Filed 3/28/23 Valley Water Management v. Superior Court CA5

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIFTH APPELLATE DISTRICT

VALLEY WATER MANAGEMENT 

COMPANY,

Plaintiff and Respondent,

v.

THE SUPERIOR COURT OF KERN COUNTY,

Respondent;

CALIFORNIA REGIONAL WATER QUALITY 

CONTROL BOARD, CENTRAL VALLEY, 

Real Party in Interest and Appellant.

F083744

(Super. Ct. No. BCV-19-101630)

OPINION

APPEAL from a judgment of the Superior Court of Kern County. David R. 

Lampe, Judge.

Rob Bonta, Attorney General, Robert W. Byrne, Assistant Attorney General, Eric 

M. Katz and Jennifer Kalnins Temple, Deputy Attorneys General, for Real Party in 

Interest and Appellant Regional Water Quality Control Board.

Downey Brand and Melissa A. Thorme for Plaintiff and Respondent Valley Water 

Management Company. 
2.

-ooOoo-
3.

Valley Water Management Company brought this action against the California 

Regional Water Quality Control Board for the Central Valley Region, challenging 

beneficial use designations for groundwater in the Tulare Lake Basin. Judgment was 

entered in favor of Valley Water Management Company. Thereafter, the trial court 

awarded attorneys’ fees to Valley Water Management Company under Code of Civil 

Procedure section 1021.5. The Regional Water Quality Control Board for the Central 

Valley Region appealed the trial court’s ruling awarding the attorneys’ fees. We reverse. 

FACTUAL AND PROCEDURAL BACKGROUND

This matter was initiated in the Kern County Superior Court by Valley Water 

Management Company (Valley Water) against California Regional Water Quality 

Control Board, Central Valley Region (Regional Board or Central Valley Regional 

Board). More specifically, on June 12, 2019, Valley Water filed a petition for writ of 

mandate and complaint for declaratory and injunctive relief against the Regional Board, 

challenging two Regional Board actions by way of traditional mandamus under Code of 

Civil Procedure section 1085.1 

A. The Regional Board’s Tulare Lake Basin Plan Designated Beneficial Uses for

Groundwater in the Tulare Lake Basin 

Under the 1969 Porter-Cologne Water Quality Control Act (Porter-Cologne Act, 

Wat. Code, § 13000 et seq.), the state agency charged with formulating and adopting state 

policy for water quality control within the state is the State Water Resources Control 

Board (State Board). (Wat. Code, §§ 13140, 13160.) Nine regional water quality boards 

operate under the purview of the State Board, and the State Board and regional boards are 

collectively responsible for protecting water quality in the state. (California Assn. of 

Sanitation Agencies v. State Water Resources Control Bd. (2012) 208 Cal.App.4th 1438, 

1 Subsequent statutory references are to the Code of Civil Procedure unless 

otherwise specified. 
4.

1444 (CASA).) The State Board establishes statewide policy and plans for water quality 

control (Wat. Code, §§ 13140, 13170, 13170.2), and the regional boards formulate and 

adopt water quality control plans (basin plans) for areas within given regions (Wat. Code, 

§ 13240). As relevant here, the Central Valley Regional Board is responsible for 

protecting and regulating the quality of surface waters and groundwater in the Central 

Valley through various basin plans, including the Tulare Lake Basin Water Quality 

Control Plan (Tulare Lake Basin Plan or Basin Plan), which is at issue in this matter. 

Basin plans have several elements, including: (1) designating beneficial uses (e.g., 

agricultural, municipal, and recreational uses) for the waterbody at issue; (2) setting water 

quality objectives or standards to further the designated beneficial uses; and (3) a 

program of implementation. (Wat. Code, § 13050, subd. (j); City of Arcadia v. State 

Water Resources Control Bd. (2010) 191 Cal.App.4th 156, 177.) The Tulare Lake Basin 

Plan was first adopted in 1975 and has been updated and revised 23 times thereafter. 

This case concerns the Tulare Lake Basin Plan’s designation of beneficial uses for 

groundwaters in the Tulare Lake Basin. 

The 1975 Tulare Lake Basin Plan adopted by the Regional Board designated 

“Present and Potential Beneficial Uses” for the Basin’s surface waters and groundwaters. 

As relevant here, the Tulare Lake Basin Plan blanket-designated groundwaters in the 

Basin as suitable for, inter alia, municipal (MUN) and agricultural (AGR) uses, with the 

caveat that “specific beneficial uses of the groundwater [would] be determined at [a later] 

time.” 

In 1988, the State Board adopted Resolution No. 88-63, a “ ‘Sources of Drinking 

Water Policy,’ ” in light of a newly enacted law, Proposition 65, the Safe Drinking Water 

and Toxic Enforcement Act of 1986, which included protections for existing and 

potential municipal drinking water sources. (Health & Saf. Code, § 25249.5 et seq.) The 

State Board’s Resolution No. 88-63 provided that “[a]ll surface and ground waters of the 
5.

State are considered to be suitable, or potentially suitable, for municipal or domestic 

water supply and should be so designated by the Regional Boards,” subject to certain 

exceptions.2 (Fn. omitted.) 

The Central Valley Regional Board incorporated the State Board’s Sources of 

Drinking Water Policy into the Tulare Lake Basin Plan on May 26, 1989. The Regional 

Board designated all surface and ground waters within the Basin as potentially suitable 

for municipal supply, except for waters that, inter alia, had an excessive mineral content, 

were otherwise contaminated beyond the point of reasonable remediation, or represented 

an insufficient yield for the purpose of constituting a domestic water supply. Since then, 

the Tulare Lake Basin Plan has blanket-designated all groundwaters in the Basin for, inter 

alia, existing or potential municipal and agricultural use, with certain specifically 

identified exceptions. As for municipal use, the Basin Plan states: “Due to the ‘Sources 

of Drinking Water Policy,’ all ground waters are designated MUN (the use may be 

existing or potential) unless specifically exempted by the Regional Water Board and 

approved for exemption by the State Water Board.” As for agricultural use, the Basin 

Plan states: “In addition, unless otherwise designated by the Regional Water Board, all 

ground waters in the Region are considered suitable or potentially suitable, at a 

minimum, for agricultural supply (AGR).” As mentioned above, the Basin Plan lists 

specific groundwater areas that are exempted from the blanket MUN and AGR 

designations. 

