Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_18-cv-01942/USCOURTS-casd-3_18-cv-01942-0/pdf.json

Nature of Suit Code: 240
Nature of Suit: Torts to Land
Cause of Action: 28:1332tl Diversity-Torts to Land

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

CITY OF CHULA VISTA, a 

municipal corporation,

Plaintiff,

v.

MONSANTO COMPANY, 

SOLUTIA INC., PHARMACIA 

CORPORATION,

Defendants.

Case No.: 18cv1942-WQH-AGS

ORDER

HAYES, Judge:

The matter before the Court is the motion to dismiss or stay filed by Defendants.

(ECF No. 5). 

I. BACKGROUND

On August 21, 2018, Plaintiff City of Chula initiated this action by filing a 

Complaint against Defendants Monsanto Company, Solutia Inc., and Pharmacia 

Corporation. (ECF No. 1). Plaintiff brings a claim for continuing public nuisance, alleging 

that Defendants are responsible for damage to Plaintiff’s stormwater system caused by 

polychlorinated biphenyls (PCBs).

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 On September 14, 2018, Defendants filed a Motion to Dismiss or Stay based on 

Plaintiff’s failure to exhaust administrative remedies. (ECF No. 5). 

On October 16, 2018, Plaintiff filed a Response in Opposition to the Motion to 

Dismiss. (ECF No. 16). 

On October 29, 2018, Defendants filed a Reply in support of the Motion to Dismiss. 

(ECF No. 20). 

II. ALLEGATIONS OF THE COMPLAINT 

Plaintiff is a “California Charter City and municipal corporation.” (ECF No. 1 ¶ 9). 

“The City was a trustee of certain relevant tidelands and submerged lands in and around 

the [San Diego] Bay from the early 1900s through 1963, when that property was transferred 

to the Port District.” Id. 

Defendants Monsanto Company, Pharmacia LLC, and Solutia Inc. are three separate 

corporations spun off from the original Monsanto Company. Id. ¶ 15. “Monsanto 

Company has repeatedly held itself out as the sole manufacturer of PCBs in the United 

States from 1935 to 1979, and trademarked the name ‘Aroclor’ for certain PCB 

compounds.” Id. ¶ 2. 

“Polychlorinated biphenyls (or ‘PCBs’) are man-made chemical compounds that 

have become notorious as global environmental contaminants – found in bays, oceans, 

rivers, streams, soil, and air.” Id. ¶ 1. “In humans, PCB exposure is associated with cancer 

as well as serious non-cancer health effects, including effects on the immune system, 

reproductive system, nervous system, endocrine system and other health effects.” Id. 

“Monsanto’s commercially-produced PCBs were used in a wide range of industrial 

applications in the United States, including electrical equipment such as transformers, 

motor start capacitors and lighting ballasts. In addition, PCBs were incorporated into a 

variety of products such as caulks, paints and sealants.” Id. ¶ 69. “PCBs easily migrate or 

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leach out of their original source material or enclosure and contaminate nearby surfaces, 

air, water, soil, and other materials.” Id. ¶ 71. 

Despite knowledge of PCB toxicity, Monsanto continued to “promot[e] the use and 

sale of Aroclor and other PCB compounds.” Id. ¶ 84. “Monsanto remained steadfast in its 

production of . . . PCBs.” Id. ¶ 92. “While the scientific community and Monsanto knew 

that PCBs were toxic and becoming a global contaminant, Monsanto repeatedly 

misrepresented these facts, telling governmental entities . . . that the compounds were not 

toxic and that the company would not expect to find PCBs in the environment in a 

widespread manner.” Id. ¶ 106. “Although Monsanto knew for decades that PCBs were 

toxic, knew that they could not be contained and as a result were widely contaminating all 

natural resources and living organisms, and knew that there was no safe way to dispose of 

PCBs, Monsanto concealed these facts and continued producing PCBs until Congress . . . 

banned the manufacture of and most uses of PCBs as of January 1, 1979.” Id. ¶ 2. 

