Humboldt Baykeeper et al v. Union Pacific Railroad Company et al, No. 3:2006cv02560 - Document 514 (N.D. Cal. 2010)

Court Description: ORDER GRANTING CONSENT DECREE. Signed by Judge JEFFREY S. WHITE on 11/9/10. (jjoS, COURT STAFF) (Filed on 11/9/2010)

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Humboldt Baykeeper et al v. Union Pacific Railroad Company et al 1 2 3 4 5 6 7 Doc. 514 DOWNEY BRAND LLP CLIFTON J. MCFARLAND (Bar No. 136940) ANDREW L. COLLIER (Bar No.191137) GREGORY T. BRODERICK (Bar No. 220871) 621 Capitol Mall, 18th Floor Sacramento, CA 95814-4686 Telephone: (916) 444-1000 Facsimile: (916) 444-2100 cmcfarland@downeybrand.com acollier@downeybrand.com gbroderick@downeybrand.com PAUL P. “SKIP” SPAULDING III (Bar No. 83922) R. CHRISTOPHER LOCKE (Bar No. 101704) MATTHEW BOSTICK (Bar No. 268563) FARELLA, BRAUN + MARTEL LLP 235 Montgomery Street, 17th Flr. San Francisco, CA 94104 Telephone: (415) 954-4400 Facsimile: (415) 954-4480 sspaulding@fbm.com clocke@fbm.com mbostick@fbm.com Attorneys for Defendant CUE VI, LLC 8 Attorneys for Defendant UNION PACIFIC RAILROAD COMPANY 9 10 11 DOWNEY BRAND LLP 12 13 14 15 16 LAYNE FRIEDRICH (Bar No. 195431) DREVET HUNT (Bar No. 240487) LAWYERS FOR CLEAN WATER, INC. 1004-A O’Reilly Avenue San Francisco, CA 94129 Telephone: (415) 440-6520 Facsimile: (415) 440-4155 Email: layne@lawyersforcleanwater.com Email: drev@lawyersforcleanwater.com Attorneys for Plaintiffs ECOLOGICAL RIGHTS FOUNDATION and HUMBOLDT BAYKEEPER 17 18 Additional Counsel for Plaintiffs on Next Page 19 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA 20 21 22 23 24 25 26 27 HUMBOLDT BAYKEEPER, a program of Ecological Rights Foundation, and ECOLOGICAL RIGHTS FOUNDATION, a non-profit corporation, Plaintiffs, v. UNION PACIFIC RAILROAD COMPANY, a Delaware corporation; and NORTH COAST RAILROAD AUTHORITY, a state agency; and CUE VI, LLC, an Alaska limited liability company, Defendants. CASE NO. C 06-02560 JSW CONSENT DECREE AND [PROPOSED] ORDER 28 1111940.4 1 CONSENT DECREE AND ORDER Dockets.Justia.com 1 2 3 4 Michelle Smith (Bar No. 233515) HUMBOLDT BAYKEEPER 217 E Street Eureka, CA 95501 Telephone: (707) 268-0665 Facsimile: (707) 268—8901 Email: michelle@humboldtbaykeeper.org 5 6 7 8 9 Frederic Evenson (Bar No. 198059) LAW OFFICES OF FREDERIC EVENSON 424 First Street Eureka, CA 95501 Telephone: (707) 268-890 Facsimile: (707) 268-8901 Email: ecorights@earthlink.net 10 11 DOWNEY BRAND LLP 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1111940.4 1 CONSENT DECREE AND ORDER 1 CONSENT DECREE AND ORDER 2 This Consent Decree and Order (the “Consent Decree”) is entered into by and between 3 Plaintiffs Ecological Rights Foundation (“ERF”) and Humboldt Baykeeper (“Humboldt 4 Baykeeper”) (collectively, the “Plaintiffs”), on the one hand, and Defendants CUE VI, LLC 5 (“CUE VI”) and Union Pacific Railroad Company (“Union Pacific”) (collectively, the 6 “Defendants”), on the other hand. The parties shall sometimes be referred to herein individually 7 as a “Party” and collectively as the “Parties.” 8 RECITALS 9 A. ERF is a 501(c)(3), non-profit, public benefit corporation organized and existing under the laws of the state of California whose stated purpose is “to educate the public about 11 environmental practices that cause harm to human health, the environment and other natural 12 DOWNEY BRAND LLP 10 resources; and to seek redress of environmental harms through litigation or alternative dispute 13 resolution.” 14 B. Humboldt Baykeeper is a program of ERF, and a membership organization, which 15 states its members “are comprised of local residents concerned with the health of the Humboldt 16 Bay area environment as well as non-local members who also visit and use the Humboldt Bay 17 area and who support ERF’s efforts to protect the Humboldt Bay area.” 18 C. Union Pacific is a corporation duly formed, and existing under, the laws of the 19 state of Delaware, and is the former owner of that certain real property located in Eureka, 20 California, commonly described as the “Balloon Track” property. 