2 The State Board’s Resolution 88-63 was subsequently determined by the 

California Office of Administrative Law to be “ ‘a regulation’ ” that was “required to be 

adopted in compliance with the Administrative Procedure Act,” but suffered from certain 

procedural defects. 
6.

B. Valley Water Faced a Proposition 65 Lawsuit from Environmental Groups as 

well as a Cease-and-Desist Order from the Central Valley Regional Board

Valley Water, a membership organization with oil company members, had 

operated, for several decades, two interconnected oilfield-produced wastewater disposal 

ponds collectively referred to as the McKittrick Facility.3 The Regional Board’s brief 

explains: “The McKittrick Facility served oil producers [that] generated wastewater as a 

byproduct of their oil extraction operations. Oil wells bring up oil, but the oil is usually 

mixed with unwanted water. After the useable oil is separated from the water, the 

produced water, which contains numerous oil related contaminants, requires disposal. 

Valley Water facilitated such disposal by way of its disposal ponds.” Valley Water’s 

McKittrick Facility operated under a permit initially issued by the Regional Board in the 

1950s. Under the permit, Valley Water could discharge wastewater into its on-site 

disposal ponds but was prohibited from creating pollution and/or a nuisance. 

California’s Proposition 65 prohibits discharges of chemicals known to cause 

cancer, to sources of drinking water, and authorizes private citizens to bring civil lawsuits 

to enforce its terms after giving 60 days’ notice of intent to file suit. (Health & Saf. 

Code, §§ 25249.5, 25249.7, subd. (d).) Proposition 65 applies when cancer-causing 

chemicals are discharged into “any source of drinking water.”4 (Health & Saf. Code, 

§ 25249.5.) Under Proposition 65, a “source of drinking water” is defined as a present 

source of drinking water or water that is identified in a water quality control plan as being 

suitable for domestic or municipal uses. (Health & Saf. Code, § 25249.11, subd. (d); 

Cal. Code Regs., tit. 27, § 25102, subd. (w) [“water” includes both surface and ground 

3 “Produced water” is a term of art in the oil industry; it refers to water produced as 

a byproduct of oil and gas production. 

4 Health and Safety Code section 25249.5 provides: “No person in the course of 

doing business shall knowingly discharge or release a chemical known to the state to 

cause cancer or reproductive toxicity into water or onto or into land where such chemical 

passes or probably will pass into any source of drinking water.”
7.

waters].) A court may award up to $2,500 per day of violation of Proposition 65’s 

prohibitions. (Health & Saf. Code, § 25249.7, subd. (b)(1).) On April 15, 2019, two 

environmental groups gave notice to Valley Water of an intent to file a citizen suit under 

Proposition 65 seeking potentially millions of dollars in civil penalties for unlawful 

discharge of pollutants into a source of drinking water. 

The environmental groups then filed a Proposition 65 complaint on June 24, 2019, 

in the Kern County Superior Court (Clean Water Fund et al. v. Valley Water 

Management Co. (Super. Ct. Kern County, BCV-19-101750)), regarding Valley Water’s 

oilfield wastewater discharges to its McKittrick Facility that was subject to the Tulare 

Lake Basin Plan.5 The complaint alleged that Valley Water “has been operating since 

approximately 1955 and has operated in its current configuration with wastewater storage 

and treatment ponds, and conveyances, such as pipelines or impoundments, since 

approximately 1980.” It further alleged that Valley Water “discharges and/or disposes as 

much as 4.4 million gallons of wastewater into these pits in a single day, and that on 

average, [Valley Water] discharges and/or disposes 2.5 million gallons per day.” In 

addition, the complaint alleged that the Regional Board staff, “after investigation, 

identified discharges from the unlined pits at [Valley Water’s] Facility, which have 

migrated through the soil and caused documented groundwater pollution that has spread 

past the alluvium and into deeper aquifers. The plume from [Valley Water’s] Facility has 

migrated laterally for miles.” Next, the complaint alleged that Valley Water had 

discharged Proposition 65-listed chemicals into groundwater designated for drinking, and 

5 The Regional Board has filed a request asking us to take judicial notice of the 

complaint in the related Proposition 65 case, pursuant to Evidence Code section 452, 

subdivision (d). Evidence Code section 452, subdivision (d) permits a court to take 

judicial notice of the records of any state court. The Regional Board’s request is hereby 

granted. (See Jefferson Street Ventures, LLC v. City of Indio (2015) 236 Cal.App.4th 

1175, 1191-1192 [court took judicial notice of relevant court documents filed in related 

matter]; In re Sodersten (2007) 146 Cal.App.4th 1163, 1171, fn. 1.)
8.

sought “penalties of $2,500 per day for each violation.” The complaint also sought a 

permanent injunction requiring Valley Water to cease discharging pollutants in violation 

of Proposition 65. 

Around the same time, on June 7, 2019, the Regional Board issued a cease-anddesist order to Valley Water. The cease-and-desist order noted: “The Discharger has 

generated an oil field produced wastewater plume that ... greatly exceeds the quality with 

respect to [certain minerals and other substances, etc.] required to support the Basin Plan 

designated beneficial uses of MUN and AGR.” The cease-and-desist order required 

Valley Water to further investigate the extent of the groundwater plume emanating from 

its facility as identified by the Regional Board. The cease-and-desist order also required 

Valley Water to cease discharging pollutants to groundwater by September 1, 2020, 

unless it made operational changes allowing it to obtain a new permit that would be in 

compliance with the Tulare Lake Basin Plan. 