“Instead of having customers return fluids, Monsanto instructed its customers to 

dispose of PCB containing material in local landfills, knowing that landfills were not 

suitable for PCB contaminated waste.” Id. ¶ 101. “Monsanto had determined that the only 

effective m[e]th[o]d of disposing of PCBs was incineration, and it constructed an 

incinerator for disposal of its own PCB contaminants.” Id. “Nevertheless . . . Monsanto 

instructed its customers to dispose of PCB contaminated waste in landfills . . . .” Id.

“PCBs have traveled into the City of Chula Vista’s stormwater system and San 

Diego Bay in a variety of ways.” Id. ¶ 4. “The Bay is one of the region’s most widely 

used natural resources, and the PCB contamination affects all Chula Vistans, who 

reasonably would be disturbed by the presence of a hazardous, banned substance in the 

sediment, water, and wildlife.” Id. ¶ 113. “PCBs . . . have been found in samples of 

sediments and water taken from the Bay at varying times and locations, requiring 

substantial remediation work and cost.” Id. ¶ 114. “PCBs leach from landfills and are 

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found in commercial and industrial waste water as a result of Monsanto’s directions to its 

customers on proper disposal methods when it knew . . . that disposal of PCBs in landfills 

was not proper.” Id. ¶ 118. “PCBs regularly leach, leak, off-gas, and escape their intended 

applications, causing runoff during naturally occurring storm and rain events, after being 

released into the environment. The runoff originates from multiple sources and industries 

and enters the City of Chula Vista’s stormwater system and San Diego Bay through 

stormwater and dry weather runoff.” Id. ¶ 4.

“The City has property rights in its stormwater system, captured stormwater, and 

tidelands or submerged lands, and other public trust lands that are contaminated with 

Monsanto’s PCBs, to the extent the City of Chula Vista owns or holds lands in public trust.” 

Id. ¶ 23. “The City owns, manages, and operates a municipal stormwater and dry weather 

runoff system, which captures, collects, reuses for beneficial purposes, and/or transports

stormwater and dry weather runoff.” Id. ¶ 24. “Monsanto’s PCBs have contaminated and 

damaged multiple facilities within the City’s stormwater and dry weather runoff systems.” 

Id. ¶ 25. “As a result of Monsanto’s PCB’s presence, the City cannot operate many of its 

stormwater and dry weather runoff systems as designed because the system now requires 

upgrades and retrofits to accommodate Monsanto’s PCBs.” Id. ¶ 26. “The City has 

incurred and will continue to incur costs to reduce PCBs from stormwater and dry weather 

runoff, which includes efforts to capture and beneficially use stormwater and dry weather 

runoff to augment existing water supplies.” Id. ¶ 27. “The City’s stormwater and dry 

weather runoff management system is damaged such that multiple facilities within the 

City’s system have been and must be further retrofitted and improved in order to reduce 

and remove PCBs from stormwater and dry weather runoff. The retrofits and 

improvements required to reduce PCBs from stormwater and dry weather runoff have cost 

and will continue to cost the City money.” Id. ¶ 28. “Retrofits . . . are required to reduce 

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and remove Monsanto’s PCBs to prevent further contamination of the San Diego Bay.” Id.

¶ 31. 

The municipal stormwater system “collects and transports stormwater to be 

discharged into the Bay.” Id. ¶ 118. “In order to discharge stormwater into the Bay, 

Plaintiff is required to receive a Municipal Regional Stormwater Permit from the Regional 

Water Board, pursuant to the National Pollutant Discharge Elimination System under the 

Clean Water Act.” Id. “As stormwater system owners and operators, Plaintiff has spent 

substantial amounts of money to limit the amount of PCBs in the Bay. Plaintiff will also 

likely continue to incur costs to remove PCBs from the Bay and to keep PCBs from entering 

the Bay for the foreseeable future.” Id. ¶ 119. 

