Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_98-cv-06264/USCOURTS-caed-1_98-cv-06264-6/pdf.json

Nature of Suit Code: 893
Nature of Suit: Environmental Matters
Cause of Action: 42:6901 Environmental Cleanup Expenses

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IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

DEPARTMENT OF TOXIC

SUBSTANCES CONTROL,

Plaintiff,

v.

WITCO CORPORATION, et al.,

Defendants.

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Case No. 1:98-cv-06264 OWW TAG

REPORT AND RECOMMENDATIONS

REGARDING PLAINTIFF’S

APPLICATION FOR DEFAULT

JUDGMENT AGAINST DEFENDANT

CLIFFORD N. PITTS

(Doc. 196)

Proceeding under the Comprehensive Environmental Response, Compensation, and

Liability Act (“CERCLA”), 42 U.S.C. § 9601, et seq., the Resources and Conservation Recovery

Act (“RCRA”), 42 U.S.C. § 6962 et seq., and the California Health & Safety Code § 58009,

Plaintiff California Department of Toxic Substances Control seeks to recover the costs of abating

and remedying environmental damages allegedly caused by, among others, Defendant Clifford N.

Pitts. (Doc. 1). Defendant Pitts, it is alleged, owned and operated San Joaquin Drum Company,

a drum cleaning and reconditioning business located at 3930 Gilmore Street, Bakersfield,

California. (Id.). Pending now before the Court is Plaintiff’s Fed. R. Civ. P. 55(b)(2) application

for entry of default judgment against Defendant Pitts. The matter has been referred to the

Magistrate Judge pursuant to 28 U.S.C. § 636(b).

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I. Procedural History and Claims Presented

Plaintiff California Department of Toxic Substances Control (“DTSC”) filed its original

Complaint against various defendants, including Defendant Pitts, on October 30, 1998. (Doc. 1). 

A First Amended Complaint that added Chevron Corporation as an additional defendant was

filed on July 29, 1999, and again on August 5, 1999. (Docs. 24, 26). A Second Amended

Complaint was filed on June 25, 2003. (Doc. 95). As alleged in the Second Amended

Complaint, the San Joaquin Drum Company at 3930 Gilmore Street in Bakersfield, California,

was used for industrial drum cleaning and reconditioning from approximately 1967 through

1986. (Doc. 95, ¶ 18). Allegedly owned and operated by Defendant Pitts (Doc. 95, ¶ ¶ 17, 19),

the site received drums for cleaning and reconditioning from other named defendants (or their

predecessors and divisions). These defendants included Witco, Western Farm Service,

Dow Chemical Company and Chevron Corporation. (Doc. 95, ¶¶ 13-16, 20-24). On November

19, 1980, the DTSC inspected the site and found approximately 800 to 1,000 containers stored

on-site and two abandoned underground sumps filled with liquid. (Doc. 95, ¶ 25). Although

clean-up activities have occurred at the site from 1981 through at least the filing of the First

Amended Complaint in 1999, the site allegedly remains contaminated and the soil has elevated

levels of chlordane, toxaphene, chromium, lead, zinc, acetone, toluene, total xylene,

trichloroethylene, tetracholoroethene, naphthalene, dibenzofuran, fluorene, pyrene, chrysene,

benzo(b)fluoranthene, benzo(a)pyrene and total petroleum hydrocarbons. (Doc. 95, ¶ 26). 

Moreover, the underlying groundwater allegedly has significant levels of tetrachloroethene,

dicloroethane, dicholoroethylene, tricholoroethane, tricholoroethylene, dicholorobenzene, DDE,

DDT, acetone, toluene, total xylene, arsenic and cadmium. (Id.)

On November 28, 1999, a process server went to Defendant Pitts’s home in Bennington,

Oklahoma, and left the original Complaint and summons with Norma Pitts, a person he deemed

to be of suitable age and discretion to accept such service. (Doc. 7 and Doc. 197, Declaration of

Janill L. Richards, Exh. C). Pitts did not respond to the Complaint and, upon application by

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Plaintiff DTSC, default was entered against him by the clerk of the court on March 25, 1999. 