On June 12, 2019, Valley Water initiated the instant lawsuit. Valley Water filed a 

Verified Petition for Writ of Mandate and Complaint for Declaratory and Injunctive 

Relief in the Kern County Superior Court, seeking to void the Regional Board’s 

beneficial use designations for groundwater throughout the Tulare Lake Basin as waters 

potentially suitable for agricultural use and drinking water. More specifically, Valley 

Water challenged the Regional Board’s 1975 action, when it initially adopted the Tulare 

Lake Basin Plan, to designate groundwater in the Tulare Lake Basin as suitable for 

agricultural use. Valley Water also challenged the Regional Board’s 1989 action to 

amend the Tulare Lake Basin Plan to incorporate the State Board’s “ ‘Sources of 

Drinking Water Policy’ ” (State Board Resolution No. 88-63), whereby groundwater in 

the Tulare Lake Basin was designated as suitable for use as municipal drinking water, 

with specific exceptions. By way of these actions, the Regional Board had “blanket 
9.

designated” large areas of the Tulare Lake Basin as suitable for both agricultural and 

municipal use. 

On June 28, 2019, Valley Water filed a Petition for Review of the Regional 

Board’s cease-and-desist order with the State Board, in which Valley Water sought, in 

part, the same relief as it did in the instant writ action. As relevant here, Valley Water 

contended the cease-and-desist order protected a “non-existent MUN use,” as the 

groundwaters under its facility “should not have been designated [for municipal use] in 

the first place.” (Unnecessary capitalization omitted.) Valley Water further contended 

that “the initial MUN use designation under and around the Facility where the 

groundwater was and is not capable of being used for municipal supply[,] was arbitrary, 

capricious, unsupported by substantial evidence, and, therefore, unlawful.” The petition 

for review requested, inter alia, the following relief: “Valley Water requests that the 

State Water Board urge the Central Valley Water Board to act with all due haste to 

correct improperly designated uses of ground water near and below Valley Water’s 

facilities.” The petition for review also contained a request that the State Board place the 

petition for review in abeyance for two years “to allow Valley Water to work with the 

Regional Board on the issues raised herein.” In the meantime, Valley Water pursued the 

instant lawsuit against the Regional Board. 

C. The Instant Lawsuit and the Trial Court’s Ruling and Judgment

As noted, on June 12, 2019, Valley Water filed the instant lawsuit against the 

Regional Board. More specifically, Valley Water filed a combined verified petition for 

writ of mandate pursuant to Code of Civil Procedure section 1085 and complaint for 

declaratory and injunctive relief. The prayer for relief sought a judicial declaration that 

the Tulare Lake Basin Plan’s beneficial use designations were invalid and/or a writ of 

mandate directing the Regional Board to invalidate them. In addition, Valley Water 

sought injunctive relief enjoining the Regional Board from enforcing the designations of 
10.

beneficial uses for groundwater in the Basin, specifically: “An order enjoining 

Defendant Central Valley Regional Board from utilizing and enforcing the improperly 

and unlawfully designated MUN, AGR, and other non-existent uses complained of herein 

for groundwater regulated under the Tulare Lake Basin Plan.” 

On July 8, 2019, Valley Water filed a notice of related case seeking to relate the 

instant lawsuit to the Proposition 65 case previously filed against it by the environmental 

groups. On August 9, 2019, the trial court related the cases assigning them both to the 

Honorable David J. Lampe. 

On September 9, 2019, Valley Water filed its operative first amended verified 

petition for writ of mandate and complaint for declaratory relief (petition/complaint) 

Valley Water’s petition/complaint clarified that Valley Water filed the instant action on 

account of the enforcement action filed by the environmental groups under Proposition 

65 as well as the separate action by the Regional Board. Thus, the petition/complaint 

asserted, as part of its general factual allegations, that invalidation of the beneficial use 

designations as to groundwater in the Tulare Lake Basin Plan was necessary because 

absent such relief, “Valley Water ... will be subject to unnecessary enforcement actions 

by the Central Valley Regional Board and under Proposition 65.” The petition/complaint 

further alleged that in such scenarios, Valley Water “may be required to expend millions 

of dollars to install additional storage, evaporation, and/or treatment facilities (e.g., 

micro-filtration/reverse osmosis) that are specific and unique to removing salinity 

compounds,” all of which would “be unnecessary if water quality objectives based on 

inapplicable beneficial uses (e.g., MUN, AGR, etc.) did not apply.” 

The petition/complaint specifically noted: “[T]wo non-profit corporations recently 

filed a Notice of Violation letter against Valley Water on April 15, 2019, prompting [the 

instant] litigation filed on June 12, 2019.” (Italics added.) The petition/complaint further 

noted that the non-profit organizations thereafter “sued Valley Water on June 25th, 2019, 
11.

under Proposition 65 ... seeking civil penalties and injunctive relief.” The 

petition/complaint added: “Thus, Valley Water has already been harmed and is currently 

facing unnecessary enforcement actions under Proposition 65 due to the Central Valley 

Regional Board’s inaccurate MUN designation.” 

On November 6, 2020, the trial court heard the merits of the petition/complaint. 

On May 14, 2021, after directing Valley Water to prepare a statement of decision and 

hearing various related objections, the trial court entered judgment in favor of Valley 

Water, and issued an accompanying statement of decision and peremptory writ of 

mandate. 

