Westlands Water Dist. v. Patterson

• Citation: 900 F. Supp. 1304
• Decision Date: 09 August 1995
• Docket Number: No. CV-F-94-5217 OWW.,CV-F-94-5217 OWW.
• Court: U.S. District Court — Eastern District of California
• Parties: WESTLANDS WATER DISTRICT and San Benito Water District, Plaintiffs, v. Roger K. PATTERSON, Regional Director, Mid-Pacific Region, United States of America, Department of the Interior, Bureau of Reclamation; Bruce Babbit, Secretary of the Interior, Defendants. Friant Water Users Authority, et al., Intervenors. San Joaquin River Exchange Contractors Water Authority, et al., Intervenors.

900 F. Supp. 1304

WESTLANDS WATER DISTRICT and San Benito Water District, Plaintiffs, v. Roger K. PATTERSON, Regional Director, Mid-Pacific Region, United States of America, Department of the Interior, Bureau of Reclamation; Bruce Babbit, Secretary of the Interior, Defendants Friant Water Users Authority, et al., Intervenors San Joaquin River Exchange Contractors Water Authority, et al., Intervenors.

No. CV-F-94-5217 OWW.

United States District Court, E.D. California, Fresno Division.

August 9, 1995.

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Michael Victor Sexton, Minasian Minasian Minasian Spruance Baber Meith and Soares, Oroville, CA.

Gregory K. Wilkinson, Best Best and Krieger, Riverside, CA.

Denslow B. Green, Green Green and Rigby, Madera, CA.

Thomas William Birmingham, Kronick Moskovitz Tiedemann and Girard, Sacramento, CA.

Maria A. Iizuka, U.S. Department of Justice, Land and Natural Resources Division, Sacramento, CA.

MEMORANDUM OPINION AND ORDER RE: PLAINTIFFS' MOTION FOR VOLUNTARY DISMISSAL WITHOUT PREJUDICE, DEFENDANTS' AND INTERVENORS' MOTIONS FOR SUMMARY JUDGMENT

WANGER, District Judge.

I. Introduction

Plaintiffs Westlands Water District ("Westlands") and San Benito County Water District ("San Benito, collectively "the Districts") move to dismiss their Complaint without prejudice, pursuant to Fed.R.Civ.P. 41(a)(2). The motion is opposed by the Federal Defendants, the Exchange Contractors,¹ and the Friant Intervenors.² The Federal Defendants, the Exchange Contractors, and the Friant Intervenors move for summary judgment. The Exchange Contractors, the Madera Irrigation District, and the Chowchilla Water District join in the motions of the Federal Defendants and of the Friant Intervenors. The Districts oppose the summary judgment motions. At the hearing on the motions, all parties were granted the opportunity to submit additional legal argument in support of or in opposition to the motions for summary judgment. The additional briefing has been received and considered.

II. Background

A. Procedural History

In 1992, the Districts sued the same defendants seeking injunctive and declaratory relief, challenging Central Valley Project ("CVP") water allocations made by the Bureau of Reclamation ("Bureau") for 1992, a short³ water year. The same intervenors in this case intervened in the 1992 action. Defendants' motion to dismiss the complaint and for judgment on the pleadings was granted on the ground that the Bureau has authority to divert water from the San Luis Reservoir for the use of the Exchange Contractors, even to the detriment of the plaintiffs, and the Bureau's 1992 water allocation to the Districts was not arbitrary or capricious. Westlands Water District v. United States Dep't of Interior ("Westlands I"), 805 F.Supp. 1503, 1513 (E.D.Cal.1992). The Ninth Circuit affirmed the decision, although the appellate court did not agree with the analysis of underlying water-law issues. Westlands Water Dist. v. Firebaugh Canal ("Westlands I — Appeal"), 10 F.3d 667, 677 (9th Cir.1993).

This case was filed after the Bureau announced CVP water allocations for the 1994 water year, another short water year.⁴ Plaintiffs were granted 35% of their contractual entitlement, and the Exchange Contractors were granted 75% of their entitlement.⁵ Plaintiffs allege that the Federal Defendants breached contractual obligations in apportioning water in shortage years. Plaintiffs complaint seeks the following relief:

First: Injunctive relief, based on the allegation that the Bureau's 1994 allocations are contrary to the provisions of the Westlands and San Benito water service contracts, and plaintiffs have no plain, speedy and adequate remedy at law;

Second: Declaratory relief, based on Article 11 of the Westlands contract, which obligates the Bureau to apportion water among those entitled to receive water from the San Luis Unit;

Third: Declaratory relief, based on Article 7(b) of the San Benito contract, which obligates the Bureau to apportion available water among water users, subject to prohibitions in existing contracts, CVP authorizations or a determination that some other method of apportionment is required to prevent undue hardship.