(Docs. 17-19). Thereafter, a First Amended Complaint was served upon Defendant Pitts by mail,

but with no response. (Doc.197, Declaration of Janill L. Richards, ¶ 8). Finally, the Second

Amended Complaint was personally served on Defendant Pitts at his Boswell, Oklahoma

residence on November 1, 2003. (Doc. 139, Doc. 197, Declaration of Janill L. Richards,

Exh. D). Defendant Pitts did not respond to the Second Amended Complaint and on February

25, 2004, Plaintiff DTSC requested entry of default against him. (Docs. 137-138). Default as to

the Second Amended Complaint subsequently was entered by the clerk against Defendant Pitts

on February 26, 2004. (Doc. 141). 

II. Analysis

A defendant is in default upon failing to respond to or answer a complaint within the time

period permitted by the Federal Rules of Civil Procedure. Fed. R. Civ. P. 55(a). The rules

generally allow a defendant twenty days after service of the summons and complaint to file an

answer or file a Rule 12 motion. See Fed. R. Civ. P. 12(a)(1). Should a defendant fail to

respond within the permissible time-frame, a default judgment may be entered. See Benny v.

Pipes, 799 F.2d 489, 492 (9th Cir. 1986), amended on other grounds, 807 F.2d 1514 (9th Cir.),

cert. denied, 484 U.S. 870 (1987). The issuance of a default judgment is governed by Fed. R.

Civ. P. 55, which states in relevant part:

 (a) Entry. When a party against whom a judgment for affirmative relief is sought

has failed to plead or otherwise defend as provided by these rules and that fact is

made to appear by affidavit or otherwise, the clerk shall enter the party's default.

(b) Judgment. Judgment by default may be entered as follows:

(1) By the Clerk. When the plaintiff's claim against a defendant is for a

sum certain or for a sum which can by computation be made certain, the

clerk upon request of the plaintiff and upon affidavit of the amount due

shall enter judgment for that amount and costs against the defendant, if the

defendant has been defaulted for failure to appear and is not an infant or

incompetent person.

(2) By the Court. In all other cases the party entitled to a judgment by

default shall apply to the court therefor; but no judgment by default shall

be entered against an infant or incompetent person unless represented in

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the action by a general guardian, committee, conservator, or other such

representative who has appeared therein. If the party against whom

judgment by default is sought has appeared in the action, the party (or, if

appearing by representative, the party's representative) shall be served with

written notice of the application for judgment at least 3 days prior to the

hearing on such application. If, in order to enable the court to enter

judgment or to carry it into effect, it is necessary to take an account or to

determine the amount of damages or to establish the truth of any averment

by evidence or to make an investigation of any other matter, the court may

conduct such hearings or order such references as it deems necessary and

proper and shall accord a right of trial by jury to the parties when and as

required by any statute of the United States.

(c) Setting Aside Default. For good cause shown the court may set aside an entry

of default and, if a judgment by default has been entered, may likewise set it aside

in accordance with Rule 60(b).

A court has the discretion to enter a default judgment against one who is not an infant,

incompetent, or member of the armed services where the claim is for an amount that is not

certain on the face of the claim and where:

(1) the defendant has been served with the claim;

(2) the defendant’s default has been entered for failure to appear;

(3) if the defendant has appeared in the action, the defendant has been served with written

notice of the application for judgment at least three days before the hearing on the

application; and

(4) the court has undertaken any necessary and proper investigation or hearing in order to

enter judgment or carry it into effect.

 Fed. R. Civ. P. 55(b)(2); Alan Neuman Productions, Inc. v. Albright, 862 F.2d 1388, 1392

(9th Cir. 1988), cert. denied, 493 U.S. 858 (1989); Twentieth Century Fox Film Corp. v.

Streeter, 438 F.Supp. 2d 1065, 1070 (D. Ariz. 2006). Factors that may be considered by courts in

exercising discretion as to the entry or setting aside of a default judgment include the nature and

extent of the delay, Draper v. Coombs, 792 F.2d 915, 924-925 (9th Cir. 1986); the possibility of

prejudice to the plaintiff, Eitel v. McCool, 782 F.2d 1470, 1471-1472 (9th Cir.1986); the merits

of the plaintiff’s substantive claim, id.; the sufficiency of the allegations in the complaint to

support judgment, Alan Neuman Productions, Inc., 862 F.2d at 1392; the amount in controversy,

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Eitel v. McCool, 782 F.2d at 1471-1472; the possibility of a dispute concerning material facts,

id.; whether the default was due to excusable neglect, id.; and the strong policy underlying the

Federal Rules of Civil Procedure that favors decisions on the merits, id..

