Orange County Water Dist. v. Alcoa Global Fasteners

Filed 6/1/17

CERTIFIED FOR PUBLICATION

COURT OF APPEAL, FOURTH APPELLATE DISTRICT

DIVISION ONE

STATE OF CALIFORNIA

ORANGE COUNTY WATER DISTRICT, D070771

Plaintiff and Appellant,

v. (Super. Ct. No. 04CC00715)

ALCOA GLOBAL FASTENERS, INC. et al.,

Defendants and Respondents.

APPEAL from a judgment of the Superior Court of Orange County, Kim G.

Dunning, Judge. Affirmed in part; reversed in part and remanded with directions.

Connor, Fletcher & Hedenkamp, Edmond M. Connor, Douglas A. Hedenkamp;

Miller & Axline, Duane C. Miller, Michael D. Axline and Justin Massey for Plaintiff and

Appellant.

Lewis Brisbois Bisgaard & Smith, R. Gaylord Smith, Malissa McKeith, Ernest

Slome, Thomas Teschner and Brittany H. Bartold for Defendant and Respondent

Northrop Grumman Systems Corporation.
 Tatro Tekosky Sadwick and René P. Tatro for Defendant and Respondent Alcoa

Global Fasteners, Inc.

Bowman and Brooke and Lawrence Ramsey for Defendant and Respondent CBS

Broadcasting, Inc.

Kutak Rock, Jad T. Davis and Tiffany K. Ackley for Defendant and Respondent

Crucible Materials Corp.

Musick Peeler & Garrett and Steven J. Elie for Defendant and Respondent The

Arnold Engineering Company.

The Orange County Water District (the District) brought this action to recover

costs associated with the North Basin Groundwater Protection Project (NBGPP), a

proposed $200 million effort intended to address groundwater contamination in northern

Orange County, California caused by volatile organic compounds (VOC's) and other

chemicals. Since at least the mid-1980's, the District and other regulatory agencies such

as the Regional Water Quality Control Board (RWQCB) have been aware of VOC

groundwater contamination in the North Basin area. The District and various private

parties under the direction of the RWQCB investigated the sources of contamination.

Based on these investigations, the District and others concluded that the groundwater

contamination was caused by VOC releases at a number of industrial sites in the North

Basin area. Under the supervision of the RWQCB and other regulatory agencies, several

of these industrial sites have undergone remediation to remove VOC contamination from

the shallow soil and groundwater. Other industrial sites received "no further action"

letters from the RWQCB based on their investigations.

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 Concerned that VOC contamination remained in groundwater notwithstanding

these remediation efforts, the District began to develop an overarching solution to

groundwater contamination in the North Basin. Beginning in 1999, the District

developed and then refined a series of proposals for the NBGPP. The NBGPP is intended

to treat VOC contamination in the shallow aquifer, with the goal of preventing

contamination of the deeper principal aquifer. The principal aquifer is a source of

drinking water for several Orange County municipalities.

An aquifer, at its most basic level, consists of soil or permeable rock saturated

with water. In the North Basin area, the shallow aquifer begins approximately 130 feet

below ground level and extends to approximately 250 feet ground level. Below the

shallow aquifer, separated by a relatively less permeable layer of soil, is the principal

aquifer. The principal aquifer begins just below the shallow aquifer and extends to

approximately 1,200 to 1,500 feet below ground level in the North Basin area. When

used without qualification in this appeal, the term "groundwater" typically refers to water

in the shallow aquifer but sometimes the principal aquifer as well.1

In the course of its investigation, the District identified various current and former

owners and operators of industrial sites in the North Basin area that it believed were

1 Large portions of the record are unclear in this regard. Where the record permits,
we have endeavored to use as precise a term as possible. The term "groundwater" can
also refer to so-called "perched" groundwater, which is created when clay layers or other
less permeable soils prevent water from migrating downwards toward the shallow and
principal aquifers, forcing it to collect or "perch" atop the less permeable soil. However,
in this appeal, the usual use of the unqualified term "groundwater" excludes perched
groundwater.
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responsible in some way for VOC contamination. The primary VOC's identified

included tetrachloroethylene (also known as perchloroethylene or PCE), trichloroethylene

(TCE), 1,1-dichloroethylene (1,1-DCE), and 1,1,1-trichloroethane (1,1,1-TCA). The last

chemical, 1,1,1-TCA, breaks down into 1,1-DCE and acetic acid. The detection of 1,1-

DCE in soil or groundwater can be evidence of past 1,1,1-TCA contamination.

The District filed suit against a number of these owners and operators, including

defendants at issue in this appeal: Alcoa Global Fasteners, Inc. (Alcoa), Arnold

Engineering Co. (Arnold), CBS Broadcasting, Inc. (CBS), Crucible Materials Corp.

(Crucible), and Northrop Grumman Systems Corp. (Northrop). The District sued several

other parties, who settled or were otherwise dismissed from the litigation prior to this

appeal. In some cases, as we will explain, the District sued parties who had remediated

or were remediating their sites under the auspices of the RWQCB, on the theory that such

remediation did not affect VOC contamination that had migrated to the shallow aquifer in

the past. The District obtained approximately $21 million in settlements during the

underlying litigation.

The District asserted statutory claims for damages under the Carpenter-Presley-

Tanner Hazardous Substances Account Act (HSAA; Health & Saf. Code, § 25300 et seq.)

and the Orange County Water District Act (OCWD Act; West's Ann. Wat. Code App.

(2016 ed.) ch. 40) and for declaratory relief (Code Civ. Proc., § 1060). The District also

asserted common law claims for negligence, nuisance, and trespass.

By the time of trial, the design of the NBGPP had not been finalized and the vast

bulk of the project had not been constructed. The District claimed it had spent

4
approximately $3.7 million in development and construction costs, out of the estimated

$200 million total. The District sought to recover its past costs and obtain a declaration

holding defendants liable for future costs associated with the NBGPP.

Following an initial bench trial on the District's statutory claims, the trial court

determined that the District should take nothing. The court found, among other things,

that the NBGPP was neither a reasonable nor a necessary response to the identified

groundwater contamination and that defendants did not cause the District to undertake the

NBGPP. The court concluded that defendants were entitled to a declaration that they

were not responsible for past or future costs related to the NBGPP.

In light of the court's findings, defendants argued that a trial on the District's

remaining common law claims for negligence, nuisance, and trespass was unnecessary

because those findings would apply in any jury trial on the remaining claims. The court

agreed and entered judgment in favor of defendants.

The District appeals. It challenges the judgment on numerous grounds, including

(1) the trial court misinterpreted the legal requirements of the District's claims under the

HSAA and the OCWD Act; (2) the court erred under Code of Civil Procedure, section

1048, subdivision (b) by scheduling a bench trial on the District's statutory (equitable)

claims before a jury trial on the District's common law (legal) claims, thereby depriving

the District of its right to trial by jury; (3) the court erred by applying its factual findings

on the District's equitable claims to defeat the District's common law claims; (4) the court

misapplied Evidence Code section 412 and made other erroneous evidentiary rulings; and

(5) the court erred by granting declaratory relief in favor of defendants. In response,

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among other arguments, defendants contend the District cannot assert a claim under the

HSAA because it is not seeking "contribution" or "indemnity" as those terms are used in

the statute.

We conclude the District may assert a claim under the HSAA. On the merits,

however, as we shall explain, we find the trial court misinterpreted some elements of this

claim, including its causation standard. Based on our review of the evidence and the

court's factual findings, we conclude the court's causation error did not prejudice the

District, except as to Northrop. However, because the District's HSAA has other

essential elements, one of which was not satisfied as to any defendant, the District's

HSAA claim against all defendants including Northrop fails. Even though the latter issue

is dispositive of the District's HSAA claim, we address the former issues because they

present important and novel legal questions and because they affect our consideration of

the District's declaratory relief claim.

We further conclude the trial court misinterpreted elements of the District's claim

under the OCWD Act, which are similar but not identical to the elements of an HSAA

claim. We conclude these errors prejudiced the District as to Northrop (but not the other

defendants). We will therefore reverse the judgment on the District's OCWD Act claim

as to Northrop and otherwise affirm.

Based on these conclusions, we will reverse the court's declaration of no liability

in favor of Northrop but affirm court's declaration of no liability in favor of the remaining

defendants. We find no merit in the District's assignments of error concerning trial

sequencing and its common law claims, and although the court misapplied Evidence

6
Code section 412, it was not prejudicial. The remainder of the judgment will therefore be

affirmed as well.

FACTUAL AND PROCEDURAL BACKGROUND

The District and Its Allegations

The District is a public entity established by the California Legislature and

empowered to manage, replenish, regulate, and protect groundwater supplies within its

boundaries. (OCWD Act, §§ 1, 2.) The District has the power to "[t]ransport, reclaim,

purify, treat, inject, extract, or otherwise manage and control water for the beneficial use

of persons or property within the district and protect the quality of groundwater supplies

within the district." (Id., § 2, subd. (6)(j).) In furtherance of these goals, the District may

"commence, maintain, intervene in, defend, and compromise . . . any and all actions and

proceedings . . . to prevent . . . diminution of the quantity or pollution or contamination of

the water supply of the district . . . ." (Id., § 2, subd. (9).)

In 2004, the District filed this lawsuit against a number of defendants, including

defendants at issue in this appeal, to address current and threatened groundwater

contamination in the North Basin. In its operative first amended complaint (FAC), the

District alleged each defendant owned or operated one or more industrial sites in northern

Orange County where hazardous wastes (i.e., VOC's) had been released into the

environment. The release of hazardous wastes had caused or threatened to cause

contamination in groundwater within the District's geographic area. The District alleged

injury in the form of investigation and remediation costs to address this contamination

and threatened contamination, as well as the ongoing threat to public health, natural

7
resources, and the environment posted by the hazardous waste releases. To recover its

costs and address this threat, the District alleged causes of action against all defendants

under the OCWD Act and the HSAA and under common law theories of negligence,

nuisance, and trespass. The District also alleged a cause of action for declaratory relief,

which claimed "[a]n actual controversy exists concerning who is responsible for abating

actual or threatened pollution or contamination of groundwater resources within the

District by VOC's" and sought "adjudication of the respective rights and obligations of

the parties." The District sought compensatory and punitive damages, attorney fees,

costs, an order finding defendants liable for the full cost of remediation, an order

declaring the contamination a nuisance and compelling defendants to abate it, and any

other proper relief. Defendants cross-complained against the District for, among other

things, a declaration of no liability.

Pretrial and Trial Proceedings

During a status conference, the court announced its intention to bifurcate trial on

the District's claims, with an initial bench trial on the District's equitable claims (under

the OCWD Act and the HSAA and for declaratory relief) and a subsequent jury trial on

the District's legal claims (for negligence, nuisance, and trespass). The District urged the

court to try its legal claims first in front of a jury. It expressed concern that holding a

bench trial first would impair its right to a jury trial on its legal claims. The court

acknowledged the District's right to a jury trial but confirmed its inclination to hold a

bench trial first. Later, the court granted several defendants' motions for summary

adjudication of the District's negligence claim on statute of limitations grounds.

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 The bench trial on the District's equitable claims began in February 2012 and

lasted over seven months. The District and defendants presented extensive lay and expert

testimony, as well as documentary evidence, covering the history of the NBGPP, the

District's investigation and analysis of the North Basin area, activities at defendants'

industrial sites that may have led to hazardous waste disposal and releases, activities at

other sites in the North Basin area that may have led to hazardous waste releases,

previous soil and groundwater remediation efforts by defendants and others, the

involvement of regulatory agencies other than the District in such remediation efforts, the

potential impact of hazardous waste releases on groundwater in the North Basin area, and

the NBGPP's effect on such groundwater.2

History of the NBGPP

The evidence at trial showed that the District became aware of groundwater

contamination in the North Basin area in the mid-1980's. Data from monitoring wells

and other sources identified a plume of VOC contamination in groundwater, oriented east

to west, approximately 4.5 miles long and up to one mile wide. This contamination

primarily affected groundwater in the shallow aquifer. But by the late 1990's, VOC

contamination had reached the principal aquifer in certain areas, leading to the

decommissioning of several drinking water wells.

2 One defendant at trial, MAG Aerospace Industries, Inc. (MAG), successfully
moved for judgment on the District's equitable claims under Code of Civil Procedure
section 631.8 and thereafter obtained judgment on the District's remaining legal claims as
well. We consider the judgment involving MAG in a separate opinion filed this date.
(Orange County Water District v. MAG Aerospace Industries, Inc. (June 1, 2017,
D070562) ___ Cal.App.5th ___.)
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 In 1999, the District issued a request for proposal for a focused feasibility study to

assess various options concerning groundwater contamination in the North Basin area.

The District's request for proposal stated that the "presumed remedy" for groundwater

contamination was hydraulic containment of the VOC plume, i.e., the construction of

wells to extract contaminated groundwater from the shallow aquifer, remove VOC

contaminants, and discharge the treated water back into the environment. This remedy

was intended to minimize the further spread of contaminants in groundwater. It would

later be known as the NBGPP.

The next year, a consultant to the District prepared a draft focused feasibility

study. The study analyzed the extent of VOC groundwater contamination in the North

Basin area and evaluated the effects of four potential alternative responses. These

responses were the following: (1) No Action: "In this alternative, it is assumed that no

remedial measures of any type would be implemented by [the District] or any other party

and that ongoing remedial efforts by private parties would be terminated." (2)

Monitored Natural Attenuation: "In this alternative, it is assumed that no remedial

measures would be implemented by [the District], although ongoing and/or planned

remedial measures by other parties would continue. Also, [the District] and others would

continue to monitor water quality via existing and recommended new wells." (3)

Mitigation Control at Leading Edge: "This alternative contains all of the elements of

[Monitored Natural Attenuation] but also includes the extraction of 600 gpm of VOC-

containing ground water from each of three wells (for a total of 1,800 gpm) located at or

10
near the 'leading edge' of the VOC plume."3 (4) Migration Control at Leading Edge

with Enhanced Removal: "This alternative contains the same elements as [Migration

Control at Leading Edge] but includes three additional extraction wells located within the

VOC plume." The two treatment responses, the third and the fourth alternatives, relied

on a "modular" system, i.e., individual extraction wells with onsite treatment facilities.

The treated water would then be returned to the principal aquifer through injection wells

or discharged onto surface spreading grounds to naturally recharge the shallow aquifer.

The primary contaminants targeted for remediation were PCE, TCE, 1,1-DCE, and cis-

1,2-dichloroethylene.

The draft focused feasibility study was intended to be consistent with standards

established by the United States Environmental Protection Agency for environmental

remediation programs. These standards, entitled the "National Oil and Hazardous

Substances Pollution Contingency Plan" (NCP), are codified in federal regulations. (40

C.F.R. § 300.1 et seq.) Under the NCP, the primary objective of a feasibility study is "to

ensure that appropriate remedial alternatives are developed and evaluated such that

relevant information concerning the remedial action options can be presented to a

decision-maker and an appropriate remedy selected." (40 C.F.R. § 300.430(e)(1).)

The draft focused feasibility study prepared for the District discussed in detail the

four alternatives and assessed them across nine criteria: overall protection of human

health and the environment; compliance with ARAR's; long-term effectiveness and

3 The abbreviation "gpm" refers to gallons per minute, a measure of the capacity of
the extraction wells to pump groundwater.
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permanence; reduction of mobility, toxicity, and volume through treatment; short-term

effectiveness; implementability; cost, state acceptance; and community acceptance. (See

40 C.F.R. § 300.430(e)(9)(iii).) The 30-year net present value cost ranges for each

alternative (including capital, operation, and maintenance costs) were no cost for the No

Action alternative, approximately $3.5 million for the Monitored Natural Attenuation

alternative, approximately $11 million to $18 million for the Mitigation Control at

Leading Edge alternative, and approximately $13 million to $23 million for the

Mitigation Control at Leading Edge with Enhanced Removal alternative.

Five years after the draft focused feasibility study was prepared, a different

consultant for the District prepared a supplemental focused feasibility study. This

supplemental study, issued in January 2005, assessed two variations of the Mitigation

Control at Leading Edge alternative discussed in the draft focused feasibility study. The

supplemental study explained that two changed circumstances required redesign of that

alternative: (1) monitoring data noted the presence of additional contaminants that

should be remediated, including 1,1-dicholoroethane and 1,4-dioxane; and (2) property

acquisition for the placement of modular extraction wells and treatment systems had

proven difficult. The alternatives under consideration in the supplemental focused

feasibility study involved extraction wells placed along the leading edge of the plume,

similar to the draft study, but the water would be pumped to a centralized treatment

system. In the first alternative, the District would construct and operate a single

centralized treatment system. In the second, the District would construct and operate two

centralized treatment systems. In both alternatives, the District would release treated

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water into the shallow aquifer through discharge into flood basins adjacent to the

treatment systems.

The supplemental focused feasibility study did not consider nontreatment

alternatives, such as the No Action and Monitored Natural Attenuation alternatives

identified in the draft study. The supplemental study explained that it "focuses primarily

on treatment technologies in the context of the presumptive remedy (i.e., hydraulic

control)." The supplemental feasibility study also limited its assessment to two of the

nine previously-considered criteria: implementability and cost. The supplemental study

estimated the 30-year net present value costs for both alternatives at approximately $19

million.

The District circulated a notice of intent to adopt a mitigated negative declaration

for the NBGPP under the California Environmental Quality Act (CEQA; Pub. Resources

Code, § 21000 et seq.). It made available for inspection the draft mitigated negative

declaration and supporting initial study. Following an approximately one-month public

review period, the District reported that it did not receive any comments that supported

the need for an Environmental Impact Report (EIR) or any significant modification to the

project. The District's board of directors adopted the mitigated negative declaration for

the project.4

4 As a public agency, the District's board and committee meetings are open to the
public. The District provides notice of agenda items and, at least 72 hours prior to the
meeting, technical backup information. The District accepts written public comments on
agenda items and holds a public comment period during meetings.
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 Later in 2005, District staff prepared a report assessing the hydrogeological and

engineering aspects of the NBGPP. The report discussed additional modifications to the

project following the supplemental focused feasibility study. The RWQCB had notified

the District that additional studies were needed to determine whether the project would

exacerbate perchlorate contamination in the shallow and principal aquifers. Because of

the expense of such studies, and the likelihood that perchlorate contamination would in

fact be exacerbated, the District determined that perchlorate treatment should be part of

the project. Similarly, the District identified nitrate contamination in groundwater and

determined that nitrate treatment should be part of the project as well. For these reasons,

among others, the District settled on a single centralized treatment system that would

treat extracted groundwater for the previously-identified VOC's as well as perchlorate

and nitrate. The report estimated the capital costs of the project, including contingencies,

to be approximately $20 million with estimated annual operation and maintenance costs

of $1.85 million. The report calculated that the project would treat 5,650 acre-feet of

groundwater per year, leading to a total treatment cost (including amortized capital costs

and operation and maintenance costs) of $576 per acre-foot of water.5 The District's

board of directors approved the NBGPP as described in the staff report.

In light of the changes to the NBGPP project, the District commissioned a Draft

Subsequent Environmental Impact Report (Draft SEIR). The Draft SEIR reviewed the

environmental impacts associated with the changes in the project after the mitigated

5 An acre-foot is a unit of measurement equal to the volume of water required to
cover an area of one acre with one foot of water.
14
negative declaration was approved. The changes identified in the Draft SEIR included,

among other things, a new proposed extraction well, additions to the centralized

treatment system to accommodate the remediation of additional contaminants (e.g.,

perchlorate and nitrate), and a new recharge system involving injection wells. The Draft

SEIR included discussions of four alternatives, but each alternative involved constructing

at least the version of the NBGPP described in the 2005 supplemental focused feasibility

study and mitigated negative declaration.

Prior to preparing the Draft SEIR, the District circulated notices to public agencies

and interested parties. It received eight comment letters from various public agencies and

Northrop. The District also met with the South Coast Air Quality Management District

and Northrop to discuss the changes to the project. The District circulated the Draft SEIR

to the public and received a number of comments.

By the time of trial, the District had constructed five extraction wells. But plans

for the centralized treatment system were not complete, and no treatment had yet

occurred. The District estimated that it had spent approximately $3.7 million on the

project to date. The District's cost estimate for the entire project, however, had increased

to over $200 million.

The NBGPP's Environmental Effects

The effect of the proposed NBGPP project on the VOC plume, and on the shallow

and principal aquifers more generally, was hotly contested at trial. The objectives of the

project, as summarized in the District's 2005 staff report, were to (1) "[p]revent exposure

of the public to groundwater containing contaminants exceeding drinking water

15
standards," (2) "[i]nhibit the lateral and vertical migration of contamination to protect the

aquifer and existing [drinking water] production wells from further impacts," and (3)

"[r]emove contaminant mass from the aquifer."

It was undisputed at trial that VOC contaminants in the North Basin area would

naturally degrade to some extent over time, even setting aside the effects of the NBGPP,

based on natural chemical processes. This process is called natural attenuation. It was

also undisputed that other public agencies and private parties had undertaken efforts to

remediate VOC-contaminated sites in the North Basin area. For example, the District

recognized in its 2000 draft focused feasibility study that at least 15 private parties had

been required by the RWQCB to investigate subsurface contaminants at their sites, and at

least seven sites had been actively remediated. At least two other sites were remediated

by or at the direction of the California Department of Toxic Substances Control (DTSC).

This process, called source removal, would likely lead to a decrease in the downward

migration of VOC contaminants into groundwater, including the shallow aquifer, and

foster the reduction of contaminant levels through natural attenuation.

At trial, District expert Graham Fogg opined, based on computer models of the

North Basin area, that the NBGPP would remove approximately half of the VOC

contaminant mass in the shallow aquifer over 30 years of operation. Fogg was

impeached, however, by deposition testimony in which he admitted that removing a third

16
of the VOC contaminant mass would be an "optimistic" estimate. Fogg did not model the

effect of the NBGPP on existing drinking water production well fields.6

A defense expert, Steven Larson, agreed that the NBGPP would change conditions

in some areas of the shallow aquifer. Larson, however, also specifically modeled the

effect of the NBGPP on the principal aquifer. He found no material charge in the level of

contaminants there, especially in the areas surrounding existing drinking water

production wells. Larson concluded that the NBGPP would provide no benefit to the

principal aquifer. Based on the data Larson reviewed, which was confirmed in a District

report, contaminant levels in the principal aquifer were already relatively stable or

declining. Larson expected that trend to continue regardless of whether the NBGPP was

constructed. Larson concluded that the cost of the NGBPP was not justified in light of

the similarity between the conditions in the principal aquifer, especially around drinking

water production wells, if the NGBPP were constructed and if it were not. He believed

the NGBPP was neither reasonable nor necessary to reduce VOC contamination in the

principal aquifer to an acceptable level.7

6 The evidence at trial showed that the drinking water production wells that had
been removed from service because of VOC contamination in the principal aquifer were
located in an area of the North Basin that would not be affected by the NBGPP. The
District determined that active treatment of the VOC contamination plume in that area
was unnecessary. It believed monitored natural attenuation would be sufficient to protect
human health and the environment there.
7 Larson also believed that one proposed extraction well was unnecessary, even
accepting other elements of the NBGPP on their own terms, because of its proximity to
other treatment wells (whose pumping rates could be increased to compensate for the
removal of that well).
17
 Larson criticized the District for not examining the effect of treatment (or lack

thereof) on the level of contaminants in the principal aquifer during development of the

NGBPP. In Larson's view, this failure was exacerbated when the plan for treated water

under the NGBPP changed from injection directly into the principal aquifer to discharge

into the shallow aquifer. While injecting treated water into the principal aquifer would

tend to inhibit migration of contaminants downward from the shallow aquifer, releasing

treated water into the shallow aquifer would likely have the reverse effect: Contaminants

in the shallow aquifer would be pushed downward into the principal aquifer.

Defendants' Sites

The testimony and evidence at trial also focused on the industrial activities,

environmental conditions, and past remediation efforts at defendants' sites in the North

Basin area. Richard Waddell, a District expert witness, testified that VOC's had been

released into the environment at each site. He concluded that these releases had caused

contamination of groundwater, including the shallow aquifer.

Each defendant, through expert and percipient testimony, disputed Waddell's

conclusions. Aside from Northrop, defendants' primary arguments were (1) VOC's had

not been released at their sites, (2) they were not responsible for any VOC releases that

had occurred, or (3) any releases at their sites had not caused VOC contamination in

groundwater. Northrop acknowledged that its sites had potentially contributed to

groundwater contamination in the past. It argued, however, that its remediation activities

at those sites had removed any potential source of future contamination. The evidence

regarding each defendant's site or sites will be discussed in turn below.

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 Alcoa

Alcoa leased the site at 800 South State College Boulevard in Fullerton, California

from 2002 through 2007, and it has owned the site since then. For decades prior to

Alcoa's tenancy, industrial activities at the site included the use of a large vapor

degreaser. The solvents used in this degreaser included TCE and PCE. Alcoa continued

to use the degreaser in 2002 and 2003 after it occupied the site. Soil samples taken near

the location of the degreaser revealed high concentrations of PCE at shallow depths and

high concentrations of TCE at slightly greater depths. In consultation with the RWQCB,

Alcoa constructed a soil vapor extraction system to remediate the soil at the site to a

depth of 50 feet. The system removed approximately 10,500 pounds of VOC's from the

soil.

In Waddell's view, the soil samples showed that releases of PCE and TCE had

occurred at the Alcoa site in the area of the former degreaser. Because PCE and TCE

were also detected in groundwater beneath the site, and based on the site characteristics

and historical sampling data, Waddell believed that releases at the Alcoa site had

contributed to PCE and TCE contamination of groundwater. On cross-examination,

however, Waddell limited his testimony to the opinion that such contamination was

possible, i.e., there was a physical mechanism by which contamination could have

occurred. His opinion was not that VOC releases at the Alcoa site had actually made

their way to groundwater. Waddell acknowledged that a nearby upgradient site operated

by Aerojet, a nonparty, contributed to groundwater PCE contamination as well. Because

the Aerojet site was such a large contributor to PCE contamination, Waddell admitted

19
that the impact of the Alcoa site on PCE levels in groundwater would be too small to be

discernable.

Alcoa's expert witness, Richard Weiss, reviewed the available data and determined

there was no evidence that VOC releases at the Alcoa site reached groundwater. He

testified that sampling data revealed an approximately 30-foot gap between the deepest

soil VOC detection and groundwater below the Alcoa site. Weiss explained that if

VOC's had migrated to groundwater, they would have been detected in the soil in a

reasonably continuous manner. As a further basis for his opinion, Weiss cited the

composition of the soil under the Alcoa site, which impeded downward migration of

VOC's, and the chemical signature of the VOC's detected in groundwater, which differed

from the chemical signature of the VOC's released at the Alcoa site. Instead, the

chemical signature of VOC's in groundwater matched the chemical signature of VOC's

released from the Aerojet site.

Arnold

Arnold owned and operated the site at 1551 East Orangethorpe Avenue in

Fullerton from 1960 through 1984. During that time, Arnold operated one or more vapor

degreasers, clarifiers, and dip tanks (or "strippers") at the site. The identity of the VOC's

used in the degreasers and dip tanks was the subject of conflicting testimony at trial.

(Clarifiers do not themselves make use of VOC solvents, but they can be a source of

VOC discharge into the environment because they may process VOC-contaminated

wastewater generated by other activities.)

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 A former Arnold maintenance manager testified that he was aware of only one

chemical, 1,1,1-TCA, used in one Arnold degreaser. Another former Arnold employee,

Daniel Hopen, testified to seeing barrels of chemicals with labels showing both

"trichloroethylene" (TCE) and "1,1,1" used in degreasers. On cross-examination, Hopen

appeared to waver, stating confidently only that the barrels were labeled "1,1,1." (The

only relevant chemical in this litigation with the designation "1,1,1" is 1,1,1-TCA.)

Hopen also recalled other barrels labeled "perchloroethylene" (PCE) used in Arnold's dip

tanks. Permits issued from 1970 through 1984 identified only 1,1,1-TCA as the solvent

used in degreasers and stored in a storage tank at the Arnold site. Other permits did not

identify a specific solvent. Use of TCE was restricted after 1976. In Waddell's opinion,

based on research into Arnold's activities at the site as well as those of subsequent

occupants, Arnold used 1,1,1-TCA, TCE, and PCE.

Soil samples taken in 1995, approximately a decade after Arnold left the site,

revealed VOC contamination in the shallow soil. For example, high concentrations of

PCE were found in depths up to 30 feet near a clarifier on the southern side of the Arnold

site. Waddell testified that these sampling results indicated a PCE release had occurred at

the site. Waddell also reviewed evidence of Arnold's activities at the site (including

employee testimony, photographs, and brochures) and concluded that the Arnold's

handling of VOC solvents was likely to cause releases of those VOC's into the

environment.

The property owner at the time attempted to remediate the VOC contamination

and operated a soil vapor extraction system for several months. Additional sampling

21
after this remediation revealed VOC contamination extending to greater depths, including

60 feet for PCE and 95 feet for TCE. In Waddell's view, these results showed that the

remediation was not successful.

Further sampling of the shallow soil (down to 40 feet below the surface) took

place in 2007. The sampling revealed PCE, TCE, 1,1,1-TCA, and 1,1-DCE

contamination in multiple locations at the Arnold site. (As noted above, 1,1-DCE is a

degradation product of 1,1,1-TCA.) The next year, the property owner began

remediation with a soil vapor extraction system again. By the time of trial, the system

had extracted 90 pounds of VOC's, the vast majority of which was PCE. A small amount

of TCE was also extracted. The system remained in operation.