21 D. CUE VI is a limited liability company duly formed, and existing under, the laws of 22 the state of Alaska, whose initials CUE stand for “Clean Up Eureka” and which is the current 23 owner of the “Balloon Track” property, having acquired it from Union Pacific in 2006 with the 24 intent of developing it into a mixed-use urban-infill retail and light industrial development known 25 as the “Marina Center.” 26 E. The “Balloon Track” property is currently covered by Assessor Parcel Nos. 003- 27 014-002; 003-031-003; 003-021-009; 003-031-006; 003-41-007; 003-031-012; 003-031-013; 28 003-041-005; 003-041-006; 003-051-001; 003-072-003 and hereinafter referred to as the “Site.” 1111940.4 2 CONSENT DECREE AND ORDER 1 A map depicting the Site is attached as Exhibit A-1 hereto. 2 F. A portion of the Site had been a railroad maintenance facility operated by Southern 3 Pacific Transportation Company (“Southern Pacific”) until about 1985. Shortly after railroad 4 operations ceased, Southern Pacific removed underground and above ground storage tanks, 5 associated piping and petroleum-impacted soil, containerized potentially hazardous materials, and 6 removed wastewater from an oil/water separator at the Site. Thereafter, soil sampling, 7 groundwater monitoring, and other environmental investigations and remedial actions were 8 performed by Southern Pacific. Union Pacific continued these actions following a merger with 9 Southern Pacific in 1996. 10 G. On or about May 9, 2001, the California Regional Water Quality Control Board, North Coast Region (the “Regional Water Board”) issued Clean Up and Abatement Order No. 12 DOWNEY BRAND LLP 11 R1-2001-26 with regard to the Site (the “CAO”) to Union Pacific, which undertook further 13 environmental investigations, monitoring, and remedial actions in connection with the CAO. 14 H. On or about May 9, 2001, the Regional Water Board issued Monitoring and 15 Reporting Program Order No. R1-2001-29. On or about July 22, 2002, the Regional Water Board 16 issued a replacement Monitoring and Reporting Program, Order No. R1-2002-0082, requiring 17 periodic monitoring of groundwater and surface water at the Site, with subsequent changes 18 documented in a letter from the Regional Water Board dated October 7, 2003 (the “Monitoring 19 Program”). 20 I. On or about February 1, 2006, Plaintiffs provided Union Pacific with written 21 notice of alleged violations of the federal Water Pollution Control Act, also known as the Clean 22 Water Act, 33 U.S.C. § 1311(a), et seq. (the “CWA”), and the federal Resource Conservation and 23 Recovery Act, 42 U.S.C. § 6972(a)(1)(B), et seq. (“RCRA”) (the “Union Pacific Notice 24 Letter”). North Coast Railroad Authority also was named by Plaintiffs as a responsible party for 25 alleged CWA violations in the Union Pacific Notice Letter and in the subsequent Complaint 26 referenced herein, but is not a party to this Consent Decree and is not included with in the terms 27 “Defendants” as defined and used herein. 28 J. 1111940.4 On or about October 12, 2006, Plaintiffs provided CUE VI with written notice of 3 CONSENT DECREE AND ORDER 1 alleged violations of the CWA and RCRA (the “CUE VI Notice Letter”). 2 K. On or about April 12, 2006, the Plaintiffs filed a Complaint against, among others, 3 Union Pacific, and thereafter, the Plaintiffs amended their Complaint in the Action known as 4 Humboldt Baykeeper, et al. v. Union Pacific, et al., United States District Court, Northern District 5 of California, case number C 06-02560 JSW (the “Action”) to, inter alia, add CUE VI as a 6 Defendant. Plaintiffs’ Third Amended Complaint for Declaratory and Injunctive Relief and Civil 7 Penalties (Dkt. No. 136) is the operative Complaint in the Action, wherein Plaintiffs allege that 8 Union Pacific and CUE VI violated the CWA and RCRA. Defendants have denied the claims 9 and allegations in the Complaint, and denied that the Plaintiffs were entitled to any relief 10 whatsoever. 