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HomeMy WebLinkAbout2011-06-07; City Council; 20575; SETTLEMENT SAN DIEGO COASTKEEPER AND CERFCITY OF CARLSBAD - AGENDA BILL 10 AB# 20,575 MTG' 6/7/11 DEPT. CA REPORTING OUT THE SETTLEMENT AGREEMENT BETWEEN SAN DIEGO COASTKEEPER, COASTAL ENVIRONMENTAL RIGHTS FOUNDATION (CERF) AND CITY OF CARLSBAD, ET AL DEPT. DIRECTOR CITY ATTORNEY CITY MANAGER RECOMMENDED ACTION: There is no action to be taken by the City Council. ITEM EXPLANATION: As previously authorized by the City Council, this office has associated with Attorney Jan Driscoll of the law firm of Allen Matkins as special counsel to defend the City and the Carlsbad Municipal Water District in the five lawsuits challenging the proposed Poseidon desalination plant. The parties have now settled all but one of the lawsuits and this Settlement Agreement constitutes a final judgment and bars any future action from Coastkeeper and CERF on issues that were or could have been raised. Additionally, Coastkeeper has agreed in this Settlement Agreement not to seek Supreme Court review of the State Lands Commission case (previously dismissed). This item satisfies the Brown Act requirement to report the fact of a settlement and makes the terms and conditions of the settlement available to the public. FISCAL IMPACT: Under the agreement with Poseidon Resources LLC to indemnify the City, there is no fiscal impact associated with this settlement agreement. ENVIRONMENTAL IMPACT: Reporting out the fact of Settlement is not a "project" within the meaning of CEQA and therefore environmental review is not required pursuant to CEQA Regulation 15061(b)(3). EXHIBITS: 1. Settlement and Release Agreement on file with the City Clerk. DEPARTMENT CONTACT: Ronald R. Ball 760-434-2891 ron.ball@carlsbadca.gov FOR CITY CLERKS USE ONLY. COUNCIL ACTION: APPROVED DENIED CONTINUED WITHDRAWN AMENDED * D D D CONTINUED TO DATE SPECIFIC CONTINUED TO DATE UNKNOWN RETURNED TO STAFF OTHER -SEE MINUTES REPORT WAS RECEIVED D D D D D SETTLEMENT AGREEMENT THIS AGREEMENT (the "Agreement") is entered into as of April 21 2011, by and among San Diego Coastkeeper ("Coastkeeper"), Coastal Environmental Rights Foundation ("CERF") (collectively, "Environmental Parties"), Poseidon Resources (Channelside) LLC, Poseidon Resources Corporation, and Poseidon Water LLC (collectively, "Poseidon"), the City of Carlsbad ("City"), Cabrillo Power I LLC ("Cabrillo"), Sweetwater Authority, Valley Center Municipal Water District, Santa Fe Irrigation District, Olivenhain Municipal Water District, Rincon del Diablo Municipal Water District, Rainbow Municipal Water District, Carlsbad Municipal Water District, and Vallecitos Water District (collectively, "Water Districts"), on the following terms and conditions: RECITALS A. The Carlsbad Desalination Project ("Project") has been reviewed and approved by the City and various state agencies. The Environmental Parties have expressed concerns with regard to the approval of the Project and have brought various lawsuits challenging Project approvals, one of which has yet to be resolved on the merits: Coastal Environmental Rights Foundation v. City of Carlsbad, et al., San Diego County Superior Court Case No. 37-2009-00061008-CU-TT-NC ("City CEQA Addendum Case"). B. Coastkeeper and Surfrider Foundation ("Surfrider") in 2008 voluntarily dismissed the case: Surfrider Foundation v. California Regional Water Quality Control Board, San Diego Region, et al., San Diego County Superior Court Case No. 37-2008-00091983- CU-WM-CTL ("Dismissed Regional Board Case"). The Court awarded costs to Poseidon and against Coastkeeper and Surfrider for this matter in the amount of $ 1,070.00. C. Coastkeeper and Surfrider unsuccessfully challenged aspects of the Project in the case: Surfrider Foundation v. California State Lands Commission, et al., San Diego County Superior Court Case No. 37-2008-00092607-CU-WM-CTL (including both the Superior Court and Appellate Actions, collectively "SLC Case"). Poseidon was awarded costs by the Superior Court in the amount of $3,212.73. Coastkeeper alone appealed the SLC Case, but was unsuccessful. Coastkeeper will be liable for an as-of-yet