The groundwater directly under the Arnold site was not tested for VOC

contaminants. Monitoring wells at an adjacent property, the nonparty Johnson Controls

site, revealed VOC contamination in groundwater. Waddell believed that this

contamination was the result of VOC releases at the Arnold site rather than the Johnson

Controls site. In 2010, the District retrieved grab samples from the shallow aquifer both

upgradient and downgradient of the Arnold site. Concentrations of TCE were higher in

grab samples downgradient of the Arnold site. Based on this and other data, Waddell

concluded that the Arnold site contributed TCE and 1,1-DCE to contamination in

groundwater. Concentrations of PCE were relatively stable, and Waddell was limited at

22
trial to the opinion that the Arnold site did not contribute to PCE contamination in

groundwater.8

Arnold's expert witness, Jonathan Rohrer, reviewed the evidence and concluded

that Arnold had used only 1,1,1-TCA in its operations. Rohrer further concluded that

Arnold's operations at the site had not caused any discharge of VOC's into soil or

groundwater. Rohrer based his conclusion on the Arnold's use of 1,1,1-TCA only, the

soil and groundwater data surrounding the site, the lack of documented chemical releases

into soil during Arnold's operations, and the presence of several VOC-contaminated

properties upgradient of the Arnold site. He identified subsequent occupants of the

Arnold site as possible contributors to VOC contamination based on their activities and

the recovery of numerous barrels of hazardous waste from the site. Rohrer admitted that

VOC contamination in the shallow soil at the Arnold site indicated that PCE and TCE

had been released there by someone, but he did not agree Arnold was responsible.

Rohrer criticized Waddell's reliance on grab samples and disagreed that the data

showed the Arnold site contributed TCE to groundwater. Rohrer testified that the

locations of the grab samples were inadequate to distinguish the contribution of the

Arnold site to VOC contamination from the contributions of the upgradient sites.

Waddell, for his part, agreed that sampling at the site was inadequate to fully characterize

the VOC contamination there.

8 Waddell acknowledged that another upgradient property, the nonparty Jonathan
Manufacturing site, contributed to TCE and PCE contamination in groundwater.
23
 Separately, Rohrer modeled the potential contribution of contaminants from the

Arnold site. This model was based on the District's interpretation of the grab samples

and its estimates of the amounts of contaminants that would be remediated by its

extraction wells. Rohrer cautioned that his model was based on the assumption that the

upgradient and downgradient differentials in the District's grab samples were attributable

to the Arnold site, an assumption Rohrer had criticized as unfounded. Rohrer concluded,

based on his model, that the Arnold site contributed approximately 4.95 grams of VOC

contamination (PCE, TCE, and 1,1-DCE) to the daily amount that would be remediated

by the NBGPP.

CBS

CBS owned and operated the site at 500 South Raymond Avenue in Fullerton

from 1965 to 1983. The site housed the Fender Electric Instrument Company, which

CBS purchased in 1965. A CBS subsidiary purchased the adjacent site at 1300 East

Valencia in 1965, and CBS expanded its holdings at that address the next year. CBS sold

the property in 1986.9 A portion of the 1300 East Valencia site, used by CBS partially as

a parking lot, has since been subdivided and now bears the address 700 Sally Place.

CBS's operations at 500 South Raymond included the use of a degreaser and an

above-ground storage tank for VOC solvent. The solvent CBS used was PCE. Samples

collected from the shallow soil near the degreaser and the storage tank revealed VOC

9 MAG leased the site at 1300 East Valencia from 1989 through 2002. As noted,
we consider the judgment involving MAG in a separate opinion filed this date. (Orange
County Water District v. MAG Aerospace Industries, Inc., supra, ___ Cal.App.5th ___.)

24
contamination. Additional samples, taken up to a depth of 100 feet below the surface,

showed PCE contamination down to 70 feet. PCE was also detected in groundwater

beneath the site.

At 1300 East Valencia, CBS operated a dip tank using solvents. Although a

former CBS employee denied that CBS used PCE at the site, shallow soil and

groundwater samples revealed PCE contamination. Waddell admitted that some

contamination was the result of an adjacent site (nonparty American Electronics), but he

believed that monitoring well data showed that the 1300 East Valencia site contributed

PCE to groundwater as well. Waddell observed that concentrations of TCE had

decreased over time while PCE concentrations had increased. In his view, if the

American Electronics site were the only site contributing PCE and TCE to groundwater,

changes in their concentrations should mirror each other.10

At the site now known as 700 Sally Place, soil samples revealed PCE

contamination near a former storage area. Again, however, a former CBS employee

denied that CBS used PCE there, and Waddell admitted that there was no evidence CBS

used or stored PCE at that site.

10 Other contaminants, such as TCE, were detected at the 500 South Raymond and
1300 East Valencia sites. Waddell believed that these contaminants had migrated there
from an adjacent sites. For 500 South Raymond, the site Waddell identified was the
nonparty Chicago Musical site, which was heavily contaminated with PCE, TCE, 1,1,1-
TCA, and 1,1-DCE and was being remediated by the DTSC. Over a several-month test
period, almost 17,000 pounds of VOC's were removed through a soil vapor extraction
system at the Chicago Musical site. For 1300 South Valencia, Waddell identified the
nonparty Monitor Plating and American Electronics sites. Waddell testified that TCE
detections at 1300 South Valencia were the result of migration from the Monitor Plating
site. The American Electronics site, in Waddell's view, contributed both TCE and PCE.
25
 Based on the site data and his analyses, Waddell opined that CBS had released

PCE into the environment at the 500 South Raymond and 1300 East Valencia sites. He

concluded that those releases had likely resulted in contamination of groundwater at the

sites.

CBS's expert witness, Daniel Stephens, disagreed. He concluded that

contamination at the sites associated with CBS had not impacted groundwater. Stephens

based his conclusion on historical data as well as his own investigation of the sites in

2011. Stephens agreed the shallow soil around the degreaser and storage tank at the 500

South Raymond site was contaminated with PCE. But Stephens believed that deeper

soils were impacted by contamination at another site, most likely Chicago Musical. He

relied primarily on a gap in the detections of PCE between the shallow soil and

groundwater and differences in the chemistry (i.e., the VOC profile) of the shallow soil

when compared to groundwater. Stephens criticized Waddell for misstating and

minimizing the concentrations of VOC's found at the Chicago Musical site.

Regarding the 1300 East Valencia site, Stephens pointed out that the shallow soil

was extensively sampled in 1988, but only one sample detected PCE, near the former dip

tank at the edge of the property. Later, more extensive testing revealed PCE

contamination to a depth of around 70 feet below the surface at that location. But no

contamination was found for approximately 40 feet below that level, until the testing hit

groundwater. Based on this fact, and his own interpretation of monitoring well data,

Stephens concluded there was no nexus between the PCE contamination found in the

shallow soil at the 1300 East Valencia site and contamination in groundwater.

26
 Stephens's conclusion was supported by two prior investigations of the 1300 East

Valencia site. In a 2003 letter, the RWQCB reviewed the existing data regarding the site

and recommended that no further action be taken: "Based on the low concentrations and

small amount of mass of VOC's that are present in the soil and groundwater, the limited

volume of groundwater that is impacted at this site, the limited lateral and vertical extent

of VOC's in groundwater, and the existence of an off-site source, this site does not appear

to pose a current, significant threat to the beneficial uses of groundwater."11 Similarly, a

2002 report commissioned by the then-owner of the 1300 East Valencia site concluded,

based on the limited extent of shallow soil PCE contamination in the area of the former

dip tank, that "the data collected during this investigation indicates that groundwater has

not likely been impacted by this past release."

For 700 Sally Place, as with CBS's other sites, Stephens opined that any VOC

contamination there did not impact groundwater. Stephens based his opinion on soil

samples (which showed a gap in PCE detections before reaching groundwater), the

differing chemical profiles of the contamination in shallow soil and in groundwater, and

the presence of upgradient sources of contamination. In 1995, the RWQCB issued a no

further action letter for the 700 Sally Place site. The RWQCB confirmed the gap in PCE

detections, but it determined that PCE contamination at the site had impacted

11 The RWQCB found, as a preliminary matter, that "[i]t is apparent that VOC's from
this site have impacted groundwater." The letter does not specify whether this impact
came from VOC's released at the surface or subsurface VOC migration from off-site
sources. Stephens interpreted the letter as concluding that there was no "definite impact
to groundwater" from the PCE contamination in the area of the former dip tank.
27
groundwater: "It appears that volatile organic compounds are not present in the soil at

concentrations that would require remediation or that would pose a significant threat to

groundwater quality. However, the presence of PCE in a groundwater sample from the

low spot area indicates that PCE from the site has impacted groundwater quality."12

Stephens analyzed the historical uses of 700 Sally Place by CBS and determined that the

"low spot" identified by the RWQCB was created after CBS sold the property. Stephens

therefore opined that any such contamination was caused by subsequent occupants.

Crucible

Crucible owned and operated the site at 2100 East Orangethorpe Avenue in

Fullerton from the late 1950's until 1985. Crucible admitted using the solvents TCE and

1,1,1-TCA in an immersion degreaser at the site. The solvents were stored at a separate

location on the site. Shallow soil sampling conducted in 1984 showed the presence of

PCE, TCE, 1,1,1-TCA, and 1,1-DCE. The next year, a limited amount of soil was

excavated in an effort to partially remediate a portion of the site. Additional sampling

occurred in 2002 and 2003, specifically in the areas surrounding the degreaser and

chemical storage area. The sampling revealed contamination with PCE, TCE, 1,1,1-

TCA, and 1,1-DCE in both areas. No contamination was found at 40 feet below the

surface, however, and the sampling did not proceed to depths below that level.

12 The PCE groundwater contamination identified by the RWQCB was relatively
minor. It was below the applicable maximum contaminant level for PCE in drinking
water.
28
 Based on this data, Waddell concluded that Crucible had released not only TCE

and 1,1,1-TCA, but also PCE, into the soil at the degreaser and the chemical storage area.

(As noted above, 1,1-DCE is a degradation product of 1,1,1-TCA.) Although the

chemical storage area was adjacent to a site occupied by nonparty Vista Paint, which was

also contaminated, Waddell determined that the soil contamination came from the

Crucible site based on its chemical profile.13

A groundwater monitoring well on the site of nonparty AC Products, located

approximately 1,000 feet from the Crucible site, detected VOC contamination in

groundwater. The District conducted further sampling at locations surrounding the

Crucible site. The sampling detected PCE, TCE, 1,1,1-TCA, and 1,1-DCE in perched

groundwater, 60 to 70 feet below the surface, and PCE, TCE, and 1,1-DCE in the shallow

aquifer as well, 100 to 120 feet below the surface. Waddell observed that the chemical

profile of the VOC's found in soil sampling at the site was similar to the chemical profiles

of the perched groundwater and (aside from 1,1,1-TCA, which had degraded into 1,1-

DCE) the shallow aquifer. Based on this data, as well as data from the AC Products

monitoring well, Waddell opined that VOC releases at the Crucible site had caused

contamination of both the perched groundwater and the shallow aquifer. Waddell further

opined that soil contamination at the Crucible site was a continuing source of

groundwater contamination.

13 Waddell's opinions involving Vista Paint were undermined by his admissions, on
cross-examination, that the District had not provided him with relevant information
regarding Vista Paint's activities and that he had not referenced any Vista Paint discovery
in his expert report.
29
 On cross-examination, Waddell admitted that many of the recent samplings had

revealed relatively low levels of contamination. He acknowledged that the Crucible site

was not a "major impact" site. Waddell was unable to quantify the amount of VOC

groundwater contamination caused by the Crucible site and did not calculate the amount

of VOC contamination from that site that the NBGPP would remediate.

Crucible's expert, Andrew Kopania, acknowledged that Crucible had used PCE,

TCE, and 1,1,1-TCA at the site. He also admitted that those VOC's had been released

into the soil at the Crucible site. But he concluded there was no evidence that VOC

releases at the Crucible site had impacted groundwater or migrated to downgradient

monitoring wells. Kopania determined that the soil sampling conducted in 1985, 2002,

and 2003 showed only modest shallow soil contamination rather than the type of

significant release that would migrate down to the shallow aquifer. He also observed that

there were no consistent detections of contamination from the shallow soil down to

groundwater.

The environmental consulting firm that conducted the 2003 sampling reached the

same conclusion. In its report, the firm wrote, "[The firm] recommends that no further

action be required for this Site. It has been clearly demonstrated that the low

concentrations of VOC's[,] where present beneath the Site, do not present a threat to

human health or groundwater beneath the Site." The DTSC accepted the firm's

conclusion and agreed no further investigation was necessary.

30
 Kopania criticized Waddell's reliance on the District's 2011 sampling because they

were one-time "grab" samples. Kopania testified that grab samples are not accepted by

regulatory agencies as adequate to characterize contamination at a site.

Kopania believed that VOC contamination in the shallow aquifer at the Crucible

site was caused by the adjacent Vista Paint site. Kopania's analysis of chemical

signatures, particularly the concentration of the VOC stabilizer 1,4-dioxane, showed

consistency between the contamination in groundwater and the contamination at the Vista

Paint site. Kopania also believed, based on the VOC composition of the contamination,

that other sites upgradient of the Crucible site, including the AC Products site, also

caused contamination.

Northrop

Northrop owned and operated three sites in the project area: 500 East

Orangethorpe Avenue (referred to as EMD), 1730 North Orangethorpe Park (Kester

Solder), and 301 East Orangethorpe Avenue (Y-12), all in Anaheim, California.

Northrop owned the EMD site from 1952 until 1995 and occupied the site for the vast

bulk of that time. Northrop acquired the corporate owner of the Kester Solder site, Litton

Industries (Litton), in 2001 or 2002. Litton had owned and occupied the site since 1967.

Northrop occupied the Y-12 site from 1962 until 1994. It owned the Y-12 site from 1992

until 1995.

Northrop operated several degreasers at the EMD site and admitted using TCE,

1,1,1-TCA, and 1,1,-DCE there. At the time operations at the EMD site ceased in 1991,

soil sampling revealed extensive VOC contamination. Northrop undertook remediation

31
of the EMD site under the supervision of the RWQCB. All existing buildings at the site

were demolished. Northrop installed and operated a soil vapor extraction system in the

area of greatest contamination. After completing that extraction process, Northrop

excavated soil in the area down a depth of approximately 40 feet below the surface,

including a clay layer 10 feet in thickness. The resulting excavation was filled with soil

from offsite. After remediation, the RWQCB reviewed soil and groundwater data from

the site to determine whether the remaining contamination posed a threat to groundwater.

The RWQCB concluded it did not. In a 1991 letter, the RWQCB wrote, "The data from

the soil investigation and remediation activities that have taken place indicate that the

VOC's that remain in the soil at the site do not appear to be present in concentrations that

would result in a significant impact on water quality." While the RWQCB concluded that

shallow groundwater at the site had been affected by onsite VOC contamination, the

RWQCB believed that contamination in deeper groundwater may have originated from

offsite sources because the concentration of contaminants in the deeper groundwater was

higher than the concentration in shallow groundwater. Following further groundwater

monitoring, the RWQCB repeated its conclusion in 1993: "Several years of site

monitoring have indicated that contaminants in the groundwater beneath the site probably

originate from an off-site source."14

14 Around this time, the District's staff reviewed Northrop's activities. Although they
found that Northrop's soil study and cleanup was "thorough and comprehensive," the
District was concerned that the site's impact on groundwater remained inadequately
investigated.
32
 The District performed additional soil and groundwater sampling in 2010 at

locations selected by its expert witness Waddell. The soil samples showed VOC

contamination at or below Northrop's remediation goal of one part per million. The

groundwater samples showed relatively low levels of contamination.

Based on these investigations, Waddell opined that Northrop had released TCE

and 1,1,1-TCA at the EMD site. Waddell also opined that these releases remained a

source of groundwater contamination with TCE, 1,1,1-TCA, and 1,1-DCE. Waddell's

opinion relied upon his analysis of the degradation time of 1,1,1-TCA into 1,1-DCE, the

continued presence of contaminated groundwater under the site, and other factors.

Waddell believed that groundwater contamination from the EMD site would be

captured by at least one, and possibly three, extraction wells as part of the NBGPP. On

cross-examination, however, Waddell admitted that it would take approximately one to

two years for groundwater under the EMD site to migrate to the District's extraction

wells. Groundwater flowing under the EMD site prior to that time would therefore not be

captured by the extraction wells.

Northrop's expert witness on site conditions, Glenn Tofani, testified that any

contamination at the EMD site would not impact the shallow aquifer. Tofani based his

opinion on a comparison of the concentrations of VOC contaminants at monitoring wells

upgradient and downgradient of the site, groundwater VOC concentrations at the site, and

the results of the District's 2010 groundwater sampling. Among other observations,

Tofani determined that VOC concentrations in groundwater downgradient of the EMD

site were similar to upgradient concentrations, both historically and in 2010. (Waddell

33
admitted that the 2010 groundwater samples showed VOC concentrations consistent with

upgradient sources.) Tofani also refuted Waddell's conclusion that the degradation time

of 1,1,1-TCA into 1,1-DCE showed that the EMD site was a source of groundwater

contamination. Based on Tofani's analysis, the contamination originated from a source

several thousand feet upgradient of the site.15

At the Kester Solder site, Litton (the prior owner) stored and repackaged PCE.

Testing revealed PCE contamination in the shallow soil, perched groundwater, and

shallow aquifer. It was undisputed at trial that PCE had been released at the site.

With the approval of the RWQCB, Northrop installed and operated a soil vapor

extraction system to remediate VOC contamination at the Kester Solder site. The system

operated between 2007 and 2009. During that time, it removed almost 1,000 pounds of

15 Northrop offered testimony from a second expert witness, John Lambie, who
testified regarding the necessity and reasonableness of the NBGPP. He agreed with
defense expert Larson that the VOC plume in the North Basin area was stable and
chemical concentrations were not increasing. As part of his analysis, Lambie calculated
the volume of VOC's flowing into groundwater from each of Northrop's sites. Lambie
relied on a similar upgradient-downgradient analysis as Tofani, but he concluded that the
EMD site did contribute VOC's, including TCE and 1,1-DCE, to groundwater. Lambie
came to similar conclusions about the Kester Solder site (for PCE) and the Y-12 site (for
TCE and 1,1-DCE). Lambie compared the total estimated volume of VOC releases from
Northrop's sites to the total VOC volume in the NBGPP treatment area. He concluded
that Northrop's sites had contributed 2.2 percent of the PCE volume, 10.4 percent of the
TCE volume, and 13.3 percent of the 1,1-DCE volume. Based on these contribution
estimates, Lambie determined the proportion of the District's NBGPP expenditures for
which Northrop would be responsible. Lambie's estimates were not based on the actual
amount of VOC contamination captured by the District's extraction wells but on the total
amount of VOC contamination in the area to be treated by the NBGPP. Lambie testified
that the latter calculation was the most equitable: "So looking at the entirety of the
problem, whether it's captured or not, is, in my view, the equitable way to look at the
mass contribution of a party."
34
VOC's. The RWQCB issued a no further action letter at the Kester Solder site in 2010.

VOC contamination in perched groundwater remains, however, and Northrop is currently

working with the RWQCB to formulate a remediation plan for that contamination as

well.

Based on Northrop's initial testing, Waddell concluded that PCE from the Kester

Solder site had reached the shallow aquifer. Waddell testified that contamination at the

Kester Solder site had created a plume of PCE contamination that had reached one of the

District's extraction wells and would be remediated by that well if the NGBPP were

constructed. Based on comparisons between the PCE contamination in upgradient and

downgradient monitoring wells, Waddell believed the Kester Solder site—particularly

contamination in perched groundwater—continued to contribute to PCE contamination in

the shallow aquifer.

Tofani agreed that the Kester Solder site had contributed to PCE contamination in

the shallow aquifer in the past. But he concluded that Northrop's soil remediation had

removed the site as a source for further PCE contamination. His conclusion was

supported by his own analysis of the concentrations of PCE contamination in upgradient

and downgradient monitoring wells. His analysis found there was no increase in PCE

concentrations as groundwater flowed beneath the Kester Solder site. Moreover, even if

the Kester Solder site were still contributing to VOC contamination in the shallow

aquifer, Tofani believed any such contamination would be remediated by a recirculation

well Northrop had installed at its Y-12 site, downgradient of the Kester Solder site.

35
 At its Y-12 site, Northrop's operations included a quench tank that was cleaned

with solvents and a degreaser. Northrop admitted that TCE and 1,1,1-TCA were among

the solvents it used. It was undisputed at trial that TCE, 1,1,1-TCA, and at least a small

amount of PCE had been released at the site.

After an initial investigation that did not disclose significant contamination,

monitoring activities in the early 2000's revealed more serious soil and groundwater VOC

contamination at the site. Northrop commissioned a series of tests, including a soil vapor

survey and dozens of groundwater monitoring wells, to characterize the nature and extent

of VOC contamination. Northrop developed a remedial action plan consisting of a dual

phase soil vapor extraction system. The RWQCB approved the plan in 2008, and

Northrop began remediation. By the time of trial, the system had removed approximately

20,000 pounds of VOC's, with the majority extracted in the first year of the system's

operation. Also with the approval of the RWQCB, Northrop installed a treatment and

recirculation well at the downgradient edge of the Y-12 site. The well captured and

remediated VOC-contaminated groundwater in the shallow aquifer. Although Northrop

encountered design hurdles at the beginning of the well's operation, the treated water

currently released by the well meets drinking water standards. Northrop's remediation

efforts have been reflected in decreasing VOC contamination in most downgradient

monitoring wells.

Waddell reviewed the sampling data and concluded that substantial PCE releases

had occurred at multiple locations at the Y-12 site. For one large area of PCE

contamination, Waddell believed the concentration of PCE was higher at the Y-12 site

36
when compared to the adjacent site, occupied by nonparty Aero Scientific, showing that

the release occurred at the Y-12 site. On cross-examination, however, Waddell admitted

that he had interpreted the data incorrectly: The concentrations at the Aero Scientific site

were higher than the concentrations at the Y-12 site, indicating that the release did not

occur at Northrop's site. Nonetheless, Waddell believed that PCE, TCE, and 1,1,1-TCA

(and its breakdown products) from the Y-12 site had contaminated groundwater in the

shallow aquifer. Although Northrop's recirculation well would capture some onsite

contamination, Waddell testified it would have no effect on contamination that had

already migrated beyond the well. The District's NBGPP extraction wells would capture

this contamination as well as contamination that continues to flow from the Y-12 site.

Tofani acknowledged that VOC contamination remained at the Y-12 site,

notwithstanding Northrop's remediation efforts. Tofani estimated that approximately 200

to 300 pounds (or 1 to 2 percent of the total) remained to be extracted by Northrop's soil

vapor extraction system. The remaining VOC's would be extracted by 2014. At that

point, in Tofani's view, the Y-12 site would no longer be contributing significantly to

groundwater contamination and the recirculation well could be decommissioned.

At the time of trial, though, the Y-12 recirculation well remained in operation, and

Tofani admitted that it does not capture all of the contamination emanating from the site.

Because the well captured contamination from upgradient offsite sources, however,

Tofani testified that Northrop's efforts achieved a "net balance," i.e., the recirculation

well remediated at least the same amount of offsite contamination as the amount of onsite

contamination that escaped remediation.

37
 Tofani believed adjacent sites, including Aero Scientific, had contributed

significant amounts of PCE and 1,1,1-TCA contamination to groundwater under the Y-12

site. Tofani analyzed sampling results at the Aero Scientific site and determined that a

PCE release at that site had not only contaminated groundwater but migrated laterally

into the shallow soil at the Y-12 site. While a separate, smaller release of PCE had

occurred on another portion of the Y-12 site, Tofani concluded that the Y-12 PCE release

had not impacted groundwater because it extended only to a depth of 10 to 15 feet below

ground surface.

Statement of Decision

Following trial, the court issued a tentative decision finding in favor of defendants

on the statutory causes of action and soliciting responses from the parties regarding

potential additional bases for its decision. After several rounds of briefing, the court

issued a 74-page statement of decision. The statement of decision recounted the history

of the litigation, the District's allegations, the development of the NGBPP, and the court's

view of the evidence presented at trial. It also assessed each of the District's statutory

claims and explained why the District did not prevail. The statement of decision

concluded, among other things, that defendants had not caused the District to develop the

NBGPP, that the non-Northrop defendants had not caused contamination in the shallow

aquifer at all, that the NBGPP was not necessary to address groundwater contamination

in the North Basin area, that the District had not complied with the NCP during

development of the NBGPP, that the District's costs were merely "investigatory" and thus

38
not recoverable under the OCWD Act, and that the District was not entitled to a

declaration that defendants were liable for future NBGPP costs.

The court spent the bulk of its statement of decision discussing causation under the

HSAA. Although the court did not explicitly apply its discussion to the District's claim

under the OCWD Act, it appears the court intended its discussion to apply to that statute

as well.

The court prefaced its causation analysis with a section entitled "Weaker Evidence

and Witness Credibility." In that section, the court provided an overview of its reasons

for distrusting and failing to credit the District's evidence, including in particular its

expert witness Waddell. The court faulted the District for offering weaker evidence

where it could have introduced stronger evidence. (See Evid. Code, § 412.) For

example, the court noted that the District did not undertake a mass transport analysis of

VOC contamination, it did not create an updated map of the VOC contamination plumes,

it did not calculate natural attenuation rates, and it did not conduct an adequate analysis

of the costs and benefits of the NBGPP. The court criticized the District for relying on

grab samples to determine the nature and extent of VOC contamination at defendants'

sites.16 And the court questioned Waddell's credibility in light of the District's failure to

provide relevant information to him, his creation of a misleading labeling system to

16 The court credited expert testimony that grab samples were only a snapshot of
conditions at a portion of a site, were not indicative of past groundwater conditions or
trends, were not reproducible, and were not accepted by California regulatory agencies as
the sole method for determining whether contamination at a site has impacted
groundwater.
39
characterize the effect of contamination at defendants' sites on groundwater, and his use

of a misleading demonstrative chart that minimized the amount of contamination at a

nonparty site.

The court applied the traditional "substantial factor" causation standard to the

District's claims. (See, e.g., Viner v. Sweet (2003) 30 Cal.4th 1232, 1240 (Viner).) In

doing so, the court focused on the NBGPP as a whole. The court found that "there was

no evidence that the conduct of any one Trial Defendant, or even the conduct of the Trial

Defendants considered together, was sufficient to necessitate the NBGPP." The court

further found, "Substantial trial evidence demonstrated that the District would have

approved the NBGPP even if any one of the Trial Defendants or even if all Trial

Defendants had not been operating in the NBGPP area." For example, "None of the trial

defendants caused the nitrate or perchlorate contamination, and that problem was a major

factor in the decision to approve the more costly, centralized treatment plan. In sum, the

Trial Defendants' activities were not a 'but for' cause of, or a substantial factor in, the

District's decision to approve a centralized water treatment plan for the NBGPP."

The court made additional factual findings regarding conditions at defendants'

sites. In general, the court wrote, "The weight of the credible trial evidence failed to

establish a causal connection between any Trial Defendant's localized releases of

hazardous substances into the soil and costs the District has already incurred and might

incur in the future. For example, there is no direct evidence of any release of VOC's to

the shallow aquifer in the NBGPP area by any Trial Defendant except Northrop. . . .

Although the court found Northrop's historical activities at Kester [Solder] and Y-12

40
resulted in shallow aquifer contamination, the [c]ourt finds that Northrop, under the

[RWQCB's] supervision, has remediated, or is currently remediating, those contaminant

releases to levels exceeding those contemplated by the NBGPP, without the District

reasonably incurring any remediation or removal expenses."

As to the Alcoa site, the court concluded that any VOC releases there did not

impact the shallow aquifer: "No VOC's of any kind were detected at [the Alcoa site] in

the main soil borings between the water table and a point approximately 30 feet above the

water table. . . . [Alcoa's] expert, Richard Weiss, testified without contradiction that if

VOC's passed through the soil column underneath [the Alcoa site] and into the shallow

aquifer, there would have been detectable amounts of VOC's in the lower soil." In

addition, the soil composition at the site made migration down to the shallow aquifer

unlikely: "Thick layers of clay underlying the [Alcoa] site discouraged migration of

VOC's from the soil to the shallow aquifer." Given Waddell's credibility issues, and

Alcoa's successful effort to remediate the soil at the site, the court found the District had

not proved causation.

As to Arnold, the court weighed the conflicting testimony regarding its TCE use

and concluded that the District had not shown Arnold used that solvent at its site.

Although Arnold acknowledged using 1,1,1-TCA, the court determined "there is

insufficient evidence that Arnold caused a release of 1,1,1-TCA or 1,1-DCE into soil."

On that basis, the court rejected "Waddell's opinion that Arnold's operations

contaminated groundwater or threaten today to contaminate groundwater."

41
 The court found that the District's allegations against CBS were limited to

potential PCE contamination. For two of CBS's three sites, 1300 East Valencia and 700

Sally Place, the court concluded that CBS did not use PCE at all. And, in any event, PCE

contamination detected at 1300 East Valencia "[did] not go all the way from just below

the surface to groundwater," indicating that groundwater was unaffected by any

contamination there. For the third site, 500 South Raymond, the court did not believe

that any PCE releases at that site impacted groundwater or posed a threat to groundwater.

The court credited the testimony of CBS's expert witness, Daniel Stephens, whose

investigation showed that PCE contamination "has dissipated to non-detect

levels . . . before the water table is reached." The court concluded that VOC groundwater

contamination at the 500 South Raymond site was caused by offsite sources.

As to Crucible, the court found that VOC contamination at the site did not reach

groundwater. The court found the shallow soil sampling, which did not detect VOC

contamination at 40 feet below the surface, more persuasive than the District's grab

samples showing deeper contamination. The court determined that VOC contamination

in deeper soil at the Crucible site was likely caused by migration from offsite sources.

The court found that Northrop used and released 1,1,1-TCA and TCE, but not

PCE, at its EMD site. The court reviewed the history of remediation at the site and

concluded that "the weight of credible evidence supports a finding that the EMD site,

following remediation in 1991, did not then and does not now present a significant threat

to groundwater quality." Data collected by the District in 2010 "demonstrates there is no

perceptible contribution from the EMD site to groundwater contamination as

42
groundwater passes below EMD." The court concluded, "The District's evidence

concerning shallow aquifer contamination or the threat thereof attributable to Northrop's

EMD site was not persuasive."

At the Kester Solder site, the court found, PCE was stored, mixed, and

repackaged. PCE was released on the edge of the site and contaminated shallow soil,

perched groundwater, and the shallow aquifer. Following Northrop's remediation efforts,

however, the court concluded that the Kester Solder site was no longer a "source of

potential groundwater contamination" and "is not contributing to PCE contamination in

the shallow aquifer." While the court acknowledged that perched groundwater at the site

remains contaminated (and Northrop is attempting further remediation), the court rejected

Waddell's opinion that the site "remains a source of groundwater contamination."