A default judgment generally bars the defaulting party from disputing the facts alleged in

the complaint, but the defaulting party may argue that the facts as alleged do not state a claim.

Alan Neuman Productions, Inc. v. Albright, 862 F.2d 1388, 1392. Thus, well pleaded factual

allegations, except as to damages, are taken as true; however, necessary facts not contained in the

pleadings, and claims which are legally insufficient, are not established by default. Cripps v. Life

Ins. Co. of North America, 980 F.2d 1261, 1267 (9th Cir. 1992); TeleVideo Systems, Inc. v.

Heidenthal, 826 F.2d 915, 917 (9th Cir. 1987).

1. Defendant’s Status and Service of Complaint

In the instant case, there is no indication in the record that Defendant Pitts is an

unrepresented incompetent person or that he is otherwise protected from entry of default

judgment by the Servicemembers Civil Relief Act, 50 U.S.C. A. § 501 et seq.

According to a proof of service filed with the Court, the original Complaint was

personally served on Defendant Pitts at his home address by having been left at that address with

Norma Pitts, a person deemed by the process server to be of suitable age and discretion. (Doc. 7,

Doc. 197, Exh. C). Although no proof of service was filed, it is alleged that the First Amended

Complaint, which simply added Chevron as a defendant was mailed to Pitts. (Doc. 197, ¶ 8). 

Finally, the operative Second Amended Complaint was, according to a proof of service filed with

the Court, personally served on Defendant Pitts himself at his home address. (Doc. 139, Doc.

197, Exh. D). As there are no contravening facts in the record, it is evident that the Complaint

and Second Amended Complaint were served upon Defendant Pitts in conformance with Fed. R.

Civ. P. 4(e)(2) (“service upon an individual . . . may be effected in any judicial district of the

United States . . . pursuant to the law of the state in which . . . service is effected . . . or by

delivering a copy of the summons and of the complaint to the individual personally or by leaving

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copies thereof at the individual’s dwelling house or usual place of abode with some person of

suitable age and discretion then residing therein”).

As noted above, the original Complaint and the Second Amended Complaint were

personally served, a method explicitly authorized by Fed. R. Civ. P. 4(e)(2). However, also as

noted above, the First Amended Complaint was mailed (Doc. 197, Decl. of Janill L. Richards, ¶

8), a process that could only be effective if done in conformance with the law of Oklahoma, the

state in which service was effected. Fed. R. Civ. P. 4(e)(1). In Oklahoma, “[s]ervice by mail

shall be accomplished by mailing a copy of the summons and petition by certified mail, return

receipt requested and delivery restricted to the addressee.” 12 Okla. Stat. Ann. § 2004(C)(2)(b). 

Because there is no indication in the record of the use of certified mail, this Court cannot find

that service of the First Amended Complaint complied with Oklahoma law. Notwithstanding,

given that Defendant Pitts was properly served with the Complaint yet nevertheless failed to

appear, and further given that the First Amended Complaint simply added Chevron as a

defendant without adding any new or additional claims for relief against Pitts himself, improper

service of the First Amended Complaint (if such occurred) was of no moment. See Fed. R. Civ.

P. 5(a) (“No service need be made on parties in default for failure to appear except that pleadings

asserting new or additional claims for relief against them shall be served upon them in the

manner provided for service of summons in Rule 4") (italics added); 4B Wright & Miller,

Federal Practice and Procedure: Civil 3d § 1144 (2002). Accordingly, the service predicate to

entry of a default judgment has been met.

2. Clerk’s Entry of Default for Failure to Appear

Twice, both after Defendant Pitts failed to respond to the original Complaint again after

he failed to respond to the operative Second Amended Complaint, Plaintiff DTSC applied to the

clerk of the court for entry of default judgment. (Docs. 17, 137). On both such occasions,

default was entered against Pitts. (Docs. 19, 141). Twentieth Century Fox Film Corp. v. 