California’s Stormwater Resources Planning Act “authorizes the City to develop a 

stormwater resource plan, including compliance with stormwater regulations and 

beneficial capture of stormwater” and “confer[s] use or usufructuary rights on the City,” 

“regarding . . . dry weather runoff and stormwater.” Id. ¶¶ 38–39. Further, in Assembly 

Bill 2594, “the California State Legislature unanimously passed legislation confirming and 

codifying the Cities’ use rights in stormwater.” Id. ¶ 34. “The City built, owns, and 

manages an entire stormwater system, including plans and programs designed and intended 

to capture stormwater for beneficial uses outlined in The Stormwater Resources Planning 

Act . . . .” Id. ¶ 48. “The City has a usufructuary right and property interest in stormwater 

and dry weather runoff by its beneficial capture and use of stormwater.” Id. ¶ 47. 

III. APPLICABLE STANDARD

Federal Rule of Civil Procedure 12(b)(6) permits dismissal for “failure to state a 

claim upon which relief can be granted.” In order to state a claim for relief, a pleading 

“must contain . . . a short and plain statement of the claim showing that the pleader is 

entitled to relief.” Fed. R. Civ. P. 8(a)(2). Dismissal under Rule 12(b)(6) “is proper only 

where there is no cognizable legal theory or an absence of sufficient facts alleged to support 

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a cognizable legal theory.” Shroyer v. New Cingular Wireless Servs., Inc., 622 F.3d 1035, 

1041 (9th Cir. 2010) (quotation omitted). 

Stating a claim for relief “requires more than labels and conclusions, and a formulaic 

recitation of the elements of a cause of action will not do.” Bell Atl. Corp. v. Twombly, 

550 U.S. 544, 555 (2007) (quoting Fed. R. Civ. P. 8(a)(2)). When considering a motion to 

dismiss, a court must accept as true all “well-pleaded factual allegations.” Ashcroft v. 

Iqbal, 556 U.S. 662, 679 (2009). “[A]ccepting all factual allegations in the complaint as 

true and drawing ‘all reasonable inferences in favor of the nonmoving party,’” the 

plaintiff’s “allegations must ‘plausibly suggest an entitlement to relief.’” Gregg v. Haw., 

Dep’t of Pub. Safety, 870 F.3d 883, 886–87 (9th Cir. 2017) (first quoting TwoRivers v. 

Lewis, 174 F.3d 987, 991 (9th Cir. 1999); then quoting Iqbal, 556 U.S. at 681). 

IV. REQUEST FOR JUDICIAL NOTICE

Monsanto requests judicial notice of the following documents: (1) Excerpts of 

“Polychlorinated Biphenyls and the Environment,” a report issued by the United States 

Department of Agriculture, Interdepartmental Task Force, issued May 1972 (“PCB 

Report”); (2) Excerpts of California Regional Water Quality Control Board, Order No. R9-

2007-0001, NPDES No. CAS0108758, dated January 24, 2007 (“2007 Permit”); (3) 

Excerpts of California Regional Water Quality Control Board, Order No. R9-2013-0001, 

NPDES No. CAS0109266, dated May 8, 2013 (“2013 Permit”); (4) Excerpts of California 

Regional Water Quality Control Board, Order Nos. R9-2015-0001, R9-2015-0100, 

NPDES No. CAS0109266, dated Nov. 18, 2015 (“2015 Permit”); (5) Excerpts of Test 

Claim No. 07-TC-09, filed by San Diego County, Cal. Water Quality Control Bd., San 

Diego Region, Order No. R9-2007-0001, dated June 20, 2008 (“2008 Test Claim”); (6) 

Statement of Decision issued by the Commission on State Mandates, In re Test Claim on 

San Diego Reg’l Water Quality Control Bd., Order No. R9-2007-0001, Permit 

CAS0108758, dated March 26, 2010 (“Statement of Decision”); (7) Excerpts of Test Claim 

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No. 14-TC-03, filed by San Diego County, Test Claim of San Diego County re San Diego 

RWQCB Order No. R9-2013-0001, dated June 29, 2015 (“2015 Test Claim”); (8) Excerpts 

of Test Claim No. 15-TC-02, filed by Orange County Flood Control District, Joint Test 