Instead, the court was persuaded by Northrop's expert witness, Glenn Tofani. Even if the

Kester Solder site were still causing groundwater contamination, the court believed

Northrop's recirculation well at its Y-12 site would capture any such contamination.

Regarding the Y-12 site, the court found, "Without dispute, TCE was

released . . . that [has] impacted groundwater." PCE, however "was not used by Northrop

at Y-12." While PCE was found in shallow soil at the site, the court concluded based on

testing data that "Y-12 is not a source of PCE groundwater contamination." The court

found that Northrop's remediation efforts had been largely successful, with 98 percent of

VOC contamination having been removed from the soil and a recirculation well treating

the shallow aquifer to drinking water standards. The court concluded, "At the time of

trial it was estimated that remediation of the perched zone would be completed by 2014,

43
at which point the circulation well will no longer be necessary because the site will no

longer be a source of elevated VOC's."

The court's statement of decision also considered whether any NBGPP costs

should be allocated to defendants. The court found that certain contaminants, such as

nitrate and perchlorate, were introduced by the District's groundwater recharge activities,

which involved (among other things) discharging contaminated Colorado River water

into the North Basin area. Regarding VOC contamination, the court wrote, "the evidence

is overwhelming that many entities other than the Trial Defendants contributed to VOC

releases into the soil and groundwater in the NBGPP area. In addition, the District's

recharge activities contributed not only to VOC contamination in the shallow aquifer, but

also contributed to the commingling of different-sourced VOC contaminants, making it

more difficult, if not impossible, to determine the potentially responsible party. [¶] The

Court further finds that the conduct of the District and entities other than the Trial

Defendants are a substantial factor in the District's decision to develop the NBGPP.

There is no factual basis for allocation of responsibility for past or future expenditures

among the Trial Defendants or as between one or more Trial Defendant and the District."

With respect to the District's claim under the HSAA specifically, the court

determined that it was required to show that the NBGPP was consistent with the NCP, the

federal regulations governing remedial environmental actions, in order to recover. (40

C.F.R. § 300.1 et seq.) The court found that the NBGPP was not consistent with the NCP

because (1) the District did not involve the public in selection of the remedy for VOC

contamination in the North Basin; (2) the District did not adequately undertake required

44
investigations, including a remedial investigation, a feasibility study, and a conceptual

site model; and (3) the District did not show the NBGPP was a cost-effective response to

contamination in the North Basin.

The court articulated four bases for its rejection of the District's claim under the

OCWD Act. First, the court found that the District had not satisfied the preconditions for

cost recovery under the statute. The court interpreted the OCWD Act to allow cost

recovery under two situations: either the contamination must be "cleaned up or contained

[or] the effects thereof abated" or necessary action must have been taken to address

"threatened contamination." (OCWD Act, § 8, subd. (c).) As to the first situation, the

court found that the NBGPP had not yet been implemented, so the District had not yet

cleaned up, contained, or abated any contamination. As to the second situation, the court

found that the consequences of the contamination were not urgent enough to qualify as a

threat. Second, the court found that funds already expended by the District were merely

"investigatory" and thus not recoverable under the OCWD Act. (OCWD Act, § 8, subds.

(a)-(c).) Third, the court found that the NBGPP was not a "reasonable" response to

contamination in the North Basin area. Fourth, the court found that the NBGPP was not a

"necessary" response to contamination in the North Basin area, i.e., the District did not

show "each Trial Defendant's conduct was a substantial factor in the decision to develop

the NBGPP."

The court rejected the District's request for a declaration holding defendants liable

for future NBGPP costs because it found (1) the District did not adequately investigate

the need for the NGBPP (including its failure to create updated maps of VOC

45
contamination, analyze the threat to the deep aquifer, and calculate natural attenuation

rates); (2) the District did not adequately assess the costs and benefits of the NBGPP,

particularly after the cost increased to over $200 million; (3) the NBGPP was not

necessary to protect the deep aquifer or remediate VOC contamination the shallow

aquifer; and (4) the District did not adequately consider the effects of source removal on

VOC contamination levels in the North Basin area. The source removal referenced by

the court included defendants' RWQCB-approved remedial actions and the efforts of

nonparties to remediate other sites in consultation with various regulatory bodies.

After summarizing its conclusions, the court found in favor of defendants, and

against the District, on its claims under the OCWD Act and the HSAA and for

declaratory relief. The court further found that each defendant was "entitled to a judicial

declaration that it has no liability to the District for damages, response costs, or other

costs claimed by the District, or any future costs associated with the NBGPP."

The District's Legal Claims

Three months after the court's statement of decision, defendants filed a motion for

judgment on the District's remaining claims for negligence, nuisance, and trespass.

Defendants argued that the court's causation findings in its statement of decision would

apply in any jury trial on the District's claims. In defendants' view, these findings

46
precluded recovery on the District's claims for negligence, nuisance, and trespass because

those claims each required a showing of causation.17

The District opposed. Analogizing to principles of collateral estoppel, the District

argued that the court's causation findings were not essential to its decision (because it

found alternative bases to rule in favor of defendants) and they were not identical to the

findings required on its remaining claims (because they do not require the same showing

of causation). The District also argued that new facts had arisen after the bench trial,

including additional evidence of continuing groundwater contamination by the Crucible

site and Northrop's Y-12 site. The District contended these new facts prevented the court

from applying its prior findings on causation to the District's remaining claims. As to

Northrop, the District additionally contended that a jury could award damages for past

VOC contamination (e.g., investigatory costs) notwithstanding the court's causation

findings.

The court granted the motion for judgment. It agreed that the District's claims for

negligence, nuisance, and trespass required the District to establish causation as to each

defendant. Given the court's causation findings in its statement of decision, it found that

the District could not prevail on its remaining claims. The court did not believe the

District was entitled to offer new evidence in support of its claims.

17 As noted above, the court previously granted several defendants' motions for
summary adjudication of the District's negligence claim on statute of limitations grounds.
The motion for judgment as to the District's negligence claim was therefore brought only
by CBS and Crucible.
47
 Judgment

Following further briefing, the court entered judgment in favor of defendants, and

against the District, on each of the District's causes of action. The judgment included a

declaration that defendants "have no liability to the [District] for damages, response

costs, or other costs claimed by the [District], or any future costs." The District appeals.

DISCUSSION

I. HSAA

A. Overview

The District challenges the court's judgment on its HSAA claim. It primarily

contends the court prejudicially erred by misinterpreting the elements of the claim,

including causation, necessity of response costs, and NCP consistency. The HSAA is

California's counterpart to the federal Comprehensive Environmental Response,

Compensation, and Liability Act of 1980 (CERCLA; 42 U.S.C. § 9601 et seq.). (Foster-

Gardner, Inc. v. National Union Fire Ins. Co. (1998) 18 Cal.4th 857, 865, fn. 4.) Among

other things, it implements California's responsibilities under CERCLA's "superfund"

program and establishes a Hazardous Substance Account to fund environmental

remediation actions and related efforts. (City of Lodi v. Randtron (2004) 118

Cal.App.4th 337, 351 (City of Lodi); BKHN, Inc. v. Department of Health Services

(1992) 3 Cal.App.4th 301, 307, fn. 2.)

The HSAA also includes a private right of action. It provides, in relevant part, that

"[a] person who has incurred response or corrective action costs in accordance with this

chapter, Chapter 6.5 (commencing with Section 25100), or the federal act may seek

48
contribution or indemnity from any person who is liable pursuant to this chapter."

(Health & Saf. Code, § 25363, subd. (d).)18 The scope of this private right of action is at

issue in the appeal.

The HSAA adopts CERCLA's standards for determining liability: " 'Responsible

party' or 'liable person,' for the purposes of this chapter, means those persons described in

Section 107(a) of the federal act (42 U.S.C. Sec. 9607(a))." (Health & Saf. Code,

§ 25323.5, subd. (a)(1); see Gregory Village Partners, L.P. v. Chevron U.S.A., Inc.

(N.D.Cal. 2011) 805 F.Supp.2d 888, 897 ["A claim under the HSAA has the same

elements as a claim under CERCLA."].)

As relevant here, CERCLA imposes liability on "the owner or operator of a vessel

or a facility, [¶] [or] any person who at the time of disposal of any hazardous substance

owned or operated any facility at which such hazardous substances were disposed of

[¶], . . . from which there is a release, or a threatened release which causes the incurrence

of response costs, of a hazardous substance . . . ." (42 U.S.C. § 9607(a).) A liable person

is responsible for, among other things, "all costs of removal or remedial action incurred

by the United States Government or a State or an Indian tribe not inconsistent with the

national contingency plan;" "any other necessary costs of response incurred by any other

person consistent with the national contingency plan;" and "damages for injury to,

18 The quoted language became effective on January 1, 2016. (Stats. 2015, ch. 458,
§ 2.) Prior to that date, among other changes, the beginning of the sentence read, "Any
person who has incurred removal or remedial action costs in accordance with this
chapter . . . ." (Former Health & Saf. Code, § 25363, subd. (e).) The parties agree this
was a nonsubstantive change in the context of this appeal, so we will refer to the current
language in our discussion.
49
destruction of, or loss of natural resources, including the reasonable costs of assessing

such injury, destruction, or loss resulting from such a release[.]" (42 U.S.C.

§ 9607(a)(4)(A)-(C).)

Under CERCLA and the HSAA, " '[t]o prevail in a private cost recovery action, a

plaintiff must establish that (1) the site on which the hazardous substances are contained

is a "facility" under CERCLA's definition of the term, Section 101(9), 42 U.S.C.

§ 9601(9); (2) a "release" or "threatened release" of any "hazardous substance" from the

facility has occurred, 42 U.S.C. § 9607(a)(4); (3) such "release" or "threatened release"

has caused the plaintiff to incur response costs that were "necessary" and "consistent with

the national contingency plan," 42 U.S.C. §§ 9607(a)(4) and (a)(4)(B); and (4) the

defendant is within one of four classes of persons subject to the liability provisions of

Section 107(a) [42 U.S.C. § 9607(a)].' " (Carson Harbor Village, Ltd. v. Unocal Corp.

(9th Cir. 2001) 270 F.3d 863, 870-871 (Carson Harbor I) [en banc].)19

Once these elements are proven, an HSAA defendant is strictly liable for

recoverable costs (Health & Saf. Code, § 25363, subd. (c)) unless the defendant

establishes an applicable defense (id., § 25323.5, subd. (b)) or the circumstances justify

apportionment (id., § 25363, subds. (a)-(b)). A similar scheme exists under CERCLA:

"Potentially responsible parties under CERCLA are strictly liable for cleanup costs,

[citation], . . . subject only to the statute's narrow defenses for damages caused solely by

19 The District contends it is not a "private" plaintiff, but rather a "State" under
CERCLA, and need only prove that its costs are "not inconsistent" with the NCP. (See
42 U.S.C. § 9607(a)(4)(A).) We disagree and will address this argument in part I.C.2.,
post.
50
acts of God, war, or third parties." (Westfarm Associates L.P. v. Washington Suburban

Sanitary Com. (4th Cir. 1995) 66 F.3d 669, 677; see 42 U.S.C. § 9607(b).) As noted, the

HSAA largely incorporates CERCLA's defenses. (Health & Saf. Code, § 25323.5, subd.

(b).)

B. The District's Ability to Bring Suit Under the HSAA

Before we reach the District's challenge, we will consider a threshold issue raised

by defendants, which appears to be one of first impression: Can the District bring a suit

for cost recovery under the HSAA at all? Although defendants did not raise this

argument in the trial court, we will exercise our discretion to consider it because it raises

a pure question of law, the facts surrounding which are undisputed and could not be

altered by the presentation of additional evidence. (See In re Marriage of Priem (2013)

214 Cal.App.4th 505, 510-511.)

To put the parties' arguments in context, we will briefly review the purposes and

scope of the HSAA. The HSAA's objectives are the following: "(a) Establish a program

to provide for response authority for releases of hazardous substances, including spills

and hazardous waste disposal sites that pose a threat to the public health or the

environment. [¶] (b) Compensate persons, under certain circumstances, for out-of-

pocket medical expenses and lost wages or business income resulting from injuries

proximately caused by exposure to releases of hazardous substances. [¶] (c) Make

available adequate funds in order to permit the State of California to assure payment of

its 10-percent share of the costs mandated pursuant to Section 104(c)(3) of the federal act

(42 U.S.C. Sec. 9604(c)(3))." (Health & Saf. Code, § 25301.)

51
 "To implement these purposes, HSAA provides a comprehensive and detailed

scheme to ensure the timely and cost-effective cleanup of hazardous substance release

sites. It establishes authority, procedures, and standards to carry out the investigation,

removal and remediation of contaminated sites ([Health & Saf. Code,] §§ 25355,

25356.1.5, 25355.7, 25355.8, 25358.3, subds. (a) and (c), 25363), issue and enforce a

removal or remedial action order to any [responsible party] ([id.,] § 25358.3, subds. (a)

and (f)), impose administrative or civil penalties for noncompliance of an order ([id.,]

§§ 25359, 25359.2), recover costs and expenses incurred by the DTSC in carrying out

HSAA ([id.,] § 25360, subd. (a)), determine by binding arbitration the apportionment of

liability of [a responsible party] ([id.] §§ 25363, 25356.3, 25356.4), seek contribution

from other [responsible parties] ([id.,] § 25359.5)[20] and apply for compensation of loss

caused by the release of a hazardous substance. ([id.,] §§ 25372 to 25381.)" (City of

Lodi, supra, 118 Cal.App.4th at p. 352.)

The focus of the statutory scheme is the DTSC, which has "the sole authority to

administer the statewide program for the remediation of hazardous waste contamination"

at sites identified for remediation under the HSAA. (City of Lodi, supra, 118

Cal.App.4th at p. 355.) "Once DTSC has confirmed that contamination at a particular

site poses a significant threat to human health or safety or to the environment and lists the

site in its published list of hazardous substance release sites, the problem is designated as

20 The cited provision concerns securing a site where hazardous substances have
been released, e.g., by posted signs or fencing, rather than contribution. (Health & Saf.
Code, § 25359.5.) Contribution is addressed in Health and Safety Code section 25363,
which we will discuss in detail below.
52
one of statewide concern, requiring application of uniform standards, procedures, and

remedies subject to the jurisdiction of DTSC." (Ibid.) In appropriate cases, the relevant

RWQCB may also have authority over a specific site. (Health & Saf. Code, §§ 25356,

subd. (h), 25356.1, subds. (a), (b), (c).)

In addition to defining the DTSC and RWQCB's role, the HSAA provides for a

private right of action, as noted above. The relevant provision reads in full as follows:

"A person who has incurred response or corrective action costs in accordance with this

chapter, Chapter 6.5 (commencing with Section 25100), or the federal act may seek

contribution or indemnity from any person who is liable pursuant to this chapter. An

action to enforce a claim may be brought as a cross-complaint by any defendant in an

action brought pursuant to Section 25360[21] or this section, or in a separate action after

the person seeking contribution or indemnity has paid response or corrective action costs

in accordance with this chapter, Chapter 6.5 (commencing with Section 25100), or the

federal act. A plaintiff or cross-complainant seeking contribution or indemnity shall give

written notice to the director upon filing an action or cross-complaint under this section.

In resolving claims for contribution or indemnity, the court may allocate costs among

liable parties using appropriate equitable factors." (Health & Saf. Code, § 25363, subd.

(d).)

The parties' dispute revolves around the word "indemnity" as it is used in this

statute. Defendants contend the word "indemnity" limits plaintiffs who sue under the

21 This section describes the Attorney General's right of action to recover costs from
liable parties at the request of the DTSC or RWQCB.
53
statute to an action for traditional equitable indemnity, i.e., only plaintiffs who are liable

for response or corrective action costs under the HSAA enjoy the right to sue. Entities

with no potential liability (so-called "volunteers") do not. (See, e.g., Union Pacific Corp.

v. Wengert (2000) 79 Cal.App.4th 1444, 1447-1448 [describing traditional equitable

indemnity].) The District contends the word "indemnity" simply means reimbursement,

and any plaintiff who incurs costs to clean up a hazardous substance release may recover

those costs from a party who is liable under the HSAA.

This issue is one of statutory interpretation. "Our fundamental task in interpreting

a statute is to determine the Legislature's intent so as to effectuate the law's purpose. We

first examine the statutory language, giving it a plain and commonsense meaning. We do

not examine that language in isolation, but in the context of the statutory framework as a

whole in order to determine its scope and purpose and to harmonize the various parts of

the enactment. If the language is clear, courts must generally follow its plain meaning

unless a literal interpretation would result in absurd consequences the Legislature did not

intend. If the statutory language permits more than one reasonable interpretation, courts

may consider other aids, such as the statute's purpose, legislative history, and public

policy." (Coalition of Concerned Communities, Inc. v. City of Los Angeles (2004) 34

Cal.4th 733, 737.)

As an initial matter, we note that the language of the statute would appear to

accommodate either interpretation of "indemnity" offered by the parties. The only

limitation on plaintiffs who may sue under the statute is that a plaintiff must have

"incurred response or corrective action costs" under the HSAA or CERCLA. (Health &

54
Saf. Code, § 25363, subd. (d).) The phrase "any person who is liable" refers to

prospective defendants, not plaintiffs. (Ibid.) The remainder of the statutory language

concerns procedure, and it could apply equally to actions for traditional equitable

indemnity or simple cost recovery actions. Although the final sentence of the statute

contemplates equitable apportionment among liable parties, the language does not imply

that such equitable apportionment must occur in all cases or that a suit may not be

brought unless such equitable apportionment is possible.

We must therefore focus on the word "indemnity." The plain meaning of the term

supports the District's interpretation. Black's Law Dictionary defines indemnity broadly

as "[a] duty to make good any loss, damage, or liability incurred by another," "[t]he right

of an injured party to claim reimbursement for its loss, damage, or liability from a person

who has such a duty," and "[r]eimbursement or compensation for loss, damage, or

liability in tort . . . ." (Black's Law Dict. (10th ed. 2014).) The dictionary provides

several different examples of indemnity, including contractual indemnity, equitable

indemnity, implied indemnity, and statutory indemnity. (Ibid.) The plain meaning of the

term is not limited to defendants' narrow interpretation.

The HSAA's private right of action appears to be an instance of "statutory

indemnity," which Black's Law Dictionary defines as "[i]ndemnity conferred by

legislation" and cites as an example the common statutory obligation of corporations to

indemnity their personnel. (Black's Law Dict., supra.) In California, for example, an

employer has a general statutory obligation to indemnify its employees under many

circumstances: "An employer shall indemnify his or her employee for all necessary

55
expenditures or losses incurred by the employee in direct consequence of the discharge of

his or her duties, or of his or her obedience to the directions of the employer, even though

unlawful . . . ." (Lab. Code, § 2802 subd. (a), italics added.) Similarly, "[a] depositor

must indemnify the depositary" for expenses and damages caused by the thing deposited

(Civ. Code, § 1833, italics added), and the detriment caused by wrongful conversion of

personal property may be "an amount sufficient to indemnify the party injured" (id.,

§ 3336, italics added). In none of these causes must a plaintiff establish the elements of

traditional equitable indemnity to recover the indemnification described in the statutes.

(See Stowe v. Fritzie Hotels, Inc. (1955) 44 Cal.2d 416, 423-424 [applying Civil Code

section 1833]; Machinists Auto. Trades Dist. Lodge v. Util. Trailers Sales Co. (1983) 141

Cal.App.3d 80, 81 [applying Labor Code section 2802]; Myers v. Stephens (1965) 233

Cal.App.2d 104, 116-118 [applying Civil Code section 3336].)

Defendants rely on our Supreme Court's statement that "there are only two basic

types of indemnity: express indemnity and equitable indemnity." (Prince v. Pacific Gas

& Electric Co. (2009) 45 Cal.4th 1151, 1157.) In this context, the Supreme Court

explained, "[e]xpress indemnity refers to an obligation that arises ' "by virtue of express

contractual language establishing a duty in one party to save another harmless upon the

occurrence of specified circumstances." ' " (Id. at p. 1158.) Defendants' implication

appears to be that statutory indemnity, as embodied in the disputed provision of the

HSAA, does not exist in California.

Defendants misinterpret the Supreme Court's discussion. The Supreme Court

considered the parties' potential indemnification obligations independent of any statutory

56
enactment. It did not foreclose the possibility that an indemnification obligation may

arise by statute. Indeed, cases interpreting the statutes cited above, and similar statutes,

refer to the obligations imposed thereunder as "statutory indemnity." (See, e.g., Crouse

v. Brobeck, Phleger & Harrison (1998) 67 Cal.App.4th 1509, 1540; Janken v. GM

Hughes Electronics (1996) 46 Cal.App.4th 55, 74, fn. 24.) Other statutes that impose a

reimbursement obligation without using the words "indemnify" or "indemnification" are

similarly described as "statutory indemnity" statutes. (See, e.g., Gattuso v. Harte-Hanks

Shoppers, Inc. (2007) 42 Cal.4th 554, 559, 560; Daza v. Los Angeles Community College

District (2016) 247 Cal.App.4th 260, 265; Kantor v. Housing Authority of Fresno County

(1992) 8 Cal.App.4th 424, 428-429.) It is clear that the concept of statutory indemnity

exists in California law. Defendants' contention that the reference to "indemnity" in the

HSAA can only refer to traditional equitable indemnification is therefore unpersuasive.22

The statute's use of the term "indemnity" to mean "reimbursement" is consistent

with the meaning of that term in CERCLA jurisprudence. Under CERCLA, it is well

22 Fullerton Redevelopment Agency v. Southern California Gas Co. (2010) 183
Cal.App.4th 428 (Fullerton Redevelopment) does not address this issue. Although
Fullerton Redevelopment described the HSAA private right of action as " 'limited to a
claim for "contribution and indemnity" and all such claims are "equitable" in nature' " (id.
at p. 433), the import of the court's language (which quoted a lower court minute order) is
unclear. The reference to "contribution and indemnity" simply repeats the terms of the
statute. The reference to equity appears to mean that actions under the HSAA are
equitable, rather than legal, in nature. In any event, the parties in Fullerton
Redevelopment were all liable parties, so the court had no occasion to determine whether
nonliable parties may sue under the HSAA. (Id. at p. 430.) Moreover, in light of our
conclusion, we need not decide whether Orange County Water District v. Arnold
Engineering Co. (2011) 196 Cal.App.4th 1110, 1126, already decided this issue in the
District's favor.
57
established that a nonliable or "volunteer" plaintiff may bring a private cause of action for

cost recovery. (42 U.S.C. § 9607(a); United States v. Atlantic Research Corp. (2007) 551

U.S. 128, 139 (Atlantic Research); Kaufman & Broad-South Bay v. Unisys Corp.

(N.D.Cal. 1994) 868 F.Supp. 1212, 1215.) Such a private right of action by a nonliable

party has been described as an "indemnity": "The language of CERCLA suggests

Congress planned that an innocent party be able to sue for full recovery of its costs, i.e.,

indemnity under [42 U.S.C. § 9607(a)], while a party that is itself liable may recover only

those costs exceeding its pro rata share of the entire cleanup expenditure, i.e.,

contribution under [42 U.S.C. § 9613(f)(1)]." (Bedford Affiliates v. Sills (2d Cir. 1998)

156 F.3d 416, 424 (Bedford Affiliates), italics added.)23

Our review of the legislative history of this provision reveals no reason to depart

from this analysis and limit the private right of action under Health and Safety Code

section 25363, subdivision (d) to plaintiffs seeking traditional equitable indemnity. To

the extent the legislative history sheds any light on the Legislature's intent, it shows that

the "indemnification" described in this section extends to nonliable parties like the

District. For example, the statute as originally enacted limited the private right of action

to "any person found liable under this chapter." (Stats. 1987, ch. 1302, § 5.) The next

year, however, the Legislature removed this liability limitation, allowing "[a]ny person

who has incurred removal or remedial action costs in accordance with this chapter" to

23 The United States Supreme Court later held that liable parties may also bring a
private cause of action for indemnity under 42 United States Code section 9607(a).
(Atlantic Research, supra, 551 U.S. at p. 141.) But this holding did not affect the right of
nonliable parties to bring such an action as well. (Id. at pp. 136, 139.)
58
seek contribution or indemnification. (Stats. 1988, ch. 1401, § 1.) Although the statute

underwent several additional revisions, the Legislature did not reinsert language limiting

the private right of action to only liable parties.

Defendants point to language in a treatise that purports to identify the limits of the

HSAA private right of action: "Unlike CERCLA, there is no express statutory

authorization for private actions for enforcement under [the HSAA]." (11 Miller & Starr,

Cal. Real Estate (4th ed. 2015) § 39.44, fn. omitted.) But private actions for

"enforcement" (analogous to CERCLA's private enforcement action, 42 U.S.C. § 9659)

are different from actions for "indemnity," as the treatise goes on to explain: "However,

such actions are possible to recover indemnity or contribution once the costs are paid,

even though the private owner could not sue for loss of use or lost profits damages."

(Miller & Starr, § 39.44, fn. omitted.)

Of more direct relevance, the treatise states under the heading "Contribution or

indemnity" the following: "Anyone found liable for cleanup costs who has entered into

an agreement with the [DTSC], or who is in compliance with an order issued by the

department, and who establishes by a preponderance of the evidence that he or she was

only liable for a portion of the costs, may seek contribution and indemnity from any other

person liable under the statute. (11 Miller & Starr, Cal. Real Estate, supra, § 39.44, fn.

omitted.) While the treatise cites the statute at issue in this appeal, the treatise appears to

conflate the various subdivisions of the section, each of which addresses different

circumstances. For example, subdivision (a) provides that "a party found liable for costs

recoverable under this chapter who establishes by a preponderance of the evidence that

59
only a portion of those costs are attributable to that party's actions shall be required to pay

only for that portion." (Health & Saf. Code, § 25363, subd. (a), italics added.) Although

subdivision (a) does not mention actions for contribution or indemnity, the treatise

imports this language of liability into its discussion of such actions. To the extent the

treatise purports to define the complete set of plaintiffs who may bring a private cause of

action for indemnity under subdivision (d), we disagree that the ability to bring such an

action is limited to liable persons. We reject defendants' contention that the District may

not bring an action for cost recovery under the HSAA.24

C. The Merits of the District's HSAA Claim

We next consider the merits of the District's HSAA claim and its contention that

the court misinterpreted the elements of that claim. The District's contention presents a

pure question of law, primarily statutory interpretation, which we review de novo.

(People ex rel. Lockyer v. Shamrock Foods Co. (2000) 24 Cal.4th 415, 432 (Shamrock

Foods); Central Valley General Hospital v. Smith (2008) 162 Cal.App.4th 501, 513

(Central Valley) ["Under the general rules applicable to a trial court's statement of

decision, an appellate court independently reviews questions of law and applies the

substantial evidence standard to findings of fact."].)

24 Defendants alternatively offer the following argument: "[The] District does not
appeal the HSAA claim under section 25363, subdivision (d), for contribution or
indemnity that it pled in the operative complaint and that was tried to conclusion. . . .
[The] District has therefore abandoned that issue in this appeal." (Fn. omitted.) This
argument is frivolous. The District devoted the bulk of its opening brief to the merits of
its HSAA claim, as did defendants in their respondents' brief. Which HSAA claim did
the District address in its briefing, if not the claim "that it pled in the operative complaint
and that was tried to conclusion"?
60
 As we have discussed, the HSAA provides that a plaintiff "may seek contribution

or indemnity from any person who is liable pursuant to this chapter." (Health & Saf.

Code, § 25363, subd. (d).) The elements of a private HSAA claim are the following:

" '(1) the site on which the hazardous substances are contained is a "facility" under

CERCLA's definition of the term, Section 101(9), 42 U.S.C. § 9601(9); (2) a "release" or

"threatened release" of any "hazardous substance" from the facility has occurred,

42 U.S.C. § 9607(a)(4); (3) such "release" or "threatened release" has caused the plaintiff

to incur response costs that were "necessary" and "consistent with the national

contingency plan," 42 U.S.C. §§ 9607(a)(4) and (a)(4)(B); and (4) the defendant is within

one of four classes of persons subject to the liability provisions of Section 107(a) [42

U.S.C. § 9607(a)].' " (Carson Harbor I, supra, 270 F.3d at pp. 870-871.)

1. Causation

a. Overview

The District contends the trial court misinterpreted the third element (causation).

The District makes two interrelated arguments, which we will consider separately.

The District first argues that the court erroneously required the District to prove

that each defendant released or threatened to release hazardous waste that caused the

District to incur response costs. As we will explain, the District is correct that it was not

required to prove a causal connection between a release by each defendant and its

response costs. Instead, the District must establish a causal connection between a release

or threatened release at a site (regardless of its source) and the District's response costs.

Whether a given defendant is liable for releases or threatened releases at that site is

61
determined by the fourth element, which identifies classes of potentially responsible

parties based on their relationship to the site.

The District next argues that the court erroneously required the District to show

that each defendant was a substantial factor in the District's decision to develop the entire

NBGPP. Again, we agree. The District was required to show only that a release or

threatened release at a defendant's site was a substantial factor in the District's decision to

incur some response costs.

Although we agree the trial court erred in interpreting the element of causation, we

conclude there is no reasonable probability the court would have found the District had

proved this element as to Alcoa, Arnold, CBS, and Crucible. As to Northrop, however,

we conclude there is a reasonable probability the court would have made such a finding.

We will explain the bases for these conclusions in the following parts.25

b. Defendant-Specific Versus Site-Specific Causation

We agree with the District's first argument that the court erroneously required it to

show that each defendant caused the District's response costs. Instead, it is only required

to show a release or threatened release from a site and a causal connection between that

release or threatened release and its response costs. "[V]irtually every court that has

considered this question has held that a CERCLA plaintiff need not establish a direct

25 Although we conclude it is reasonably probable the trial court would have made
different findings on causation, this conclusion alone does not mandate reversal of the
trial court's judgment in favor of Northrop on the District's HSAA claim. The court's
judgment rested on several grounds, any one of which was sufficient to support the
judgment. We will consider the District's contentions regarding those additional grounds
below.
62
causal connection between the defendant's hazardous substances and the release or the

plaintiff's incurrence of response costs." (United States v. Alcan Aluminum Corp. (3d Cir.