The statement of decision summarized the court’s ruling at the top:

“The Court renders judgment for the Petitioner Valley Water 

Management Company (“Petitioner” or “Valley Water”) and against 

Respondent California Regional Water Quality Control Board for the 

Central Valley Region (“Respondent” or “Regional Board”) upon the First 

Amended Verified Petition for Writ of Mandate (“Petition”) and issues a 

writ of mandamus limited to requiring the Respondent to initiate and pursue 

a Basin Plan Amendment process for portions of the Tulare Lake Basin to 

determine the scope and extent of actual and potential beneficial uses of 

groundwater near the Petitioner’s McKittrick 1 and 1-3 facilities

(“McKittrick Facilities”), including the propriety and reasonableness of the 

current designation of municipal drinking water supply (“MUN”) and/or 

agricultural (“AGR”) use as to all or any portion of that groundwater.

“Otherwise, the Court denies the Petition without prejudice to 

Petitioner’s right to seek further proceedings. Also, the Court declines to 

consider at this time the Petitioner’s collateral cause of action for 

declaratory relief or the collateral remedy of injunction pursuant to the 

doctrine of judicial abstention, without prejudice to further proceedings 

upon further order of the Court. (See Acosta v. Brown (2013) 213 

Cal.App.4th 234.) The Court shall retain continuing equitable jurisdiction 

for this matter pending a return demonstrating that an amendment process 

has been initiated and finalized after judgment as necessary.

“Petitioner is to have judgment for costs incurred. The propriety of 

an award of attorney’s fees can be determined by separate motion and 

ruling.” (Italics added.) 
12.

The court discussed its reasoning and ruling in more depth in subsequent sections 

of its statement of decision. For example, the court clarified that blanket designations of 

beneficial uses for groundwaters in basin plans is not per se improper, but such blanket 

designations need further refinement under certain circumstances. Specifically, the court 

noted: 

“Valley Water argues that these ‘blanket’ designations lack 

evidentiary support and are improper because they encompass much 

groundwater that has never been suited and never will be suited for such 

designations. This issue must be considered in context. While it is literally 

true that the assignations of beneficial uses here were not based upon 

individualized factual analyses, it was not unreasonable or entirely lacking 

in evidentiary support for the Regional Board, as a policy matter, to create a 

working assumption that the beneficial uses existed or were attainable 

where it is impractical to list every groundwater formation in the region. 

This is a sensible approach and ensures that water quality is protected. It is 

a ‘useful tool’ for managing the state water quality program, provided that

there is an established reasonable regulatory process to make adjustments 

for actual uses. 

“This Court recognizes that an MUN and AGR beneficial use may 

not be appropriate for some of the groundwater covered by the initial 

blanket designations, including groundwaters affected by Valley Water’s 

discharges. But if the Regional Board or this Court were to invalidate the 

blanket designated MUN or AGR uses, much of the groundwater in the 

region might lack any beneficial use designation. Thus, the ‘blanket’ 

language represents a reasonable means of protecting the beneficial uses of 

the groundwaters of the region unless or until the Regional Board has or 

gains knowledge that such uses do not or likely will not in the future exist 

in ‘individual’ groundwater formations, then the use designations must be 

expeditiously modified. (See CASA, 208 Cal.App.4th at 1460-1461 [the 

Basin Plan ‘impose[s] upon the Regional Board an affirmative obligation to 

determine the factual accuracy of a use previously designated by blanket 

application ..., where such analysis is necessary for rational regulatory 

action’].) [¶] ... [¶]

“The Regional Board has an affirmative continuing obligation to 

determine the factual accuracy of a use previously designated by blanket 

application, where such analysis is necessary for rational regulatory action. 

Here, the Regional Board acknowledges that the groundwater near Valley 
13.

Water’s discharges at its facilities is not likely suitable for MUN 

designation[

6

] ... The blanket designation was a reasonable approach to a 

complex problem; it was also, admittedly, based upon unavailable specific 

use data, and in some cases, a known falsehood. ([Citation] [record 

evidence showing that the Regional Board had data indicating that 

groundwater in many areas was too saline to support drinking water or 

irrigation uses]....) In addition to [evidence reflected in] the permits the 

Regional Board issued to Valley Water in the 1950s and 1960s, the record 

contains several examples of locations where the Regional Board was 

aware that groundwater was too high in salinity or boron to be able to be 

used for drinking water or irrigation. [Citation.] Therefore, the Basin Plan 

explicitly and implicitly charges the Regional Board with the responsibility 

to correct erroneous designations when circumstances require it, for 

example, when the Regional Board is considering pursuing monitoring 

requirements or alleged violations for discharges. (CASA, 208 Cal.App.4th 

at 1461.) Where the Regional Board has evidence that a use may not exist 

nor likely cannot be feasibly attained, the Regional Board must 

expeditiously initiate efforts to consider correcting or removing the use 

designation. (Ibid.) If the Regional Board unreasonably fails or refuses to 

do so, mandamus will lie. (Ibid.)

“Here the Regional Board has and previously had evidence ... that 

the underlying groundwater near Valley Water’s McKittrick Facilities are 

unsuitable for MUN or AGR designation.... In order to preserve the 

reasonableness of its initial overall blanket designations for the entire basin, 

the Regional Board must initiate a Basin Plan amendment process, where 

warranted. (CASA, 208 Cal.App.4th at 1461 [‘[W]here a Regional Board 

has evidence that a use neither exists nor likely can be feasibly attained, the 

Regional Board must expeditiously initiate appropriate basin plan 

amendments to consider dedesignating the use.’].) 

As for the writ granted by the trial court, it directed as follows: “In accordance 

with the Court’s Statement of Decision on Petition for Writ of Mandate, dated May 14, 

6 The court was referring here to, inter alia, a Regional Board Staff Report attached 

to the Board’s cease-and-desist order, which report stated on page 22: “The ground water 

directly under the Facility appears to be primarily produced water from the Facility ponds

and possibly other Valley Water facilities. This groundwater may be suitable for 

dedesignation. However, this water is migrating to the northeast into areas where 

groundwater [is] not suitable for dedesignation, because it is of higher quality and is 

being beneficially used.” (Italics added.) 
14.

