Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_08-cv-03168/USCOURTS-cand-3_08-cv-03168-15/pdf.json

Nature of Suit Code: 893
Nature of Suit: Environmental Matters
Cause of Action: 42:9607 Real Property Tort to Land

---

STIPULATION AND [PROPOSED] ORDER RE ANSWERS TO FIRST AMENDED COMPLAINT 

CASE NO: CV 08 3168 MHP 

292652.4

Page 1

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

ROGERS JOSEPH O’DONNELL 

ROBERT C. GOODMAN (SBN 111554) 

ANN M. BLESSING (SBN 172573) 

D. KEVIN SHIPP (SBN 245947) 

311 California Street 

San Francisco, California 94104 

Telephone: 415.956.2828 

Facsimile: 415.956.6457 

E-mail: rgoodman@rjo.com; ablessing@rjo.com; kshipp@rjo.com

Attorneys for Defendants 

CHARLES FREDERICK HARTZ dba PAUL’S 

SPARKLE CLEANERS and CHARLES F. HARTZ 

UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF CALIFORNIA 

PALMTREE ACQUISITION CORPORATION, 

a Delaware corporation, 

 Plaintiff, 

 vs. 

MICHAEL R. NEELY, an individual; PERRY J. 

NEELY, an individual; GARY NEELY, an 

individual; MICHAEL R. NEELY, PERRY J. 

NEELY and GARY NEELY dba MIKE'S ONE 

HOUR CLEANERS; CHARLES FREDERICK 

HARTZ dba PAUL'S SPARKLE CLEANERS; 

CHARLES F. HARTZ, an individual; 

MULTIMATIC CORPORATION, a New Jersey 

corporation; WESTERN STATES DESIGN, a 

California corporation; MCCORDUCK 

PROPERTIES LIVERMORE, LLC, a Delaware 

limited liability company individually and as the 

successor to JOHN MCCORDUCK , 

KATHLEEN MCCORDUCK, PAMELA 

MCCORDUCK, SANDRA MCCORDUCK 

MARONA, and IMA FINANCIAL 

CORPORATION, a California corporation; 

STARK INVESTMENT COMPANY, a 

California general partnership; GRUBB & 

ELLIS REALTY INCOME TRUST, 

LIQUIDATING TRUST, a California trust; 

Northrop Grumman Systems Corporation, a 

Delaware corporation, and DOES 1-20, 

inclusive, 

 Defendants. 

Case No. CV 08 3168 MHP 

STIPULATION AND [PROPOSED] 

ORDER RE ANSWERS TO FIRST 

AMENDED COMPLAINT 

AND RELATED ACTIONS 

Case 3:08-cv-03168-EMC Document 79 Filed 08/03/10 Page 1 of 7
STIPULATION AND [PROPOSED] ORDER RE ANSWERS TO FIRST AMENDED COMPLAINT 

CASE NO: CV 08 3168 MHP 

292652.4

Page 2

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

RECITALS 

A. Plaintiff Palmtree Acquisition Corporation filed this action (“Action”) as a 

“reopener” of a prior action that was conditionally settled, which prior action was filed on 

February 3, 1993 in the United States District Court for the Northern District of California, 

entitled Grubb & Ellis Realty Trust v. Catellus Development Corp., et al., and related crossactions, Case No. C93-0383 SBA (“Prior Action”). 

B. In the course of litigating the Prior Action, the parties to the Prior Action 

engaged in discovery relating to the factual background, ownership and operations of certain 

of the parties to the Prior Action and their conduct which may have resulted in the PCE 

contamination. 

C. On February 7, 1994, the parties to the Prior Action entered into a settlement 

agreement (“1994 Settlement”). On February 17, 1994, this Court entered an order approving 

the settlement agreement and dismissing the Prior Action. 

D. Pursuant to the 1994 Settlement, the parties agreed that the release amongst 

each other would not extend to: 

...any claims, causes of action, obligations, damages, expenses or liabilities 

resulting from (1) claims or cross-claims arising from actions brought by third 

parties after the date of this agreement relating to PCE [perchloroethylene] 

contamination at the properties, or (2) actions by governmental agencies 

requiring cleanup of PCE contamination or seeking recovery of governmental 

response costs for the cleanup of PCE contamination: (a) of the deeper aquifer 

as defined in Paragraph 5 of SCO [Site Cleanup Order], or (b) in the form of 

DNAPLs, defined as PCE found in pore-water concentrations which exceed 

their effective soluabilities as measured using the residual DNAPL detection 

method of Feenstra, Mackay, and Cherry (1991). The limitations expressed in 

the preceding sentence on the release contained in this paragraph are referred to 

as “the Paragraph 9 reopeners”. 