1992) 964 F.2d 252, 265 (Alcan Aluminum); see State of New York v. Shore Realty Corp.

(2d Cir. 1985) 759 F.2d 1032, 1044 (Shore Realty).) "It is clear from the text, structure,

and legislative history of [42 U.S.C. § 9607] that the provision does not require a plaintiff

to show that a particular defendant caused either the release or the incurrence of response

costs in order to prove liability." (Kalamazoo River Study Group v. Menasha Corp. (6th

Cir. 2000) 228 F.3d 648, 655 (Kalamazoo River).)

The causation requirement under CERCLA and HSAA is therefore independent of

a given defendant. (Kalamazoo River, supra, 228 F.3d at p. 655.) It focuses on whether

there was a release or threatened release at the site or facility at issue, not whether the

defendant caused the release or threatened release. For purposes of the third element, a

plaintiff need prove only that a release or threatened release occurred at the site that

caused the plaintiff to incur necessary response costs. (Carson Harbor I, supra, 270 F.3d

at pp. 870-871.)

Whether a given defendant is liable is governed by the fourth element. This

element identifies several categories of potentially liable defendants (or, in CERCLA

terminology, "potentially responsible parties"). These categories include persons who

might otherwise not be considered liable under traditional tort theories, e.g., current

owners and operators of a contaminated site. (See 42 U.S.C. § 9607(a)(1).) These

categories are based on the defendant's relationship to the site, not the defendant's

relationship to the release or threatened release that caused the incurrence of response

63
costs. (See Alcan Aluminum, supra, 964 F.2d at p. 265 ["[T]he version [of CERCLA]

ultimately passed by Congress . . . imposed liability upon a class of responsible persons

without regard to whether the person specifically caused or contributed to the release and

the resultant response costs."]; Asarco LLC v. NL Industries, Inc. (E.D.Mo. 2015) 106

F.Supp.3d 1015, 1031 (Asarco) ["Once the connection between the defendant and a

hazardous waste site has been established (because the defendant fits into one of the four

categories of responsible parties), 'it is enough that response costs resulted from "a"

release or threatened release—not necessarily the defendant's release or threatened

release.' "].)

The lack of a causal connection between a defendant's actions and the release or

threatened release that caused the incurrence of response costs is instead an affirmative

defense that the defendant must prove. CERCLA provides, "There shall be no liability

under subsection (a) of this section for a person otherwise liable who can establish by a

preponderance of the evidence that the release or threat of release of a hazardous

substance and the damages resulting therefrom were caused solely by [¶] . . . [¶] (3) an

act or omission of a third party" under specified circumstances. (42 U.S.C. § 9607(b).)

This defense has been incorporated into the HSAA. (Health & Saf. Code, § 25323.5,

subd. (b); see id., § 25363, subd. (a).) Requiring a plaintiff to prove that a release or

threatened release by the defendant caused the incurrence of response costs would render

this affirmative defense superfluous. (Kalamazoo River, supra, 228 F.3d at p. 655; Alcan

Aluminum, supra, 964 F.2d at p. 265; Shore Realty, supra, 759 F.2d at p. 1044.)

64
 Although the District acknowledges it must show that a release or threatened

release occurred at defendants' sites that caused it to incur necessary response costs, as

discussed in the foregoing authorities, it contends the standard for causation in this

context is relaxed. It argues that plaintiff need show only "that it incurred response costs

in cleaning up pollution at the site which is of a similar kind to the pollution generated by

the defendant." The District is incorrect. It confuses the showing under third element

(causation) with the fourth element (potentially liable parties). The primary authority

cited by the District, United States v. Monsanto Co. (4th Cir. 1988) 858 F.2d 160

(Monsanto), considered scope of the fourth element, specifically the potential liability of

so-called "generator" defendants under section 9607(a)(3) of title 42 of the United States

Code. (Monsanto, supra, 858 F.2d at p. 169.) A generator defendant is liable if a

plaintiff proves it is a "person who by contract, agreement, or otherwise arranged for

disposal or treatment, or arranged with a transporter for transport for disposal or

treatment, of hazardous substances owned or possessed by such person, by any other

party or entity, at any facility or incineration vessel owned or operated by another party

or entity and containing such hazardous substances." (42 U.S.C. § 9607(a)(3).) In that

context, Monsanto explained that CERCLA imposes liability on defendants who

generated hazardous substances at one site and arranged for disposal of the hazardous

substances at another site, so long as the defendant's hazardous substances were

chemically similar to those released or threatened to be released at the disposal site.

(Monsanto, supra, 858 F.2d at p. 169 & fn. 15 ["[CERCLA plaintiffs] must . . . present

evidence that a generator defendant's waste was shipped to a site and that hazardous

65
substances similar to those contained in the defendant's waste remained present at the

time of release."].) Regardless of Monsanto's interpretation of the fourth element for

generator defendants, the third element must still be satisfied. United States v. Wade

(E.D.Pa. 1983) 577 F.Supp. 1326, also cited by the District, involved generator

defendants, like Monsanto, and it is unpersuasive for the same reasons.

Asarco, on which the District also relies, does not support the District's relaxed

causation standard either. Asarco rejected the requirement that a CERCLA plaintiff

prove that a particular defendant's release caused a plaintiff's response costs. (Asarco,

supra, 106 F.Supp.3d at p. 1031 [rejecting "trac[ing]" or "fingerprint[ing]" a particular

defendant's hazardous waste].) As we have discussed, CERCLA does not require such a

showing. But, Asarco confirms that a CERCLA plaintiff must still prove that an actual or

threatened release caused its response costs under CERCLA's third element. (Asarco,

supra, 106 F.Supp.3d at p. 1031 ["Response costs must be caused by an actual or

threatened release."].)

The District claims Artesian Water Co. v. Government of New Castle County

(D.Del. 1987) 659 F.Supp. 1269 (Artesian Water) supports its position. Again, however,

this case confirms that CERCLA requires a showing of causation as part of its third

element: "CERCLA's strict liability scheme does not diminish the necessity of

demonstrating a causal connection between a release or threatened release and the

incurrence of costs by a . . . plaintiff. [Citations.] [Plaintiff] must therefore show that it

incurred costs as a result of the release or threatened release of hazardous substances

from the Site." (Id. at p. 1282.) Artesian Water expressly confirmed that traditional tort

66
principles of causation, including substantial-factor causation where multiple sources

may have contributed to contamination, govern CERCLA's causation requirement. (Id. at

p. 1283; see Thomas v. FAG Bearings Corp. (W.D.Mo. 1994) 846 F.Supp. 1382, 1394

[granting summary judgment because plaintiff could not show the release at issue caused

groundwater contamination].) CERCLA's departure from traditional tort principles can

be found in the omission of the defendant from its causation requirement, which as we

have discussed focuses on whether a release caused plaintiff's response costs, rather than

whether a defendant caused plaintiff's response costs.26

The trial court's statement of decision is ambiguous with respect to the element of

causation. In its initial treatment of the elements of the District's HSAA claim, the court

correctly quoted the four CERCLA elements from a federal district court case. (Castaic

Lake Water Agency v. Whittaker Corp. (C.D.Cal. 2003) 272 F.Supp.2d 1053, 1059

(Castaic Lake).) The court correctly noted that it must determine whether a release

occurred at the sites in question (not whether each individual defendant caused a release)

and whether such a release caused the District to incur response costs. After this initial

26 The District relies heavily on a perceived distinction between so-called "one-site"
cases, where the contamination and the remediation action occur at the same location,
and so-called "two-site" cases, where the locations are different. We reject this
distinction. As one federal district court explained, "After a review of the statute, its
legislative history, and applicable case law, the Court holds that the analytical framework
that applies in a two-site CERCLA case is no different than the framework that applies in
a one-site CERCLA case. . . . Rather, [42 U.S.C. § 9607(a)] always requires a plaintiff to
prove, in its prima facie case, that a release from a facility for which the defendant is a
responsible person caused the incurrence of response costs." (Asarco LLC v. Cemex, Inc.
(W.D.Tex. 2014) 21 F.Supp.3d 784, 804.)

67
statement, however, the trial court shifted its focus. The court repeatedly and incorrectly

characterized the District's burden as follows: "The District had the burden to provide

causation as to each Trial Defendant, i.e., a causal connection between each Trial

Defendant's conduct and the District's response costs." In finding against the District, the

court concluded, "The weight of credible trial evidence failed to establish a causal

connection between any Trial Defendant's localized releases of hazardous substances into

the soil and costs the District has already incurred and might incur in the future." By

focusing on the conduct of each defendant, rather than the releases at each defendant's

site, the court in these latter passages held the District to an incorrect causation standard.

We will discuss the consequences of this error, and additional findings by the trial court,

with respect to each defendant in parts I.C.1.d.-e., post.27

27 Defendants do not articulate a clear position on the issue of causation. On one
hand, defendants appear to agree with the District that the correct causation standard
focuses on the consequences of a release at a site for which defendant is liable. On the
other hand, defendants cite the trial court's conclusions that defendants' own activities did
not cause response costs as conforming to that standard. Viewing their briefing as a
whole, it appears defendants believe the latter articulation of the standard was correct.
Defendants state, for example, that the "District was required to prove NBGPP would
actually treat off-site contamination released by Respondents [i.e., defendants], not
contamination released by another entity." For the reasons we have discussed, this
articulation of the HSAA's causation standard is incorrect. In any event, defendants
devote the bulk of their discussion to the issue of whether substantial evidence supported
the trial court's findings and do not address the potential prejudice stemming from the
trial court's use of an incorrect causation standard. Defendants' heading for this section
makes this focus clear: "Substantial evidence supports the finding that no respondent
released contamination causing [the] District to incur response costs." (Some
capitalization omitted.) This statement of the causation standard, which is limited to
defendants' activities only, is incorrect.
68
 c. "Some" Versus "All" Response Costs

As noted, the District also contends the trial court erred by requiring it to show

that each defendant's conduct was a substantial factor in the District's decision to develop

the entire NBGPP. We agree. CERCLA and the HSAA require only that the District

show that a release or threatened release caused some necessary response costs, not that

the release caused all costs incurred by the District in responding to a multitude of

releases. (See Carson Harbor I, supra, 270 F.3d at pp. 870-871; Santa Clara Valley

Water District v. Olin Corp. (N.D.Cal. 2009) 655 F.Supp.2d 1048, 1057 ["Cases within

the Ninth Circuit support the conclusion that a CERCLA prima facie case requires a

plaintiff to show that a release caused the incurrence of some response costs but it does

not require that the release cause all of the recoverable response costs."].) Once the

District has shown a release or threatened release caused it to incur some necessary

response costs, the causation standard is satisfied. Each defendant is responsible for

those costs caused by the release or threatened release for which it is liable.28

28 If multiple releases or threatened releases each cause the same response costs, the
defendants liable for those releases or threatened releases may each be responsible for the
full extent of those response costs. Under the HSAA, however, a defendant may obtain
apportionment of those costs in two ways. First, "a party found liable for costs
recoverable under this chapter who establishes by a preponderance of the evidence that
only a portion of those costs are attributable to that party's actions shall be required to pay
only for that portion." (Health & Saf. Code, § 25363, subd. (a).) This affirmative
defense, in contrast to the causation standard discussed above, focuses on the actions of
the defendant in question. Second, if the evidence is insufficient to establish the first
method of apportionment, "the court shall apportion those costs, to the extent practicable,
according to equitable principles, among the defendants." (Id., § 25363, subd. (b); see
id., § 25363, subd. (d) ["In resolving claims for contribution or indemnity, the court may
allocate costs among liable parties using appropriate equitable factors."].) In its
69
 The trial court's statement of decision does not conform to these legal principles.

The court described the District's burden as follows: "[T]he District had the burden to

prove by a preponderance of the evidence that each Trial Defendant caused or threatened

to cause groundwater contamination and that but for each defendant's conduct, the

NBGPP would not have been necessary. Stated another way, the District had the burden

to prove that each Trial Defendant's conduct was a substantial factor in the decision to

develop the NBGPP." As discussed in the previous part, the trial court incorrectly

focuses on each defendant's conduct, rather than the releases or threatened releases for

which each defendant is liable. And, in addition to that error, the court required the

District to show that each defendant, standing alone, caused the entire NBGPP—even

those portions of the project intended to address contamination completely unrelated to a

given defendant and the releases or threatened releases for which it was liable. This was

error. The correct standard requires the District to show only that it incurred some

necessary response costs as a consequence of a release or threatened release for which a

defendant is liable.

Similarly, at the outset of its causation discussion, the court concluded, "Based on

the evidence presented, the Court finds that no Trial Defendant's conduct was a 'but for'

statement of decision, the trial court found, based on the failures of causation it identified,
"[t]here is no factual basis for allocation of responsibility for past or future expenditures
among the Trial Defendants or as between one or more Trial Defendant[s] and the
District." Contrary to defendants' interpretation, the trial court did not apportion zero
costs to defendants. Instead, it found no basis on which to make such an apportionment
at all. To the extent the court's statement of decision could be read to make an allocation,
it was simply relying on its causation findings, as we will discuss in part I.C.5., post.

70
cause of, or a 'substantial factor' in, the District's decision to approve the NBGPP." While

the trial court did not err by using the substantial factor test for causation (see, e.g.,

Artesian Water, supra, 659 F.Supp. at p. 1283), it did err in selecting the objects of the

causation inquiry by requiring a showing that each "Trial Defendant's conduct" caused

the District "to approve the NBGPP." Instead, the trial court should have considered

whether each release or threatened release caused the District to incur necessary response

costs. We will discuss the consequences of this error, and additional findings by the trial

court, with respect to each defendant in the next parts, post.

d. Sufficiency of the Statement of Decision

Based on these legal errors, the District argues the trial court's statement of

decision is deficient because it omits material factual findings. It contends the judgment

must be reversed on that basis alone to allow the trial court to make findings under the

proper causation standard. (See Weisz Trucking Co. v. Emil R. Wohl Construction (1970)

13 Cal.App.3d 256, 263-264.) For reasons we will explain, we disagree.

"Ordinarily, when the court's statement of decision is ambiguous or omits material

factual findings, a reviewing court is required to infer any factual findings necessary to

support the judgment. [Citations.] This rule 'is a natural and logical corollary to three

fundamental principles of appellate review: (1) a judgment is presumed correct; (2) all

intendments and presumptions are indulged in favor of correctness; and (3) the appellant

bears the burden of providing an adequate record affirmatively proving error.' "

(Ermoian v. Desert Hospital (2007) 152 Cal.App.4th 475, 494 (Ermoian).)

71
 "In order to avoid the application of this doctrine of implied findings, an appellant

must take two steps. First, the appellant must request a statement of decision pursuant to

[Code of Civil Procedure] section 632; second, if the trial court issues a statement of

decision, 'a party claiming omissions or ambiguities in the factual findings must bring the

omissions or ambiguities to the trial court's attention' pursuant to [Code of Civil

Procedure] section 634." (Ermoian, supra, 152 Cal.App.4th at p. 494; see In re Marriage

of Arceneaux (1990) 51 Cal.3d 1130, 1134.)

"To bring defects in a statement of decision to the trial court's attention within the

meaning of [Code of Civil Procedure] section 634, objections to a statement of decision

must be 'specific.' [Citation.] The alleged omission or ambiguity must be identified with

sufficient particularity to allow the trial court to correct the defect. [Citation.] 'By filing

specific objections to the court's statement of decision a party pinpoints alleged

deficiencies in the statement and allows the court to focus on the facts or issues the party

contends were not resolved or whose resolution is ambiguous.' " (Ermoian, supra, 152

Cal.App.4th at p. 498.)

These requirements apply to omissions or ambiguities in a court's factual findings

only. Since the doctrine of implied findings does not apply to the court's legal

conclusions (which are reviewed de novo on appeal), this procedure does not apply to

potential errors of law. (Fladboe v. American Isuzu Motors, Inc. (2007) 150 Cal.App.4th

42, 59 (Fladboe); see Duarte Nursery, Inc. v. California Grape Rootstock Improvement

Com. (2015) 239 Cal.App.4th 1000, 1012 ["The statute applies only when there is an

72
omission or ambiguity in the trial court's decision, not when the party attacks the legal

premises or claims the trial court's findings are irrelevant or unsupported by evidence."].)

The District points to two filings in the trial court that it contends preserved its

objections to the trial court's statement of decision and vitiates application of the implied

findings doctrine. Neither filing was sufficient. The first, entitled "Plaintiff's Objections

and Counter Proposals to Defendants' Proposed Addition to Defendants' Statement of

Decision [Proposed] Re Causation Evidence," was filed after the court issued its

statement of decision. But, as its title implies, it was directed to an earlier filing by

defendants, not the statement of decision itself. Even assuming it could be read as an

objection to the statement of decision, the document explicitly does not request any

further factual findings by the court: "These objections do not reargue the District's

disagreements with this Court's factual determinations. Rather, the District objects to

legal errors in Defendants' Proposed Addition that have now been incorporated into the

Statement of Decision." The District argued that the court's factual findings were

sufficient to compel judgment in the District's favor: "Under the HSAA's true liability

standard, the factual findings in this Court's Statement of Decision establish that

Defendants are jointly and severally liable for the District's 'removal and remedial action

costs.' " The District did not identify any allegedly omitted or ambiguous factual

findings; it simply requested that the court use its existing factual findings to hold

defendants liable under the HSAA. This filing was therefore insufficient to prevent

application of the doctrine of implied findings.

73
 The District's second filing, entitled "Plaintiff's Objections to Defendants'

Statement of Decision [Proposed]," was submitted prior to the court's statement of

decision. As such, it could not have identified omissions or ambiguities in the statement

of decision. For this reason alone, it is insufficient. (See Fladboe, supra, 150

Cal.App.4th at pp. 59-60.) Even setting that insufficiency aside, the District's second

filing also did not identify material factual omissions or ambiguities the court must

resolve. Instead, it reargued the evidence presented at trial in an effort to persuade the

court (contrary to its tentative decision) to find the defendants liable under the HSAA.

Simply arguing the District's own view of the evidence is insufficient; the District must

identify material omissions or ambiguities in the ultimate factual findings necessary to

resolve the issues contested at trial.

Because the District failed to properly object to omissions or ambiguities in the

statement of decision, the doctrine of implied findings applies. We will therefore imply

any factual findings necessary to support the judgment, and the trial court's alleged

failure to include a material factual finding in its statement of decision is not reversible

error.

e. Review and Prejudice

The court's statement of decision is not insulated from review, however. We may

still review the court's factual findings, including any implied findings, for substantial

evidence. (Fladboe, supra, 150 Cal.App.4th at p. 60 ["The appellate court then reviews

the implied factual findings under the substantial evidence standard."]; see Ermoian,

supra, 152 Cal.App.4th at p. 494.) And, of course, we still review the court's

74
interpretation of the law under a de novo standard of review. (Central Valley, supra, 162

Cal.App.4th at p. 513.)

Here, with limited exceptions, the District does not challenge the sufficiency of the

evidence supporting the court's factual findings. Instead, as we have explained, the

District challenges the court's interpretation of the legal element of causation under the

HSAA.29 We have determined the trial court misapplied the standard. In order to obtain

reversal, the District must show the error was prejudicial, i.e., there is a reasonable

probability the District would have obtained a more favorable result if the court had

applied the correct standard. (See, e.g., Perez v. VAS S.p.A. (2010) 188 Cal.App.4th 658,

676, 679.)

We have reviewed the evidence presented at trial, the trial court's detailed

statement of decision, and the parties' arguments on appeal. In the following parts, we

will consider in detail the question of prejudice as to each defendant. In summary,

however, our conclusions are as follows: As to Alcoa and CBS, the court explicitly

found that VOC releases at those defendants' sites—regardless of their source—did not

affect the shallow aquifer. These factual findings were based on the trial court's

29 In its briefing, the District explained that it "will be focusing primarily on errors of
law, such as the trial court's improper standard of causation, which are reviewed de
novo." In some instances, the District makes explicit substantial evidence arguments,
which we will address below. To the extent the District contends the evidence did not
support the trial court's judgment more broadly, however, the District has waived this
contention because it discusses primarily evidence favorable to its position in its opening
brief, rather than all evidence relevant to the court's judgment. (Foreman & Clark Corp.
v. Fallon (1971) 3 Cal.3d 875, 881; Pope v. Babick (2014) 229 Cal.App.4th 1238, 1246.)
For example, the District largely omits any discussion of unfavorable testimony from
defendants' experts on the issue of causation.
75
credibility determinations at trial, and there is no reasonable probability the trial court

would have changed its evaluation of this evidence had it not misapplied the causation

standard under the HSAA. As to Arnold and Crucible, such findings may be implied, and

our review of the court's express findings and the evidence reveal no reasonable

probability the court would have found the District carried its burden to show that VOC

releases at the Arnold and Crucible sites affected the shallow aquifer. Because the

District's response costs rely primarily on shallow aquifer contamination (with some

exceptions we will explain below), the trial court's finding of no contamination precludes

causation under the correct HSAA standard for Alcoa, Arnold, CBS, and Crucible. The

trial court's error did not prejudice the District as to those defendants, and the court's

judgment on the District's HSAA claim will be affirmed as to them.

However, as to Northrop's sites, the trial court expressly found that VOC

contamination had affected the shallow aquifer. For reasons we will explain, therefore,

the trial court's error was prejudicial to some extent as to Northrop on the element of

causation. As noted, however, we must review the alternate grounds supporting the trial

court's judgment in favor of Northrop to determine whether the court's causation error as

to Northrop ultimately requires reversal of the judgment.

Alcoa

At the Alcoa site, as with all of defendants' sites, the trial court found there had

been one or more releases of hazardous substances (i.e., VOC's). The court determined,

however, that any VOC releases at the Alcoa site did not reach the shallow aquifer. "No

VOC's of any kind were detected at [the Alcoa site] in the main soil borings between the

76
water table and a point approximately 30 feet above the water table. . . . [Alcoa's] expert,

Richard Weiss, testified without contradiction that if VOC's passed through the soil

column underneath [the Alcoa site] and into the shallow aquifer, there would have been

detectable amounts of VOC's in the lower soil." The court found that thick layers of clay

under the Alcoa site "discouraged migration of VOC's from the soil to the shallow

aquifer." While the groundwater under the Alcoa site was contaminated with VOC's, the

court concluded based on the evidence that "VOC contamination (both PCE and TCE) in

the shallow aquifer under [the Alcoa site] came from one or more upgradient facilities."

These factual findings do not focus on releases by Alcoa itself or Alcoa's potential

responsibility for the entire NBGPP. Instead, they focus on whether releases of

hazardous substances at the Alcoa site caused shallow aquifer contamination and

therefore the District's response costs. As such, the court's factual findings mirror the

correct standard of causation under CERCLA and the HSAA. The past response costs

claimed by the District are the District's construction of two extraction wells to capture

contaminated water from the shallow aquifer for treatment. Because the Alcoa site did

not contribute to shallow aquifer contamination, according to the findings of the trial

court, it could not have caused these response costs.30

30 The District also claims that it "incurred response costs constructing monitoring
wells to evaluate contamination from the [Alcoa] site." To support this assertion, the
District cites only the testimony of its expert witness Waddell, who stated that a District
monitoring well "on the eastside of the Chicago Musical site" provided data that he used
in his evaluation of the Alcoa site. This testimony does not relate to causation at all.
Nowhere does Waddell testify that releases at the Alcoa site caused the District to install
the monitoring well in question. Given the trial court's factual determination that releases
77
 Relying on Monsanto, supra, 858 F.2d at page 169, the District criticizes the

court's factual findings. The District's reliance on Monsanto is unpersuasive for reasons

we have already discussed. The District also argues it was required only to show a

"plausible migration pathway" to the shallow aquifer, not actual migration, to establish

causation. Although the District could potentially establish its prima facie case (or

"satisf[y] its burden," as the District argues) by showing a plausible migration pathway,

rather than actual migration (see, e.g., Castaic Lake, supra, 272 F.Supp.2d at p. 1066),

the issue in this appeal is not whether the District can establish a prima facie case. Nor is

the issue what conclusions this court would have reached if we had considered the

evidence in the first instance as the trier of fact. Instead, the issue is whether the court's

factual finding, after it weighed the District's evidence against contrary evidence, was

affected by the court's use of an incorrect causation standard. Based on our review of the

evidence and the trial court's findings, we conclude there is no reasonable probability this

factual finding would have been altered if the trial court had used the correct standard.

The District has not shown prejudice.

Arnold

As to the Arnold site, the trial court recognized that 1,1,1-TCA and 1,1-DCE had

been found in the shallow soil. With respect to these contaminants, the court focused on

whether Arnold was responsible for these VOC releases, which is the incorrect causation

standard under CERCLA and the HSAA: "[T]here is insufficient evidence to find that

at the Alcoa site did not cause shallow aquifer contamination at all, the District has not
shown there is a reasonable probability the trial court would have found that those
releases caused its claimed investigatory costs.
78
the 1,1,1-TCA or 1,1-DCE found in shallow soil vapor on the [Arnold site] originated

from Arnold. Without a foundation for the opinion that Arnold released 1,1,1-TCA into

the soil (which would have eventually broken down to some extent to 1,1-DCE), there is

no basis for Dr. Waddell's opinion that Arnold's operations contaminated groundwater or

threaten today to contaminate groundwater."

The court's statement of decision did not make any express findings regarding the

dispositive causation issue, i.e., whether any VOC releases at the Arnold site—from

Arnold or another source—had caused shallow aquifer contamination and therefore the

District's response costs. While we will imply such a finding to support the judgment, we

must nonetheless consider whether it would have been affected by the trial court's use of

an incorrect causation standard.31

31 By contrast, the court found that PCE contamination at the Arnold site did not
impact groundwater, based on admissions by the District's expert witness Waddell. This
finding conforms to the correct causation standard under the HSAA. And, with respect to
TCE, the court found that Arnold did not use that chemical at all. The District argues that
the evidence does not support the court's finding regarding TCE. We disagree. The
District had the burden of proof on this issue. The District's evidence of Arnold's TCE
use consisted of (1) testimony by an Arnold employee, Daniel Hopen, who recalled such
use but was not confident and (2) TCE contamination in the shallow soil based on soil
samples taken two decades after Arnold left the site. Arnold's evidence in opposition
consisted of (1) testimony by a Arnold maintenance manager who was aware only of
1,1,1-TCA use over the entire time of Arnold's operations and (2) various permits and
reports from the second half of Arnold's tenancy at the site that do not reference TCE (but
in some cases do reference 1,1,1-TCA). Given the District's weak evidence, and the
conflicting evidence offered by Arnold, the trial court could reasonably find that the
District had not carried its burden of showing that Arnold used TCE. While we may have
come to an opposite conclusion had we considered this issue in the first instance, our
standard of review precludes second-guessing the trial court in this manner. Given this
finding, even if the District had proven that a TCE release at the site had impacted
groundwater and caused response costs, the District's HSAA claim would nonetheless fail
79
 The evidence bearing on causation was disputed at trial. Waddell analyzed

monitoring well data and grab samples from the shallow aquifer and concluded that the

Arnold site contributed TCE and 1,1-DCE contamination to the shallow aquifer.

Arnold's expert disagreed. He testified that the available data was insufficient to prove

that the Arnold site contributed TCE to groundwater. Although 1,1-DCE was found in

the shallow soil at the Arnold site, its presence in deeper samples was limited. Waddell

himself admitted that the available data was inadequate to fully characterize the VOC

contamination at the Arnold site because most sampling occurred at shallow depths and

the sampling at deeper levels was sparse. And, while groundwater data was available at

adjacent sites, there was no groundwater data for the Arnold site itself.

The District's claimed response costs consisted solely of an extraction well

designed to remediate groundwater contamination flowing from the Arnold site (among

others). A finding of causation therefore requires proof that the Arnold site caused

groundwater contamination. Based on our review of the evidence, and cognizant of the

trial court's findings regarding Waddell's lack of credibility, we conclude there is no

reasonable probability the court would have found the District carried its burden to

establish the essential fact of groundwater contamination had it understood the correct

causation standard under CERCLA and HSAA. As to Arnold, therefore, the District has

not shown prejudice.

because Arnold cannot be a responsible party for a hazardous substance it did not
"dispose[] of." (See 42 U.S.C. § 9607(a)(2).)
80
 CBS

As to CBS, the trial court recognized there had been VOC contamination in the

shallow soil at 500 South Raymond and 1300 East Valencia, the latter of which was

partially subdivided into 700 Sally Place. The court found, however, VOC releases at

those sites had not resulted in actual or threatened contamination of the shallow aquifer.

These factual findings avoid the legal errors we have identified and therefore provide

strong evidence the District was not prejudiced by the errors.

For 500 South Raymond, the court concluded, "To the extent that shallow soil

releases of PCE at 500 South Raymond are attributable to CBS, such releases have not

impacted groundwater and do not pose a present or future threat to groundwater."

Although couched as an unnecessary caveat, the trial court's attribution of any releases at

the site to CBS actually conforms its finding to the correct causation standard. By

concluding that any PCE releases at the 500 South Raymond site did not impact

groundwater (or threaten to do so), the court applied the correct causation standard and

made a dispositive factual finding on that issue.

Likewise, for the 1300 East Valencia site, the trial court credited the evidence that

any VOC releases at the site did not impact groundwater or threaten to do so. Prominent

among this evidence was Waddell's admission, supported by testing data, that a gap

existed in PCE detections between the shallow soil and the shallow aquifer. This gap

showed that contamination in the shallow soil had not reached the shallow aquifer and

therefore could not have contaminated it. Again, these findings bear directly on the

correct causation standard.

81
 The District contends the trial court's factual findings reflect the oft-criticized

"fingerprinting" or "tracing" requirement. (See Asarco, supra, 106 F.Supp.3d at p. 1031.)

Not so. The cited conclusions of the trial court properly focused on whether

contamination at the sites in question had caused the District's response costs. The

District's claimed response costs were limited to the installation of extraction wells to

treat contamination in the shallow aquifer, so it was appropriate for the trial court to

consider whether there was any causal connection between contamination at the CBS

sites and such costs. Again, while the District may have established a prima facie case by

showing shallow aquifer contamination and a plausible migration pathway from the

shallow soil to the shallow aquifer, the trial court was entitled to credit CBS's contrary

evidence. And, in any event, the trial court made clear it did not believe the District's

evidence for reasons entirely unrelated to the causation standard at issue in this appeal:

"Accordingly, since much of Dr. Waddell's testimony did not comport with the facts

presented at trial, lacked foundation, in some cases contained material mis[]statements,

and was otherwise founded on speculation, particularly, as it related to causation, the

Court does not credit his opinions regarding CBS'[s] alleged liability." Based on our

review of the evidence and the court's findings, there is no reasonable probability the

court would have found for the District on the issue of causation even if the court had

used the correct causation standard. The District has not shown prejudice.