2021, Respondent Regional Water Board shall initiate a basin planning amendment 

procedure to review the scope and extent of actual and potential beneficial uses of 

groundwater near and underlying the Valley Water Management Company’s McKittrick 

1 and 1-3 facilities.” (Italics added.) The writ further specified: “The Court will not 

dictate the precise nature or result of this review, but does require that the Regional Board 

consider all relevant factors, develop a factual record to allow for judicial review of its 

decision, and explain how its discretion was exercised.” 

Finally, the trial court judgment noted that Valley Water’s petition for writ of 

mandate was “granted in part,” while its causes of action for declaratory and injunctive 

relief were “denied without prejudice.” 

D. Valley Water’s Settlement of the Proposition 65 Case

As noted above, Valley Water’s petition/complaint alleged the Proposition 65 case 

that sought penalties of $2,500 per day for Proposition 65 violations, was the impetus for 

Valley Water’s instant action against the Regional Board. Valley Water similarly 

characterized the Proposition 65 case in its present motion for attorney fees: “Valley 

Water had hoped [the instant] case would have been a tool to avoid further litigation in a 

related case alleging that Valley Water violated Proposition 65.” Valley Water sought, in 

the instant action, to void the beneficial uses designated for groundwaters throughout the 

Tulare Lake Basin. 

Valley Water ultimately settled the Proposition 65 case by means of a stipulated 

consent judgment. The plaintiff environmental organizations in the Proposition 65 case 

filed a memorandum of points and authorities in support of the stipulated consent 

judgment. The memorandum of points and authorities candidly stated: “[W]hile this 

Court’s tentative ruling in the related case may weigh against a full penalty assessment in 

this case, Plaintiffs allege and can prove violations beyond just discharges to MUN 
15.

designated waters, for which the penalty amount is a reasonable settlement compromise.” 

(Emphasis in original.) 

Under the stipulated consent judgment, Valley Water settled the Proposition 65 

case for a total of $645,000, consisting of $139,000 in civil penalties pursuant to Health 

and Safety Code section 25249.7, subdivision (b); $481,000 as reimbursement for the 

plaintiffs’ reasonable attorneys’ fees, experts’ fees, and costs; and $25,000 as an 

additional settlement payment, to be paid to the Clean Water Fund. Pursuant to the 

stipulated consent judgment, Valley Water closed down the McKittrick Facilities in 2021. 

E. Valley Water’s Motion for Attorneys’ Fees

After entry of judgment in the instant matter, Valley Water filed, on July 20, 2021, 

a motion seeking attorneys’ fees under section 1021.5. Valley Water sought a lodestar 

amount of $239,479.65 and a multiplier of 1.5, for a total fee award in the amount of 

$359,219.48. The Regional Board opposed the motion on grounds that Valley Water had 

not satisfied the statutory criteria for an award of attorneys’ fees set forth in section 

1021.5. The Regional Board further argued that any award of attorneys’ fees should be 

subject to a negative multiplier given the limited nature of the relief obtained by Valley 

Water in this matter. 

The court issued a final ruling on Valley Water’s motion for attorneys’ fees on 

October 6, 2021. The court’s barebones ruling, in its entirety, states: 

“The Court grants in part Petitioner/Plaintiff Valley Water 

Management Company’s Motion for Attorneys’ Fees, finding Valley Water 

Management’s action has resulted in the enforcement of an important right 

affecting the public interest, a significant benefit has been conferred on the 

general public or a large class of persons, private enforcement was 

necessary and the financial burden of private enforcement was such as to 

make the award appropriate. (Code Civ. Proc.[,] § 1021.5.) In light of 

Valley Water Management’s failure to obtain relief as to the entire Tulare 

Lake Basin, as well as the Court’s determination that this action did not 

involve novel or complex issues, the Court declines to award a multiplier as 

requested. The Court awards the lodestar amount of $239,479.65. 
16.

The Regional Board appeals the trial court’s award of attorneys’ fees to Valley Water. 

DISCUSSION

I. Standard of Review

Section 1021.5 provides in relevant part: “Upon motion, a court may award 

attorneys’ fees to a successful party against one or more opposing parties in any action 

which has resulted in the enforcement of an important right affecting the public interest 

if: (a) a significant benefit, whether pecuniary or nonpecuniary, has been conferred on 

the general public or a large class of persons, (b) the necessity and financial burden of 

private enforcement, or of enforcement by one public entity against another public entity, 

are such as to make the award appropriate, and (c) such fees should not in the interest of 

justice be paid out of the recovery, if any.”

“Section 1021.5 provides for court-awarded attorney fees under a private attorney 

general theory.” (Baggett v. Gates (1982) 32 Cal.3d 128, 142; see Serrano v. Priest

(1977) 20 Cal.3d 25.) “[T]he private attorney general doctrine ‘rests upon the 

recognition that privately initiated lawsuits are often essential to the effectuation of the 

fundamental public policies embodied in constitutional or statutory provisions .... 

[Without] some mechanism authorizing the award of attorney fees, private actions to 

enforce such important public policies will as a practical matter frequently be 

infeasible.’ ” (Baggett v. Gates, supra, 32 Cal.3d at p. 142.) The private attorney general 

doctrine as codified in section 1021.5 “is an exception to the usual rule that each party 

bears its own attorney fees.” (Vosburg v. County of Fresno (2020) 54 Cal.App.5th 439, 

449 (Vosburg).) “The section acts as an incentive for the pursuit of public interest-related 

litigation that might otherwise have been too costly to bring.” (Coalition for a 

Sustainable Future in Yucaipa v. City of Yucaipa (2015) 238 Cal.App.4th 513, 520-521 

(Yucaipa); Ryan v. California Interscholastic Federation (2001) 94 Cal.App.4th 1033, 

1045 [“where the financial burden is disproportionate, section 1021.5 serves to 
17.

underwrite successful litigation that effectuates strong public policy and obtains benefits 

for a broad class of citizens”].)

