CaliforniaLawsuits that seek damages for contamination in groundwater have been brought in many parts of the United States, and nowhere more frequently, or with more financial impact, than in California. The lawsuits typically claim that because of chemical contamination of the groundwater, it will be necessary to spend many millions of dollars to clean up that water. These lawsuits are often handled on a contingency basis. One California law firm in particular, Miller Axline & Sawyer, has a long track record of large judgments and settlements.

OCWDThe Miller Axline firm represented the Orange County Water District (OCWD) (not part of the county government for the County of Orange) in bringing two cases, commonly referred to as the North Basin and South Basin cases. Both cases were assigned to the complex litigation division of the Orange County Superior Court, but with different judges.

Each case alleged that there was substantial chemical contamination from industrial and other operations, and that it would take hundreds of millions of dollars to clean up this contamination. The defendants included many present and former Orange County businesses, including, as with one of WFBM's clients, companies that had started, or even completed, remediation for any contamination they might possibly have generated. Many of these companies also asserted, with significant support, that nothing they generated would have made its way through the soil and into the groundwater that is actually used to supply drinking water to the County's residents.

As is typical in such situations, a number of defendants settled and OCWD received millions of dollars from those settlements. Some defendants, in both cases, hung in.

They pointed to two serious defects in the OCWD's claims: First, although the OCWD alleged that many millions of dollars would be necessary to clean up the water supply, and also that it had already incurred substantial expenses in investigating the situation, it had not actually spent anything to clean up the water. Second, the contamination is in a relatively shallow aquifer, while the drinking water comes from a much deeper aquifer. The defendants argued that there is no reason to believe that the contamination would ever spread to the water actually used by County residents and businesses, so there is no need for a cleanup.

One of the two cases proceeded to trial. In response to a defense motion, the court ruled that the District's statutory claims should be tried first, in a bench (non-jury) proceeding. The defendants prevailed on all the key issues in the first phase. Those defendants are now bringing motions which, if successful, will avoid the need for a second phase entirely.

As to the second case, in front of a different judge, the remaining defendants eventually prevailed on summary judgment motions.
California Legislature
The OCWD and its lawyers did not go down easily. In addition to aggressive legal tactics, they also sought to win through political means by attempting to have the California legislature amend a law. The law, as currently written, provides that costs of investigation, as compared to costs actually spent cleaning up contamination, are not recoverable, at least not independent of cleanup expenses. The OCWD and its lawyers tried to have the law changed to allow for recovery of investigation costs, even before any cleanup costs have been incurred. To date, those lobbying efforts have been unsuccessful.

The case in which summary judgment was granted is on appeal. The other case has not yet been appealed, because proceedings at the trial court level are ongoing. If the defendants prevail, as it appears they will, and if the results in the trial courts are not overturned, will this mean a reduction in the number of cases brought in California based on damages for the alleged need to clean up groundwater contamination?

Most likely so: Prospective plaintiffs and their lawyers are now going to have to take a hard look at the facts of their cases. It will no longer be sufficient to simply find contaminated water, bring a lawsuit alleging that the water will need to be cleaned up, then extort millions of dollars in settlements.
water-glassIf the plaintiffs can't show that (a) the water which is contaminated really needs to be cleaned up, because it is used for drinking, and (b) that the plaintiff has incurred, or at least is incurring, actual cleanup costs, as compared to merely investigative costs, the cases may well be thrown out of court.

Because there is no published appellate opinion as yet, the trial court decisions in Orange County do not control what happens in other places, in front of other judges.

However, both decisions are based on sound logic and existing law, so it is likely that plaintiffs can expect that other judges will follow the same logic.

WFBM attorneys, in both the Northern and Southern California offices of the firm, have significant experience in defending groundwater contamination cases. 

Rudy R. PerrinoIf you have questions or general comments about this article, feel free to contact the author:

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