unspecified sum SDY775806.1 of costs on appeal. The time-period for filing a petition for review in the California Supreme Court has expired. D. The parties to this agreement now wish to settle the merits of the CEQA Addendum Case and, as to the Environmental Parties, all remaining aspects of the Dismissed Regional Board Case and SLC Case. In exchange for Coastkeeper's and CERF's agreement to dismiss the CEQA Addendum Case and forego seeking Supreme Court review of the SLC Case, Poseidon, City, Cabrillo, and Water Districts agree to waive any and all claims to litigation costs or fees to which they are or may be entitled from the Environmental Parties related to the Dismissed Regional Board Case, the SLC Case, and the City CEQA Addendum Case. AGREEMENT NOW, THEREFORE, in consideration of the foregoing recitals, which are hereby incorporated by reference, and of the mutual covenants set forth herein, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, IT IS HEREBY AGREED as follows: 1. Dismissal Of Pending Lawsuit With Prejudice and Agreement Not to Appeal. a. Within three (3) business days of the Effective Date of this Agreement, CERF and Coastkeeper will file a request for dismissal of the City CEQA Addendum Case captioned Coastal Environmental Rights Foundation v. City of Carlsbad, et al., Case No. 37-2009- 00061008-CU-TT-NC, with prejudice, in the San Diego County Superior Court. b. CERF and Coastkeeper understand and agree the dismissal with prejudice of the City CEQA Addendum Case will constitute a final judgment on the merits of the action and will bar any future action on issues which were or could have been raised under the doctrines of res judicata and collateral estoppels and pursuant to Boeken v. Phillip Morris USA, Inc. 48, Cal. 4th 788, 793 (2010). c. Coastkeeper agrees not to seek Supreme Court review of the SLC Case. 2. Poseidon's. Cabrillo's, City's, and Water Districts' Waivers of Litigation Costs. Poseidon, Cabrillo, City, and Water Districts hereby waive any claim to litigation costs or Page 2 of8 SDY775806.1 attorneys' fees that each entity may have, respectively, from the Environmental Parties only arising from the Dismissed Regional Board Case, the SLC Case, and the City CEQA Addendum Case. 3. Representations and Warranties. The parties to this agreement represent and warrant to each other as follows: a. The terms and conditions of this Agreement are the result of arm's-length negotiation between the Parties; b. This Agreement has been carefully read by each of the Parties and their respective counsel, the contents thereof are known and understood by each of the Parties, and this Agreement is signed freely by each Party executing it; c. The Parties to this Agreement have the sole right and exclusive authority to execute this Agreement and have not sold, assigned, hypothecated, pledged or otherwise set over to any other person or entity any claim, lien, demand, suit, right, action, proceeding, cause of action, obligation, damage or liability covered hereby; d. The person who signs this Agreement for a Party has the authority to bind that Party and to act on its behalf; and, e. The representations and warranties contained in this Agreement are deemed to and do survive the execution hereof. 4. No Admission of Liability. This Agreement is not an admission of liability. The purpose of this Agreement is to settle claims which are denied and contested, or are potential, and this Agreement is the result of a compromise over such contested claims. Nothing contained herein shall be deemed as an admission of any kind to any other party. 5. Modifications. This Agreement may not be amended, canceled, revoked or otherwise modified except by written agreement signed by all of the Parties to this Agreement. 6. Mutual Cooperation. The Parties agree to cooperate in good faith to carry out the provisions and intent of this Agreement, including the timely execution and delivery of any other documents necessary to carry out its provisions. Each of the Parties shall execute and deliver to the others all such other further instruments and documents, and take all other such Page 3 of8 SDY775806.1 <t actions, as may be reasonably necessary to carry out the terms and provisions of this Agreement and secure to the others the full and complete enjoyment of their respective rights end privileges hereunder. The Parties agree to meet and confer in good faith to try to resolve any conflicts arising under this Agreement prior to bringing any actions in court to enforce the Agreement. 