11 L. The Defendants deny that they have violated the CWA or RCRA and deny that DOWNEY BRAND LLP 12 they have any liability in this Action or that Plaintiffs are entitled to any relief whatsoever. The 13 Parties agree that nothing in this Consent Decree shall be construed as an admission as to any 14 fact, finding, issue of law, or violation of law by Defendants; nor shall compliance with this 15 Consent Decree be construed as an admission by the Defendants of any fact, finding, conclusion, 16 issue of law, or violation of law. 17 M. Notwithstanding the foregoing, each of the Parties has determined that it is in its 18 best interests to resolve the Action without the taking of any evidence or findings of fact, or law, 19 and without the time and expense of trial. 20 21 NOW, THEREFORE, IT IS HEREBY AGREED BY AND BETWEEN THE PARTIES, SUBJECT TO THE APPROVAL OF THE COURT, AS FOLLOWS: 22 CONSENT DECREE 23 1. Jurisdiction and Venue. For purposes of this Consent Decree, the Parties 24 acknowledge and agree that the United States District Court for the Northern District of 25 California has jurisdiction over the Parties and the subject matter of the Action and that venue is 26 proper in the Northern District. 27 28 2. Review by the United States. Upon full execution by all Parties, this Consent Decree shall be submitted by the Plaintiffs to the United States Department of Justice (“DOJ”) 1111940.4 4 CONSENT DECREE AND ORDER 1 and the Administrator of the United States Environmental Protection Agency (“EPA”) for the 2 forty five (45) day statutory review period, pursuant to 33 U.S.C. § 1365(c), and the other 3 procedures in 33 U.S.C. § 1365 associated with approval of consent decrees (the “DOJ/EPA 4 Review Process”). If for any reason the EPA or DOJ (the “United States Reviewing Agencies”) 5 should object to this Consent Decree in the exact form presented, the Parties shall meet and 6 confer in good faith within seven (7) calendar days of receiving the United States Reviewing 7 Agencies objections to decide whether to modify the Consent Decree so that it is acceptable to the 8 Parties and the United States Reviewing Agencies. 9 3. Submission of the Consent Decree for Court Approval. Plaintiffs shall submit this Consent Decree for Court approval promptly upon conclusion of the DOJ/EPA Review Process. 11 If for any reason the Court should decline to approve this Consent Decree in the exact form 12 DOWNEY BRAND LLP 10 presented (including whatever modifications the Parties agree to as part of the DOJ/EPA Review 13 Process), the Parties shall meet and confer in good faith within seven (7) calendar days of 14 receiving the Court’s notice it declines to approve the Consent Decree to discuss modifying the 15 Consent Decree so that it is acceptable to the Parties and the Court. The Parties will meet and 16 confer for at least thirty (30) days, and if after this thirty (30) calendar day period the Parties are 17 unable to modify this Consent Decree in such a mutually acceptable matter, then this Consent 18 Decree shall be immediately null and void. 19 4. Effective Date. The “Effective Date” shall be the date that the Court enters an 20 order approving this Consent Decree following the conclusion of the DOJ/EPA Review Process 21 (the “Effective Date”). 22 23 5. Termination Date. This Consent Decree and Order shall automatically terminate upon the third anniversary of the Effective Date (the “Termination Date”). 24 6. 