E. On March 17, 2008, and March 21, 2008, the California Regional Water 

Case 3:08-cv-03168-EMC Document 79 Filed 08/03/10 Page 2 of 7
STIPULATION AND [PROPOSED] ORDER RE ANSWERS TO FIRST AMENDED COMPLAINT 

CASE NO: CV 08 3168 MHP 

292652.4

Page 3

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Quality Control Board (“RWQCB”), a governmental agency, sent letters to certain of the 

defendants and the plaintiff, and/or their predecessors, requiring the further investigation and 

monitoring of PCE contamination which potentially impacted the deeper aquifer that may be 

in the form of DNAPLs, thereby triggering the “Paragraph 9 reopeners” (“RWQCB 

Directives”). As a result of the RWQCB Directives, certain parties to the prior 1994 

Settlement, made a demand upon other parties asserting that the Paragraph 9 reopener applied 

and demanding that they respond to the RWQCB Directives. 

F. On July 1, 2008, plaintiff Palmtree Acquisition Corporation, the successor to 

one of the 1994 Settlement parties, Catellus Development Corporation, filed a Complaint for 

CERCLA Cost Recovery, Damages and Declaratory Relief, seeking contribution and 

damages (“the Original Complaint”) against certain of other parties to the 1994 Settlement, 

pursuant to the Paragraph 9 reopener. 

G. Defendant The Grubb & Ellis Realty Income Trust, Liquidating Trust 

(“GERIT”) has not appeared, is not represented by counsel, and claims to have dissolved and 

to no longer exist, and thus is not a party to this stipulation. 

H. Third Party Plaintiffs The Kirrberg Corporation and Stark Investment 

Company have asserted claims against the beneficiaries of the GERIT (Document No. 64). 

The beneficiaries are alleged to have received improper distributions from the GERIT. 

I. On September 15, 2008 Magistrate Judge Edward M. Chen signed a stipulation 

and order (Document No. 13) providing that, among other things, the defendants were 

deemed to have denied each and every allegation in the Original Complaint, that defendants 

were deemed to have filed crossclaims against each other for contribution and indemnity, and 

deemed to have filed counterclaims for contribution and indemnity against Plaintiff. 

J. Subsequent to the filing of the Original Complaint, certain parties agreed to 

cooperate in jointly retaining an environmental consultant to respond to the RWQCB 

Directives. The environmental consultant has been engaged with the RWQCB and the parties 

have made substantial progress towards meeting the demands of the RWQCB. 

K. Subsequent to the filing of the Original Complaint, the parties participated in 

Case 3:08-cv-03168-EMC Document 79 Filed 08/03/10 Page 3 of 7
STIPULATION AND [PROPOSED] ORDER RE ANSWERS TO FIRST AMENDED COMPLAINT 

CASE NO: CV 08 3168 MHP 

292652.4

Page 4

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

meditation with Timothy Gallagher, Esq., during which the parties engaged in an in depth 

discussion and investigation relating to the factual background, ownership and operations of 

the parties and their conduct which may have resulted in the PCE contamination. 

L. On July 14, 2010 plaintiff Palmtree Acquisition Corporation filed its First 

Amended Complaint (the “Current Action” or “FAC”), adding Northrop Grumman Systems 

Corporation (“Northrop Grumman”) as a party. 

M. Northrop Grumman and the other parties to this stipulation reached a 

settlement of their respective claims against one another. Northrop Grumman was named as 

a party so that the parties could make a good faith settlement application to the Court. If the 

Court finds that the settlement was entered into in good faith, Northrop Grumman will be 

dismissed as a party. 

N. The parties to this Current Action, who were defendants in the Prior Action, 

filed answers in the Prior Action. 

O. The responses and defenses in this Current Action should be substantially 

similar to those raised by the parties in the Prior Action. 

P. The responses and defenses of Northrop Grumman should be substantially 

similar to those raised by the parties named in the Prior Action. 

Therefore, in the interest of judicial economy, pursuant to Local Rule 6-1(b) and 7-12, 

the parties below hereby agree and stipulate as follows: 

STIPULATION 

1. Each of the defendants in this Current Action, who have signed this stipulation 

and proposed order, shall be deemed to have denied each and every allegation in the FAC. 

2. Each of the defendants to this Current Action reserves the right to supplement 

its response to the FAC, and may file an answer and separate crossclaims or counterclaims at 

a later date, but no later than 60 days following the conclusion of mediation with mediator 

Timothy Gallagher, currently underway. Mediation will be concluded at such time as: (a) a 

settlement is reached, or (b) the mediator issues a letter concluding that a settlement has not 

been reached and the mediation is concluded. 