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Streeter, 438 F.Supp. 2d at 1070 (“After entry of a default, a court may grant a default judgment

on the merits of the case”).

3. Notice of Application for Default Judgment

A defaulting party is entitled to written notice of the application for default judgment

unless the party has not appeared in the action. Fed. R. Civ. P. 55(b)(2). Written notice of an

application for default judgment must be served at least three days prior to the hearing on the

defaulting party. An appearance for the purpose of Rule 55 need not be a formal one and may

consist even of informal contacts made by the defaulting party where the defaulting party

demonstrates a clear purpose to defend the suit. See In re Roxford Foods, Inc., 12 F.3d 875, 879-

881 (9th Cir. 1993) (holding in declaratory relief action that communications by a trustee in

bankruptcy regarding identical claim in related bankruptcy action sufficient to demonstrate clear

intention to defend where time had been given to trustee to retain counsel for representation on

the merits). Thus, the party seeking a default judgment must demonstrate either that the required

notice has been given, or that the defaulting party or parties have not appeared in the action and

that notice is therefore not required.

In this case, Defendant Pitts has not appeared in the action, notwithstanding having been

served with the Complaint and with amendments thereto. Accordingly, pursuant to Fed. R. Civ.

P. 55(b)(2), notice of application for entry of default was not required. Twentieth Century Fox

Film Corp. v. Streeter, 438 F.Supp. 2d at 1070-1071; .Discovery Communications, Inc. v.

Animal Planet, Inc., 172 F. Supp. 2d 1282, 1287 (C.D. Cal. 2001). Finally, although it was not

required, the Court notes DTSC’s statement in its application for entry of default judgment that a

copy of the application, with all appended declarations, was mailed to Defendant Pitts at his last

known address. (Doc. 196, p. 2). In sum, the notice predicate to entry of default judgment is

inapplicable and, should the remaining predicates be satisfied, such a judgment may be entered

against Defendant Pitts. 

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4. Liability

Because claims that are legally insufficient are not established by a party’s default, a court

in considering an application for default judgment must determine whether the claims upon

which a plaintiff seeks a default judgment are legally sufficient. An application for a default

judgment qualifies as a motion pursuant to Fed. R. Civ. P. 7(b)(1) and it should include the legal

memorandum and affidavits required by Local Rule 78-230(b). It is the plaintiff’s burden to

demonstrate to the court that under the pertinent law, the plaintiff’s claims, as alleged, are legally

sufficient. Likewise, the applicant should supply the court with all pertinent and necessary legal

authority pursuant to which it is appropriate to enter judgment against a particular party based

upon the allegations of the party’s status, agency, participation, or other alleged basis for liability

of the particular party. 

a. Complaint’s Allegations and DTSC’s Evidence

The court has reviewed and considered the allegations in the complaint, along with the

declarations of Janill L. Richards, James Tjosvold, P.E., Jeffrey Mahan, and DTSC’s Custodian

of Records, all filed in support of entry of default judgment against Defendant Pitts. (Docs. 197-

200). Based on these declarations and attached exhibits, the court finds evidence that Plaintiff

DTSC conducted investigative and cleanup activities at the San Joaquin Drum Company site at

3930 Gilmore Street in Bakersfield, California. (E.g., Doc. 198, Declaration of James Tjosvold,

P.E., ¶ 4). Furthermore, the Court finds that these activities have caused DTSC to incur over

$1,000,000 in response costs, that these costs continue to be incurred, and that to date only

$300,000 is expected to be recovered through a settlement by DTSC with another defendant

(Western Farm Services, Inc.). (Id. at ¶ 5).