Claim of Orange County, et al. re San Diego RWQCB Order No. R9-2015-0001, dated 

June 30, 2016 (“2016 Test Claim”); (9) Declaration of Khosro Aminpour, City of Chula 

Vista, filed in the 2008 Test Claim, dated June 12, 2008 (“2008 City Declaration”); (10) 

Supplemental Declaration of Khosro Aminpour, City of Chula Vista, filed in the 2008 Test 

Claim, dated February 24, 2010 (“2010 City Declaration”); (11) Excerpts of a BMP Design 

Manual, originally issued by the City of Chula Vista in December 2015, and updated May 

2017 (“City BMP Design Manual”); (12) Excerpts of the San Diego Bay Watershed 

Management Area Water Quality Improvement Plan, submitted to the San Diego Regional 

Water Quality Control Board, dated June 2015 (“San Diego Bay WQIP”); and (13) 

Excerpts of a Jurisdictional Runoff Management Program, originally issued by the City of 

Chula Vista in June 2015, and updated January 2018 (“City JRMP”).

Defendants contend that these documents may be properly considered on this motion 

to dismiss under the doctrine of incorporation by reference and as public records under 

Federal Rule of Evidence 201. 

“Generally, a court may not consider material beyond the complaint in ruling on a 

Fed. R. Civ. P. 12(b)(6) motion. . . . However, a court may take judicial notice of matters 

of public record without converting a motion to dismiss into a motion for summary 

judgment, as long as the facts noticed are not subject to reasonable dispute.” Intri-Plex 

Techs., Inc. v. Crest Grp., Inc., 499 F.3d 1048, 1052 (9th Cir. 2007) (quotation and 

alteration omitted). “The court may judicially notice a fact that is not subject to reasonable 

dispute because it . . . is generally known within the trial court’s territorial jurisdiction; or 

. . . can be accurately and readily determined from sources whose accuracy cannot 

reasonably be questioned.” Fed R. Evid. 201(b). A court “may take judicial notice of 

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‘records and reports of administrative bodies.” Anderson v. Holder, 673 F.3d 1089, 1094 

(9th Cir. 2012) (quotation omitted). 

The docket reflects that Plaintiff has not filed any opposition to this Request for 

Judicial Notice. The Court concludes that these documents are matters of public record 

properly subject to judicial notice. See Fed. R. Evid. 201; Intri-Plex Techs., 499 F.3d at 

1052; S.F. Baykeeper v. W. Bay Sanitary Dist., 791 F. Supp. 2d 719, 732 (N.D. Cal. 2011)

(“It is well established that records, reports, and other documents on file with 

administrative agencies—such as the State Water Resources Control Board—are judicially

noticeable.”). Defendants’ request for judicial notice is granted.

V. DISCUSSION

Defendants contend that the Complaint should be dismissed or stayed pending 

resolution of test claims because Plaintiff “seeks to recover as tort damages the same permit 

compliance costs” for which Plaintiff is entitled to reimbursement as unfunded state 

mandates. (ECF No. 5-1 at 14, 17). Defendants list specific costs for which Plaintiff seeks 

recovery in this action as well as reimbursement from the Commission on State Mandates 

(Commission) in previous and current test claims; for example, watershed-wide 

management programs and hydromodification management plans. Defendants assert that 

the same state-mandated storm water discharge permit requirements at issue in this case 

were found to constitute unfunded state mandates subject to state reimbursement in 

Department of Finance v. Commission on State Mandates, 378 P.3d 356 (Cal. 2016), and 

Department of Finance v. Commission on State Mandates, 226 Cal. Rptr. 3d 846 (Ct. App. 

2017). Defendants contend that the Court has discretion to dismiss or stay this matter 

pending resolution of the test claims through judicially imposed prudential exhaustion. 

Defendants contend that public policy considerations favor exhaustion. Defendants assert

that “[a]waiting the completion of the Commission’s proceedings will avoid double 

recovery, moot or substantially narrow the claims and damages at issue in this case—which 

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will correspondingly reduce the scope of discovery and motion practice—and it will result 

in a shorter, more streamlined trial.” (ECF No. 5-1 at 8). 