Rulings under section 1021.5 are reviewed for abuse of discretion.7 (Lyons v. 

Chinese Hospital Assn. (2006) 136 Cal.App.4th 1331, 1344.) “The questions are whether 

the court applied the proper legal standards under section 1021.5 and, if so, whether the 

result was within the range of the court’s discretion [citation], i.e., whether there was a 

reasonable basis for the decision [citation].” (Ibid.; see Yucaipa, supra, 238 Cal.App.4th 

at p. 519 [“Although [the abuse of discretion] standard is deferential, a court abuses its 

discretion where no reasonable basis for the action is shown.”]; Baggett v. Gates, 32 

Cal.3d at p. 143 [“ ‘discretion may not be exercised whimsically and, accordingly, 

reversal is appropriate “where no reasonable basis for the action is shown.” ’ ”]; Ryan v. 

California Interscholastic Federation (2001) 94 Cal.App.4th 1033, 1044 [an attorney 

fees award under section 1021.5 will “be reversed where ‘ “it is clearly wrong or has no 

reasonable basis” ’ ”]. )

II. Legal Framework

Under section 1021.5, the private attorney general statute, “[a] superior court may 

award attorney fees to (1) a successful party in any action (2) that has resulted in the 

enforcement of an important right affecting the public interest if (3) a significant benefit 

7 See, however, McGuigan v. City of San Diego (2010) 183 Cal.App.4th 610, 623

[“Where the material facts are undisputed, and the question is how to apply statutory 

language to a given factual and procedural context, the reviewing court applies a de novo 

standard of review to the legal determinations made by the trial court.”]. But see Carian 

v. Department of Fish and Wildlife (2015) 235 Cal.App.4th 806, 816 [“Even assuming 

the underlying facts are undisputed, it remains the trial court’s duty to consider those 

facts and the circumstances of the case and exercise its discretion in determining whether 

the requirements were satisfied for an award of attorney fees under section 1021.5, and 

we can reverse the court’s determination only if there is no reasonable basis for it.”].
18.

has been conferred on the general public or a large class of persons,[

8

] (4) private 

enforcement is necessary because no public entity or official pursued enforcement or 

litigation, (5) the financial burden of private enforcement is such as to make a fee award 

appropriate, and (6) in the interests of justice the fees should not be paid out of the 

recovery.” (Robinson v. City of Chowchilla (2011) 202 Cal.App.4th 382, 390

(Robinson), fn. omitted.) 

“As section 1021.5 states the criteria in the conjunctive, each of the statutory 

criteria must be met to justify a fee award.” (County of Colusa v. California Wildlife 

Conservation Bd. (2006) 145 Cal.App.4th 637, 648; McGuigan v. City of San Diego, 

supra, 183 Cal.App.4th at p. 623 [“ ‘Because the statute states the criteria in the 

conjunctive, each must be satisfied to justify a fee award.’ ”].) 

“The burden of proving the existence of the first five statutory elements listed in 

Robinson is placed on the party requesting attorney fees under section 1021.5.” 

(Vosburg, supra, 54 Cal.App.5th at p. 450; Ryan v. California Interscholastic Federation, 

supra, 94 Cal.App.4th at p. 1045 [same].)

III. The Trial Court Abused its Discretion in Awarding Attorney Fees Under 

Section 1021.5

As noted above, here the trial court listed the factors the court must consider in 

determining whether an award of attorney fees is appropriate under the private attorney 

general statute, section 1021.5, but the court awarded Valley Water $239,479.65 in 

8 “Because the public always has a significant interest in seeing that laws are 

enforced, it always derives some benefit when illegal private or public conduct is 

rectified. Nevertheless, the Legislature did not intend to authorize an award of fees under 

section 1021.5 in every lawsuit enforcing a constitutional or statutory right. [Citations.] 

The statute specifically provides for an award only when the lawsuit has conferred ‘a 

significant benefit’ on ‘the general public or a large class of persons.’ The trial court 

must determine the significance of the benefit and the size of the class receiving that 

benefit by realistically assessing the gains that have resulted in a particular case.” 

(Flannery v. California Highway Patrol (1998) 61 Cal.App.4th 629, 635.)
19.

attorney fees without any discussion or analysis with respect to the application of those 

factors to the factual and procedural context of this case. 

The Regional Board does not contest Valley Water’s showings as to the first 

statutory element (fees may be awarded to successful party) and sixth statutory element 

(fees may not be paid out of any monetary recovery). Rather, the Regional Board 

contends that Valley Water “failed to carry its burden to satisfy the remaining four 

elements.” We will focus on the fifth statutory element, that is, whether the financial 

burden of private enforcement is such as to make a fee award appropriate. 

A. The “Financial Burden” Element of Section 1021.5

The Regional Board persuasively contends the trial court abused its discretion in 

awarding Valley Water fees under section 1021.5, because it failed to meet its burden of 

showing that the costs of the instant lawsuit disproportionately transcended its personal 

financial interest in the matter. (See Ryan v. California Interscholastic Federation, 

supra, 94 Cal.App.4th at pp. 1043-1044, 1047 [holding that the “trial court abused its 

discretion in awarding Ryan attorney fees under section 1021.5, because he failed meet 

his burden of showing that ... [the costs of his lawsuit] disproportionately transcended his 

personal [financial] interest in the matter”].)

