United States v. CB & I Constructors, Inc.

• Decision Date: 29 June 2012
• Docket Number: No. 10–55371.,10–55371.
• Citation: 2012 Daily Journal D.A.R. 9123,12 Cal. Daily Op. Serv. 7465,685 F.3d 827
• Parties: UNITED STATES of America, Plaintiff–Appellee, v. CB & I CONSTRUCTORS, INC., Defendant–Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

685 F.3d 827

12 Cal. Daily Op. Serv. 7465

2012 Daily Journal D.A.R. 9123

UNITED STATES of America, Plaintiff–Appellee,

v.CB & I CONSTRUCTORS, INC., Defendant–Appellant.

No. 10–55371.

United States Court of Appeals,Ninth Circuit.

Argued and Submitted Nov. 15, 2011.

Filed June 29, 2012.

Abraham Meltzer, Leon W. Weidman, Office of the United States Attorney, Los Angeles, CA, for the appellee.

Peder Kristian Batalden, Lisa J. Perrochet, Robert H. Wright, Horvitz & Levy, LLP, Encino, CA, Jeffrey D. Lyddan, Lyddan Law Group, Moraga, CA, for the appellant.

Randy W. Gimple, Carlson Calladine & Peterson, LLP, San Francisco, CA, Daniel Paul Collins, Munger, Tolles & Olson, LLP, Los Angeles, CA, Charles Larry Davis, San Diego Gas & Electric Company, San Diego, CA, John Ross Ellis, Southern California Gas Company, Los Angeles, CA, for amici curiae.

Appeal from the United States District Court for the Central District of California, Percy Anderson, District Judge, Presiding. D.C. No. 2:08–cv–03609–PA–AGR.

Before: ALFRED T. GOODWIN, WILLIAM A. FLETCHER, and JOHNNIE B. RAWLINSON, Circuit Judges.

OPINION

W. FLETCHER, Circuit Judge:

Defendant CB & I Constructors, Inc., (“CB & I”) negligently caused a June 2002 wildfire that burned roughly 18,000 acres of the Angeles National Forest in Southern California. The United States brought a civil action against CB & I to recover damages for harm caused by the fire. CB & I does not contest its liability or the jury's award of roughly $7.6 million in fire suppression, emergency mitigation, and resource protection costs. It challenges only the jury's additional award of $28.8 million in intangible environmental damages.

The district court denied CB & I's motions for judgment as a matter of law and a new trial or remittitur, concluding that under California law the government could recover damages for all of the harm caused by the fire, including intangible harm to the environment. The court held that the government provided sufficient evidence for the jury to determine the amount of environmental damages, and that the resulting award was not grossly excessive. We affirm.

I. Background

A. Factual Background

The Angeles National Forest covers roughly 650,000 acres in the San Gabriel Mountains, just north of metropolitan Los Angeles. It was set aside for watershed protection and public use in 1892 as the first federal forest reserve in California. See ANTHONY GODFREY, THE EVER–CHANGING VIEW: A HISTORY OF NATIONAL FORESTS IN CALIFORNIA 38 (2005). The U.S. Forest Service administers the forest “for outdoor recreation, range, timber, watershed, and wildlife and fish purposes.” 16 U.S.C. § 528. It is part of a National Forest System “dedicated to the long-term benefit for present and future generations.” Id. § 1609(a).

The Angeles National Forest is an important environmental and recreational resource for Southern Californians, representing about 70 percent of all open space in Los Angeles County. It is also a refuge for native plants and animals, including several threatened and endangered species. San Francisquito Canyon, a chaparral and sage scrub ecosystem surrounded by high ridges in the northwestern part of the National Forest, contains known populations of several species protected under the Endangered Species Act, including the Bald Eagle, California Condor, Southwest Willow Fly-catcher, and California Red–Legged Frog. The Red–Legged Frog was once widespread throughout the region, but now has only three known populations in Southern California. The largest of the three populations is in San Francisquito Canyon, where the frog remains “extremely vulnerable” to local extinction.

In April 2002, a county water district hired Merco Construction Engineers, Inc., (“Merco”) to build four water storage tanks for a housing project in the city of Santa Clarita. Merco subcontracted with CB & I to construct two of the steel tanks. The site was on private land, next to a brush-covered hillside about a half mile from the National Forest. As the general contractor, Merco maintained a superintendent at the construction site for part of the work day. CB & I encouraged its employees to work quickly by offering them a financial bonus if they completed the tanks in fewer hours than initially projected.

