Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_97-cv-20099/USCOURTS-cand-5_97-cv-20099-10/pdf.json

Nature of Suit Code: 893
Nature of Suit: Environmental Matters
Cause of Action: 42:4321 Review of Agency Action-Environment

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Case No. C 97-20099 JF (HRL)

ORDER RESOLVING PENDING ISSUES RE RECEIVERSHIP

(JFLC3)

**E-filed 03/04/08**

NOT FOR CITATION

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

UNITED STATES OF AMERICA,

 Plaintiff,

 v.

ALISAL WATER CORPORATION, et al.,

 Defendants.

Case Number C 97-20099 JF (HRL)

ORDER RESOLVING PENDING 1

ISSUES RE RECEIVERSHIP

Having considered the parties’ submissions at and subsequent to a status conference on 

January 30, 2008, the Court will resolve the pending issues with respect to the Receivership in

the above-entitled action as follows:

1) Pajaro/Sunny Mesa Community Services District (“PSMCSD”) seeks final Court

approval of the Bill of Sale for five small water systems in North Monterey County, termination

of the existing Management Agreements, and release of all claims. Pursuant to this Court’s Order

dated April 13, 2004, PSMCSD was designated as the purchaser of the assets of the Moss Landing

Water System, Inc., North Monterey County Water System, Inc. (“NORMCO”), Blackie Road

Mutual Water System #18, Vierra Canyon Water System, and Langley/Valle Pacifico Water

Case 5:97-cv-20099-EJD Document 824 Filed 03/04/08 Page 1 of 4
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Case No. C 97-20099 JF (HRL)

ORDER RESOLVING PENDING MATTERS RE RECEIVERSHIP

(JFLC3)

System. On or about January 12, 2005, PSMCSD entered into “Operational and Management

Agreements” with the Receiver for the five systems. In June, 2007, at the Court’s direction,

PSMCSD engaged the Chicago Title Company to complete title research and production of title

documents, easement descriptions, and maps and the Bill of Sale to complete the transfer of the

five systems. The Court hereby authorizes and confirms the sale of the five systems to PSMCSD

and directs the Receiver to execute and deliver the Bill of Sale that has been presented to the

Court.

2) PSMCSD shall account for all funds collected pursuant to the surcharge authorized

by California Public Utilities Commission (CPUC) Resolution W-4504 and shall remit to the

Receiver all sums collected by it pursuant to the surcharge without further claim or set-off.

3) All claims against Defendants Robert T. Adcock and Natholyn Patricia Adcock in

their individual capacities will be dismissed.

4) All claims against Defendants Moss Landing, Inc., Normco, Inc., and Toro Water

System, Inc. will be dismissed.

5) PSMCSD seeks reimbursement from the Receiver in the amount of $6,000 for the

expenses incurred in researching title to the small systems. PSMCSD contends that it was forced

to incur these expenses because of delay on the part of the Receiver. In light of the total

compensation awarded to the Receiver and considering all of the relevant circumstances, the

Court finds that PSMCSD’s request is reasonable. Accordingly, the Court will order the

reimbursement subtracted from the Receiver’s fees but otherwise approve the Receiver’s

outstanding fees and expenses in their entirety. 

6) The County of Monterey (“the County”) has requested funds totaling $368,940.78

for expenses it incurred through October, 2007 to install and operate the interim water filtration

system at San Jerardo. The Receiver is directed to pay the County the requested amount.

7) Upon payment of the amounts authorized above, the Receiver shall remit any 

remaining Receivership funds to Alco.

8) The Court declines to assert jurisdiction over the dispute between PSMCSD and

the County over the unfinished water tanks at the Carlson Estates/ Grey Eagle Subdivision.

Case 5:97-cv-20099-EJD Document 824 Filed 03/04/08 Page 2 of 4
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Case No. C 97-20099 JF (HRL)

ORDER RESOLVING PENDING MATTERS RE RECEIVERSHIP

(JFLC3)

9) The United States requests amendment of Paragraph 3.c. of the Stipulated Settlement

approved by the Court on September 6, 2007, which provides as follows:

Upon entry of this stipulation as an order of the court, Alco, at its own expense,

shall forthwith apply to the CPUC for authorization to pay a sur-credit of $212,000

to its Salinas customers without need of further order of this Court. The

application of the CPUC will request the sur-credit to commence one year

following termination of the receivership in this case and shall be sur-credited over

a period of 48 months thereafter.

The Government requests that the paragraph be revised to provide that the sur-credit commence

one year for the date of this Order. At the time the Stipulated Settlement was negotiated by the

parties and signed by the Court, all parties and the Court expected that the Receivership would

conclude by the end of 2007. It is now apparent that some form of the Receivership must remain

in place to deal with the San Jerardo system and may continue for another one to two years. The

Government argues that customers of the Salinas system should not have to wait another one to

two years to begin to receive their sur-credit. This concern is well-taken. Accordingly, the Court

will grant the Government’s motion to amend the Stipulated Settlement. Specifically, the

application to the CPUC concerning the sur-credit shall request that the sur-credit commence one

year from the date of this Order rather than one year following the termination of the

Receivership.

11) The Receivership shall remain in effect with respect to the San Jerardo water system only. 

The Court directs the Receiver, either personally or through contractors, to take all actions

necessary to maintain and operate the San Jerardo system, including but not limited to billing

customers, collecting customer remittances, and paying all bills of the system, including the

Receiver’s reasonable fees and expenses. 

IT IS SO ORDERED.

DATED: March 4, 2008

__________________________________

JEREMY FOGEL

United States District Judge

Case 5:97-cv-20099-EJD Document 824 Filed 03/04/08 Page 3 of 4
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Case No. C 97-20099 JF (HRL)

ORDER RESOLVING PENDING MATTERS RE RECEIVERSHIP

(JFLC3)

Copies of Order served on:

Counsel for Plaintiff:

Lori Jonas

Matthew Fogelson

Noel Wise

Environmental Enforcement Section

Environment and Natural Resources Division

U.S. Department of Justice

P.O. Box 7611

Washington, D.C. 20044

Charles O’Connor

U.S. Attorney’s Office

450 Golden Gate Avenue

P.O. Box 36055

San Francisco, CA 94102 

John D. Rothman

United States Environmental Protection Agency, Region IX

75 Hawthorne Street

San Francisco, CA 94105 

Counsel for Defendants:

Marc P. Fairman

Law Offices of Marc P. Fairman

Two Embarcadero Center, Suite 1800

San Francisco, CA 94111

John P. Dwyer

Attorney at Law

1550 California Street, No. 60201

San Francisco, CA 94109

Counsel for Receiver:

Michael A. Isaacs

Diana L. Donabedian

Luce, Forward, Hamilton & Scripps, LLP

121 Spear Street, Suite 200

San Francisco, CA 94105

John W. Richardson

2941 Park Avenue, Suite H

Soquel, CA 95073 

Case 5:97-cv-20099-EJD Document 824 Filed 03/04/08 Page 4 of 4