The Court further finds that Kern County tax assessment records establish that San

Joaquin Drum Company is the current owner of 3930 Gilmore Street in Bakersfield, California,

although records from the California Secretary of State establish that no such incorporated entity,

whether foreign or domestic, ever registered with the California Secretary of State under that

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name. (Doc. 197, Decl. of Janill L. Richards, ¶¶ 6-7 and Exhs. A, B). These records therefore

indicate that “San Joaquin Drum Company” was simply an unincorporated entity under which

the drum cleaning and refurbishing business located at 3930 Gilmore Street in Bakersfield,

California was operated. Furthermore, Plaintiff DTSC has provided the results of a Westlaw

search of Oklahoma tax assessor records, and these show Defendant Clifford Pitts’s former

address to be in Bakersfield, California and his current address to be in Boswell Oklahoma, the

same town in which San Joaquin Drum Company is located according to Kern County tax

assessment records. (Doc. 197, Decl. of Janill L. Richards, ¶ 9, Exhs. B, E). Finally, “‘the

general rule of law is that upon default the factual allegations of the complaint, except those

relating to the amount of damages, will be taken as true.’” TeleVideo Systems, Inc. v.

Heidenthal, 826 F.2d at 917-918 (quoting Geddes v. United Financial Group, 559 F.2d 557, 560

(9th Cir. 1977)). Here, those well-pleaded allegations clearly and specifically state that

Defendants Pitts owned and operated San Joaquin Drum Company at 3930 Gilmore Street in

Bakersfield, California, that his company was in the business of cleaning and reconditioning

drums from approximately 1967 through 1986 and that, during the company’s operations,

hazardous waste, sludge and wastewater generated from the drum cleaning and reconditioning

process. (Doc. 95, ¶¶ 17-19). 

b. Complaint’s Causes of Action

In its Application for Court Entry of Default Judgment (Doc. 196), Plaintiff DTSC seeks

a money judgment against Defendant Pitts in the amount of $100,000. (Doc. 196, p. 2). DTSC’s

application for default judgment does not, however, specify the counts within its second amended

complaint upon which such judgment should be entered. Notwithstanding, given that Counts

Two and Three of DTSC’s Second Amended Complaint seek nothing more than injunctive relief

under the Resources and Conservation Recovery Act, 42 U.S.C. § 6972 and under California

Health & Safety Code § 58009, respectively, only Count One of the Second Amended Complaint

is relevant. In Count One, DTSC demands payment under section 107(a) of the Comprehensive

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Environmental Response, Compensation, and Liability Act (“CERCLA”), 42 U.S.C. § 9601 et

seq., for its costs incurred in responding to the release and threatened release of hazardous

substances from the San Joaquin Drum site. (Doc. 95, ¶¶ 27-37). 

I. CERCLA

To establish liability under CERCLA, a plaintiff must prove: (1) the site at issue is a

disposal or treatment facility, (2) there has been a release, or a threatened release of hazardous

substances from the facility, (3) the plaintiff has incurred costs in response to the release or

threatened release, and (4) the defendant falls within one of the four classes of responsible

persons. United States v. Chapman, 146 F.3d 1166, 1169 (9th Cir. 1998); 3350 Stevens Creek

Assoc. v. Barclays Bank of California, 915 F.2d 1355, 1358 (9th Cir. 1990), cert. denied, 500

U.S. 917 (1991); California Dep’t of Toxic Substances Control v. Interstate Non-Ferrous Corp.,

298 F. Supp. 2d 930, 940 (E.D. Cal. 2003). As to the fourth requirement above, four classes of

persons are strictly liable for releases of hazardous substances: (1) current owners and operators

of a facility where hazardous substances were disposed, (2) past owners or operators who owned

or operated the facility at the time of the disposal, (3) transporters of the hazardous substances,

and (4) persons who arrange for disposal or treatment at any facility containing hazardous

substances. California Dep’t of Toxic Substances Control v. Interstate Non-Ferrous Corp., 

298 F. Supp. 2d at 940; Courtaulds Aerospace, Inc. v. William C. Huffman, 826 F. Supp. 345,

349 (E.D. Cal. 1993).