7. Binding Nature of this Agreement. This Agreement shall be binding upon, and shall inure to the benefit of, the Parties, their respective heirs, representatives, successors, trustees in bankruptcy, administrators, executors, conservators, assigns, affiliates, agents and employees, and their respective successors and assigns, and each and every entity which now or ever was, or will ever be, a division, parent, successor, predecessor, subsidiary or related entity of any kind for each Party and its respective legal successors and assigns. 8. Parties To This Agreement And No Third Party Beneficiaries. The only parties to this Agreement are the Parties which are named in this agreement and which have executed the Agreement as listed below, or any entity which may be formed in the future which is controlled by the parties to this Agreement, and there are no third party beneficiaries to this Agreement. 9. Sole and Final Agreement. Except as otherwise specifically provided herein, this Agreement is intended to be and is the final expression of the Agreement between the Parties with respect to the subject matter of this Agreement, and supersedes and fully and completely extinguishes, any prior understandings or agreements by or between the Parties, whether oral or written, express or implied. 10. Notices. Except as otherwise specifically set forth herein, all notices or other communications specifically required or permitted to be given under this Agreement shall be in writing and personally delivered or sent by certified mail, return receipt requested and postage prepaid, or sent by reputable overnight courier (such as Fed Ex), or by facsimile with copies sent by overnight courier or U.S. Postal Service the following day, to the addresses or facsimile numbers set forth below. Any Party may at any time change its address or facsimile number for the delivery of notice upon five (5) days' written notice to the other Parties. Page 4 of 8 SDY775806.1 Coastal Environmental Rights Foundation C/O Executive Director 1140 South Coast Highway 101 Encinitas, CA 92024 Ph. 760-942-8505 Fx. 760-942-8515 San Diego Coastkeeper C/O Executive Director 2825 Dewey Road, Suite 200 San Diego, CA 92106 Ph. 619-758-7743 Fx. 619-758-7744 City of Carlsbad Carlsbad Municipal Water District Vallecitos Water District Jan Driscoll ALLEN MATKINS Jan Driscoll 501 West Broadway, 15th Floor San Diego, CA 92101-3541 Ph. 619.233.1166 Fx. 619.233.1158 Poseidon Resources (Channelside) LLC Poseidon Resources Corporation Poseidon Water LLC LATHAM & WATKINS LLP Christopher W. Garrett 600 West Broadway, Suite 1800 San Diego, CA 92101 Ph. 619-236-1234 Fx. 619-696-7419 Cabrillo Power I LLC SHEPPARD MULLIN RICHTER & HAMPTON LLP Dana J. Dunwoody 501 West Broadway, 19th Floor San Diego, CA 92101-3598 Ph. 619.338.6500 Fx. 619.234.3815 Sweetwater Authority; Valley Center Municipal District; Santa Fe Irrigation District; Olivenhain Municipal Water District; Rincon Del Diablo Municipal Water District; Rainbow Municipal Water District Page 5 of8 SDY775806.I BEST BEST & KRIEGER Melissa Woo 655 West Broadway, 15th Floor San Diego, CA 92101 Ph. 619.525.1300 Fx. 619.233.6118 11. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, and together shall constitute one and the same instrument, having the same force and effect as if a single original had been executed by all Parties. Furthermore, this Agreement may be executed and delivered by the exchange of electronic facsimile copies or counterparts of the signed documents, which facsimile copies or counterparts shall be binding upon the Parties. 12. Time is of the Essence. Time is of the essence for this Agreement. 13. Governing Law and Jurisdiction. This Agreement shall be construed and enforced under the laws of the State of California without regard to conflicts of law principles. 