Plaintiff contends that the Commission is not authorized to address its public 

nuisance claim for tort damages or to award tort damages for the costs related to PCB 

contamination. Plaintiff contends that the conditions necessary to require administrative 

exhaustion under California law are not present in this case. Plaintiff asserts that no statute 

provides an administrative procedure and remedy for its nuisance claims and that the Court 

does not need agency assistance or expertise to determine its public nuisance claims. 

Plaintiff asserts that prudential exhaustion is impossible because decisions in this action 

are unaffected by any agency ruling on unfunded mandates. Plaintiff contends that public 

policy considerations weigh against exhaustion. 

The California Constitution states that “if the legislature or a state agency requires a 

local government to provide a new program or higher level of service, the local government 

is entitled to reimbursement from the state for the associated costs.” Dep’t of Fin., 378 

P.3d at 360 (Cal. 2016) (citing Cal. Const. art. XIII B, § 6, subd. (a)). An exception to this 

requirement provides that “if the new program or increased service is mandated by a federal 

law or regulation, reimbursement is not required.” Id. (citing Cal. Gov. Code § 17556, 

subd. (c)). “[T]he Legislature established the Commission as a quasi-judicial body to carry 

out a comprehensive administrative procedure for resolving claims for reimbursement of 

state-mandated local costs arising out of article XIIIB, section 6 . . . of the California 

Constitution.” Redev. Agency v. Comm’n on State Mandates, 51 Cal. Rptr. 2d 100, 102 

(Ct. App. 1996). “[T]hus the statutory scheme contemplates that the Commission, as a 

quasi-judicial body, has the sole and exclusive authority to adjudicate whether a state 

mandate exists.” Id. (citing Cty. of L.A. v. Comm’n on State Mandates, 38 Cal. Rptr. 2d 

304, 311 (Ct. App. 1995)). 

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In Department of Finance, the Regional Water Quality Control Board, a state 

agency, issued permits to the Los Angeles County Flood Control District and eighty-four

cities to operate storm drainage systems with certain permit conditions requiring that the 

operators “take various steps to reduce the discharge of waste and pollutants into state 

waters.” 378 P.3d at 361. Some of the drainage system operators sought reimbursement 

through the Commission for the cost of satisfying the conditions as an unfunded state 

mandate. The Commission determined that “each required condition was a new program 

or higher level of service mandated by the state rather than by federal law.” Id. Upon 

review of the decision, the trial court and the court of appeal found that all of the 

requirements were federally mandated. Id. However, the California Supreme Court upheld 

the decision of the Commission and concluded that the permit conditions were not federally 

mandated. Id. at 371. 

Under California law, “[w]here an administrative remedy is provided by statute, 

relief must be sought from the administrative body and this remedy exhausted before the 

courts will act.” Abelleira v. Dist. Court of Appeal, 109 P.2d 942, 949 (Cal. 1941); see 

also Campbell v. Regents of the Univ. of Cal., 106 P.3d 976, 982 (Cal. 2005). “[H]owever, 

this oft-quoted rule speaks only to the need to exhaust administrative remedies provided 

for a statutory right and does not govern rights and remedies outside the legislative 

scheme.” Rojo v. Kliger, 801 P.2d 373, 385 (Cal. 1990). When required, “[e]xhaustion of 

administrative remedies is a jurisdictional prerequisite to resort to the courts.” Campbell, 

106 P.3d at 982 (quoting Johnson v. City of Loma Linda, 5 P.3d 874, 879 (Cal. 2000) 

(internal quotations omitted)). 

“Administrative exhaustion can be either statutorily required or judicially imposed 

as a matter of prudence.” Puga v. Chertoff, 488 F.3d 812, 815 (9th Cir. 2007). “Where 

there is no explicit statutory requirement of exhaustion of administrative remedies, the 

application of exhaustion rules is a matter committed to the discretion of the district court.” 