2010-11 Interim Stormwater BMPs. Plaintiffs acknowledge that CUE VI is 25 currently working with the Regional Water Board to obtain approval for the implementation of 26 best practices for the management of stormwater on the Site for the 2010-11 rainy season, in 27 response to the Regional Water Board’s April 19, 2010 letter, and subsequent correspondence 28 (the “2010-11 Interim Stormwater BMPs”). Plaintiffs shall not take any action to oppose or 1111940.4 5 CONSENT DECREE AND ORDER 1 interfere with the implementation of the 2010-11 Interim Stormwater BMPs. Plaintiffs shall not 2 provide any financial or technical aid or support to others for the purpose of opposing and/or 3 appealing the issuance of any regulatory permits, approvals or authorizations that are necessary 4 for the implementation of the 2010-11 Interim Stormwater BMPs. CUE VI and Plaintiffs intend 5 this portion of the Consent Decree to operate as a contractual agreement in advance of the 6 expiration of the DOJ/EPA Review Process and Court approval of this Consent Decree. To the 7 extent that the Effective Date does not occur, then this section shall be null and void. 8 9 7. CUE VI’s Interim Removal Action. Upon the Regional Water Board’s approval of a work plan, and the issuance of all necessary permits, CUE VI shall commence and thereafter diligently complete the following interim removal actions with regard to the Site which were 11 previously described in CUE VI’s Supplemental Interim Remediation Plan (the “SIRAP”), as 12 DOWNEY BRAND LLP 10 approved and in a manner that is consistent with the contents of the Regional Water Board’s June 13 18, 2009, correspondence conditionally approving the SIRAP. 14 a. Excavation of Former General Petroleum Site. CUE VI shall remove 15 petroleum-contaminated soil located in the former General Petroleum Site as more specifically 16 depicted on Exhibit A-2 hereto, and backfill with clean soil material. 17 b. Metals Impacted Soil Removal (Sample Location SHN-S-17): CUE VI 18 shall remove metals-contaminated soils at the location on the Site identified by sample SHN-S- 19 17, as located on Exhibit A-3 hereto. 20 c. Metals Impacted Soil Removal (Sample Location S-5): CUE VI shall 21 remove metals-contaminated soils at the location on the Site identified by sample Humboldt 22 Baykeeper S-5, as located on Exhibit A-4 hereto. 23 d. Excavation of Western Ditch. CUE VI shall remove soil and/or sediments 24 in the Western Ditch where prior sampling activities have indicated the presence of dioxins and 25 furans, as located on Exhibit A-5 hereto. 26 e. Excavation of Eastern Ditch. CUE VI shall remove soil and/or sediments in 27 the Eastern Ditch where prior sampling activities have indicated the presence of dioxins and 28 furans, as located on Exhibit A-5 hereto. 1111940.4 6 CONSENT DECREE AND ORDER 1 f. Removal of Debris. CUE VI shall remove the metal and railroad tie debris 2 piles and other debris that remain on the Site as more specifically defined in sections 4.2.1. 3 through 4.2.7., inclusive, of the SIRAP (collectively, the “Interim Removal Action”). 4 8. Interim Removal Action Work Plan. Not later than fifteen (15) calendar days after 5 the Effective Date, CUE VI shall provide the Plaintiffs with a copy of the proposed workplan to 6 implement the Interim Removal Action in the form CUE VI intends to submit to the Regional 7 Water Board for approval (the “Interim Removal Action Work Plan”), which shall describe the 8 following elements, to the extent included in the Interim Removal Action Work Plan and in a 9 manner that is consistent with the SIRAP and the Regional Water Board’s June 18, 2009, letter 10 conditionally approving the SIRAP: a. characterization and confirmation sampling methodologies; 12 DOWNEY BRAND LLP 11 b. excavation plans; 13 c. disposal plans; 14 d. backfill plans; 15 e. plans to restore the Site once the removal work is complete; and 16 f. permitting plans. 