Crucible

As to Crucible, the trial court acknowledged that soil vapor sampling in 2003

showed VOC contamination in the shallow soil at the Crucible site. The deepest samples,

82
however, were at 40 feet below the surface, and these samples did not detect any VOC's.

The court credited the conclusion of the consultant who conducted the sampling that "the

low concentrations of VOC's[,] where present beneath the Site, do not present a threat to

human health or groundwater beneath the Site." The court found Waddell's opinions, and

the District's causation evidence, unpersuasive.

Although the trial court did not make an explicit causation finding for the Crucible

site that corresponds to the correct causation standard, we nonetheless conclude the trial

court's use of an incorrect causation standard was harmless. The court's factual findings

regarding the nature and extent of VOC contamination of the site, its rejection of the

District's evidence, and the state of the evidence generally show that it is not reasonably

probable that the court would not have found in the District's favor on causation even if it

had used the correct causation standard. As with Arnold and CBS, the District's claimed

response costs were limited to extraction wells designed to treat the shallow aquifer. The

court's findings make clear it did not believe the contamination at the Crucible site

contaminated or threatened to contaminate that aquifer. The District's focus on contrary

evidence, which the court did not credit, is unpersuasive. Even if the District's evidence

did establish a prima facie case (by showing a plausible migration pathway or otherwise),

that is not the issue in this appeal. The District has not shown prejudice.

Northrop

For Northrop, unlike the other defendants, the trial court found that releases at its

sites had contaminated the shallow aquifer. For two of Northrop's sites, EMD and Kester

Solder, the court's conclusion that those sites had not caused the District's response costs

83
rested on the court's factual findings that those sites no longer contributed to shallow

aquifer contamination. For the third site, Y-12, the court's conclusion rested on

Northrop's ongoing remediation of the site. For reasons we will explain, we conclude

there is a reasonable probability the trial court would have found that the District had

proved causation as to Northrop's Kester Solder and Y-12 sites had it used the correct

causation standards.

The trial court found that TCE and 1,1,1-TCA were released at Northrop's EMD

site. The court described Northrop's remediation activities, including soil vapor

extraction and soil excavation to a depth 40 feet below the surface. The court cited the

RWQCB's 1991 assessment, following Northrop's remediation, that "VOC's present in

the soil have apparently not significantly impacted water quality." The court also cited

the RWQCB's 1993 assessment, which concluded that " 'contaminants in groundwater

beneath the site probably originate from an off-site source.' " Later testing in 2010 by the

District, the court concluded, showed "there is no perceptible contribution from the EMD

site to groundwater contamination as groundwater passes below EMD." The testing

"refute[d] the notion that past releases at EMD have caused the District to engage in any

remedial action." The court noted Waddell's admission that contamination caused by

EMD in the past will not be captured by the District's extraction wells. Instead, the wells

"will capture only water that is either currently passing through EMD or will soon be

passing through EMD." The court concluded that "[t]he District's evidence concerning

shallow aquifer contamination or the threat thereof attributable to Northrop's EMD site

was not persuasive."

84
 At the Kester Solder site, the trial court found that PCE had been released. Initial

testing revealed PCE contamination in the shallow soil, perched groundwater, and

shallow aquifer. The court noted that, beginning in 2007, Northrop engaged in an

RWQCB-approved remediation plan, including a soil vapor extraction process that

yielded 1,000 pounds of VOC's. The court concluded that Northrop's remediation

"remove[d] the source of potential groundwater contamination." While the court

acknowledged that contamination remained in the perched groundwater at the site,

Northrop was continuing its remediation efforts under the auspices of the RWQCB.

Reviewing the expert testimony, the court rejected Waddell's opinion that the site

remained a source of contamination. Instead, the court credited the testimony of

Northrop's expert witness Glenn Tofani, who compared upgradient and downgradient

monitoring well data to determine that the site did not contribute to shallow aquifer

contamination. And, in the court's view, even if the site contributed to such

contamination, it would be remediated by the downgradient treatment well at Northrop's

Y-12 site. Weighing the evidence, the court concluded, "Kester [Solder] is no longer a

source of further PCE contamination and as a result of soil remediation, is not

contributing to PCE contamination in the shallow aquifer. The [RWQCB] is properly

exercising its jurisdiction over Northrop's remediation efforts at this site. The Court

therefore finds that Kester [Solder] does not pose a threat to groundwater and has not

caused the need for the NBGPP."

At the Y-12 site, the trial court found that TCE had been released and impacted

groundwater. PCE was also found at the site, but the trial court determined that it was

85
not a source of groundwater contamination. As with the EMD and Kester Solder sites,

Northrop undertook an RWQCB-approved remediation effort. The trial court found that

the effort had removed approximately 98 percent of VOC's at the Y-12 site

(approximately 20,000 pounds). The trial court credited testimony predicting that

remediation of the soil and perched groundwater would be completed by 2014 (two years

after trial), at which point the Y-12 site would "no longer be a source of groundwater

contamination." The trial court noted that Northrop had also installed a treatment well at

Y-12, which was remediating groundwater to drinking water standards. Given this

evidence, the court concluded as follows: "The evidence establishes that the NBGPP is

not necessary to address Y-12 contamination because the source of the contamination at

Y-12 is in the process of remediation under a responsible agency. . . . Accordingly, the

Court concludes that Y-12 is being adequately remediated and that contamination at the

site has not caused, and will not cause, the District to incur remedial action costs."

The court's statement of decision does not make a distinction between potential

contamination at Northrop's sites (the correct causation standard) and potential

contamination by Northrop itself (the incorrect causation standard). It simply focuses on

the sites themselves. To that extent, the trial court's use of an incorrect standard does not

appear to have been prejudicial. The District's assertions regarding its ability to show a

"plausible migration pathway" or establish a prima face case are unpersuasive for reasons

we have already stated.

But given the undisputed fact that Northrop's sites caused some VOC

contamination in the shallow aquifer, we conclude the District has shown prejudice

86
stemming from the court's erroneous belief that the District was required to show

hazardous substance releases at defendants' sites were a substantial factor in causing the

District to develop the entire NBGPP, rather than simply a substantial factor in causing

the District to incur some response costs.

For the Northrop sites, the District's claimed response costs include the

construction of two extraction wells to treat contamination in the shallow aquifer and

several monitoring wells to evaluate contamination flowing from Northrop's sites. Based

on the trial court's findings that the EMD site no longer contributes to shallow aquifer

contamination, and that any past contamination has already flowed beyond the District's

extraction well, it is not reasonably probable the court would have found that releases at

the EMD site caused the construction of the extraction wells if it had not misapplied the

causation standard. For the Kester Solder and Y-12 sites, however, it is reasonably

probable the trial court would have changed its conclusion. Although the trial court

found the Kester Solder site no longer contributed to contamination in the shallow

aquifer, it made no findings regarding the ability of the District's extraction wells to

remediate past contamination. (Northrop does not appear to have introduced evidence

that past contamination from Kester Solder had already flowed beyond the District's

extraction wells, as it did with the EMD site.) And the Y-12 site continued to contribute

to contamination the shallow aquifer at the time of trial. Northrop's expert Tofani

admitted that its recirculation well did not capture all of the contamination flowing from

the site. Like the Kester Solder site, the trial court made no findings regarding the ability

of the District's extraction wells to remediate past (or present) contamination flowing

87
from the Y-12 site. While not certain, it appears reasonably probable that the court

would have found that contamination from Y-12 caused the District to construct an

extraction well to treat that contamination. It therefore may have found in the District's

favor on the issue of causation if it had understood the District needed merely to prove

that releases at the Kester Solder or Y-12 sites caused some response costs, rather than

believing that releases at the sites had to cause the entire NBGPP project. The District

has shown prejudice as to these extraction well costs and the Kester Solder and Y-12

sites.32

32 In its briefing, Northrop claims, "Lambie also testified that any VOC's historically
released at Northrop's Y-12 or upgradient Kester [Solder] site will not reach any
proposed extraction wells as a result of the installation and operation of Northrop's
groundwater treatment well." Northrop overstates Lambie's testimony. Lambie testified
that he gave Northrop credit for its remediation activities, including its recirculation well,
that reduced its share of the VOC contamination that would reach the shallow and
principal aquifers. In explaining the credit, Lambie stated, "I reduced their share of
chemicals going to the District-proposed recirculation system by virtue of the fact that
their chemicals will not continue to arrive there. I would submit that what they have
contributed to the aquifer in the past has already reached the area that the District's
proposed recirculation system will remove. But that the recirculation well is sufficient to
control any migration or contribution ongoing from Kester Solder to the shallow aquifer."
The focus of Lambie's analysis was Northrop's contribution to VOC contamination in the
aquifer system, not Northrop's contribution to contamination actually captured by the
District's extraction wells. As mentioned above (see fn. 15, ante), Lambie believed the
former analysis results in a more equitable allocation of responsibility and cost. Given
Lambie's focus, our interpretation of his testimony is that Northrop's remediation
activities resulted in a net zero contribution of VOC contamination in the aquifer system
and the NBGPP's treatment area after those activities were fully implemented. Lambie
did not opine on the potential for the NBGPP to treat past VOC contamination caused by
Northrop's sites or the ongoing contamination caused by the Y-12 site that was not
treated by Northrop's recirculation well. We note that while Northrop's remediation of
contamination from non-Northrop sites may have some relevance to cost allocation under
Lambie's methodology, it cannot prevent a finding of causation as to the Northrop
contamination that escapes remediation.
88
 The fact that Northrop offered contradictory expert testimony from Tofani and

Lambie regarding whether contamination from its sites would be part of the NBGPP's

treatment area (see fn. 15, ante) further supports our finding of prejudice as to the Kester

Solder and Y-12 sites. Contrary to the District's contention, however, such testimony

does not establish prejudice as to the EMD site. The trial court weighed the conflicting

expert testimony and credited Tofani's opinion that the EMD site no longer contributed to

shallow aquifer contamination and Waddell's admission that past contamination had

already flowed past the District's extraction wells. The District appears to challenge the

former testimony, arguing it cannot constitute substantial evidence because Tofani

allegedly did not consider all of the factors Lambie considered. (See Pacific Gas &

Electric Co. v. Zuckerman (1987) 189 Cal.App.3d 1113, 1136 ["When a trial court has

accepted an expert's ultimate conclusion without critical consideration of his reasoning,

and it appears the conclusion was based upon improper or unwarranted matters, then the

judgment must be reversed for lack of substantial evidence."].) The fact that two experts

disagreed on the factors used in their analysis under the circumstances here, however,

does not mean one expert's conclusion was based on "improper or unwarranted matters,"

such that his conclusion was not substantial evidence. At most, the District has shown

only run-of-the-mill disagreement between experts, which the trial court was entitled to

resolve against the District. (See, e.g., People v. Poe (1999) 74 Cal.App.4th 826, 831.)

Substantial evidence therefore supported the trial court's finding, and we may not reweigh

this factual finding on appeal. It also does not appear reasonably probable the trial court

89
would have come to a different conclusion if it had not misperceived the causation

standard under the HSAA. The court's legal errors have no bearing on this factual issue.

The District also claimed investigatory costs consisting of monitoring wells in the

vicinity of the EMD and Kester Solder sites. With one exception, the District does not

explain how hazardous substance releases at those sites caused the District to construct

those monitoring wells. Instead, the evidence cited by the District shows only that it used

data from those monitoring wells to analyze releases at those sites. That evidence does

not bear on the issue of causation. As to one well, however, the District cites evidence

that it constructed the well specifically to evaluate shallow aquifer contamination at the

Kester Solder site. Given that evidence, it is reasonably probable the trial court would

have found that releases at the Kester Solder site caused these investigatory costs if it had

not believed that such releases were required to cause the entire NBGPP. The District

has therefore shown prejudice as to these costs related to the Kester Solder site as well.

2. Response Costs: Whether the District Is a "State"

We will next consider the additional grounds supporting the judgment against the

District on its HSAA claim. The trial court found, in the alternative, that the District

could not recover on its HSAA claim because it had not shown its response costs were (1)

necessary and (2) consistent with the NCP. (See Carson Harbor I, supra, 270 F.3d at

pp. 870-871; see 42 U.S.C. § 9607(a)(4)(B).) The District contends the trial court erred

by imposing these requirements because it is a "State" under CERCLA and a different

CERCLA provision applies. As we will explain, we disagree that the District is a "State"

90
for purposes of CERCLA's cost recovery provisions. The court therefore did not err by

imposing these requirements.

Under CERCLA, States (as well as Indian tribes and the federal government) can

recover "all costs of removal or remedial action . . . not inconsistent with the [NCP]."

(42 U.S.C. § 9607(a)(4)(A).) States, Indian tribes, and the federal government therefore

enjoy a presumption that their costs are NCP-compliant, which is not extended to other

cost recovery plaintiffs. (Washington State Department of Transportation v. Washington

Natural Gas Co. (9th Cir. 1995) 59 F.3d 793, 799-800 (WSDOT).) "HSAA incorporates

the NCP standard by reference." (Fireman's Fund Insurance Co. v. City of Lodi (9th Cir.

2002) 302 F.3d 928, 950 (Fireman's Fund).) The District's contention presents a question

of statutory interpretation, which we review de novo. (Shamrock Foods Co., supra, 24

Cal.4th at p. 432; Central Valley, supra, 162 Cal.App.4th at p. 513.)

Under CERCLA, "[t]he terms 'United States' and 'State' include the several States

of the United States, the District of Columbia, the Commonwealth of Puerto Rico, Guam,

American Samoa, the United States Virgin Islands, the Commonwealth of the Northern

Marianas, and any other territory or possession over which the United States has

jurisdiction." (42 U.S.C. § 9601(27).) "This definition does not explain what constitutes

each of the 'several States of the United States.' A more detailed statutory definition was

unnecessary because the plain meaning of 'State' is the organized government acting on

behalf of the citizens of the state." (WSDOT, supra, 59 F.3d at p. 800.) "The organized

government of a state includes state administrative departments and agencies. A 'state

agency' is '[a] department, commission, board, committee, or body of any form operating

91
as an instrumentality of the state government.' " (Ibid.) For example, as a State agency,

the DTSC falls within CERCLA's definition of a State. (Fireman's Fund, supra, 302

F.3d at p. 950.)

CERCLA's definitions distinguish States from other, subsidiary political units. In

its definition of a "person," in addition to various private parties, CERCLA includes

"United States Government, State, municipality, commission, political subdivision of a

State, or any interstate body." (42 U.S.C. § 9601(21).) Under well-settled canons of

statutory interpretation, these subsidiary political units (municipalities and political

subdivisions of a State) are not States under CERCLA because they are listed separately.

To equate them with States would render their separate listing superfluous. (See, e.g.,

Dyna-Med, Inc. v. Fair Employment & Housing Commission (1987) 43 Cal.3d 1379,

1387 ["A construction making some words surplusage is to be avoided."]; see also Civ.

Code, § 3541.) "A municipality, a local government with authority over a limited area, is

a different type of government unit than a state-wide agency that is part of the organized

government of the state itself." (WSDOT, supra, 59 F.3d at p. 800, fn. 5; see United

States ex rel. Norton Sound Health Corp. v. Bering Strait School Dist. (9th Cir. 1998) 138

F.3d 1281, 1284 ["In short, a local government unit, though established under state law,

funded by the state, and ultimately under state control, with jurisdiction over only a

limited area, is not a 'State.' "].)

Reviewing federal court decisions distinguishing States from subsidiary political

units, one court summarized, "The courts explain that CERCLA's definition of 'state' does

not include political subdivisions such as municipalities and the entities included under

92
the definition differ substantially from political subdivisions in terms of their authority

and power. All are sovereigns and, unlike municipalities, do not depend on states for

their authority to govern. The courts further note that 'municipalities' and other 'political

subdivision[s]' are included within the statutory definition of 'person.' " (Town of New

Windsor v. Tesa Truck, Inc. (S.D.N.Y. 1996) 919 F.Supp. 662, 683.)

Numerous other federal district courts agree that municipalities and other political

subdivisions are not States for purposes of CERCLA cost recovery actions. (See, e.g.,

Miami-Dade County v. United States (S.D.Fla. 2004) 345 F.Supp.2d 1319, 1334 ["By the

clear language of CERCLA, the County, as a 'political subdivision of a state,' is not

entitled to the presumption that response actions taken were necessary and consistent

with the NCP, to which States and the Federal government are entitled."]; City of New

York v. Chemical Waste Disposal Corp. (E.D.N.Y. 1993) 836 F.Supp. 968, 977 ["By its

terms, CERCLA's definition of 'state' does not include political subdivisions such as

municipalities."]; Sherwin-Williams Co. v. City of Hamtramck (E.D.Mich. 1993) 840

F.Supp. 470, 474-475 (Sherwin Williams); City of Heath v. Ashland Oil, Inc. (S.D.Ohio

1993) 834 F.Supp. 971, 976-977; Town of Bedford v. Raytheon Co. (D.Mass. 1991) 755

F.Supp. 469, 470-471; City of Philadelphia v. Stepan Chemical Co. (E.D.Pa. 1989) 713

F.Supp. 1484, 1486-1487; see also Borough of Rockaway v. Klockner & Klocker (D.N.J.

1993) 811 F.Supp. 1039, 1048-1049.)33

33 The District cites three federal district court opinions that adhere to the contrary
view that municipalities should be considered States in CERCLA cost recovery actions.
(See, e.g., City of New York v. Exxon Corp. (S.D.N.Y. 1990) 112 B.R. 540, 545; City of
93
 The District was established by an act of the California Legislature. (OCWD Act,

§ 1, subd. (a).) It has powers over a limited sphere, groundwater, and within a limited

geographic area, roughly corresponding to Orange County. (Id., §§ 1, subd. (a), 2.) It

has no statewide authority in subject matter or geography. It is therefore a political

subdivision of the State, not a State itself. It is akin to a municipality, but with more

specialized powers.

It appears only one court has considered whether a California water district is a

State under CERCLA. (See Santa Clara Valley Water District v. Olin Corp. (N.D.Cal.

Sept. 28, 2007, No. C-07-03756) 2007 WL 2890390 (SCVWD).) That federal district

court held, in an unpublished opinion, that the district in question was not a State because

New York v. Exxon Corp. (S.D.N.Y. 1988) 697 F.Supp. 677, 683-686; Arizona v.
Motorola, Inc. (D. Ariz. Sept. 1, 1992, No. CIV 89-1700) 1992 U.S. Dist. LEXIS 22799,
*14-*17.) It appears that these cases represent the minority view of the federal district
courts, and we find them unpersuasive for reasons we have already discussed. The
District also relies on two opinions that construe other CERCLA provisions. (Carolina
Casualty Insurance Co. v. Oahu Air Conditioning Service, Inc. (E.D.Cal. 2014) 994
F.Supp.2d 1082, 1087, fn. 2 (Carolina Casualty) [construing CERCLA's contribution
cause of action, 42 U.S.C. § 9613(f)]; Unigard Insurance Co. v. City of Lodi (E.D.Cal.
Mar. 5, 1999, No. Civ. S98-1712) 1999 WL 33454809, *4-*5 (Unigard) [construing
CERCLA's savings provision against federal preemption, 42 U.S.C. 9614(a)].) Neither
opinion engaged in a textual analysis of CERCLA's distinction between States and their
political subdivisions in its definition of "person." And, unlike the CERCLA provisions
at issue in those opinions, the CERCLA provision here makes an explicit distinction
between States and "other person[s]." (42 U.S.C. § 9607(a)(4)(A)-(B).) For these
reasons, Unigard and Carolina Casualty are unpersuasive. We note additionally that
these opinions appear to have relied on the policies behind the CERCLA provisions at
issue to include political subdivisions within the term States. We will consider the policy
considerations implicated by the use of the term in CERCLA's cost recovery provisions
below.
94
it did not have statewide authority. (Id. at p. *5.) We agree with the district court's

reasoning and conclusion.34

The District points out that its claim is under the HSAA, not CERCLA, and

therefore we should consider policy reasons specific to California why the District should

enjoy the presumption afforded to States under CERCLA. The District argues that the

cost recovery provisions of the OCWD Act, which reflect a presumption that the

District's costs are reasonable and necessary (OCWD Act, § 8, subd. (c)), show that the

District should enjoy a similar presumption under CERCLA and the HSAA. We note

first that, absent absurd or unintended results, such policy considerations cannot override

the plain meaning of the statute. (See California School Employees Assn. v. Governing

Board (1994) 8 Cal.4th 333, 340 (California School Employees).) And, to the extent we

can discern a policy thread connecting these various concepts, it does not favor the

District's position.

The HSAA itself places NCP compliance at the heart of environmental

remediation actions in California. (Health & Saf. Code, §§ 25350, 25356.1, subd. (d).) It

also entrusts the State of California's overall environmental investigation and remediation

efforts to two state agencies, the DTSC and the RWQCB. (See, e.g., id., §§ 25356.1,

subd. (b), 25312.) The District is not included. The District's own governing act does

34 The District attempts to distinguish SCVWD on the grounds that the water district
at issue there, unlike the District, was not specifically empowered to perform
environmental remediation. This difference, however, does not affect our textual analysis
of the statute. And, for reasons we explain post, the District's environmental remediation
powers do not make it a State under CERCLA.
95
not contemplate environmental investigation and remediation efforts on the scale of the

DTSC and the RWQCB under the HSAA. Instead, it includes specific provisions relating

to the District only. (OCWD Act, § 8.) (As we will discuss in part II, post, the OCWD

Act's standards differ materially from the HSAA.) Given the District's exclusion from

the HSAA, and the specific standards and provisions governing the District's

environmental cleanup activities in the OCWD Act, we conclude that the applicable

California policies support our conclusion that the District should not be considered a

State under the cost recovery provisions of CERCLA and should not enjoy the

presumption of NCP compliance.

The policies underlying CERCLA's cost recovery provisions likewise counsel

against extending the NCP presumption to the District. As one court explained, with

respect to the presumption enjoyed by States that their costs will be NCP compliant,

"This standard of proof was designed in deference to the highly technical nature of

environmental cleanup efforts, and the realization that the expertise of agencies charged

with environmental protection should not be second-guessed by the courts."

(Commonwealth of Massachusetts v. Blackstone Valley Electric Co. (D. Mass. 1994) 867

F.Supp. 78, 81.) Although CERCLA does not explicitly limit the presumption to

agencies with special environmental experience (WSDOT, supra, 59 F.3d at p. 801),

interpreting the term to include only statewide agencies that are part of a State's

government ensures at least the opportunity for institutional specialization and broad-

based coordination that would not exist if the term were extended to all municipalities

and political subdivisions.

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 3. Response Costs: Necessity

Because it is not a State under CERCLA, the District must prove its response costs

were necessary. (See 42 U.S.C. § 9607(a)(4)(B) [allowing recovery of "necessary costs

of response"].)35 The District argues the evidence does not support the trial court's

finding that its response costs were not necessary, as that term is used in CERCLA. We

agree.

"It is generally agreed that [the necessity] standard requires that an actual and real

threat to human health or the environment exist before initiating a response action."

(Carson Harbor I, supra, 270 F.3d at p. 871; see City of Colton v. American Promotional

Events, Inc.-West (9th Cir. 2010) 614 F.3d 998, 1003 (City of Colton); Regional Airport

Authority of Louisville v. LFG, LLC (6th Cir. 2006) 460 F.3d 697, 703 (Louisville).) "In

determining whether response costs are 'necessary,' we focus not on whether a party has a

business or other motive in cleaning up the property, but on whether there is a threat to

human health or the environment and whether the response action is addressed to that

threat." (Carson Harbor I, supra, 270 F.3d at p. 872.) Investigatory costs incurred "in

order to assist with and help plan the eventual remediation and cleanup efforts" are

necessary under CERCLA (Walnut Creek Manor, LLC v. Mayhew Center, LLC (N.D.Cal.

2009) 622 F.Supp.2d 918, 929) and " 'are recoverable even absent any subsequent

35 Defendants claim the District was also required to show its costs were reasonable.
But neither the HSAA nor CERCLA have an express requirement that costs be
"reasonable." The concept is instead part of the requirement that costs be consistent with
the NCP. We will consider defendants' criticisms in connection with that requirement.
97
recoverable response costs' " (Yankee Gas Services Co. v. UGI Utilities, Inc. (D. Conn.

2012) 852 F.Supp.2d 229, 242 (Yankee Gas)).

In its statement of decision, the trial court determined that "the NBGPP is

unnecessary and unreasonable, thus precluding the District's recovery under . . . the

HSAA." The court's determination rested on its finding that natural attenuation of VOC

contaminants in the shallow aquifer was sufficient to protect drinking water supplies in

the principal aquifer: "The court further finds, based on the weight of the evidence, that

the NBGPP is not necessary either to protect the principal aquifer—the drinking water

aquifer—or to remediate VOC contamination in the shallow (non-drinking water) aquifer

to a goal of 5-10 times the [maximum contaminant level] for the various VOC's in order

to provide future protection for the drinking water principal aquifer." And, with respect

to Northrop's Y-12 site specifically, the court found that "[t]he evidence establishes that

the NBGPP is not necessary to address Y-12 contamination because the source of

contamination at Y-12 is in the process of remediation under a responsible agency."

As with all factual determinations, we review the trial court's determination that

the District's response costs were not necessary for substantial evidence. (See Central

Valley, supra, 162 Cal.App.4th at p. 513.) Viewing the record in the light most favorable

to defendants, and in light of the standards articulated above, we conclude that the

evidence did not support a finding that the District's response costs were not necessary. It

was undisputed that groundwater in the North Basin area, including around defendants'

sites, had been impacted by VOC contamination. The presence of VOC contamination at

significant levels was a threat to human health and the environment. (See, e.g., United

98
Alloys, Inc. v. Baker (C.D.Cal. 2011) 797 F.Supp.2d 974, 996 [finding that VOC

contamination in soil "pose[s] an actual and real threat to public health and the

environment" and remediation costs are therefore "necessary" under CERCLA].) No

reasonable trier of fact could find otherwise. It was also undisputed that the District's

costs were addressed to the threat posed by VOC contamination. The District did not

investigate VOC contamination or construct its extraction wells for some other reason.

The trial court focused on drinking water supplies, to the exclusion of other

hazards to human health and the environment, such as VOC contamination in the shallow

aquifer. The court also applied the term "necessary" in its strictest sense, i.e., the NBGPP

was not necessary because other means existed to protect the deep aquifer. The court

misinterpreted the standard of "necessity" under CERCLA and the HSAA and therefore

erred.

Defendants offer a fusillade of criticism against the NBGPP generally, claiming it

is not necessary to remediate VOC contamination in the North Basin because, for

example, natural attenuation would be an acceptable alternative. But they do not tie their

arguments to the applicable standard of necessity under CERCLA and the HSAA.

Indeed, they do not reference the standard at all. The standard, properly understood, does

not speak to the quality of the District's response action. It simply asks whether the

response action is addressed to an actual threat to human health or the environment.

Shortcomings in the development and overall design of the NBGPP do not, in and of

themselves, bear strongly on this standard. Defendants' criticisms are more relevant to

99
the District's compliance with the NCP, and we will consider that issue in the next

section.36

4. Response Costs: NCP Consistency

Because the District is not a State under CERCLA, it must also prove its response

costs are "consistent with" the NCP, including its requirements for meaningful public

participation, cost-effectiveness, and adequate planning for any remedial action. (42

U.S.C. § 9607(a)(4)(B); see Carson Harbor Village v. County of Los Angeles (9th Cir.

2006) 433 F.3d 1260, 1265-1266 (Carson Harbor II).) For reasons we will explain, we

conclude the District has not shown its claimed response costs were consistent with the

NCP.

"The NCP 'specifies procedures for preparing and responding to contaminations

and was promulgated by the Environmental Protection Agency (EPA) pursuant to

CERCLA § 105 [42 U.S.C. § 9605].' [Citations.] 'It is designed to make the party

seeking response costs choose a cost-effective course of action to protect public health

and the environment.' " (City of Colton, supra, 614 F.3d at p. 1003.) A response action

"will be considered 'consistent with the NCP' if the action, when evaluated as a whole, is

in substantial compliance with the applicable requirements . . . , and results in a

36 In its discussion of causation, Northrop contends its remediation efforts render the
NBGPP unnecessary because it is not needed to remediate VOC contamination from
Northrop's sites. Northrop cites various authorities interpreting the CERCLA necessity
requirement. But, as the placement of Northrop's discussion shows, the specific
relationship between contamination for which Northrop is responsible and the District's
specific response costs is an issue of causation, not necessity, under the CERCLA and the
HSAA. We have already addressed Northrop's arguments regarding causation in part
I.C.1.e., ante.
100
CERCLA-quality cleanup." (40 C.F.R. § 300.700(c)(3)(i).) Mere "immaterial or

insubstantial deviations" from applicable requirements are not sufficient to show that an

action is not consistent with the NCP. (Id., § 300.700(c)(4); see Louisville, supra, 460

F.3d at p. 707.)

In general, "[a] 'CERCLA-quality cleanup' is a response action that (1) protects

human health and the environment, (2) utilizes permanent solutions and alternative

treatment technologies or resource recovery technologies to the maximum extent

practicable, (3) is cost-effective, (4) satisfies Applicable and Relevant or Appropriate

Requirements ('ARARS') for the site, and (5) provides opportunity for meaningful public

participation." (Franklin County Convention Facilities Authority v. American Premier

Underwriters (6th Cir. 2001) 240 F.3d 534, 543 (Franklin County).) The specific

regulatory requirements identified by the NCP include protection of worker health and

safety (40 C.F.R. § 300.150); adequate documentation of hazardous substance releases,

responsible parties, response actions, and costs incurred (id., § 300.160); identification of

ARARS applicable to the hazardous substance release and response action (id.,

§ 300.400(g)); an adequate remedial site evaluation (id., § 300.420); an NCP-compliant

remedial investigation, feasibility study, and selection of remedy (id., § 300.430); and

subsequent remedial design and remedial action (id., § 300.435). (See id.,

§ 300.700(c)(5).)

