Facts

On Sept. 3, 2007, a fire broke out near Moonlight Peak in Plumas County. The fire, known as the Moonlight Fire, burned approximately 65,000 acres of privately and federally owned land before it was fully contained. In 2009, the California Department of Forestry and Fire Protection brought this lawsuit for recovery of fire suppression costs against Eunice Howell, individually and dba Howell's Forest Harvesting, Sierra Pacific Industries, W.M. Beaty, a group of landowners and other defendants. Following this lawsuit, several other actions were filed against the defendants seeking damages caused by the Moonlight Fire. The six lawsuits were later consolidated. In 2013, plaintiff California-Engels Mining Co. dismissed its entire action against all defendants in exchange for a waiver of costs by all defendants.

On July 26, 2013, the court granted defendants' motions for judgment on the pleadings and dismissed all actions against the defendants pursuant to Cottle v. Superior Court (1992) 3 Cal. App. 4th 1367, on the basis that the plaintiffs could not demonstrate they had a prima facie case. These two motions disposed of the case, and the trial court entered judgment against plaintiffs. The court also dismissed Cal Fire's action against Sierra Pacific, W.M. Beaty and the landowners on the grounds that Cal Fire could not use Health & Safety Code Sections 13009 and 13009.1 to collect the cost of suppressing and investigating the Moonlight Fire from the defendants.

The United States filed suit against the defendants in federal court, and defendants settled that lawsuit in July 2012, for a total payment of $55 million and Sierra Pacific's conveyance of 22,500 acres of land to the U.S.

PLAINTIFF'S CONTENTIONS:
Cal Fire sued defendants for statutory fire suppression costs in connection with the forest fire. Cal Fire filed motions to tax defendants' claimed prevailing party costs.

DEFENDANTS' CONTENTIONS:
Defendants filed a motion for fees, expense and/or sanctions against Cal Fire under various legal theories. Among other things, defendants argued they were entitled to sanctions under California Code of Civil Procedure section 2023 for discovery abuses, and that they were also entitled to fees and expenses under section 1021.5 for the benefits the defense of this matter conferred upon the public, and that they were entitled to fees and expenses under California Civil Code section 1717.

Result

The court issued terminating sanctions and full compensatory attorney fees and costs against Cal Fire upon finding that Cal Fire's actions in initiating, maintaining, and prosecuting this action was corrupt and tainted. The court found that Cal Fire had failed to comply with discovery orders and directives. Also, that Cal Fire destroyed critical evidence, and essentially engaged in a "systematic campaign of misdirection" aimed at recovering money from defendants. The court awarded Sierra Pacific $14,891,262 in attorney fees plus more than $3 million in expert fees and costs, both adjusted upward by a 1.2 multiplier, plus more than $2.8 million in prevailing party costs, for a complete total of $24,733,693.34. The court awarded the Beaty and landowner defendants $6,146,901.41 in attorney fees plus more than $500,000 in prevailing party costs, for a complete total of $6,730,074.56. The court awarded the Howell defendants $971,796 in attorney fees, adjusted upward by a 1.2 multiplier, plus more than $400,000 in expert fees and expenses, plus more than $400,000 in prevailing party costs, for a complete total of $1,989,345.34. Defendants received a total judgment of $32,453,113.248. The court found that the sanctions were recoverable under California Code of Civil Procedure section 2023 for discovery abuses, and that fees and expenses were recoverable under California Code of Civil Procedure section 1021.5 and California Civil Code section 1717. The court denied Cal Fire's motions to tax costs.

Other Information

FILING DATE: Aug. 9, 2009.