Case 3:08-cv-03168-EMC Document 79 Filed 08/03/10 Page 4 of 7
STIPULATION AND [PROPOSED] ORDER RE ANSWERS TO FIRST AMENDED COMPLAINT 

CASE NO: CV 08 3168 MHP 

292652.4

Page 5

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

3. Each of the defendants to this Current Action further reserves the right to file 

crossclaims against other third parties who are not parties to this Current Action, and the 

parties reserve any and all rights against such third parties. Each party reserves its right to 

file crossclaims against parties named in the First Amended Third Party Complaint filed by 

third party plaintiffs Stark Investment Company and the Kirrberg Corporation. The plaintiff 

reserves the right to amend the complaint to add or remove allegations, to add new parties or 

to make any other changes consistent with the Federal Rules of Civil Procedure. 

Wherefore, the Parties respectfully request that the Court approve this Stipulation. 

Dated: August 2, 2010 COX, CASTLE & NICHOLSON LLP

By: /s/ Peter M. Morrisette 

Stuart I. Block 

Peter M. Morrisette 

Attorneys for Plaintiff 

PALMTREE ACQUISITION 

CORPORATION, a Delaware corporation 

f/k/a Catellus Development Corporation 

Dated: July 30, 2010 BASSI EDLIN HUIE & BLUM LLP 

By: /s/ Noel Edlin 

Noel Edlin 

Attorneys for Defendants 

MICHAEL R. NEELY, an individual; 

PERRY J. NEELY, an individual; GARY 

NEELY, an individual; MICHAEL R. 

NEELY, PERRY J. NEELY and GARY 

NEELY dba MIKE’S ONE HOUR 

CLEANERS 

Dated: July 30, 2010 GONSALVES & KOZACHENKO 

By: /s/ Selena P. Ontiveros 

Selena P. Ontiveros 

Attorneys for Defendant 

STARK INVESTMENT COMPANY, a 

California general partnership 

Case 3:08-cv-03168-EMC Document 79 Filed 08/03/10 Page 5 of 7
STIPULATION AND [PROPOSED] ORDER RE ANSWERS TO FIRST AMENDED COMPLAINT 

CASE NO: CV 08 3168 MHP 

292652.4

Page 6

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Dated: July 31, 2010 DONGELL LAWRENCE FINNEY LLP 

By: /s/ Thomas F. Vandenburg 

Thomas F. Vandenburg 

Attorneys for Defendant 

MULTIMATIC CORPORATION, a New 

Jersey corporation 

Dated: July 30, 2010 ROGERS JOSEPH O’DONNELL 

By: /s/ Robert C. Goodman 

Robert C. Goodman 

Attorneys for Defendant 

CHARLES FREDERICK HARTZ dba 

PAUL’S SPARKLE CLEANERS; 

CHARLES F. HARTZ, an individual 

Dated: July 30, 2010 McKENNA LONG & ALDRIDGE LLP 

By: /s/ Christian Volz 

Christian Volz 

Attorneys for Defendant 

NORTHROP GRUMMAN SYSTEMS 

CORPORATION 

Dated: July 30, 2010 GORDON WATROUS RYAN 

LANGLEY BRUNO & PALTENGHI 

INC. 

By: /s/ Bruce Clinton Paltenghi 

Bruce Clinton Paltenghi 

Attorneys for Defendant 

McCORDUCK PROPERTIES 

LIVERMORE, LLC, a Delaware limited 

liability company individually and as the 

successor to JOHN McCORDUCK, 

KATHLEEN McCORDUCK, PAMELA 

McCORDUCK, SANDRA McCORDUCK 

MARONA, and IMA FINANCIAL 

CORPORATION, a California corporation 

Dated: August 2, 2010 FOLEY MCINTOSH FREY & CLAYTOR 

By: /s/ Jim Claytor 

Jim Claytor 

Attorneys for Defendant 

WESTERN STATES DESIGN, a 

California corporation 

Case 3:08-cv-03168-EMC Document 79 Filed 08/03/10 Page 6 of 7
STIPULATION AND [PROPOSED] ORDER RE ANSWERS TO FIRST AMENDED COMPLAINT 

CASE NO: CV 08 3168 MHP 

292652.4

Page 7

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Dated: August 2, 2010 THE COSTA LAW FIRM 

By: /s/ Daniel P. Costa 

Daniel P. Costa 

Attorneys for Defendant 

STARK INVESTMENT COMPANY 

IT IS SO ORDERED 

Dated: _______________________ 

 U.S. DISTRICT COURT JUDGE 

8/3/2010

U

NITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

IT IS SO ORDERED

U

Judge Marilyn H. Patel

NITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

IT IS SO ORDERED

Judge Marilyn H. Patel

Case 3:08-cv-03168-EMC Document 79 Filed 08/03/10 Page 7 of 7