The regulations emphasize the role of public participation throughout the

investigation, study, and remedial phases of an NCP-compliant response action: "Private

parties undertaking response actions should provide an opportunity for public comment

101
concerning the selection of the response action based on [NCP requirements], or based on

substantially equivalent state and local requirements." (40 C.F.R. § 300.700(c)(6).) The

NCP requirements for public participation "are intended to promote active

communication between communities affected by discharges or releases" and the party

instituting the response action. (Id., § 300.155(c).) The specific NCP requirements for

public participation will be discussed in further detail below.

The District contends, as an initial matter, that the requirement of NCP

consistency should not apply to investigatory costs. A number of federal authorities

support the District's contention. (See Village of Milford v. K-H Holding Corp. (6th Cir.

2004) 390 F.3d 926, 934 ["[T]his court has held that consistency with the NCP is not

required for recovery of monitoring and investigation costs."] (italics added); CNH

America, LLC v. Champion Environmental Services (E.D.Wis. 2012) 863 F.Supp.2d 793,

809 ["[M]any courts have held that initial investigation, site-assessment, and monitoring

costs are recoverable under [42 U.S.C. § 9607(a)] irrespective of compliance with NCP

requirements."].) Other authorities disagree. (See Board of County Commissioners v.

Brown Group Retail, Inc. (D.Colo. 2011) 768 F.Supp.2d 1092, 1115; Aviall Services, Inc.

v. Cooper Industries, LLC (N.D.Tex. 2008) 572 F.Supp.2d 676, 697 (Aviall Services).)

We agree with the latter line of authority and conclude the District must prove its

investigatory costs are consistent with the NCP to recover. The plain language of the

federal statute compels this result. " 'It is well-established that costs of investigation,

assessment, or monitoring of potential environmental harm qualify as "costs of response"

under CERCLA.' [Citations.] And CERCLA plainly allows private parties to recover

102
only those 'costs of response' incurred 'consistent with the [NCP].' 42 U.S.C.

§ 9607(a)(4)(B). It would thus contravene the plain language of the statute to hold that

investigatory costs are exempt from NCP compliance." (Aviall Services, supra, 572

F.Supp.2d at p. 697.)

Based on the nature of these costs, however, not all NCP requirements may be

applicable when litigation commences. Because a plaintiff may seek cost recovery

before a remediation action has been completed (Wickland Oil Terminals v. Asarco, Inc.

(9th Cir. 1986) 792 F.2d 887, 892), consistency with the NCP in this context may not

mean that all NCP requirements have been met. The NCP requirements applicable to a

given remedy will depend on where in the development process the remedy is at the time

of the plaintiff's cost recovery action.

One federal district court explained that " 'investigatory costs will be considered

"consistent with the NCP" where they are incurred consistently with the purpose of the

NCP.' " (Aviall Services, supra, 572 F.Supp.2d at p. 697.) The key criterion, sometimes

ignored in the federal authorities we have reviewed, is that costs must be consistent with

the NCP. The plaintiff need not have complied with the NCP in its entirety to recover.

(See Yankee Gas, supra, 852 F.Supp.2d at p. 242.) The trial court here did not err by

requiring the District to show NCP consistency for its investigatory costs.

The District contends the court erred by finding its response costs were not

consistent with the NCP. The federal courts view this issue as a mixed question of law

and fact. "Whether a party has substantially complied with the NCP is a mixed question

of law and fact. [Citation.] This means that, once the factual details regarding [the

103
District's] cleanup efforts have been established, the court decides—as a matter of law—

whether those efforts substantially comply with the NCP." (Aviall Services, supra, 572

F.Supp.2d at p. 695.) We agree and will therefore review the trial court's factual findings

for substantial evidence and review de novo the ultimate conclusion that the District's

costs were not consistent with the NCP, i.e., that the District did not substantially comply

with applicable NCP requirements. (See Louisiana-Pacific Corp. v. ASARCO Inc. (9th

Cir. 1994) 24 F.3d 1565, 1576; see also Board of Administration v. Wilson (1997) 52

Cal.App.4th 1109, 1127-1130 [discussing mixed questions of law and fact under

California law].)

At trial, the District claimed a total of approximately $3.7 million in incurred

response costs. This total included approximately $876,000 in investigatory costs (e.g.,

monitoring wells), $1.8 million in extraction well construction costs, and $1 million in

design and development costs (e.g., environmental impact analysis). On appeal, the

District does not focus on the relationship between its specific incurred costs and the

NCP. Instead, the District argues it substantially complied with the NCP in the course of

its overall response to VOC contamination in the North Basin area. For reasons we will

explain, we disagree.37

37 Because the District focuses on its overall response to VOC contamination in the
North Basin area, and not any specific response costs, we need not consider whether any
specific response costs were consistent with the NCP. The District's focus appears to be
part of its effort to hold defendants liable for some part of its future costs related to the
NBGPP, rather than its past incurred costs only.
104
 A primary goal of the NCP is to ensure meaningful public participation in the

selection of a response action. (See Waste Management of Alameda County, Inc. v. East

Bay Regional Park District (N.D.Cal. 2001) 135 F.Supp.2d 1071, 1100 (Waste

Management) [" '[M]eaningful public participation' is 'integral' to ensuring the proper

completion of a CERCLA-quality cleanup."]; see also Franklin County, supra, 240 F.3d

at p. 543.) "The public participation requirement has two main components. First, in

developing a remedial action plan, prior to actual field work beginning, the party

conducting the cleanup 'shall . . . to the extent practicable' interview local officials,

community residents, or other interested or affected parties to learn their concerns. 40

C.F.R. § 300.430(c)(2)(i). Additionally, a formal community relations plan must be

prepared to ensure an opportunity for public involvement, and at least one local

'information repository' must be established to make information available to the public

about the site remediation. 40 C.F.R. § 300.430(c)(2)(ii). Second, after a remediation

plan has been chosen, the party conducting the cleanup shall publish notice of the plan in

a local newspaper, provide an opportunity for submission of comments on the proposed

plan, provide an opportunity for a public meeting, make a transcript of the meeting

available to the public, and prepare a written summary of significant comments and

responses to those comments. 40 C.F.R. § 300.430(f)(3)." (Carson Harbor II, supra,

433 F.3d at p. 1266.)

The proposed plan must "[p]rovide a brief summary of the remedial alternatives

evaluated" and "[i]dentify and provide a discussion of the rationale that supports the

preferred alternative." (40 C.F.R. § 300.430(f)(2)(i)-(ii).) The evaluation must consider

105
nine criteria: overall protection of human health and the environment; compliance with

ARARS; long-term effectiveness and permanence; reduction of toxicity, mobility, or

volume through treatment; short-term effectiveness; implementability; cost; state

acceptance; and community acceptance. (Id., § 300.430(e)(9)(iii).) As part of the public

comment process, the party conducting the cleanup must "[m]ake the proposed plan and

supporting analysis and information available" (id., § 300.430(f)(3)(i)(B)) and allow a

comment period on the proposed plan of at least 30 days (id., § 300.430(f)(3)(i)(C)).

The District did not follow these requirements during its development of the

NBGPP. The District has not pointed to any evidence of community outreach when

VOC contamination was first discovered, nor is there any evidence the District put

together a community relations plan or a public information repository when it chose the

NBGPP (and its precursors) as the treatment for VOC contamination in the North Basin

area. The District instead discussed, considered, and approved various aspects of the

NBGPP (and its precursors) during its regular board meetings over a period of more than

10 years. This circumstance resulted in a number of material deviations from the NCP

requirements. The District provided only 72 hours' notice that the NBGPP (or its

precursors) would be on the agenda of a District board meeting. The public therefore

only had 72 hours—rather than 30 days—to review the proposed action, analyze any

supporting material, and provide any comments. The District also materially changed the

NBGPP (and its precursors) numerous times over the period of its development, and its

projected cost increased from a maximum of approximately $23 million to over $200

million. The public was presented, in effect, with a moving target. Its ability to

106
meaningfully participate in the District's selection of a remedy was severely hampered.

(See Waste Management, supra, 135 F.Supp.2d at pp. 1102-1103 [public participation

requirement not met through piecemeal public hearings; "no one public meeting

presented [the] proposal as a whole or presented an opportunity for meaningful public

input into [the responding party's] consideration of remedial alternatives"].)

The District's efforts to comply with CEQA likewise do not substantially comply

with the public participation requirements of the NCP. "CEQA is a comprehensive

scheme designed to provide long-term protection to the environment." (Mountain Lion

Foundation v. Fish & Game Commission (1997) 16 Cal.4th 105, 112.) The key

requirement of CEQA is the preparation of an EIR for "any project that a public agency

proposes to carry out or approve that may have a significant effect on the environment."

(Ballona Wetlands Land Trust v. City of Los Angeles (2011) 201 Cal.App.4th 455, 465

(Ballona Wetlands).) "An [EIR] is an informational document which, when its

preparation is required . . . , shall be considered by every public agency prior to its

approval or disapproval of a project. The purpose of an [EIR] is to provide public

agencies and the public in general with detailed information about the effect which a

proposed project is likely to have on the environment; to list ways in which the

significant effects of such a project might be minimized; and to indicate alternatives to

such a project." (Pub. Resources Code, § 21061.) A public agency should not approve a

proposed project under CEQA "if there are feasible alternatives or feasible mitigation

measures available which would substantially lessen the significant environmental effects

of such projects . . . ." (Id., § 21002.)

107
 The formal disclosure requirements of CEQA and the NCP overlap, but they are

not coextensive. We need not decide whether CEQA compliance could ever satisfy the

NCP because it is apparent, based on the record before us here, that the District's

disclosures under CEQA do not substantially comply with the NCP. The District's draft

mitigated negative declaration contains only cursory information about that iteration of

the NBGPP, without any meaningful discussion of the NCP's evaluation criteria or

project alternatives. The draft mitigated negative declaration mentions a supporting

initial study, but that study does not appear to be part of the record. The District's Draft

SEIR provides further detail on the NBGPP as eventually approved and significant

disclosure of its environmental effects. The Draft SEIR, however, falls short of the

NCP's disclosure requirements. It assumed construction of the precursor to the NBGPP

described in the District's late 2005 staff report; that was the "no project" alternative. The

proposed alternatives in the Draft SEIR were that precursor and several variations,

including the project as described in the District's 2005 mitigated negative declaration

and the final NBGPP. The Draft SEIR did not consider an alternative where the District

took no action, nor did it consider alternatives that did not build on the 2005 proposals.

For this reason alone, the Draft SEIR did not substantially comply with the NCP.

Moreover, the Draft SEIR did not contain a meaningful summary of the District's

evaluation of the NBGPP and its alternatives under the criteria specified by the NCP. For

example, the Draft SEIR mentioned cost only in passing, by reference to the District's

$20.5 million capital budget approved six years earlier. The Draft SEIR did not disclose

the NBGPP's then-current estimated cost, and it did not hint that the cost would soon

108
expand to $200 million. The Draft SEIR also made no effort to put those costs in context

or weigh the financial costs and benefits of the NBGPP or any alternative. Without a

discussion of cost, or the cost of alternatives, the District's disclosures pursuant to CEQA

cannot substantially satisfy the NCP's proposed plan requirements because they do not

allow the public to meaningfully assess the District's proposed response action and its

alternatives. In this appeal, the District makes no real effort to compare its CEQA

disclosures to those required under the NCP. Its contention that the CEQA process

satisfied the NCP's public participation requirements is therefore unpersuasive.

Based on the deficiencies we have identified, we conclude the District has not met

its burden to show compliance with the NCP's public participation requirements. These

deficiencies are neither technical nor de minimus departures from the NCP's

requirements; they significantly impacted the public's ability to meaningfully participate

in the selection of a remedy for VOC contamination in the North Basin. (See Waste

Management, supra, 135 F.Supp.2d at p. 1103.)

"Courts have consistently held that failure by a party to provide for the required

opportunity for public comment 'renders a remedial action inconsistent with the NCP and

bars recovery of costs.' " (Sherwin-Williams, supra, 840 F.Supp. at p. 476.) We likewise

conclude the District's failure to satisfy the NCP's public participation requirement bars

recovery of its costs under the HSAA.38

38 The District contends its status as a public agency is evidence that the NCP's
public participation requirement was satisfied. We disagree. The NCP governs response
actions by public agencies and private parties alike. The specific public participation
109
 A second primary goal of the NCP is to encourage cost-effective response actions.

(See Franklin County, supra, 240 F.3d at p. 543.) The NCP requires cost to be

considered in determining potential remedial actions, and excessive cost may be a ground

to exclude a potential remedial action from further consideration. (40 C.F.R.

§ 300.430(e)(7)(iii).) The NCP also expressly requires that a proposed remedial action be

"cost-effective," provided that it adequately protects human health and the environment.

(Id., § 300.430(f)(1)(ii)(D); see State of New York v. Adamowicz (E.D.N.Y. 2013) 932

F.Supp.2d 340, 344 ["Among other factors, to be 'consistent' with the NCP, remedial

actions must be cost-effective."].)

"Cost-effectiveness is determined by evaluating the following three of the five

balancing criteria noted in § 300.430(f)(1)(i)(B) to determine overall effectiveness: long-

term effectiveness and permanence, reduction of toxicity, mobility, or volume through

requirements of the NCP would have no meaning as applied to public agencies if their
status as public agencies were sufficient to satisfy those requirements. Indeed, even the
federal government and states must show their actions are "not inconsistent" with these
requirements in order to prevail in a cost recovery action. (42 U.S.C. § 9607(a)(4)(A).)
While the District's status as a public agency may, at the margins, make it more likely
that its actions will substantially comply with the NCP's public participation
requirements, the deficiencies we have identified outweigh any such benefit the District
might receive in this regard. The District's reliance on Bedford Affiliates, supra, 156 F.3d
416 is unpersuasive. In that case, the court held that a statewide agency's approval of a
private party's remediation action may obviate the need for formal public comment:
"Where a state agency responsible for overseeing remediation of hazardous wastes gives
comprehensive input, and the private parties involved act pursuant to those instructions,
the state participation may fulfill the public participation requirement." (Id. at p. 428.)
Here, there was no similar state involvement. And, in Bedford Affiliates, "none of the
parties to the action dispute[d] the quality or cost of [plaintiff's] cleanup efforts," so "to
preclude its recovery solely because of the lack of public comment" would have been
unjust. (Id. at p. 429.) By contrast here, the parties certainly dispute the quality and cost
of the NBGPP.
110
treatment, and short-term effectiveness. Overall effectiveness is then compared to cost to

ensure that the remedy is cost-effective. A remedy shall be cost-effective if its costs are

proportional to its overall effectiveness." (40 C.F.R. § 300.430(f)(1)(ii)(D); see Franklin

County, supra, 240 F.3d at p. 546.) A remedial action need not be the least expensive

alternative to be cost-effective. (Basic Management Inc. v. United States (D. Nev. 2008)

569 F.Supp.2d 1106, 1121.)

The trial court found that the NBGPP, as envisioned at the time of trial, was not

cost-effective. In late 2005, District staff performed a cost-benefit analysis of the $20

million precursor to the NBGPP. The report calculated that the project would treat 5,650

acre-feet of groundwater per year, leading to a total treatment cost (including amortized

capital costs and operation and maintenance costs) of $576 per acre-foot of water.

Although certain District witnesses asserted that a further cost-benefit analysis had been

conducted on the $200 million NBGPP, no such analysis was offered at trial. Based on

the dramatic increase in the cost of the project, the trial court calculated that the cost of

treating water in the shallow aquifer with the NBGPP would be more than three times the

cost of importing an equivalent amount of clean water. While the District criticizes the

trial court's calculations as speculative, there does not appear to be any direct evidence of

the cost per acre-foot of water treated by the NBGPP, any comparison of that cost against

the cost of other sources of water, or any comparison of that cost against other remedial

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actions. Without this evidence, it is difficult for the District to meet its burden to show

cost-effectiveness.39

In addition to increased cost, the trial court found the NBGPP would have limited

effect on VOC contamination in the North Basin area. The court credited impeachment

evidence that the District's expert Graham Fogg had admitted removing one-third of the

VOC contaminant mass over 30 years would be an "optimistic" estimate of the effect of

the NBGPP on the shallow aquifer. (At trial, Fogg's estimate was one-half.) And

defense expert Steven Larson testified that the NBGPP would not materially change the

level of contaminants in the principal aquifer, especially in the areas surrounding existing

drinking water production wells. The trial court's findings on effectiveness further

undermine the District's own analyses, which were premised at least in part on the

perceived benefit to the principal aquifer and drinking water production wells from the

operation of the NGBPP. Without that benefit, the likely cost-effectiveness of the

NBGPP (based solely on its limited effect on the shallow aquifer) decreases markedly.40

The District offers a number of criticisms of the trial court's reasoning. We are

unpersuaded by these criticisms given our standard of review and the evidence at trial.

And the District does not offer affirmative evidence that would show the cost-

39 The District claims the trial court prevented it from presenting evidence showing
the actual cost of water treated by the $200 million NBGPP. The District does not
describe the context of the trial court's decision and does not attempt to show the decision
was error. The District's claim therefore has no effect on our analysis.
40 In its briefing, the District estimates the reduction in VOC contamination in the
shallow aquifer at 4,300 pounds, or 30 to 40 percent of the total contaminant mass.
Using this estimate, and the District's updated $200 million cost projection, the NBGPP
appears to cost over $46,500 per pound of remediated contamination.
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effectiveness of the NBGPP in light of the findings by the trial court. It merely asserts

the NBGPP would be effective in treating some VOC contamination, which does not

address cost and is therefore insufficient. On the record before us, we cannot say the

court erred in concluding that the District had not proven the NBGPP was cost-effective.

The NBGPP is therefore not consistent with the NCP for this reason as well.

In addition to the goals of public participation and cost-effectiveness, the NCP

mandates a number of procedural steps designed to ensure a CERCLA-quality cleanup.

These steps include an NCP-compliant remedial investigation, feasibility study, and

remedial documentation in a record of decision. (40 C.F.R. § 300.430(d)-(f); see Carson

Harbor II, supra, 433 F.3d at pp. 1267-1269.) "The purpose of the remedial investigation

(RI) is to collect data necessary to adequately characterize the site for the purpose of

developing and evaluating effective remedial alternatives. To characterize the site, the

lead agency [or party] shall, as appropriate, conduct field investigations, including

treatability studies, and conduct a baseline risk assessment. The RI provides information

to assess the risks to human health and the environment and to support the development,

evaluation, and selection of appropriate response alternatives." (40 C.F.R.

§ 300.430(d)(1).) "The primary objective of the feasibility study (FS) is to ensure that

appropriate remedial alternatives are developed and evaluated such that relevant

information concerning the remedial action options can be presented to a decision-maker

and an appropriate remedy selected. . . . The development and evaluation of alternatives

shall reflect the scope and complexity of the remedial action under consideration and the

site problems being addressed." (Id., § 300.430(e)(1).) The feasibility study must

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establish remedial action objectives, develop alternative remedial actions, and provide a

detailed analysis of the alternatives (including a no action alternative where some

removal or remediation has already occurred) across the nine criteria for evaluation we

have already discussed. (Id., § 300.430(e)(2), (e)(6), (e)(9).) After a remedy is selected,

the NCP requires the party conducting the remedial action to document its selection in

detail in a record of decision: "To support the selection of a remedial action, all facts,

analyses of facts, and site-specific policy determinations considered in the course of

carrying out activities in this section shall be documented, as appropriate, in a record of

decision, in a level of detail appropriate to the site situation, for inclusion in the

administrative record . . . . Documentation shall explain how the evaluation criteria in

paragraph (e)(9)(iii) of [section 300.430] were used to select the remedy." (Id.,

§ 300.430(f)(5)(i).)

The trial court found that the District failed to comply with these requirements.

The court determined that the District did not conduct a baseline risk assessment in its

remedial investigation. The court noted that the District's focused feasibility study was

based on the " 'presumptive remedy' " of treatment. Crediting the testimony of defense

expert Larson, the court found that the focused feasibility study had inadequately

assessed the No Action and Monitored Natural Attenuation alternatives. In the court's

view, the District's supplemental focused feasibility study compounded these errors by

materially changing the project (by treating additional contaminants, at one or two central

locations) without reconsidering the No Action or Monitored Natural Attenuation

alternatives in light of the changes. The supplemental focused feasibility study also did

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not adequately explain the costs and benefits of the alternatives considered or their effect

on the principal aquifer (rather than the shallow aquifer). The court did not believe the

District's late 2005 staff report, which outlined the final iteration of the NBGPP,

remedied these deficiencies.

Based on our review of the record, we conclude the District's efforts were not

consistent with the NCP. The District's failure to conduct a baseline assessment of the

risk to human health and the environment prevented the District (and the public) from

adequately assessing the cost-effectiveness and necessity of the District's proposed

remedial actions. (See United States v. Burlington Northern R.R. (10th Cir. 1999) 200

F.3d 679, 684.) Although the District assessed the nature and extent of VOC

contamination in the North Basin area, its failure to assess the risks resulting from that

contamination inhibited consideration of an important factor in choosing the District's

response action.41 Moreover, whatever the merits of the District's focused feasibility

41 The District relies on Carson Harbor II, supra, 433 F.3d at page 1268, where the
court held that a plaintiff "arguably conducted a remedial investigation that substantially
complied with the [NCP]" because it "analyzed the physical characteristics of the [site],
determined the level and kind of pollutants present, and to some extent, determined the
potential source of the pollutants." The court stated, "Even though no public health
assessment was conducted, only substantial compliance is required to satisfy the [NCP],
and [plaintiff] meets that standard as to the remedial investigation." (Ibid.) We do not
find the District's reliance on Carson Harbor II persuasive. Whether a party has
substantially complied with the NCP is highly fact intensive. The rigor required of a
plaintiff to substantially comply with the NCP will depend on a variety of factors,
including the type and extent of the contamination and the cost and complexity of the
remediation effort. Carson Harbor II involved contamination at a single site, consisting
of tar-like material covering an area approximately 170 feet long by 75 feet wide, with
depths of one to five feet. (Id. at p. 1262.) To the extent we can discern these facts from
the court's opinion, the contamination and proposed remedial action in that case was on a
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study, the changes over the ensuing decade to the design and cost of the NBGPP, the

scope of contamination it sought to address, and the characteristics of the North Basin

itself (e.g., extensive source removal and remediation at defendants' sites, among others)

overtook the District's initial analysis. These changes rendered moot large sections of the

focused feasibility study and blunted its value under the NCP. The District's subsequent

analytic efforts, in its supplemental focused feasibility study and its late 2005 staff report,

did not remedy these deficiencies. Instead, these subsequent efforts took the analysis of

the focused feasibility study as given and analyzed the District's proposed changes to the

project. Importantly, the District never reconsidered whether, in light of the changes to

the project and the North Basin area, the No Action or Monitored Natural Attenuation

alternatives merited further consideration. The District's efforts resulted in inadequate

consideration of alternative remedial actions, including the NBGPP as eventually

approved, and were therefore inconsistent with the NCP. The District's contrary

arguments are unpersuasive.42

Because the District has not shown its response costs were consistent with the

NCP, it is not entitled to monetary recovery on its HSAA claim against any defendant,

much smaller scale than those at issue here. Given the size and scope of the NBGPP, the
District's remedial investigation did not substantially comply with the NCP because it did
not conduct a baseline assessment of risk to human health and the environment.
42 We disagree, however, with the trial court's finding that the District's
documentation was not consistent with the NCP. Because the District had not selected a
final remedy at the time of trial, it was not yet required to prepare and release a record of
decision. (See 40 C.F.R. § 300.430(f)(5)-(f)(6); see also State of California v. Neville
Chemical Co. (9th Cir. 2004) 358 F.3d 661, 670, fn. 7.) We likewise disagree that the
District was required under the circumstances here to create a conceptual site model to
establish consistency with the NCP. (See 40 C.F.R. § 300.430(b)(2).)
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including Northrop. The court's errors identified above were therefore not ultimately

prejudicial, and we will therefore affirm the court's judgment against the District on this

claim. We next consider the separate question of the District's request for a declaration

finding defendants liable for its future costs under the HSAA.

5. Declaratory Relief and Equitable Apportionment

The District sought a declaration that defendants would be jointly and severally

liable under the HSAA for future costs of the NBGPP. The trial court rejected the

District's claim for declaratory relief, and instead it issued a declaration that defendants

"have no liability to the [District] for damages, response costs, or other costs claimed by

the [District], or any future costs." We will consider the District's broader challenge to

this declaration in part V, post. But several arguments regarding causation, NCP

consistency, and equitable allocation implicate the HSAA specifically, so we will

consider them here.

As we have explained, as to Alcoa, Arnold, CBS, and Crucible, we will affirm the

judgment in their favor on the District's HSAA claim based, in part, on the trial court's

causation findings. The District makes no argument for reversal of the trial court's

declaration for these defendants where, as here, the trial court's causation findings stand.

As to Northrop, we rely solely on the District's failure to prove NCP consistency in

affirming the judgment in its favor on the District's HSAA claim. The District argues

that NCP inconsistency cannot provide a basis for a declaration of no liability as to future

costs because the District could remedy that inconsistency in the future. (See Calmat Co.

v. San Gabriel Valley Gun Club (C.D.Cal. 2011) 809 F.Supp.2d 1218, 1224.) We agree.

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The trial court's declaration of no liability as to future costs as to Northrop cannot be

affirmed based on NCP noncompliance alone. Absent a valid ground for affirmance, the

declaration as to future costs must be reversed as to Northrop.

On this point, defendants contend the declaration of no future liability reflects an

equitable apportionment of zero percent responsibility to defendants and may therefore

be affirmed on that basis. The HSAA allows such equitable apportionment: "In

resolving claims for contribution or indemnity, the court may allocate costs among liable

parties using appropriate equitable factors." (Health & Saf. Code, § 25363, subd. (d).)

The HSAA differs in this regard from CERCLA, which does not allow equitable

apportionment in actions for cost recovery under title 42 United States Code section

6907(a).43 (See PCS Nitrogen Inc. v. Ashley II of Charleston LLC (4th Cir. 2013) 714

F.3d 161, 182.) The District's reliance on federal authorities regarding apportionment in

CERCLA cost recovery actions is therefore unpersuasive. The District's claim under the

HSAA is for indemnity (see part I.A., ante), and the HSAA expressly allows equitable

apportionment for such claims. (Health & Saf. Code, § 25363, subd. (d).)

Although the trial court had the discretion to order equitable apportionment, based

on our review of the court's statement of decision it did not do so. The court referenced

43 CERCLA does allow equitable apportionment for contribution actions under title
42 United States Code section 9613(f)(1). The federal courts have identified a number of
potential equitable factors for use in connection with these actions. (See, e.g., United
States v. Colorado & Eastern R. Co. (10th Cir. 1995) 50 F.3d 1530, 1536, fn. 5;
Lockheed Martin Corp. v. United States (D.D.C. 2014) 35 F.Supp.3d 92, 123-124.)

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only "allocation," not "equitable allocation" or "equitable apportionment."44 It did not

reference the text of the statute allowing equitable apportionment, and it did not consider

any equitable factors in determining that defendants should be allocated no liability.

Instead, the court's allocation rested on its causation findings, including that "[t]he

District did not persuade the trier of fact by a preponderance of the evidence that there

was a causal connection between the Trial Defendants' activities and the need to incur

response costs" and that "the conduct of the District and entities other than the Trial

Defendants are a substantial factor in the District's decision to develop the NBGPP." The

court concluded, "There is no factual basis for allocation of responsibility for past or

future expenditures among the Trial Defendants or as between one or more Trial

Defendant and the District."

The trial court's statement of decision shows that its zero allocation was not

equitable in nature. It was based on the court's causation findings, not equitable factors.

As such, for reasons we have already discussed, it cannot provide the basis for a future

declaration of no liability under the HSAA for Northrop.

44 The trial court used the word "equitable" once in its discussion of this issue, in
reference to contamination not caused by defendants: "As between the Trial Defendants
and the District, the District is responsible for all remediation costs attributable to nitrate
and perchlorate contamination. There is no statutory or equitable principle that justifies
holding the Trial Defendants liable on any theory, much less a joint and several one, for
nitrate, perchlorate, TCP or DCA contamination." (Italics added.) In our view, this
passage reflects the court's belief that defendants are not liable for the consequences of
that contamination under any theory, not that they are liable under the HSAA but entitled
to zero allocation based on equitable factors.
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 II. OCWD Act

The District contends the trial court erred by rejecting its claim under section 8 of

the OCWD Act. That section empowers the District to "conduct any investigations of the

quality of the surface and groundwaters within the [D]istrict . . . to determine whether

those waters are contaminated or polluted" (OCWD Act, § 8, subd. (a)), to "perform any

cleanup, abatement, or remedial work . . . needed to prevent, abate, or contain any

threatened or existing contamination of, or pollution to, the surface or groundwaters of

the [D]istrict" (id., subd. (b)), and to seek recovery of its reasonable costs from "the

person causing or threatening to cause that contamination or pollution" in a civil action

(id., subd. (c)). Subdivision (c) therefore creates a private right of action for cost

recovery specific to the District: "If, pursuant to subdivision (b), the contamination or

pollution is cleaned up or contained, the effects thereof abated, or in the case of

threatened contamination or pollution, other necessary remedial action is taken, the

person causing or threatening to cause that contamination or pollution shall be liable to

the [D]istrict to the extent of the reasonable costs actually incurred in cleaning up or

containing the contamination or pollution, abating the effects of the contamination or

pollution, or taking other remedial action. The amount of those costs, together with court

costs and reasonable attorneys' fees, shall be recoverable in a civil action by, and paid to,

the [D]istrict." (Id., § 8, subd. (c).)

The trial court rejected the District's claim under the OCWD Act on four grounds:

(1) the District had not established causation; (2) the District's costs were not reasonable

or necessary; (3) the District's costs were merely investigatory; and (4) the District had

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not shown it had cleaned up, contained, or abated contamination or pollution, or taken

other necessary remedial action in response to threatened contamination or pollution.