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Morrison-Knudsen Co., Inc. v. CHG Int’l, Inc., 811 F.2d 1209, 1223 (9th Cir. 1987) 

(citation omitted). “Courts may require prudential exhaustion if (1) agency expertise 

makes agency consideration necessary to generate a proper record and reach a proper 

decision; (2) relaxation of the requirement would encourage the deliberate by pass of the 

administrative scheme; and (3) administrative review is likely to allow the agency to 

correct its own mistakes and to preclude the need for judicial review.” Puga, 488 F.3d at 

815 (quotation omitted). 

In this case, the Complaint alleges, “In order to discharge stormwater into the Bay, 

Plaintiff is required to receive a Municipal Regional Stormwater Permit from the Regional 

Water Board, pursuant to the National Pollutant Discharge Elimination System under the 

Clean Water Act.” (ECF No. 1 ¶ 118). The San Diego Regional Quality Control Board 

issued Plaintiff, among other permittees, NPDES permits in 2007, 2013, and 2015. (ECF 

Nos. 5-4, 5-5, 5-6). Plaintiff and other permittees have filed test claims in administrative 

proceedings before the Commission, challenging certain provisions of the permits and 

contending that those provisions constituted unfunded mandates for which the permittees 

are entitled to State reimbursement. (ECF Nos. 5-7, 5-9). In 2010, the Commission 

determined that certain provisions of the 2007 permit were unfunded state mandates subject 

to reimbursement. (ECF No. 5-8). The California Court of Appeal upheld the 

Commission’s decision and the California Supreme Court denied review. See Dep’t of 

Fin., 226 Cal. Rptr. 3d 846. Test claims challenging certain provisions of the 2013 and 

2015 permits are currently pending before the Commission. (ECF Nos. 5-9, 5-10). 

The administrative mandate procedure before the Commission “is the exclusive way 

for a local agency to claim reimbursement for state mandated costs.” Lake Madrone Water 

Dist. v. State Water Res. Control Bd., 256 Cal. Rptr. 894, 902 (Ct. App. 1989); see also 

Tri-County Special Educ. Local Plan Area v. Cty. of Tuolomne, 19 Cal. Rptr. 3d. 884, 889 

(Ct. App. 2004) (“Without first exhausting the administrative remedies, the local agency 

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cannot claim a section 6 violation in defense of its failure to perform its duty . . . . After a 

determination by the Commission that reimbursement is due, but only then, may the local 

government bring a traditional mandamus action . . .). However, in this case, the City 

brings a cause of action in tort for public nuisance against a private entity pursuant to 

applicable sections of the California Civil Code and the California Code of Civil Procedure. 

California law does not establish an administrative procedure for a public nuisance claim. 

See Abelleira, 109 P.2d at 949 (“[W]here an administrative remedy is provided by statute, 

relief must be sought from the administrative body and this remedy exhausted before the 

courts will act.”). While some of the damages Plaintiff seeks from Defendants in this 

public nuisance claim may overlap with the unfunded state mandate costs at issue in 

pending test claims before the Commission, the jurisdictional requirement of 

administrative exhaustion is limited to “where an administrative remedy is required by 

statute.” Id. The Court concludes that Plaintiff is not precluded from bringing its public 

nuisance claim by any statutory administrative exhaustion requirement. The Court further 

concludes that prudential exhaustion is not warranted at this stage in proceedings. See 

Morrison-Knudsen Co., 811 F.2d at 1223.

VI. INTERLOCUTORY APPEAL

In the alternative, Defendants seek certification for interlocutory appeal. (ECF No.

5-1 at 25). Defendants contend that “whether a municipality must exhaust the 

Commission’s administrative remedies for State-imposed permit compliance costs before 

litigating to seek recovery of the same costs in federal court” is a controlling question of 

law. Defendants contend that discretionary decisions of district courts, including 

discretionary decisions not to require prudential exhaustion, “routinely serve as proper 

bases for certification of an interlocutory appeal in the Ninth Circuit.” Id. at 27. 