On June 5, 2002, the air temperature at the work site exceeded 100 degrees. A crew from CB & I worked through the heat to perform tasks that posed known fire hazards. Neither CB & I nor Merco had taken several recommended fire prevention precautions, such as clearing brush 100 feet from the tanks, regularly watering dry vegetation, or keeping a fire watch on the ground while the crew worked on the roof.

At about 2:40 p.m., a CB & I employee was on the roof of the tank operating an electric grinder. The grinder cuts and smooths metal with a high-speed rotating abrasive disc that sends out a trail of sparks and hot metal slag. The employee was directing the sparks away from his coworkers and off the edge of the tank toward the dry brush. He saw that the sparks ignited a fire, but by the time the crew descended from the roof the fire was out of control.

As the fire spread, it burned about 2,000 acres of private and county-owned property. It quickly reached the National Forest where it burned another 18,000 acres, or more than 28 square miles. Federal, state, and county firefighters fought the fire for nearly a week before they contained it on June 11. The government incurred roughly $6.6 million in fire suppression costs. The fire became known as the Copper Fire.

The CB & I welding crew returned to work the day after starting the fire. Company employees eventually received a bonus for completing the water tanks in fewer hours than originally projected.

Within the National Forest, some of the greatest fire damage occurred in San Francisquito Canyon. The fire burned “pretty much all” of the native chaparral and sage scrub vegetation in the Canyon, opening the door to invasive, nonnative plants that increase the risk of future fires. For example, the Copper Fire spread an infestation of Arundo donax—a highly invasive giant reed that grows as fast as eighteen inches per day, outcompetes native vegetation, and clogs waterways. The fire also created a serious flood hazard by destroying vegetation that normally intercepts the flow of rainwater and allows for filtration of the water into the soil. Cf. First English Evangelical Lutheran Church of Glendale v. Los Angeles Cnty., 482 U.S. 304, 307, 107 S.Ct. 2378, 96 L.Ed.2d 250 (1987) (discussing a July 1977 forest fire and resulting February 1978 flood in the Angeles National Forest). The Copper Fire increased the rates of sedimentation in the Canyon watershed by up to three times its normal amount. Much of San Francisquito Creek filled in with ash and dead trees.

The U.S. Forest Service assembled a Burned Area Emergency Rehabilitation (“BAER”) team of specialists to coordinate immediate erosion control measures after the fire. The team included a hydrologist, soil scientist, botanist, biologist, and archeologist. Based on the team's recommendations, the Forest Service installed drainage on forest roads and built a large, 30,000 cubic-yard catchment basin to trap mudflow from denuded hillsides. The total cost of BAER work was about $530,000. The government also estimated about $515,000 in anticipated resource protection costs, such as manually removing Arundo donax from about 40 burned acres and surveying and reestablishing boundary markers damaged by the fire.

In September 2002, as part of the BAER process, the Forest Service closed public access to areas where the National Forest most needed to recover. The Forest Service prohibited all users in these areas for one year, and horseback riders, bicycles, and off-road vehicles for two. Vegetation had regrown by roughly 40% when the closures ended in September 2004. However, researchers estimated it would take as long as 20 to 25 years for the National Forest to recover from the fire.

The fire and subsequent floods destroyed more than 90% of the California Red–Legged Frog habitat in the National Forest. In 2002, before the fire, about 350 to 500 adult California Red–Legged Frogs lived along San Francisquito Creek. By 2009, researchers saw only about 30 to 50 frogs. Researchers expressed concern that the small size of the remaining population would result in a lack of genetic diversity, making the population more susceptible to diseases and other threats.

The Copper Fire also caused extreme damage to the Hazel Dell Mining Camp, an abandoned graphite mine in the NationalForest with historically significant cabins and artifacts from the early twentieth century. The fire consumed all of the camp's wooden structures and contents and collapsed two horizontal mining tunnels. It left the vegetation at the site “moonscaped” and “burned beyond recognition.” Damage from the fire reduced the site's historical value and integrity to the point where the camp was no longer eligible for listing on the National Register of Historic Places.

B. Procedural Background

In June 2008, the United States filed a civil action against CB & I and Merco to recover tort damages resulting from the Copper Fire. During a five-day jury trial in September 2009, the government presented evidence of monetary costs for its fire suppression, BAER, and resource protection efforts. The government also called expert witnesses who testified about environmental harm to scenic views, recreational use, soil stability, water quality, plant life, wildlife habitat, the Red–Legged Frog population, and the mining camp. However, the government did not elicit testimony that put a dollar amount on the environmental harm. It maintained that the environmental damages are “not susceptible to empirical calculation” because they are “measured by their value to the public and for posterity.”

In its closing argument, the government described the intangible environmental...