The District claims error as to each ground. For reasons we will explain, we conclude the

trial court erred in interpreting the OCWD Act on each ground, but the errors were

prejudicial only as to Northrop.

A. Causation

The District contends the court erred by finding that defendants had not caused the

NBGPP and therefore were not liable under the OCWD Act. The meaning of the OCWD

Act is a legal question subject to our independent review; the court's factual findings will

be upheld if the evidence supports them. (See Central Valley, supra, 162 Cal.App.4th at

p. 513.) The OCWD Act provides, in relevant part, as follows: "[T]he person causing or

threatening to cause that contamination or pollution shall be liable to the district to the

extent of the reasonable costs actually incurred in cleaning up or containing the

contamination or pollution, abating the effects of the contamination or pollution, or

taking other remedial action." (OCWD Act, § 8, subd. (c), italics added.) The causation

standard under the OCWD Act differs from standard under the HSAA and CERCLA.

Whereas the HSAA and CERCLA have a site-based causation requirement (with liable

defendants identified on the basis on their relationship to a contaminated site), the

OCWD Act requires proof that a defendant itself caused or threatened to cause

contamination or pollution for which the District has incurred remediation costs.

The OCWD Act does not purport to depart from traditional tort principles of

causation, so they apply here. (See Centeno v. Roseville Community Hospital (1979) 107

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Cal.App.3d 62, 69.) As noted above, California has adopted the substantial factor test for

causation in tort actions. (Viner, supra, 30 Cal.4th at p. 1239.) "[T]he 'substantial factor'

test subsumes the traditional 'but for' test of causation." (Id. at p. 1240.) Thus, subject to

an important exception, the "but-for" test governs: A defendant's conduct is not a

substantial factor in bringing about harm (here, actual or threatened contamination or

pollution) if the harm would have been sustained even if the defendant had not acted.

(Ibid.) The exception applies where there are concurrent independent causes, i.e., the

defendant's conduct is sufficient by itself to bring about the harm, but one or more other

forces are operating independently that would also be sufficient by themselves to bring

about the harm. (Ibid.) When this exception applies, the defendant's conduct satisfies the

substantial factor test even though the defendant's conduct is not a "but-for" cause of the

harm.

The District contends the trial court erred by requiring the District to show that

each defendant caused the NBGPP as a whole. For reasons analogous to those we have

already discussed under the HSAA and CERCLA (see part I.C.1.c., ante), we agree. The

issue is not whether a defendant was a substantial factor in bringing about the entire

NBGPP. Under the OCWD Act, the District was required to prove that a defendant was a

substantial factor in bringing about actual or threatened contamination or pollution of

surface or groundwater in the District. (OCWD Act, § 8, subds. (b), (c).)

Although the District has shown error, we must nonetheless affirm unless the error

was prejudicial, i.e., it is reasonably probable the District would have obtained a more

favorable result absent the error. Here, aside from Northrop, the trial court made factual

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findings that mirrored the correct standard under the OCWD Act. Among the court's

findings were the following: (1) "There is no direct evidence of any release of VOC's to

the shallow aquifer in the NBGPP area by any Trial Defendant except Northrop." (2)

"The preponderance of the evidence is that VOC releases to the shallow aquifer in the

NBGPP area were not caused by any Trial Defendant except Northrop." (3) "The weight

of the evidence establishes that [Alcoa], Arnold, CBS, and Crucible did not release

Chemicals of Concern into the shallow aquifer (i.e., groundwater), nor do their past

activities threaten future groundwater contamination." Given these findings, and as more

fully explained in part I.C.1.e. ante, the District has not shown a reasonable probability

that it would have obtained a more favorable result on this issue as to Alcoa, Arnold,

CBS, and Crucible. As to Northrop, the trial court found that it had caused VOC

contamination in the shallow aquifer. Causation under the OCWD Act requires the

District to prove that a defendant "caus[ed] or threaten[ed] to cause . . . contamination or

pollution" in surface or groundwater. (OCWD Act, § 8, subd. (c).) The trial court's

finding shows that this element was satisfied. As to Northrop, therefore, it is reasonably

probable the trial court would have found the District carried its burden on causation if it

had used the correct causation standard.

Based on analogies to CERCLA and California negligence law, the District

contends it was prejudiced as to all defendants. It argues that causation should be

presumed where a defendant has generated a particular type of contamination or pollution

and the District has incurred costs to respond to a similar type of contamination or

pollution at the defendant's site. The District's argument ignores the text of the OCWD,

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which ties the District's recovery to remedial actions taken in response to actual or

threatened contamination or pollution caused by a specific defendant. The District's

analogy to CERCLA relies on Monsanto, supra, 858 F.2d 160, Asarco, supra, 106

F.Supp.3d 1015, and Castaic Lake, supra, 272 F.Supp.2d 1053, and is unpersuasive for

the reasons we have already discussed in part I.B.1., ante. The District's analogy to

California negligence law relies on the principle that causation will be presumed where

the defendant's wrongful conduct has made it impossible for the plaintiff to prove

causation. (See, e.g., Haft v. Lone Palm Hotel (1970) 3 Cal.3d 756, 769-771.) We are

unpersuaded that this principle applies here. Defendants' mere acts of contamination in

this case did not make it impossible for the District to prove causation. To the contrary,

the actions of defendants were revealed by contamination in the soil at their sites. Any

difficulty in proving causation stemmed from the complexities of hydrogeology, not the

actions of defendants, and would be present in any groundwater contamination case. The

District has not shown prejudice as to any defendant other than Northrop. And, because

causation is an essential element of the District's OCWD Act claim, the District's failure

to show prejudice requires that we affirm the judgment against the District as to all

defendants except Northrop on this claim. As to Northrop, however, we must consider

the alternative grounds supporting the trial court's judgment to determine whether any

properly support the judgment notwithstanding the court's error regarding causation.

B. "Necessary" Remedial Actions and "Reasonable" Costs

The second alternative ground for the trial court's judgment was its finding that the

NBGPP was neither necessary nor reasonable. The OCWD Act requires that any

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cleanup, containment, abatement, or remedial work be "necessary" and any incurred costs

be "reasonable" in order for the District to recover. (OCWD Act, § 8, subd. (c).) The

necessity of the District's actions, and the reasonableness of its costs, is presumed;

defendants have the burden of proving otherwise. (Ibid.) The trial court concluded,

"Whether the statutory presumptions of necessity and reasonableness applied or not, the

Trial Defendants demonstrated the NBGPP was neither necessary nor reasonable in terms

of cost insofar as the VOC, nitrate and perchlorate contamination they were being sued to

pay for. In any event, the District had the burden to prove by a preponderance of the

evidence that each Trial Defendant caused or threatened to cause groundwater

contamination and that but for each defendant's conduct, the NBGPP would not have

been necessary. Stated another way, the District had the burden to prove that each Trial

Defendant's conduct was a substantial factor in the decision to develop the NBGPP. The

District did not carry its burden."

The OCWD Act does not definite the term "necessary." In interpreting the term,

we focus first on the word itself, giving it its ordinary meaning. (California School

Employees, supra, 8 Cal.4th at p. 338.) Here, based on our review of the language and

purposes of the statute, the ordinary meaning of "necessary" as "needed or required"

applies here. (American Heritage Dictionary of the English Language (5th ed. 2016).) In

this sense, the OCWD Act uses the word "necessary" in the same way as CERCLA (and

therefore the HSAA). For this reason, federal authorities interpreting the term in the

CERCLA context instructive. In order to satisfy the OCWD Act's necessity requirement,

the District must show "an actual and real threat to human health or the environment" and

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"a response action [that] is addressed to that threat." (See Carson Harbor I, supra, 270

F.3d at pp. 871, 872.)

Because we conclude the requirement of "necessity" is the same under both

CERCLA/HSAA and the OCWD Act, our discussion of the court's erroneous

interpretation of that requirement in part I.C.3. ante applies equally here. To briefly

reiterate, the trial court erred by assessing whether the entire NBGPP was necessary,

rather than simply whether the District's actions for which it had incurred response costs

were necessary. And, although it referenced the statutory presumption of necessity, it

appears to have nonetheless placed the burden on the District to show some form of

necessity. For that reason as well, the court erred. Under the proper standard of

necessity, there is no substantial evidence for the court's conclusion that the District's

response costs were not necessary.45

Similarly, the court erred by assessing whether the costs of the entire planned

NBGPP were reasonable, rather than simply the District's incurred costs for which it

sought recovery. The OCWD Act allows recovery "to the extent of reasonable costs

actually incurred." (OCWD Act, § 8, subd. (c).) It is possible, for example, that some

costs incurred in connection with a remedial action will be reasonable and other costs will

be unreasonable. Only the District's reasonable costs are recoverable.

The trial court's error prejudiced the District as to Northrop's Y-12 and Kester

Solder sites. The trial court did not make any findings regarding the reasonableness of

45 The court also appears to have conflated the requirement of necessity with the
OCWD Act's causation requirement, which we discussed in the previous part.
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the District's past incurred costs related to those sites, separate and apart from the NBGPP

as a whole. Based on our review of the evidence, it is reasonably probable the court

would have found at least some of the District's past costs reasonable if it had undertaken

such an analysis under the correct standard.

It is unnecessary to consider prejudice as to the remaining defendants because the

element of causation, which we discussed in the previous part, is an essential to the

District's OCWD Act claim. Our conclusion that it is not reasonably probable that the

trial court would have found in favor of the District on causation if it had used the correct

standard fatally undermines the claim.

C. Recovery of Investigatory Costs

The third alternative ground for the trial court's judgment was its finding that the

District's past costs for installing monitoring and extraction wells were merely

"investigatory" and therefore not recoverable under the OCWD Act. The court reasoned

that such costs fell within the District's power to conduct "investigations" under the

OCWD Act, section 8, subdivision (a). Because the OCWD Act allows recovery of costs

incurred pursuant to the District's power to perform cleanup, abatement, or remedial work

under the OCWD Act, section 8, subdivision (b)—not investigations under subdivision

(a)—the court found that the monitoring and extraction well costs were not recoverable.

On de novo review, we conclude the trial court incorrectly restricted the scope of

recoverable costs under the OCWD Act. The issue is not whether the claimed costs fall

under the District's power under section 8, subdivision (a) and are therefore excluded. It

is whether the claimed costs fall under section 8, subdivisions (b) and (c) and are

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therefore included. A given action, for example, might fall under both grants of power.

It was error for the trial court to conclude the two subdivisions are mutually exclusive.

The OCWD Act, section 8, subdivision (c) allows recovery of "the reasonable

costs actually incurred in cleaning up or containing the contamination or pollution,

abating the effects of the contamination or pollution, or taking other remedial action." A

cost is recoverable if it is incurred as part of these remedial actions. As our discussion of

the NCP shows, a remedial action involves much more than simply the physical cleanup

or containment process itself. It involves investigation, planning, design, development,

and documentation. Because these activities are part of remedial action, the costs of such

activities are recoverable.46

46 Although the HSAA's definition of "remedy" and "remedial action" does not
directly apply to the subsequently-enacted provisions of the OCWD Act, we find it
instructive regarding the Legislature's use of a similar term in this related context. (See
Central Pathology Service Medical Clinic, Inc. v. Superior Court (1992) 3 Cal.4th 181,
187 ["Although the Legislature did not repeat that definition . . . , we must presume that
the Legislature was familiar with existing statutory definitions."]; see also Trope v. Katz
(1995) 11 Cal.4th 274, 282.) The HSAA's definition of "remedy" and "remedial action"
includes CERCLA's definition of the same terms. (Health & Saf. Code, § 25322, subd.
(a).) CERCLA's definition states, "The terms 'remedy' or 'remedial action' mean[] those
actions consistent with permanent remedy taken instead of or in addition to removal
actions in the event of a release or threatened release of a hazardous substance into the
environment, to prevent or minimize the release of hazardous substances so that they do
not migrate to cause substantial danger to present or future public health or welfare or the
environment." (42 U.S.C. § 9601(24).) The CERCLA definition goes on to provide the
following examples: "cleanup of released hazardous substances and associated
contaminated materials," "onsite treatment or incineration," "any monitoring reasonably
required to assure that such actions protect the public health and welfare and the
environment," and "offsite transport and offsite storage, treatment, destruction, or secure
disposition of hazardous substances and associated contaminated materials." (Ibid.) In
addition to the CERCLA definition, the HSAA's definition includes the following
additional categories: "[t]hose actions that are necessary to monitor, assess, and evaluate
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 Resisting this conclusion, defendants rely on the well-settled maxim of statutory

interpretation that different words or phrases in a statute must have different meanings.

(See, e.g., Roy v. Superior Court (2011) 198 Cal.App.4th 1337, 1352 (Roy)

[" ' "Ordinarily, where the Legislature uses a different word or phrase in one part of a

statute than it does in other sections or in a similar statute concerning a related subject, it

must be presumed that the Legislature intended a different meaning." ' "].) But words or

phrases can have different meanings without being mutually exclusive. In other words,

different words and phrases may have overlapping, but not coextensive, meanings. For

example, in Regents of the University of California v. Superior Court (2013) 220

Cal.App.4th 549, 564-565, the court compared the meanings of "disclose" and "release"

as used in different sections of the Confidentiality of Medical Information Act (Civ.

Code, § 56 et seq.). The court recognized the terms were "not synonymous" and

therefore had different common or ordinary meanings. (Regents of the University of

California, at p. 564) Nonetheless, the court implicitly recognized their meanings

overlapped, describing the definition of release as "broader" than the definition of

disclose. (Ibid.; see Roy, supra, 198 Cal.App.4th at pp. 1352-1353 [recognizing that the

term "sexual relations" was broader than, but overlapped with, the term "sexual contact"

as used in physician disciplinary statutes].)

a release or a threatened release of a hazardous substance" and "[s]ite operation and
maintenance." (Health & Saf. Code, § 25322, subds. (b), (c).) The former category
encompasses the type of remediation activities characterized by the trial court here as
nonrecoverable investigations.
129
 The different meanings of the OCWD Act provisions at issue are readily apparent.

Section 8, subdivision (a), gives the District broad power to conduct investigations of

surface and groundwater quality, unconstrained by any known contamination or

prospective remedial action. Section 8, subdivision (b), gives the District power to

conduct cleanup, abatement, and remedial work. These subdivisions plainly have

different meanings, even though they overlap. The relevant question for purposes of a

cost recovery action is simply whether the costs in question fall within the latter

subdivision. The fact that some costs may also fall within the former subdivision is of no

moment.

Defendants rely on a federal district court opinion interpreting the cost recovery

provisions of the OCWD Act. (In re Methyl Tertiary Butyl Ether Products Liability

Litigation (S.D.N.Y. 2011) 824 F.Supp.2d 524 (MTBE Litigation).) In that case, the

court considered whether costs associated with the following activities were recoverable:

"[T]he District (1) 'has conducted testing for MTBE at drinking water production wells

associated with stations where MTBE was released' and (2) 'retained consultants to

investigate and characterize the groundwater impacts from MTBE . . . released at

gasoline stations within the District's service area' at a cost of at least six-hundred

thousand dollars." (Id. at p. 534, footnotes omitted.) The court concluded these costs

were not recoverable: "Testing and report-commissioning constitute investigatory work,

not 'remedial action.' The District conducts testing as part of its regular course of

business. As for the consultant reports, creating summaries of the activities of others at

the sites at issue in this motion has nothing to do with remedying threatened

130
contamination. Nor is there any evidence that the District's consultants' file review has

led or will lead to remedial action at these sites, or off-site. In fact, there is no evidence

that the District has done anything with these consultant reports outside of this litigation."

(Id. at p. 535, footnotes omitted.)

Although the MTBE Litigation court adhered to a strict and unwarranted

distinction between investigatory costs and remedial action, its discussion reflects some

of the factors that a court should use to determine whether an activity that could be

characterized as investigatory is nonetheless also part of a remedial action. For example,

if a plaintiff conducts testing as part of its "regular course of business," and not in

response to contamination or threatened contamination, that could indicate that such

testing is not remedial action. (See MTBE Litigation, supra, 824 F.Supp.2d at p. 535.)

Similarly, if a plaintiff drafts reports that have "nothing to do with remedying threatened

contamination," that could indicate that the reports are not part of a remedial action. (See

ibid.) Because we do not have the relevant record before us, we cannot comment on the

MTBE Litigation court's conclusion regarding the specific costs at issue in that litigation.

But we are not persuaded that its conclusion should affect our interpretation of the

OCWD Act discussed above.47

For the foregoing reasons, the trial court here erred by interpreting the OCWD Act

to preclude recovery for all investigatory activities, no matter how closely tied to

47 The federal district court reiterated its conclusion in a subsequent opinion but did
not offer any significant additional discussion or analysis. (In re Methyl Tertiary Butyl
Ether Products Liability Litigation (S.D.N.Y. 2011) 279 F.R.D. 131, 138.)
131
remedial action. The court's error was prejudicial to the District, at least viewing this

issue in isolation, because it categorically excluded the District from obtaining otherwise-

recoverable costs. However, the prejudice stemming from this error effectively applies

only to Northrop because we have found that the District was not prejudiced by the trial

court's findings on causation as to the non-Northrop defendants, the failure to satisfy that

element is fatal to the District's OCWD Act claim, and the trial court's findings relative to

that element would not have been affected by this error regarding investigatory costs.

D. Preconditions to Cost Recovery

The fourth alternative ground for the trial court's judgment was its finding that the

District had not shown that "the contamination or pollution [was] cleaned up or

contained, the effects thereof abated, or in the case of threatened contamination or

pollution, other necessary remedial action [was] taken," as required for cost recovery

under section 8, subdivision (c) of the OCWD Act. Because the District does not allege

legal error, we review the court's finding for substantial evidence.

The evidence at trial showed past VOC contamination of varying degrees in the

shallow soil at each defendant's site, as well as a large plume of VOC contamination in

the shallow aquifer in the North Basin area. It was undisputed that the District had not

cleaned up any VOC contamination by the time of trial. It was also undisputed, however,

that VOC contamination had attenuated to some extent due to natural processes.

The ordinary meaning of "abate" is "[t]o reduce in amount, degree, or intensity" or

"lessen." (American Heritage Dict. (2016 ed.).) Given this meaning, and the undisputed

evidence, we conclude the trial court could not reasonably find that the effects of VOC

132
contamination in the North Basin area had not abated. It was undisputed they had. The

trial court focused on the District's activities, finding that the District had not yet cleaned

up, contained, or abated any contamination. But this portion of the OCWD Act focuses

on the result, not the mechanism of action. As defendants point out in their criticism of

the NBGPP, monitored natural attenuation is a valid response action to groundwater

contamination. The District should not be disincentivized from pursuing this response

action, where warranted, based on a reading of the OCWD Act that would preclude cost

recovery for such an action.

We also conclude the court could not reasonably find that there was no threatened

contamination in the North Basin area. The ordinary meaning of the word "threat" in this

context is "[a]n indication of an approaching menace; the suggestion of impending

detriment" and "[a] person or thing that might well cause harm." (Black's Law Dict.

(10th ed. 2014).) Industrial landowners and operators, including some defendants, had

released large amounts of VOC's into the shallow soil. In some cases, this VOC

contamination migrated through about 100 feet of soil to the shallow aquifer and was

carried offsite with the flow of groundwater, resulting in plumes of contamination above

minimum acceptable levels. These surface VOC releases, and their resulting plumes,

were an "approaching menace" that "might well cause harm" to groundwater.

In reaching its conclusion that VOC releases in the North Basin area did not

threaten contamination, the court referenced the definition of "threaten" in an analogous

section of the Water Code: " 'Threaten,' for purposes of this section, means a condition

creating a substantial probability of harm, when the probability and potential extent of

133
harm make it reasonably necessary to take immediate action to prevent, reduce, or

mitigate damages to persons, property, or natural resources." (Water Code, § 13304,

subd. (e).) The court focused on the phrase "immediate action" and reasoned that the

District had not shown sufficient urgency in its actions to qualify under this statute. The

court's analysis puts the proverbial cart before the horse. Even accepting this definition

of "threaten," the focus of the analysis is the contamination itself, not whether the

District's response was adequate. Here, it would be unreasonable to conclude the

extensive VOC releases in the North Basin area did not justify immediate action.

Whether the District appropriately pursued such action is another matter.

The trial court also stated, "A vague or possible or potential threat of groundwater

contamination in the future based on 20th century VOC releases onto the surface soil is

too speculative to trigger the conditional clause in the [OCWD Act] for future

remediation which may or may not occur." The import of the trial court's statement is

unclear. VOC groundwater contamination in the North Basin area was not "vague or

possible or potential"—it was a fact, documented by numerous environmental consultants

and government agencies. And the OCWD Act's cost recovery provisions are not

"conditional." They allow recovery of "reasonable costs actually incurred in cleaning up

or containing the contamination or pollution, abating the effects of the contamination or

pollution, or taking other remedial action." (OCWD Act, § 8, subd. (c), italics added.)

We conclude the court erred by finding that the District had not shown that the

effects of VOC contamination had abated or that other remedial action had been taken in

response to threatened VOC contamination. As with the issue of investigatory costs

134
considered in the previous part, this error—viewed in isolation—was prejudicial to the

District as to all of defendants because it precluded any recovery on the District's claim.

However, the prejudice stemming from this error effectively applies only to Northrop for

the same reasons we discussed in the previous part. We will therefore affirm the court's

judgment on the District's OCWD Act claim as to Alcoa, Arnold, CBS, and Crucible. As

to Northrop, because we have found the trial court erred as to each of the four alternative

grounds supporting the judgment, and those errors were prejudicial, we will reverse the

judgment.48

III. Common Law Claims

The District next contends the trial court erred by (1) bifurcating trial and

scheduling a bench trial on the District's equitable claims before a jury trial on the

District's legal (common law) claims and (2) treating its factual findings following the

bench trial as binding on the District's legal claims. The District argues that the court

deprived it of its right to trial by jury on its legal claims and thereby violated Code of

Civil Procedure section 1048, subdivision (b); that the factual findings on the District's

equitable claims involved different issues than its legal claims (or were unnecessary) and

48 Defendants urge affirmance on the additional ground that the settlements the
District has received already exceed its past incurred costs. They argue that any liability
under the OCWD Act is fully offset by these settlement amounts. (See Code Civ. Proc.,
§ 877; Arbuthnot v. Relocation Realty Service Corp. (1991) 227 Cal.App.3d 682, 687.)
Even assuming defendants are entitled to some offset, they have not accounted for issues
of apportionment among the District's various claims and among the defendants
themselves. They have not shown, for example, that the portion of the settlements that
would be apportioned to liability under the OCWD Act for which defendants are
responsible would exceed their liability under that Act. Defendants' argument is
unpersuasive.
135
therefore do not apply; and that new evidence arising after the bench trial required the

court to allow a jury trial on the District's legal claims.

In advance of a pretrial status conference, the District submitted a statement

proposing that its legal claims be tried first before a jury and its equitable claims be

determined by the court afterwards. Defendants proposed the opposite schedule. They

explained that any factual findings made as a result of the bench trial would be binding in

the jury trial, thereby shortening the jury trial or eliminating it entirely.

At the status conference, the court said it was inclined to try the equitable issues

first. The District expressed its concern that it would not be able to present its legal

claims to a jury if the court resolved its equitable claims adversely: "And the problem is

that if you rule on any issue, the defendants will argue that that precludes us from going

to a jury on our tort claims, that that's been resolved for all time." The court responded,

"Well, that can be handled before we start the trial with exactly some understanding,

either an understanding among counsel or an order from the court, as to exactly what the

court's rulings mean, doesn't it?" The District agreed, "That's one potential solution," but

it was concerned about duplicative presentations of evidence. The court discussed what

would happen if the District did not prevail on its equitable claims: "Let's take the flip

side. You do the court trial and plaintiffs don't prevail on the statutory causes of action.

As long as we're clear going in kind of what the parameters are, plaintiff would still have

a choice whether plaintiff wanted to—having had a verdict or a judgment—or a decision

in a court trial on statutory causes of action, whether it makes sense to go forward with a

jury." The court later remarked, "But I think we all agree that while you have an absolute

136
right—an absolute right—and I would never try and talk anybody out of a jury trial on

the causes of action where you'd have the right to a jury trial—sometimes that's not the

economically or physically, that's not the best way to go." After a lengthy discussion of

joint and several liability, the court stated, "But look, unless someone comes up with a

real show stopper, I'm inclined to try the court issues first. I think on balance it is just a

better way to go."49

As we have discussed, the court held a bench trial on the District's claims under

the OCWD Act and the HSAA and for declaratory relief. The court found in favor of

defendants on each claim. Following trial, defendants filed a motion for judgment on the

District's remaining claims for negligence, nuisance, and trespass. Defendants argued

that the court's causation findings in its statement of decision would apply in any jury

trial on the District's claims. In defendants' view, these findings precluded recovery on

the District's claims because those claims each required a showing of causation. The

District opposed. Following argument, the court granted the motion for judgment.

49 To the extent defendants argue the District forfeited its argument that the trial
court erred because it failed to object in its pretrial briefs, we disagree. "If the party, at
the time when the order, ruling, action or decision is sought or made, or within a
reasonable time thereafter, makes known his position thereon, by objection or otherwise,
all other orders, rulings, actions or decisions are deemed to have been excepted to."
(Code Civ. Proc., § 647.) Here, the District made known its position both in its status
conference statement and at the status conference itself that the court should hold a jury
trial first and the bench trial thereafter. It did not have to object again after the court
announced its intent to hold the bench trial first; it had already made its position known.
The District did not forfeit its claim of error.

137
 A. Trial Sequencing and the Right to Trial by Jury

As noted, the District argues that the sequencing of trial, and the subsequent

application of the court's equitable findings to the District's legal claims, violated its right

to trial by jury and thereby ran afoul of Code of Civil Procedure section 1048,

subdivision (b).50 That statute provides, in relevant part, as follows: "The court, in

furtherance of convenience or to avoid prejudice, or when separate trials will be

conducive to expedition and economy, may order a separate trial of any cause of action,

including a cause of action asserted in a cross-complaint, or of any separate issue or of

any number of causes of action or issues, preserving the right of trial by jury required by

the Constitution or a statute of this state or of the United States." (Code Civ. Proc.,

§ 1048, subd. (b).)

We review the court's order determining the sequence of a bifurcated trial for

abuse of discretion. (Hoopes v. Dolan (2008) 168 Cal.App.4th 146, 163 (Hoopes).) This

discretion is not unlimited: " 'The scope of discretion always resides in the particular law

being applied, i.e., in the "legal principles governing the subject of [the] action . . . ."

Action that transgresses the confines of the applicable principles of law is outside the

scope of discretion and we call such action an "abuse" of discretion.' " (Horsford v.

Board of Trustees of California State University (2005) 132 Cal.App.4th 359, 393.) We

independently interpret the relevant statutes and determine the applicable principles of

50 The same issue arises in the related appeal involving MAG. (See fn. 2, ante.)
138
law. (Shamrock Foods, supra, 24 Cal.4th at p. 432; Lamar Central Outdoor, LLC v.

California Department of Transportation (2013) 221 Cal.App.4th 810, 821.)

The District's contention requires us to interpret Code of Civil Procedure section

1048, subdivision (b). " 'The objective of statutory construction is to determine the intent

of the enacting body so that the law may receive the interpretation that best effectuates

that intent. [Citation.] "We first examine the words themselves because the statutory

language is generally the most reliable indicator of legislative intent. [Citation.] The

words of the statute should be given their ordinary and usual meaning and should be

construed in their statutory context." [Citation.]' [Citation.] 'If the plain, commonsense

meaning of a statute's words is unambiguous, the plain meaning controls.' [Citation.]

'We consider extrinsic aids, such as legislative history, only if the statutory language is

reasonably subject to multiple interpretations.' " (City of Alhambra v. County of Los

Angeles (2012) 55 Cal.4th 707, 718-719.)

The plain language of Code of Civil Procedure section 1048, subdivision (b)

requires a court to preserve a party's right to a jury trial when ordering separate trials, but

it does not itself define a party's jury trial right or what "preserving" it requires. We will

therefore consider extrinsic aids, including case authority regarding California's jury trial

right and the legislative history of this statute, to interpret its language.

"A jury trial, '[a]s a general proposition, ". . . is a matter of right in a civil action at

law, but not in equity." [Citations.]' [Citation.] An action at law is one for which a jury

trial was permitted at common law as it existed at the time our Constitution was first

adopted in 1850." (Nwosu v. Uba (2004) 122 Cal.App.4th 1229, 1237 (Nwosu).) The

139
parties here agree that the District's common law claims for negligence, nuisance, and

trespass are actions at law and therefore the District has a right to trial by jury on those

claims.51

By joining its equitable and legal claims in one action, the District did not lose this

jury trial right. "It is settled in this state that where legal and equitable issues are joined

in the same action the parties are entitled to a jury trial on the legal issues." (Robinson v.

Puls (1946) 28 Cal.2d 664, 665-666; see Swasey v. Adair (1891) 88 Cal. 179, 180

(Swasey); Selby Constructors, Inc. v. McCarthy (1979) 91 Cal.App.3d 517, 526.) In light

of reforms that allowed a plaintiff to assert both legal and equitable claims in the same

forum, the Supreme Court explained "it does not seem desirable to force a party to give

up his right to a jury trial as an alternative to utilizing the advantages of modern code

procedure designed to permit settlement of various issues in a single action." (Connell v.

Bowes (1942) 19 Cal.2d 870, 872 (Connell).)

The recognition that a plaintiff did not give up his or her jury trial right by

combining equitable and legal causes of action, however, was accompanied by an

important caveat: A trial court handling such a combined action could, and in many

cases should, hold a bench trial on any equitable issues first. (Connell, supra, 19 Cal.2d

at p. 872.) "[I]f any legal issues remain [after the bench trial], a jury may be called."