The financial burden requirement examines “ ‘ “whether the financial burden of 

private enforcement warrants subsidizing the successful party’s attorneys.” ’ ” 

(Conservatorship of Whitley (2010) 50 Cal.4th 1206, 1214 (Whitley).) “In determining 

the financial burden on litigants, courts have quite logically focused not only on the costs 

of the litigation but also any offsetting financial benefits that the litigation yields or 

reasonably could have been expected to yield.” (Id. at p. 1215.) “ ‘ “An award on the 

‘private attorney general’ theory is appropriate when the cost of the claimant’s legal 

victory transcends his personal interest, that is, when the necessity for pursuing the 

lawsuit placed a burden on the plaintiff ‘out of proportion to his individual stake in the 
20.

matter.’ ” ’ ” (Ibid.) “ ‘This requirement focuses on the financial burdens and incentives 

involved in bringing the lawsuit.’ ” (Ibid.; see Press v. Lucky Stores, Inc. (1983) 34 

Cal.3d 311, 321, fn. 11 [“[Section 1021.5, subd. (b)] focuses not on plaintiffs’ abstract 

personal stake, but on the financial incentives and burdens related to bringing suit.”

(italics added)]; Collins v. City of Los Angeles (2012) 205 Cal.App.4th 140, 152 (Collins) 

[“The appropriate inquiry is whether the financial burden of the plaintiff’s legal victory 

outweighs the plaintiff’s personal financial interest.”].)

Significantly, “in assessing the financial burdens and benefits in the context of 

section 1021.5, we are evaluating incentives rather than outcomes.” (Whitley, supra, 50 

Cal.4th at p. 1220.) “ ‘ “[W]e do not look at the plaintiff’s actual recovery after trial, but 

instead we consider ‘the estimated value of the case at the time the vital litigation 

decisions were being made.’ ” [Citation.] The reason for the focus on the plaintiff’s 

expected recovery at the time litigation decisions are being made, is that Code of Civil 

Procedure section 1021.5 is intended to provide an incentive for private plaintiffs to bring 

public interest suits when their personal stake in the outcome is insufficient to warrant 

incurring the costs of litigation.’ ” (Id. at pp. 1220-1221.)

Whitley set out a “method for weighing costs and benefits” of bringing the lawsuit 

at issue. (Whitley, supra, 50 Cal.4th at p. 1215.) “ ‘The trial court must first fix—or at 

least estimate—the monetary value of the benefits obtained by the successful litigants 

themselves .... Once the court is able to put some kind of number on the gains actually 

attained it must discount these total benefits by some estimate of the probability of 

success at the time the vital litigation decisions were made which eventually produced the 

successful outcome.... Thus, if success would yield ... the litigant group ... an aggregate 

of $10,000 but there is only a one-third chance of ultimate victory[,] they won’t 

proceed—as a rational matter—unless their litigation costs are substantially less than 

$3000.” (Ibid., italics added; City of Oakland v. Oakland Police & Fire Retirement
21.

System (2018) 29 Cal.App.5th 688, 700 & fn. 2 [“Whitley ... requires consideration of the 

monetary value of the benefits that the successful litigant reasonably expected to 

obtain”]; see Collins, supra, 205 Cal.App.4th 140, 154-155 & fn. 10 [“The successful 

litigant’s reasonably expected financial benefits are determined by discounting the 

monetary value of the benefits that the successful litigant reasonably expected at the time 

the vital litigation decisions were made by the probability of success at the time.”].)

“ ‘After approximating the estimated value of the case at the time the vital 

litigation decisions were being made, the court must then turn to the costs of the 

litigation—the legal fees, deposition costs, expert witness fees, etc., which may have 

been required to bring the case to fruition. ... [¶ ] The final step is to place the estimated 

value of the case beside the actual cost and make the value judgment whether it is 

desirable to offer the bounty of a court-awarded fee in order to encourage litigation of the 

sort involved in this case.... [A] bounty will be appropriate except where the expected 

value of the litigant’s own monetary award exceeds by a substantial margin the actual 

litigation costs.’ ” (Whitley, supra, 50 Cal.4th at pp. 1215-1216; Espejo v. The Copley 

Press, Inc. (2017) 13 Cal.App.5th 329, 379 [“trial court ... was required to consider the 

estimated value of the case at the time the vital litigation decisions were being made, 

rather than plaintiffs’ actual recovery, and compare that amount to actual litigation 

costs”]; Norberg v. California Coastal Com. (2013) 221 Cal.App.4th 535, 545 [under 

§ 1021.5, a court must “compare the estimated value of the case at the time the vital 

litigation decisions were being made, to the costs of the litigation”]; Collins, supra, 205 

Cal.App.4th at p. 154 [“An attorney fee award under section 1021.5 is proper unless the 

plaintiff’s reasonably expected financial benefits exceed by a substantial margin the 

plaintiff’s actual litigation costs.”].)

Sufficient financial incentives may exist that preclude an award under section 

1021.5 even where the plaintiff seeks no monetary award in the litigation. (Summit 
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Media, LLC v. City of Los Angeles (2015) 240 Cal.App.4th 171, 192-194 (Summit Media) 

[rejecting the “dubious proposition that the absence of a monetary award necessarily 

equates to ‘zero’ financial benefits”; “[n]ot all cases involve a monetary award” and 

“Whitley [did not] say that a plaintiff’s financial incentive must ‘direct’ ”]; see DiPirro v. 

Bondo Corp. (2007) 153 Cal.App.4th 150, 199 (DiPirro) [§ 1021.5 attorney fee award 

not appropriate where manufacturer’s in litigation was to avoid the cost of placing 

warnings on its product].) 

