECF No. 67). On June 14, 2016, the Port District filed a reply to the sur-reply. (ECF No. 68). On August 23, 2016, Monsanto filed a Notice of Supplemental Authority in Support of Motion to its Motion to Dismiss. (ECF No. 69). On August 31, 2016, the Port District and the City filed responses to Monsanto's Notice of Supplemental Authority. (ECF Nos. 73, 74). On September 7, 2016, Monsanto filed a reply to the Port District's response to Monsanto's Notice of Supplemental Authority. (ECF No. 78). On September 19, 2016, Monsanto filed a reply to the City's Notice of Supplemental Authority. (ECF No. 79).
Plaintiff City is a "California Charter City and municipal corporation." (ECF No. 25 ¶ 7). The City was "the trustee of certain relevant tidelands and submerged lands in and around the [San Diego] Bay from the early 1900s through 1963, when that property was transferred to the Port District." Id.
"Plaintiff Port District is a public entity created by the San Diego Unified Port District Act." Id. ¶ 5. "The Port District is a trustee for the people of the State of California, which holds and manages the tidelands and submerged lands in and around San Diego Bay 'for the development, operation, maintenance, control, regulation, and management of the harbor of San Diego . . . and for the promotion of commerce, navigation, fisheries, and recreation therein.'" Id. "The Port District is specifically authorized to use its 'powers and authority . . . to protect and enhance . . . physicalaccess to the bay . . . natural resources of the bay, including plant and animal life . . . [and] quality of water in the bay.'" Id.
Defendant companies, Monsanto, Pharmacia, and Solutia, are corporate spin-offs of the original Monsanto Company. Id. ¶ 12. "Monsanto Company was the sole manufacturer of [polychlorinated biphenyls ("PCBs")] in the United States from 1935 to 1979, and trademarked the name 'Aroclor' for certain PCB compounds." Id. ¶ 2. PCBs "are man-made chemical compounds that have become notorious as global environmental contaminants found in bays, oceans, rivers, streams, soil, and air." Id. ¶ 1. "In humans, PCB exposure is associated with cancer as well as serious non-cancer health effects, including effects on the immune system, reproductive system, nervous system and endocrine system, among others." Id. ¶ 1. "In the environment, PCBs have widespread deleterious effects and can impair and even destroy populations of fish, birds, and other animals." Id.
"While the scientific community and Monsanto knew that PCBs were toxic and becoming a global contaminant, Monsanto repeatedly misrepresented these facts, telling governmental entities the exact opposite - that the compounds were not toxic and that the company would not expect to find PCBs in the environment in a widespread manner." Id. ¶ 56.
Although Monsanto knew "that landfills were not suitable for PCB contaminated waste," Monsanto "instructed its customers to dispose of PCB containing wastes in local landfills" instead of "having customers return the old formula fluids." Id. ¶ 51. Having "determined that the only effective method of disposing of PCBs was high temperature incineration, which was not commercially available to it or its customers," Monsanto "constructed an incinerator for the disposal of its own liquid PCB contaminants." Id. "Monsanto made its incinerator available to its customers, for a fee, for the disposal of their liquid PCB wastes." Id.
Monsanto "continued producing PCBs until Congress enacted the Toxic Substances Control Act ('TSCA'), which banned the manufacture of and most uses ofPCBs." Id. ¶ 2.
"PCBs are identified as a Primary Chemical of Concern ('COC') in California Regional Water Quality Control Board, San Diego Region ('Regional Water Board') Cleanup and Abatement Order ('CAO') No. R9-2012-0024, dated March 14, 2012, which directed the City and the Port District to, among other things, remediate PCB contaminated sediments within a discrete area known as the Shipyard Sediment Site." Id. ¶ 65. "There are other sites and public properties within and around the Bay that are currently under investigation for PCB contamination and that will be investigated for PCB contamination in the future." Id. ¶ 66.
"The Regional Water Board estimated human health risks due to the consumption of PCB contaminated fish tissue found in the Bay and employed human fish consumption rates and bioaccumulation factors in the analysis." Id. ¶ 67. "The Regional Water Board . . . concluded that human ingestion of seafood caught within certain assessment areas can significantly increase cancer risk, specifically identifying PCBs as a carcinogenic chemical." Id. ¶ 68.
"PCBs have entered the Bay through various sources." Id. ¶ 69. "PCBs sluff from myriad products and uses promoted by Monsanto and enter the environment . . . ." Id. "PCBs are also found in commercial and industrial waste water as a result of Monsanto's directions to its customers to dispose of their PCB contaminated wastes in landfills when Monsanto knew, in fact, that disposal of PCBs in landfills was not proper." Id. "PCBs also leach out of paints, caulk, sealants and other applications and are transported by air and water to the Bay." Id.
The City "manages and operate a municipal stormwater system, which collects and transports stormwater to be discharged into the Bay." (ECF No. 24 ¶ 70). "In order to discharge stormwater into the Bay, Plaintiff is required to receive a Municipal Regional Stormwater Permit from the Regional Water Board, pursuant to the National Pollutant Discharge Elimination System under the Clean Water Act." Id. "As former and current trustees of the Bay, and as stormwater dischargers into the Bay, [the City]has spent substantial amounts of money to limit the amount of PCBs in the Bay." Id. ¶ 71. "[The City] will also likely continue to incur costs to remove PCBs from the Bay and to keep PCBs from entering the Bay for the foreseeable future." Id. "PCBs were not only a substantial factor in causing the City to incur costs and damages, but PCBs were also the primary driving force behind the need to clean up and abate the Shipyard Sediment Site." Id. ¶ 72.
"As trustees of the Bay, Plaintiff Port District has spent substantial amounts of money to limit the amount of PCBs in the Bay." (ECF No. 25 ¶ 70). "The Port District will also likely continue to incur costs to remove PCBs from the Bay and to keep PCBs from entering the Bay for the foreseeable future." Id. "PCBs were not only a substantial factor in causing the Port District to incur costs and damages, but PCBs were also the primary driving force behind the need to clean up and abate the Shipyard Sediment Site." Id. ¶ 71. "Without abatement of the health hazard caused by PCBs in the Bay, Plaintiff Port District will continue to suffer injuries and damages." Id. "In addition, PCB contamination has resulted in the impairment of navigational capabilities within the Bay." Id. "For example, previous PCB driven remedial actions have resulted in the creation of permanent engineered caps isolating PCB-contaminated sediments at the Campbell Shipyard and Convair Lagoon sediment sites, at significant cost and interference to the Port District." Id. "Navigation is prohibited above and around these caps to ensure their stability and continued effectiveness." Id. " PCBs have similarly impaired and interfered with the use of other properties and functions of the Port District."
The FAC filed by the City asserts claims for public nuisance and for equitable indemnity. The FAC filed by the Port District asserts claims for public nuisance, equitable indemnity, and purpresture.
"As a general rule, a district court may not consider any material beyond the pleadings in ruling on a Rule 12(b)(6) motion." Lee v. City of Los Angeles, 250 F.3d668, 688 (9th Cir. 2001) (internal quotation marks omitted). Under the doctrine of incorporation by reference, "[a] district court ruling on a motion to dismiss may consider documents whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the plaintiff's pleadings." Parrino v. FHP, Inc., 146 F.3d 699, 705 (9th Cir. 1998) (internal quotation marks omitted). The "incorporation by reference" doctrine has been extended "to situations in which the plaintiff's claim depends on the contents of...
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