(Ibid., italics added; see Swasey, supra, 88 Cal. at pp. 180-181.) Thus, while a plaintiff

51 The District does not argue it had a right to a jury trial on its claims under the
HSAA or the OCWD Act. We therefore assume without deciding that the trial court
could properly try these claims, standing alone, without a jury.
140
retained his jury trial right, the extent of the issues actually tried by jury could be

impacted by the trial court's findings in equity. "Where a 'mixed bag' of legal and

equitable claims is presented in a case, a court trial of the equitable claims first may

obviate the necessity of a jury trial on the legal claims, but otherwise the plaintiff cannot

be denied the right to a jury trial on the legal causes of action. [Citations.] If 'there are

equitable and legal remedies sought in the same action, the parties are entitled to have a

jury determine the legal issues unless the trial court's initial determination of the equitable

issues is also dispositive of the legal issues, leaving nothing to be tried by a jury.' "

(DiPirro v. Bondo Corp. (2007) 153 Cal.App.4th 150, 185 (DiPirro), italics added.)52

Numerous opinions from California courts, including our Supreme Court, confirm

this rule: "It is well established that, in a case involving both legal and equitable issues,

the trial court may proceed to try the equitable issues first, without a jury . . . , and that if

the court's determination of those issues is also dispositive of the legal issues, nothing

further remains to be tried by a jury." (Raedeke v. Gibraltar Savings & Loan Assn.

(1974) 10 Cal.3d 665, 671 (Raedeke); see, e.g., Darbun Enterprises, Inc. v. San Fernando

Community Hospital (2015) 239 Cal.App.4th 399, 408-409 (Darbun); Hoopes, supra,

168 Cal.App.4th at p. 157; Nwosu, supra, 122 Cal.App.4th at p. 1238; Golden West

52 The result that the court's findings in the bench trial may limit or obviate the need
for a jury trial flows from a different principle of general applicability: "Issues
adjudicated in earlier phases of a bifurcated trial are binding in later phases of that trial
and need not be relitigated." (Arntz Contracting Co. v. St. Paul Fire & Marine Insurance
Co. (1996) 47 Cal.App.4th 464, 487 (Arntz Contracting).) The same result occurs if the
procedure is reversed. If the trial court holds a jury trial first on any legal issues, the
court is bound by the jury's factual findings when it considers any equitable issues.
(Hoopes, supra, 168 Cal.App.4th at pp. 157-158.)
141
Baseball Co. v. City of Anaheim (1994) 25 Cal.App.4th 11, 50; Jaffe v. Albertson Co.

(1966) 243 Cal.App.2d 592, 609; Moss v. Bluemm (1964) 229 Cal.App.2d 70, 73;

Richard v. Degen & Brody, Inc. (1960) 181 Cal.App.2d 289, 295.)

Indeed, reviewing courts have emphasized that the better practice for trial courts is

to decide equitable issues first for the explicit reason that a jury trial on any legal issues

may be avoided. "Generally, in mixed actions, the equitable issues should be tried first

by the court, either with or without an advisory jury. [Citations.] Trial courts are

encouraged to apply this 'equity first' rule because it promotes judicial economy by

potentially obviating the need for a jury trial." (Darbun, supra, 239 Cal.App.4th at pp.

408-409; see, e.g., Hoopes, supra, 168 Cal.App.4th at p. 157; Nwosu, supra, 122

Cal.App.4th at p. 1238.) Under these authorities, the trial court's decision to bifurcate

trial and decide the District's equitable claims first was proper.

The District argues that these authorities fail to give effect to Code of Civil

Procedure section 1048, subdivision (b), which requires courts to "preserv[e] the right of

trial by jury required by the Constitution or a statute of this state or of the United States"

when ordering separate trials. The District points out that this language was part of a

broader revision intended to conform the statute to its federal counterpart, Rule 42 of the

Federal Rules of Civil Procedure (28 U.S.C.). The District contends that Rule 42

prohibits the "equity first" procedure followed in California and that the Legislature's

adoption of revised Code of Civil Procedure section 1048 indicates its intent to adopt

Rule 42's prohibition for California courts as well.

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 The District's premise is flawed. The federal prohibition of the "equity first"

procedure stems not from Rule 42 but from federal constitutional law. In Beacon

Theatres, Inc. v. Westover (1959) 359 U.S. 500 (Beacon Theatres), the United States

Supreme Court recognized that existing federal rules gave trial courts the discretion to try

equitable issues first. (Id. at p. 510.) Beacon Theatres held that this discretion was

limited in federal cases by the Seventh Amendment: "Since the right to [a] jury trial is a

constitutional one, however, while no similar requirement protects trials by the court, that

discretion is very narrowly limited and must, wherever possible, be exercised to preserve

jury trial." (Ibid., fn. omitted.)

The Seventh Amendment applies only in federal courts; it does not apply to the

states. (Curtis v. Loether (1974) 415 U.S. 189, 192, fn. 6; Crouchman v. Superior Court

(1988) 45 Cal.3d 1167, 1173, fn. 5.) Beacon Theatres and its progeny are therefore not

binding on California courts. (See Rankin v. Frebank Co. (1975) 47 Cal.App.3d 75, 92.)

At the time Beacon Theatres was decided, Rule 42 was silent on the issue of the

right to a jury trial. In 1966, seven years after Beacon Theatres, Rule 42 was amended to

include the italicized language in the following excerpt: "The court, in furtherance of

convenience or to avoid prejudice, or when separate trials will be conducive to

expedition and economy, may order a separate trial of any claim, cross-claim,

counterclaim, or third-party claim, or of any separate issue or of any number of claims,

cross-claims, counterclaims, third-party claims, or issues, always preserving inviolate the

right of trial by jury as declared by the Seventh Amendment to the Constitution or as

given by a statute of the United States." (Former Fed. Rules Civ. Proc., rule 42, 28

143
U.S.C., italics added.) The Advisory Committee Notes to Rule 42 indicate that the

purpose of the second italicized portion was not to codify the holding of Beacon

Theatres, but to ensure federal trial courts were cognizant of the Seventh Amendment

when ordering separate trials. (Fed. Rules Civ. Proc., rule 42 foll., 28 U.S.C., citing

United Air Lines, Inc. v. Wiener (9th Cir. 1961) 286 F.2d 302, 305.)

After Rule 42 was amended, the California Legislature amended Code of Civil

Procedure section 1048, the statute governing separate trials in California courts, to

"conform in substance to Rule 42 of the Federal Rules of Civil Procedure." (Sen. Com.

on Judiciary, Rep. on Sen. Bill No. 201 (1971 Reg. Sess.) 1 Sen J. (1971 Reg. Sess.) p.

888; see Rodriguez v. Bethlehem Steel Corp. (1974) 12 Cal.3d 382, 407, fn. 28.)

Subdivision (b) of the statute was amended to read as follows: "The court, in furtherance

of convenience or to avoid prejudice, or when separate trials will be conducive to

expedition and economy, may order a separate trial of any cause of action, including a

cause of action asserted in a cross-complaint, or of any separate issue or of any number of

causes of action or issues, preserving the right of trial by jury required by the

Constitution or a statute of this state or of the United States." (Stats. 1971, ch. 244, § 58,

italics added.)

Although the District has submitted legislative history for S.B. 201, which effected

this amendment, nothing in this history shows that the Legislature intended to adopt the

reasoning of Beacon Theatres. Instead, the comments of the Senate Committee on the

Judiciary state, in relevant part, "The revision makes clear not only that the court may

sever causes of action for trial but also that the court may sever issues for trial." (Sen.

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Com. on Judiciary, Rep. on Sen. Bill No. 201 (1971 Reg. Sess.) 1 Sen J. (1971 Reg.

Sess.) pp. 888-889.) The sequence of the severed trial was not discussed.

The District points to the well-settled rule that "[w]hen the Legislature adopts the

substance of a non-California statute, the Legislature is presumed to have acted with

knowledge and in light of decisions interpreting the adopted statute." (Hodge v.

Kirkpatrick Development, Inc. (2005) 130 Cal.App.4th 540, 555.) But, as we have

discussed, the federal rule against "equity first" sequencing is not an interpretation of

Rule 42. It is a requirement of the Seventh Amendment, as Beacon Theatres and its

progeny explain. (Beacon Theatres, supra, 359 U.S. at p. 510; see Ross v. Bernhard

(1970) 396 U.S. 531, 537-538; Dairy Queen, Inc. v. Wood (1962) 369 U.S. 469, 471-

472.)

The District attempts to limit California's "equity first" rule only to certain

situations that do not apply here, such as where the plaintiff seeks mutually exclusive

legal and equitable remedies or where the defendant asserts an equitable defense. While

certain cases have highlighted these grounds as historic reasons for preferring the "equity

first" procedure (see, e.g., Hoopes, supra, 168 Cal.App.4th at p. 157), the rule announced

in numerous appellate cases — and by our Supreme Court — is not so limited. (Raedeke,

supra, 10 Cal.3d at p. 671; Darbun, supra, 239 Cal.App.4th at pp. 408-409; Hoopes,

supra, 168 Cal.App.4th at p. 157; DiPirro, supra, 153 Cal.App.4th at p. 185; Nwosu,

supra, 122 Cal.App.4th at p. 1238; Golden West Baseball Co. v. City of Anaheim, supra,

25 Cal.App.4th at p. 50; Jaffe v. Albertson Co., supra, 243 Cal.App.2d at p. 609; Moss v.

Bluemm, supra, 229 Cal.App.2d at p. 73; Richard v. Degen & Brody, Inc., supra, 181

145
Cal.App.2d at p. 295.) Leading commentators agree. (See, e.g., 7 Witkin, Cal. Procedure

(5th ed. 2008) Trial, § 149; Weil & Brown, Cal. Practice Guide: Civil Procedure Before

Trial (The Rutter Group 2016) ¶ 12:304.1.)

The District relies on Walton v. Walton (1995) 31 Cal.App.4th 277 (Walton) as

explicitly articulating a contrary rule. Walton approved of an "equity first" procedure on

the grounds the plaintiff sought mutually exclusive equitable and legal remedies. (Id. at

p. 293.) Walton further commented, in dicta, that when a plaintiff seeks cumulative legal

and equitable remedies, "all claims — legal and equitable — must be tried, and the right

to jury trial cannot be defeated by severance of the equitable claim." (Ibid.)

This comment is not supported by the authorities cited by Walton. (See Walton,

supra, 31 Cal.App.4th at p. 293, citing Connell, supra, 19 Cal.2d 870; Pacific Western

Oil Co. v. Bern Oil Co. (1939) 13 Cal.2d 60 (Pacific Western); Hutchason v. Marks

(1942) 54 Cal.App.2d 113 (Hutchason).) Those authorities stand for the settled

proposition that a plaintiff does not lose his or her right to a jury trial on its legal claims

by combining those claims with equitable claims. (Connell, at p. 872; Pacific Western, at

p. 68; Hutchason, at p. 119.) And, as we have noted, Connell approved of the "equity

first" rule. (Connell, supra, 19 Cal.2d at p. 872.) We find Walton's dicta unpersuasive

and will adhere to the long-standing and well-settled "equity first" rule articulated in the

cases cited above. The trial court did not abuse its discretion by following the rule here.

On reply, the District contends that even if the "equity first" rule were valid, the

trial court erred under the specific circumstances here by giving preclusive effect to its

factual findings in connection with the District's equitable claims. The District points to

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the court's comments during a status conference that the District had an "absolute right"

to a jury trial and that the court "would never try and talk anybody out of jury trial on the

causes of action where you'd have the right to a jury trial."

The District relies on the recent case of Darbun, supra, 239 Cal.App.4th 399.

Darbun considered whether a trial court properly gave preclusive effect to its factual

findings in a first-phase bench trial under the "equity first" rule. (Id. at pp. 410-411.)

Darbun found error based on the trial court's "inconsistent and misleading statements"

regarding, among other things, which issues would be decided during the first phase

bench trial. (Id. at pp. 409-410.) "The parties proceeded through the first phase of trial,

then to jury trial, under the court's assurances that the jury would decide the issue of

breach." (Id. at p. 411.) The trial court subsequently decided the issue of breach, which

Darbun held deprived the plaintiff of its jury trial right. "Had the trial court properly

informed the parties of an intention to decide the issue of breach, [the plaintiff] would

have had the opportunity to preserve its right to a jury trial by abandoning its request for

equitable relief and seeking only damages." (Ibid.)

Here, unlike Darbun, the trial court did not limit the issues it would consider in

connection with the bench trial on the District's equitable claims. During the status

conference, the court mentioned the possibility the parties might come to an agreement

regarding such a limitation, but no agreement appears in the record. The court's

references to the District's right to a jury trial were consistent with longstanding case law

holding that the District did not lose its right to a jury trial on its legal claims when it

combined those claims with equitable claims in a single action. (See Connell, supra, 19

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Cal.2d at p. 872.) As we have explained, however, this jury trial right is not inconsistent

with the further principle that any factual findings made following a bench trial on the

District's equitable claims may be binding on its legal claims, and the right is not

infringed by its application. (See DiPirro, supra, 153 Cal.App.4th at p. 185; Nwosu,

supra, 122 Cal.App.4th at p. 1244 ["Here, the fact that the trial of the equitable issues

first resulted in factual findings that implicated the legal claims does not mean that

[plaintiff] was improperly denied the right to a jury trial."].) The District has not shown

any error.

C. "Necessary" Findings

The District alternatively argues that, even if the sequencing of trial were proper,

the court's causation findings were not necessary (because other findings also foreclosed

the District's claims) and therefore could not be applied to the District's legal claims. The

District is incorrect. All of the trial court's equitable findings were binding on the

District's legal claims, regardless of whether they were necessary for the judgment.

"Issues adjudicated in earlier phases of a bifurcated trial are binding in later phases of that

trial and need not be relitigated. [Citations.] No other rule is possible, or bifurcation of

trial issues would create duplication, thus subverting the procedure's goal of efficiency.

[Citation.] '[D]uplication of effort is the very opposite of the purpose of bifurcated

trials.' " (Arntz Contracting, supra, 47 Cal.App.4th at p. 487; see Nwosu, supra, 122

Cal.App.4th at p. 1244.)

The District relies on authorities interpreting the doctrine of collateral estoppel or

issue preclusion. (See, e.g., Newport Beach Country Club, Inc. v. Founding Members of

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Newport Beach Country Club (2006) 140 Cal.App.4th 1120, 1132.) Although courts

have compared the binding effect of factual findings in a prior phase of trial to collateral

estoppel (see, e.g., Nwosu, supra, 122 Cal.App.4th at p. 1244), the District has not shown

the requirements of collateral estoppel apply here. The District cites only Hoopes, supra,

168 Cal.App.4th 146, which quoted a federal appellate opinion as requiring an issue be

necessarily decided in the earlier phase of trial to have binding effect. (Id. at p. 158,

citing Troy v. Bay State Computer Group, Inc. (1st Cir. 1998) 141 F.3d 378, 383.)

Whatever the rule in federal courts, California courts have not so narrowly interpreted the

binding effect of earlier findings. (See Arntz Contracting, supra, 47 Cal.App.4th at p.

487.)

The District also argues that the court's causation findings have no bearing on the

merit of its legal claims because those claims do not require an analogous showing of

causation and because they may give rise to different damages. The particulars of the

District's argument are difficult to discern. The District does not identify the elements of

its legal claims for trespass, nuisance, and negligence. It does not discuss the trial court's

factual findings in any detail or compare those findings to the elements of its claims. Its

legal argument on this issue is wholly lacking.

Under these circumstances, we may treat the District's arguments as waived.

" 'Appellate briefs must provide argument and legal authority for the positions taken.

"When an appellant fails to raise a point, or asserts it but fails to support it with reasoned

argument and citations to authority, we treat the point as waived." ' [Citation.] 'We are

not bound to develop appellants' arguments for them. [Citation.] The absence of cogent

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legal argument or citation to authority allows this court to treat the contention as

waived.' " (Cahill v. San Diego Gas & Electric Co. (2011) 194 Cal.App.4th 939, 956.)

Even considering the analysis offered by the District, it is unpersuasive. The

District asserts that a landowner or possessor has a duty to prevent harm from dangerous

artificial conditions on his or her property, regardless of their origin. (See Sprecher v.

Adamson Cos. (1981) 30 Cal.3d 358, 367-370; Coates v. Chinn (1958) 51 Cal.2d 304,

308.) Whatever the merits of the District's assertion, it has no bearing on the issue of

causation. The District has not shown that causation is not an element of its legal claims.

Similarly, the District claims it would be entitled to damages in the form of diminution in

value of the groundwater in the North Basin area. (See Raven's Cove Townhomes, Inc. v.

Knuppe Development Co. (1981) 114 Cal.App.3d 783, 801-802.) But, again, the District

does not explain how this difference in the type of recoverable damages (even if correct)

removes the need to prove causation or why its claims should survive notwithstanding the

court's extensive factual findings. As the appellant, it was the District's burden to show

error. It has not done so.

D. New Evidence

The District contends that new evidence, arising after the court's bench trial,

required the court to hold a jury trial on its legal claims. The new evidence identified by

the District includes new data from Northrop's Y-12 site, the Alcoa site, and the Crucible

site that the District believes undermine the court's conclusions regarding those sites.

The District also identifies new data from the principle aquifer allegedly showing an

increase in PCE contamination in the two years following the court's bench trial.

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 It is well settled that, in the second phase of a bifurcated trial, the parties may

present evidence that was not presented during the first phase. (See, e.g., Sturges v.

Charles L. Harney, Inc. (1958) 165 Cal.App.2d 306, 324 ["The record of the equitable

proceedings indicated that the court patiently heard a great deal of additional

testimony."].) But this principle does not compel the trial court to hold an otherwise-

unnecessary second phase trial merely because a party contends it can present additional

evidence.

The District analogizes the instant situation to collateral estoppel (issue

preclusion), which may not be applied in certain situations where new facts have arisen in

the time between the first and second actions. "Res judicata or collateral estoppel 'was

never intended to operate so as to prevent a re-examination of the same question between

the same parties where, in the interval between the first and second actions, the facts have

materially changed or new facts have occurred which may have altered the legal rights or

relations of the litigants.' " (Evans v. Celotex Corp. (1987) 194 Cal.App.3d 741, 748

(Evans).) Even assuming that this principle would apply here, the District has not shown

a change in circumstances sufficient to justify discarding the factual determinations in the

first phase of trial. This exception to collateral estoppel may apply where the legal

relationship of the parties has changed or where "new events or conditions which altered

the respective rights of the parties or caused a different legal doctrine to be applied"

occur. (Ibid.) A related exception may apply where a party was deprived of a full and

fair opportunity to litigate an issue in the prior proceeding. (Smith v. ExxonMobil Oil

Corp. (2007) 153 Cal.App.4th 1407, 1417.)

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 The exception will not apply, however, where the new evidence or changed

circumstances merely go to the weight of the evidence bearing on the issue: "An

exception to collateral estoppel cannot be grounded on the alleged discovery of more

persuasive evidence. Otherwise, there would be no end to litigation." (Evans, supra, 194

Cal.App.3d at p. 748.) Based on our review of the new evidence identified by the

District, we conclude it does not show a changed legal relationship or other sufficient

circumstances to justify an exception to the doctrine of collateral estoppel. It merely goes

to the weight of the evidence regarding contamination at defendants' sites and their

subsequent remediation efforts. As such, the District has not shown the court erred by

refusing to hold a second phase trial on its legal claims based on the discovery of

allegedly new evidence.

IV. Evidentiary Issues

A. Evidence Code Section 412

The District contends the trial court erred by applying Evidence Code section 412

in its statement of decision to justify viewing the District's causation evidence "with

distrust" because of certain deficiencies in the District's presentation of evidence. The

deficiencies identified by the trial court included (1) the District's failure to conduct a fate

and transport analysis of VOC contamination in the North Basin area; (2) the District's

failure to update its 2005 and 2008 contaminant plume maps for trial; (3) the District's

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failure to calculate the rate of natural attenuation for VOC contamination; and (4) the

District's failure to conduct an "adequate cost/benefit analysis for the NBGPP."53

Evidence Code section 412 provides as follows: "If weaker and less satisfactory

evidence is offered when it was within the power of the party to produce stronger and

more satisfactory evidence, the evidence offered should be viewed with distrust."

"Section 412 only applies when it can be shown that a party is in fact in possession of or

has access to better and stronger evidence than was presented." (People v. Taylor (1977)

67 Cal.App.3d 403, 412; see People v. Marshall (1996) 13 Cal.4th 799, 836, fn. 5.) It

does not apply to evidence that does not exist. (See People v. Von Villas (1992) 10

Cal.App.4th 201, 249 [statute does not apply to "the failure to create evidence or record

evidence in a certain fashion"]; People v. Coleman (1972) 28 Cal.App.3d 36, 45 [statute

does not apply to prosecution's failure to obtain fingerprint evidence].) We review the

question of whether the court properly invoked Evidence Code section 412 for substantial

evidence, i.e., whether the evidence viewed in the light most favorable to the court's

decision supported the application of the statute.

The paradigmatic example of the application of Evidence Code section 412 is

where a party has documentation of an event, but instead offers oral testimony by a

potentially biased witness. The witness's testimony may be viewed "with distrust" under

53 The District identifies two additional grounds the trial court purportedly relied
upon in its application of Evidence Code section 412: the District's groundwater recharge
activities and its reliance on grab samples. Based on our review of the court's statement
of decision, we disagree that the court intended its criticism of the District on these two
grounds as additional reasons to invoke that statute. We will discuss the District's
specific arguments on these two grounds in parts IV.B-C., post.
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the statute. (Hardesty v. Sacramento Metropolitan Air Quality Management District

(2011) 202 Cal.App.4th 404, 425; see Pelayo v. J.J. Lee Management Inc. (2009) 174

Cal.App.4th 484, 495 [failure to produce summons]; Vallbona v. Springer (1996) 43

Cal.App.4th 1525, 1537 [failure to produce documentation of financial liabilities];

Largey v. Intrastate Radiotelephone, Inc. (1982) 136 Cal.App.3d 660, 672 [failure to

produce corporate records concerning board meetings].)

Here, the question is whether the District's failure to conduct certain analyses,

either by its own staff or its expert witnesses, falls within the scope of the statute. We

conclude it does not. The trial court did not find that the District failed to produce the

results of these analyses; it found that the District did not conduct the analyses at all. The

evidence the trial court believed should be produced did not exist. It therefore cannot be

the subject of an adverse inference under Evidence Code section 412. (See People v. Von

Villas, supra, 10 Cal.App.4th at p. 249; People v. Coleman, supra, 28 Cal.App.3d at

p. 45.)

Defendants point out that the statute references the "power of the party to produce

stronger and more satisfactory evidence." (Evid. Code, § 412, italics added.) They claim

that the District had the power to produce (i.e., create) the analyses at issue. But, as the

foregoing cases demonstrate, the statute has not been applied merely where a party has

the ability or opportunity to create evidence. The evidence must itself already exist.54

54 Both the District and defendants contend People v. Alvarez (1975) 44 Cal.App.3d
375 (Alvarez) supports their interpretation of the statute. In Alvarez, the defense
attempted to cross-examine an expert witness regarding the prosecution's failure "to
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The court therefore erred by invoking Evidence Code section 412 without a showing that

the District had evidence in existence that it had not produced.

That said, the trial court was entitled to judge the credibility and weight of the

District's causation evidence, separate and apart from Evidence Code section 412. The

court could take into account a variety of factors, including whether the evidence was

outdated or did not reflect the relevant professional standards of a given scientific field.

In its statement of decision, the trial court identified a number of additional reasons it

distrusted the District's causation evidence, including the District's failure to provide its

expert witnesses with important information, expert witness Waddell's confusing and

misleading classification system for VOC groundwater contamination, his use of exhibits

perform tests to eliminate the defendant as the donor of sperm found" on certain
evidence. (Id. at p. 379.) The trial court sustained a prosecution objection under
Evidence Code section 352. (Id. at p. 380.) Outside the presence of the jury, the witness
testified regarding the possibility of conducting a semen-typing test and the reasons why
the prosecution had decided not to do so. (Ibid.) The witness acknowledged, however,
that he was not an expert on semen-typing. (Ibid.) Alvarez discussed the issue on appeal
as follows: "To summarize: the defense was not trying to show that semen-typing had
been undertaken and its results suppressed; nor was there any suggestion that the defense
had been prevented from causing its own analysis to be made. The most it could hope to
gain from the cross-examination was an instruction based on the principle of section 412
of the Evidence Code . . . . In order to apply that rule the jury would have had to find
affirmatively that it was within the power of the People to produce stronger evidence than
was offered. This finding would have had to be based on the testimony of an expert who
evidently had no faith in the result of the analysis he did not make and who, admittedly,
had not even read relevant literature on the subject. There can be no quarrel with the trial
court's determination that the admission of the evidence that no semen testing was
performed would have had little probative value and would have posed the danger of
confusing and misleading the jury." (Id. at p. 381.) Alvarez did not focus on Evidence
Code section 412; it based its decision expressly on Evidence Code section 352.
Although Alvarez considered it unlikely that the defense could properly obtain an
instruction under Evidence Code section 412, it is unclear whether Alvarez considered the
failure to conduct the test or the witness's lack of qualifications dispositive on that issue.
Alvarez does not provide persuasive support for the position of either side.
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based on "inaccurate data," the District's reliance on leading questions during Waddell's

direct examination, Waddell's admissions on cross-examination that his testimony was

"simply wrong" in certain instances, and his "advocate's demeanor."

The District has the burden of showing prejudice stemming from the trial court's

erroneous application of Evidence Code section 412. The District must show there is a

reasonable probability, i.e., a reasonable chance, it would have obtained a more favorable

result absent the error. (See College Hospital Inc. v. Superior Court (1994) 8 Cal.4th

704, 715; see also Kinsman v. Unocal Corp. (2005) 37 Cal.4th 659, 682.) The District

makes little effort to establish prejudice in its briefing. It states that the trial court's

application of the statute "call[s] into question the propriety of all of the trial court's

factual findings" and references its prior discussion of causation with respect to each

defendant. These conclusory assertions do not establish prejudice. Given the evidence

showing a lack of causation, and the trial court's other identified grounds for distrusting

the District's causation evidence discussed above, we conclude the District has not shown

prejudice based on the court's erroneous application of Evidence Code section 412.55

55 In urging prejudice, the District offers the following standard based on
instructional error: "We review the evidence in the light most favorable to appellant and
assume that, had it been properly instructed, the jury might have believed the evidence
upon which the rejected instruction was based, drawn inferences favorable to appellant,
and rendered a different verdict." (Douglas v. Fidelity National Insurance Co. (2014)
229 Cal.App.4th 392, 415-416 (Douglas).) This standard applies in narrow cases of
instructional error, however, where an instruction was "rejected" that may have provided
a legal basis—otherwise omitted from the instructions—on which the jury may have
found for the appellant. Because the jury in such a situation was entirely foreclosed from
considering that basis, it may be appropriate to view the evidence surrounding the
instruction in the light most favorable to the appellant. (Id. at p. 415 [considering
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 B. Grab Samples

The District claims the trial court "improperly discounted" the results of the

District's grab sample evidence while crediting defendants' similar evidence. The District

contends its grab samples were a reliable method of identifying contamination at

defendants' sites. (See United States v. Federal Resources Corp. (D. Id. 2014) 30

F.Supp.3d 979, 989, 991 [crediting the results of sampling to show site contamination].)

The District does not contend the trial court excluded the evidence at issue. The

challenge raised by the District therefore goes only to the weight accorded to the

District's evidence, not its admissibility. Our standard of review precludes reweighing

the evidence on appeal, so the District's challenge must fail.56

C. Groundwater Recharge Activities

The District argues the trial court improperly used the District's groundwater

recharge activities as a reason to "distrust" its causation evidence. In its statement of

decision, the court stated, "Moreover, the District's pre-litigation conduct made it more

difficult to determine which entities, including non-parties, contributed to groundwater

rejected jury instruction regarding disputed issue of agency, which was an affirmative
defense offered by the appellant].) Even if we were to view the court's error here as akin
to instructional error, the error did not entirely omit an instruction on a disputed legal
issue, so Douglas does not apply. (Cf. Soule v. General Motors, Corp. (1994) 8 Cal.4th
548, 580-581 & fn. 11.)
56 In its briefing, the District cites two documents published by the United States
Environmental Protection Agency and available on the Internet. These documents are
not part of the record on appeal, and the District's citation to these documents is
unaccompanied by any request for judicial notice. (See Cal. Rules of Court, rule
8.252(a).) We will therefore disregard these and similar citations. (See Tenet
Healthsystem Desert, Inc. v. Blue Cross of California (2016) 245 Cal.App.4th 821, 834.)
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contamination or the threat of groundwater contamination. . . . This conduct by the

District made it more difficult to determine which entities other than Trial Defendants

could or were likely to have contributed to groundwater contamination."

While the court remarked on the difficulties created by the District's recharge

activities, the court did not draw an adverse inference based on those activities. The

court did not mention recharge activities in its enumerated list of reasons to distrust the

District's causation evidence under Evidence Code section 412. Instead, recharge

activities were discussed in connection with the court's assessment of the District's

causation evidence in general. We therefore disagree with the premise of the District's

argument, that the trial court drew an adverse inference based on the District's recharge

activities. And, even if the District had established error, it has not shown prejudice for

the reasons stated above.

V. Declaratory Relief

The District challenges the trial court's declaration that defendants "have no

liability to the [District] for damages, response costs, or other costs claimed by the

[District], or any future costs." The District argues that its request for declaratory relief

was derivative of its other claims, so the court's declaration must be reversed if the

District successfully urges reversal of its other claims. We agree. The court's judgment

in favor of Northrop on the District's OCWD Act claim must be reversed. (See part II,

ante.) To that extent, the court's declaration in favor of Northrop must be reversed as

well. And, for reasons we have explained, the court's declaration in favor of Northrop as

to future costs under the HSAA must be reversed. (See part I.C.5., ante.) We therefore

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need not address the District's further asserted ground for reversal concerning the its

future costs and Northrop.

DISPOSITION

The judgment is reversed in part as to (1) District's cause of action against

Northrop under the OCWD Act and (2) the declaration finding no liability in favor of

Northrop. On remand, the trial court shall reexamine the relevant evidence in conformity

with the views expressed herein, receive such additional evidence as the court deems

necessary and appropriate, make new findings of fact and conclusions of law concerning

the issues subject to reversal, and enter judgment accordingly. In all other respects, the

judgment is affirmed. As between the District and Alcoa, Arnold, CBS, and Crucible,

these defendants shall recover their costs on appeal. As between the District and

Northrop, the parties shall bear their own costs on appeal.

CERTIFIED FOR PUBLICATION

HALLER, J.

WE CONCUR:

BENKE, Acting P. J.

HUFFMAN, J.

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