B. Analysis: Valley Water Did Not Meet its Burden Under Whitley

Valley Water has been operating wastewater disposal facilities for oil companies 

since the 1950s or 1960s. The Tulare Lake Basin Plan was first adopted in or about 

1975, when groundwater in the Tulare Lake Basin was blanket-designated as suitable for 

agricultural use. In 1989, groundwater in the Tulare Lake Basin was blanket-designated 

as suitable for use for the municipal drinking water supply. For decades, Valley Water 

did not undertake any steps to challenge the beneficial use designations for groundwater 

in the Tulare Lake Basin or around its facilities. 

On April 15, 2019, Valley Water received notice that environmental groups 

intended to file a citizen suit under Proposition 65 seeking potentially millions of dollars 

in civil penalties for unlawful discharge of pollutants into a source of drinking water. 

The environmental groups then filed a Proposition 65 complaint on June 24, 2019, 

targeting Valley Water’s oilfield wastewater discharges to its McKittrick Facility that 

was subject to the Tulare Lake Basin Water Quality Control Plan. The Proposition 65 

complaint sought hefty civil penalties ($2,500 per day per violation of Proposition 65) 

and a permanent injunction requiring Valley Water to cease discharging pollutants in 

violation of Proposition 65 to groundwater designated as suitable for drinking under a 

basin plan. 
23.

Around the same time, on June 7, 2019, the Regional Board issued a cease-anddesist order to Valley Water. The cease-and-desist order required Valley Water to cease 

discharging pollutants to groundwater by September 1, 2020, unless it made operational 

changes allowing it to obtain a new permit that would be in compliance with the Tulare 

Lake Basin Plan. 

In light of these developments, Valley Water initiated the instant lawsuit on June 

12, 2019, seeking to void the municipal and agricultural beneficial uses of groundwater 

throughout the Tulare Lake Basin, which uses were blanket designated in the Basin Plan. 

To the extent a plume of contaminated groundwater from the McKittrick Facility had 

migrated down gradient thereof, a voiding of the beneficial use designations throughout 

the Tulare Lake Basin would have greatly benefitted Valley Water. Valley Water 

explicitly acknowledged it filed the instant lawsuit on account of the Proposition 65 

enforcement action it was facing at the time. Valley Water’s petition/complaint noted: 

“[T]wo non-profit corporations recently filed a Notice of Violation letter against Valley 

Water on April 15, 2019, prompting [the instant] litigation filed on June 12, 2019.” 

(Italics added.) Valley Water moved to relate the two cases, and subsequently 

acknowledged in its motion for attorney fees that it viewed the instant case as a “tool to 

avoid further litigation in [the] related case alleging that Valley Water violated

Proposition 65.” 

The Proposition 65 case and the Regional Board’s cease-and-desist order posed 

massive financial risks for Valley Water. Valley Water faced the expensive prospect of 

upgrading its equipment and facilities and its ability to continue to run its McKittrick 

Facility was threatened. In addition, the Proposition 65 case raised a very real possibility 

of millions of dollars of civil penalties being levied against Valley Water. The instant 

action sought dedesignation of groundwater in the Tulare Lake Basin, which groundwater 

had been blanket designated for municipal and agricultural use decades earlier. 
24.

Dedesignation of this groundwater, including the groundwater under and around the 

McKittrick Facility, would have provided a complete defense to the Proposition 65 

lawsuit and potentially stymied the cease-and-desist order as well. In short, Valley 

Water’s financial interest in bringing the instant lawsuit was enormous. Moreover, in 

light of CASA, supra, 208 Cal.App.4th 1438, which the trial court applied in resolving the 

merits of this matter, Valley Water had every reason to expect it would achieve some 

success in this lawsuit. 

On the other hand, the expected costs of litigation—somewhere in the vicinity of 

$239,479.65, the attorney fees amount awarded in this matter—were much smaller in 

magnitude as compared to the potential financial fallout from the Proposition 65 case and 

cease-and-desist order. Indeed, upon issuance of the trial court’s tentative ruling in this 

matter, Valley Water was able to negotiate reduced penalties and settle the Proposition 65 

case (the environmental groups acknowledged they had to “compromise” on the penalties 

in light of the trial court’s tentative ruling). 

This record manifestly establishes that Valley Water had a personal financial stake 

in this litigation that was more than sufficient to warrant its decision to incur significant 

attorney fees and costs in the vigorous prosecution of the lawsuit. (Summit Media, supra, 

240 Cal.App.4th at pp. 193-194 [if the plaintiff had a “personal financial stake” in the 

litigation “sufficient to warrant [the] decision to incur significant attorney fees and costs 

in the vigorous prosecution” of the lawsuit, an award under section 1021.5 is 

inappropriate].) There was no reasonable basis for the trial court to find otherwise. 

In sum, Valley Water did not meet its burden to show the financial burden of 

bringing the instant lawsuit was disproportionate to its own pecuniary stake in the 

litigation. It bears mention that Valley Water’s brief does not address at all the Whitley 

formula for evaluating the “financial burden” element of section 1021.5; nor did the trial 

court’s ruling granting attorneys’ fees do so. We conclude the trial court abused its 
25.

discretion in awarding Valley Water $239,479.65 in attorneys’ fees.9 (See Millview 

County Water Dist. v. State Water Resources Bd. (2016) 4 Cal.App.5th 759, 767-769, 773 

(with respect to the issue of financial burden, “the trial court abuses its discretion in 

making an award under section 1021.5 when there is no substantial evidence to support 

the required findings”].)

DISPOSITION

The trial court’s ruling granting Valley Water’s motion for attorneys’ fees is 

reversed. The Regional Board is awarded its costs on appeal.

SMITH, J.

WE CONCUR:

FRANSON, Acting P. J.

PEÑA, J.

9 Given our determination, it is unnecessary for us to consider whether any of the 

other statutory elements were satisfied; Valley Water would not be entitled to an award 

even if the other requirements of section 1021.5 were met.