17 9. Dispute Resolution Re Proposed Interim Removal Action Work Plan. Plaintiffs 18 shall have fourteen (14) calendar days from receipt of the proposed Interim Removal Action 19 Work Plan within which to provide CUE VI with any comments on the proposed Interim 20 Removal Action Work Plan. To the extent that Plaintiffs do not provide comments to CUE VI 21 within fourteen (14) calendar days from receipt of the proposed Interim Removal Action Work 22 Plan, CUE VI may submit the proposed Interim Removal Action Work Plan to the Regional 23 Water Board. 24 In the event that Plaintiffs’ provide comments that disagree with the proposed Interim 25 Removal Action Work Plan, CUE VI’s designated consultant(s) and the Plaintiffs’ designated 26 consultant(s) shall meet and confer within seven (7) calendar days of CUE VI’s receipt of 27 Plaintiffs’ comments in a good faith effort to develop a mutually acceptable proposed Interim 28 Removal Action Work Plan. In the event that CUE VI and the Plaintiffs are unable to develop a 1111940.4 7 CONSENT DECREE AND ORDER 1 mutually acceptable proposed Interim Removal Action Work Plan within fourteen (14) calendar 2 days of the initial meet-and-confer conference, CUE VI and the Plaintiffs shall mediate the dispute 3 with a technically-trained mediator who is mutually acceptable. 4 If CUE VI and the Plaintiffs cannot identify a mutually acceptable technically-trained mediator, then each shall identify a technically-trained mediator and those two mediators shall 6 select a third technically-trained mediator, and the three-person mediation panel shall mediate the 7 dispute regarding the proposed Interim Removal Action Work Plan. Plaintiffs shall pay the fees 8 and costs associated with retention of the mediator they select; CUE VI shall pay the fees and 9 costs associated with retention of the mediator CUE VI selects; and CUE VI shall pay the fees and 10 costs associated with the retention of the mediator the first two mediators select. The mediator(s) 11 shall attempt to mediate any dispute to arrive at a mutually agreeable proposed Interim Removal 12 DOWNEY BRAND LLP 5 Action Work Plan. To the extent this is not possible, the mediator(s) shall determine the contents 13 of the proposed Interim Removal Action Work Plan. If there are multiple mediators, the content 14 of the proposed Interim Removal Action Work Plan shall represent the unanimous views of the 15 mediators to the maximum extent feasible. 16 The mediation process shall conclude no later than thirty (30) from commencement. CUE 17 VI shall submit said proposed Interim Removal Action Work Plan to the Regional Water Board 18 within ten (10) calendar days of the completion of the mediation process. 19 Plaintiffs acknowledge and agree that the process described in this section shall be the 20 sole mechanism for the resolution of any disputes related to the Interim Removal Action and 21 proposed Interim Removal Action Work Plan and that the Regional Water Board’s decision 22 regarding the Interim Removal Action Work Plan shall be definitive and not subject to 23 administrative or judicial appeal. 24 10. Support for Agreed Upon Interim Removal Action. If Plaintiffs and CUE VI 25 develop a mutually acceptable proposed Interim Removal Action Work Plan through either the 26 informal “meet and confer” or mediation processes described in the preceding section, then 27 Plaintiffs acknowledge and agree: a) that they shall not oppose and/or appeal the issuance of any 28 regulatory permits, approvals or authorizations, including those from the Regional Water Board, 1111940.4 8 CONSENT DECREE AND ORDER 1 that are necessary for the implementation of the proposed Interim Removal Action Work Plan; b) 2 that they shall not provide financial or technical aid or assistance to others for the purpose of 3 opposing and/or appealing the issuance of any regulatory permits, approvals or authorizations that 4 are necessary for the