14. Headings and Cross-References. The headings and captions used in this Agreement are for convenience and ease of reference only and shall not be used to construe, interpret, expand or limit the terms of this Agreement. All cross-references in this Agreement, unless specifically directed to another agreement or document, shall refer to provisions in this Agreement and shall not be deemed to be references to any other agreements or documents. 15. No Duress. This Agreement is executed voluntarily by each of the Parties without any duress or undue influence on the part of, or on behalf of any of them. Each of the Parties to this Agreement has read and fully understands the meaning of each provision of this Agreement and has relied on the independent advice and representation of legal counsel in entering into this Agreement. 16. Construction. This Agreement has been reviewed and edited by the Parties and their legal counsel, and no presumption or rule that ambiguities shall be construed against the drafting party shall apply to the interpretation or application of this Agreement. 17. Effective Date. This Agreement shall become effective upon execution by all parties, or their authorized representatives. Page 6 of8 SDY775806.1 7 18. Attorneys Fees And Costs For Prevailing Party. In any action for enforcement or breach of this agreement, the Court shall award attorneys fees and costs to the prevailing party. IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the date hereinafter written. Date: Date: Date: Date: Sara Honadle Programs Director Coastal Environmental Rights Foundation Gabriel Solmer Executive Director San Diego Coastkeeper Marco A. Gonzalez COAST LAW GROUP LLP Attorneys for Coastal Environmental Rights Foundation and San Diego Coastkeeper Jan Driscoll ALLEN MATKINS LECK GAMBLE MALLORY LLP Attorneys for City of Carlsbad, Vallecitos Water District and Carlsbad Municipal Water District Date: ^/IS/^] \ j/^/\ Chiastopher W. Garrett L/THAM & WATKINS LLP Attorneys for Poseidon Resources (Channelside) LLC, Poseidon Resources Corporation, and Poseidon Water LLC Page 7 of 8 SDY775806.1 18. Attorneys Fees And Costs For Prevailing Party. In any action for enforcement or breach of this agreement, the Court shall award attorneys fees and costs to the prevailing party. IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the date hereinafter written. Date: Date: Date: Date: Date: Sara Honadle Programs Director Coastal Environmental Rights Foundation Gabriel Solmer Executive Director San Diego Coastkeeper Marco A. Gonzalez COAST LAW GROUP LLP Attorneys for Coastal Environmental Rights Foundation and San Diego Coastkeeper 7 7 J^fi/Driscoll : MATKINS LECK GAMBLE VLLORY LLP Attorneys for City of Carlsbad, Vallecitos Water District and Carlsbad Municipal Water District Christopher W. Garrett LATHAM & WATKINS LLP Attorneys for Poseidon Resources (Channelside) LLC, Poseidon Resources Corporation, and Poseidon Water LLC Page 7 of 8 SDY775806.1 18. Attorneys Fees And Costs For Prevailing Party. In any action for enforcement or breach of this agreement, the Court shall award attorneys fees and costs to the prevailing party. IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the date hereinafter written. Date: S^Honadle Programs Director Coastal Environmental Rights Foundation Date: Date: 7 / Gabriel Solmer Executive Director San Diego Coasikeeper larco A. uonzaiez COAST LAW GROUP! Attorneys for Coastal Effvironmental Rights Foundation and San Diego Coastkeeper /if. Jriscoll MATKINS LECK GAMBLE ^LLORYLLP Attorneys for City of Carlsbad, Vallecitos Water District and Carlsbad Municipal Water District Date: Christopher W. Garrett LATHAM & WATKINS LLP Attorneys for Poseidon Resources (Channelside) LLC, Poseidon Resources Corporation, and Poseidon Water LLC SD\775806.1 Page 7 of 8 Date: SHEPPARD^RJtXIN RICHTER & HAMPTON LLP Attorneys for Cabrillo Power 1 LLC Date:04/15/2011 Melissa Woo BEST BEST & KRIEGER LLP Attorneys for Sweetwater Authority, Valley Center Municipal District; Santa Fe Irrigation District; Olivenhain Municipal Water District; Rincon Del Diablo Municipal Water District; Rainbow Municipal Water District Page 8 of 8 SD\775806.I