Plaintiffs moved to preliminarily enjoin the Federal Defendants from implementing the 1994 water allocation plan and to require the Bureau to reduce water deliveries by the same percentage among the Exchange Contractors and other agricultural water contractors capable of receiving water from the facilities of the Delta Division, the West San Joaquin Division, and the San Felipe Division of the Central Valley Project. That motion was denied, because plaintiffs did not demonstrate a likelihood of success on the merits of their Complaint; the balance of hardships favored defendants and intervenors, rather than plaintiffs; and the public interest did not favor a preliminary injunction. Westlands Water Dist. v. Patterson ("Westlands III"), 864 F.Supp. 1536, 1551 (E.D.Cal.1994).

The Scheduling Conference Order, filed September 2, 1994, established a final discovery cut-off date of March 3, 1995, and a dispositive motion deadline of April 3, 1995. All parties participated through the appearance of counsel at the scheduling conference and expressed positions in their scheduling conference statements, which afforded the basis for the Case Management Order adopted for the case.

According to the Districts,

after reviewing the court's written decision on the motion for preliminary injunction, which was served by United States mail six days before the Scheduling Conference, the Districts determined that they did not wish to pursue this matter and therefore did not proceed with discovery.

(Districts' Consolidated Opposition 17:12-15.) The Federal Defendants and defendants-in-intervention agree that no discovery has been conducted by the Districts.

Although plaintiffs' decision not to pursue this case was apparently made in early September, 1994, the Court was not notified. It was not until December 23, 1994, that the Districts voluntarily moved to dismiss the case without prejudice. The only explanation given for this three-and-a-half-month delay is that plaintiffs sought to proceed by stipulation under Fed.R.Civ.P. 41(a)(1), but the Federal Defendants and defendants-in-intervention would not agree to a dismissal without prejudice.

B. Factual History

The historical background has been summarized in the published decisions concerning these parties and the disputed contracts. See O'Neill v. United States, 50 F.3d 677, 680-82 (9th Cir.1995) (affirming in part district court's denial of plaintiffs' motion to enforce a stipulated judgment on the 1963 water service contract with Westlands); Westlands I, 805 F.Supp. at 1504-05; Westlands I — Appeal, 10 F.3d at 669-70; Westlands III, 864 F.Supp. at 1538-39.

In the mid-1930's, the Bureau sought to expand the CVP into the Kern County area of the southern San Joaquin Valley. The Friant Dam was constructed to divert the upper reaches of the San Joaquin River into the Friant-Kern Canal and the Madera Canal. The Exchange Contractors, or their predecessors-in-interest, held vested rights to water in the upper San Joaquin River. The Bureau could not implement the CVP expansion unless it acquired these water rights. To acquire the water rights, the United States and the Exchange Contractors entered into two contracts in July of 1939: the Purchase Contract and the Exchange Contract.

Under the Purchase Contract, the Exchange Contractors sold all of their rights to water from the upper San Joaquin River to the United States, except for "reserved water," water to which the Exchange Contractors held vested rights. Simultaneously, under the Exchange Contract, the Exchange Contractors agreed not to exercise their rights to reserved water, as long as they received substitute water from the Federal Delta-Mendota Canal, or other sources that delivered to the Mendota Pool. An amended contract, dated September 15, 1967, is based on these 1939 Purchase and Exchange Contracts. As amended, the Exchange Contract guarantees the Exchange Contractors the delivery of a minimum of 75% of their full allotment.⁶ By these contracts, the Bureau obtained the water rights necessary to implement the southern expansion of the CVP, and the Exchange Contractors transferred their water rights to protect their interest in a reliable water supply.

The water obtained from the Exchange Contractors through the Purchase and Exchange Contracts flows into Millerton Lake. Millerton Lake was formed when the Friant Dam was completed in 1942. It provides water to both the Madera Canal and the Friant-Kern Canal. In the 1940's, the Bureau entered into contracts with the water districts within the Friant Division. Friant Division agricultural water contractors — including the Friant Intervenors — receive water from both the Madera and Friant-Kern Canals.

The San Luis Unit of the CVP was authorized by the San Luis Act in 1960.⁷ It consists of the San Luis Dam, the San Luis Reservoir, and a number of smaller facilities. The Bureau constructed the San Luis Reservoir to provide water to Merced, Fresno, and Kings Counties, and to store surplus water from the Sacramento-San Joaquin Delta. The excess capacity of the Delta-Mendota Canal is used to carry water along the west side of the San Joaquin Valley for use in the San Luis Unit and the San Luis Reservoir.⁸

To implement the San Luis Act, the Bureau entered into water service contracts, to provide water to agricultural contractors in the area of the San Luis Unit, including Westlands and San Benito. The Westlands water service contract was executed in 1963. The San Benito water service contract was executed in 1978.

III. The Districts' Motion to Dismiss

A. Standards for Dismissal

Rule 41 allows a plaintiff, with the approval of the court, to dismiss an action without prejudice at any time:

Except

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