Defendants contend that certification is appropriate because there is a difference of opinion 

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among district courts on whether exhaustion is necessary on this issue. Defendants assert

that interlocutory appeal will reduce the scope of and materially advance the litigation. 

Plaintiff contends that interlocutory appeal is not warranted in this case on this issue. 

Plaintiff contends that Defendants’ “question for appeal depends on a the factual issue of 

whether Plaintiffs’ tort damages are the same as or overlap with costs subject to test claims 

before the Commission.” (ECF No. 16 at 22). 

A district court may certify an otherwise non-appealable order for appellate review

when three conditions are met: (1) the order involves a “controlling question of law”; (2) 

there is “substantial ground for difference of opinion”; and (3) “an immediate appeal from 

the order may materially advance the ultimate termination of the litigation.” 28 U.S.C. § 

1292(b). All three criteria must be met in order for a district court to certify an issue for 

interlocutory appeal. Couch v. Telescope Inc., 611 F.3d 629, 633 (9th Cir. 2010). “Section 

1292(b) is a departure from the normal rule that only final judgments are appealable, and 

therefore must be construed narrowly.” James v. Price Stern Sloan, Inc., 283 F.3d 1064, 

1067 n.6 (9th Cir. 2002); United States v. Woodbury, 263 F.2d 784, 788 n.11 (9th Cir. 

1959) (“[Section] 1292(b) is to be applied sparingly and only in exceptional cases”).

A question is “controlling” for purposes of § 1292(b) if “resolution of the issue on 

appeal could materially affect the outcome of litigation in the district court.” In re Cement 

Antitrust Litig., 673 F.2d 1020, 1026 (9th Cir. 1982). “To determine if a ‘substantial ground 

for difference of opinion’ exists under § 1292(b), courts must examine to what extent the 

controlling law is unclear.” Couch, 611 F.3d at 633. “Courts traditionally will find that a 

substantial ground for difference of opinion exists where the circuits are in dispute on the 

question and the court of appeals of the circuit has not spoken on the point, if complicated 

questions arise under foreign law, or if novel and difficult questions of first impression are 

presented.” Id. (internal citations and quotation marks omitted). “That settled law might 

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be applied differently does not establish a substantial ground for difference of opinion.” 

Id. at 633.

In this case, the Court finds that Defendants do not identify a controlling question of 

law. The question of “whether a municipality is required as a matter of prudence to exhaust

administrative remedies with the Commission before initiating litigation over the exact 

same costs” is not a pure question of law in this case. The question presumes a factual 

determination that the same costs are at issue in the various proceedings. The question 

challenges the Court’s application of existing law on administrative exhaustion and

prudential exhaustion to the factual circumstances of this case. Courts in the Ninth Circuit 

have determined that mixed questions of fact and law are not appropriate for interlocutory 

appeal under § 1292(b). See, e.g., City of San Jose v. Monsanto Co., No. 5:15-CV-03178-

EJD, 2017 WL 6039670, at *1 (N.D. Cal. Dec. 6, 2017); Halloum v. McCormick Barstow 

LLP, No. C-15-2181 EMC, 2015 WL 4512599, at *2 (N.D. Cal. July 24, 2015); Karoun 

Dairies, Inc. v. Karlacti, Inc., No. 08CV1521 AJB (WVG), 2014 WL 11906588, at *4 

(S.D. Cal. Sept. 3, 2014). Absent a controlling question of law warranting certification for 

interlocutory appeal pursuant to 28 U.S.C. § 1292(b), the motion for certification for 

interlocutory appeal is denied. See In re Cement, 673 F.2d at 1026 (holding that 

interlocutory appeal is only justified under “exceptional circumstances.”).

VII. CONCLUSION

IT IS HEREBY ORDERED that the Motion to Dismiss or Stay filed by Defendants 

is DENIED. (ECF No. 5). The alternative request for certification for interlocutory appeal 

pursuant to 28 U.S.C. § 1292(b) is DENIED. 

Dated: March 21, 2019

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