Here, the Complaint, Amended Complaint and Second Amended Complaint all alleged

that Defendant Pitts owned a facility where hazardous wastes were released, specifically, the San

Joaquin Drum Company at 3930 Gilmore Street in Bakersfield, California. (Doc. 1, ¶¶ 16-24,

Doc. 26, ¶¶ 17-26, Doc. 95, ¶¶ 17-26). Moreover, given the evidence submitted by DTSC in its

application for default as noted above, and taking the allegations of DTSC’s well-pleaded Second

Amended Complaint as true, also as noted above, the Court concludes that Defendant Pitts is the

current owner of a hazardous waste facility and was the owner and operator of that facility when

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hazardous substances were disposed thereon. Each of the remaining elements required for

CERCLA-liability also have been established: (1) the site at issue is a disposal or treatment

facility (Doc. 198, Decl. of James Tjosvold, P.E., ¶ 4), (2) there has been a release, or a

threatened release of hazardous substances from the facility (Doc. 95, ¶¶ 19-26, Doc. 198, Decl.

of James Tjosvold, P.E., ¶¶ 4-5) and (3) Plaintiff DTSC has incurred costs in response to the

release or threatened release. (Doc. 95, ¶ 32, Doc. 198, Decl. of James Tjosvold, P.E., ¶ 5, Doc.

200, Decl. of DTSC’s Custodian of Records, ¶¶ 2-5 and Exh. A). Thus, based on the evidence

before the Court, Defendant Pitts is subject to CERCLA liability. 

III. Amount of Judgment

Generally, the scope of proceedings on an application for default judgment involves a

determination of damages, which the plaintiff must prove by evidence, whether by affidavits, see

Davis v. Fendler, 650 F.2d 1154, 1161-1162 (9th Cir. 1981), or other evidence, see Fed. R. Civ.

P. 55(b)(2). Fed. R. Civ. P. 55(b)(2) provides in pertinent part:

If, in order to enable the court to enter judgment or to carry it into effect, it is

necessary to take an account or to determine the amount of damages or to

establish the truth of any averment by evidence or to make an investigation of any

other matter, the court may conduct such hearing or order such references as it

deems necessary and proper and shall accord a right of trial by jury to the parties

when and as required by any statute of the United States.

A party seeking a default judgment must provide the court with evidence sufficient to prove the

amount of any damages sought. A judgment by default shall not be different in kind from or

exceed in amount that prayed for in the demand for judgment. Fed. R. Civ. P. 54(c).

1. Joint and Several Liability

Liability under CERCLA is joint and several. California v. Montrose Chem. Corp.,

104 F.3d 1507, 1518 n.9 (9th Cir. 1997). Notwithstanding, DTSC requests judgment only in the

amount of $100,000. (Doc. 196, p. 2). While this is substantially less that DTSC’s actual

response costs to date, DTSC submits that such sum nevertheless will permit it enforce a lien

against the property at 3930 Gilmore Street, the site of the operations of San Joaquin Drum 

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Company. (Doc. 196, p. 2, Doc. 197, p. 2). Given that liability is established, the Court finds

that judgment in the requested amount of $100,000 is reasonable and just.

RECOMMENDATIONS

In light of the foregoing IT IS RECOMMENDED that

1. DTSC’s application for default judgement in the amount of One Hundred

Thousand Dollars ($100,000) be GRANTED;

2. DTSC’s previously filed Proposed Default Judgment Against Clifford N. Pitts

dba San Joaquin Drum Company (Doc. 201) be ADOPTED; and 

3. DTSC be DIRECTED to serve a copy of this order on Defendant Pitts at his last

known address and to file proof of service of same.

This Report and Recommendations is submitted to the United States District Court Judge

assigned to the case, pursuant to the provisions of 28 U.S.C. § 636 (b)(1)(B) and Rule 72-304 of

the Local Rules of Practice for the United States District Court, Eastern District of California.

Within thirty (30) days after being served with a copy, any party may file written objections with

the court and serve a copy on all parties. Such a document should be captioned “Objections to

Magistrate Judge’s Report and Recommendations.” Replies to the objections shall be served and

filed within ten (10) court days (plus three days if served by mail) after service of the objections.

The Court will then review the Magistrate Judge’s ruling pursuant to 28 U.S.C. § 636 (b)(1)(C). 

The parties are advised that failure to file objections within the specified time may waive the

right to appeal the District Court’s order. Martinez v. Ylst, 951 F.2d 1153 (9th Cir. 1991).

IT IS SO ORDERED.

Dated: October 3, 2006 /s/ Theresa A. Goldner 

j6eb3d UNITED STATES MAGISTRATE JUDGE 

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