implementation of the proposed mutually acceptable Interim Removal 5 Action Work Plan; and c) that they will support the mutually acceptable Interim Removal Action 6 Work Plan and earliest possible issuance of any permits that are necessary for the implementation 7 of the mutually acceptable proposed Interim Removal Action Work Plan. 8 9 If Plaintiffs and CUE VI cannot develop a mutually acceptable proposed Interim Removal Action Work Plan through either the informal “meet and confer”, the mediation processes described in the preceding section, or if the Plaintiffs fail to provide comments to the Interim 11 Removal Action Work Plan within fourteen (14) days of initial receipt, then Plaintiffs 12 DOWNEY BRAND LLP 10 acknowledge and agree a) that they shall not oppose and/or appeal the issuance of any regulatory 13 permits, approvals or authorizations, including those from the Regional Water Board, that are 14 necessary for the implementation of a proposed Interim Removal Action Plan; and b) that they 15 shall not provide financial or technical aid or assistance to others for the purpose of opposing 16 and/or appealing the issuance of any regulatory permits, approvals or authorizations that are 17 necessary for the implementation of the proposed Interim Removal Action Work Plan. 18 11. Final Site Characterization Plan. No later than 8 months prior to CUE VI’s 19 application for any land use entitlements necessary for development at the Site, including but not 20 limited to the Marina Center, or such earlier time as directed by the Regional Water Board, CUE 21 VI shall provide Plaintiffs with a proposed plan for conducting soil and sediment sampling in 22 order to characterize the Site (the “Final Site Characterization Plan”) consistent with the 23 preparation of a final Remedial Action Plan for development at the Site including but not limited 24 to the Marina Center (“Final Remedial Action Plan”). 25 12. Dispute Resolution Re Proposed Final Site Characterization Plan. Plaintiffs shall 26 have fourteen (14) calendar days from receipt of the proposed Final Site Characterization Plan 27 within which to provide CUE VI with any comments on the proposed Final Site Characterization 28 Plan. If CUE VI and Plaintiffs agree on the proposed Final Site Characterization Plan, it shall 1111940.4 9 CONSENT DECREE AND ORDER 1 be submitted in the approved form to the relevant federal, state, or local agencies. CUE VI shall 2 subsequently perform the work contemplated in the proposed Final Site Characterization Plan 3 for investigation and characterization upon receipt of approval by the necessary regulatory 4 agencies. To the extent that Plaintiffs do not provide comments to CUE VI within 14 calendar 5 days from receipt of the proposed Final Site Characterization Plan, CUE VI may submit the 6 proposed Final Site Characterization Plan to the Regional Water Board. 7 In the event that Plaintiffs provide comments that disagree with the proposed Final Site 8 Characterization Plan, CUE VI’s designated consultant(s) and the Plaintiffs’ designated 9 consultant(s) shall meet and confer within seven (7) calendar days of CUE VI’s receipt of Plaintiffs’ comments in a good faith effort to develop a mutually acceptable proposed Final Site 11 Characterization Plan. In the event that CUE VI and the Plaintiffs are unable to develop a 12 DOWNEY BRAND LLP 10 mutually acceptable proposed Final Site Characterization Plan within fourteen (14) calendar days 13 of the initial meet-and-confer conference, CUE VI and the Plaintiffs shall mediate the dispute with 14 a technically-trained mediator that is mutually acceptable. 15 If CUE VI and the Plaintiffs cannot identify a mutually acceptable technically-trained 16 mediator, then each shall identify a technically-trained mediator and those two mediators shall 17 select a third technically-trained mediator, and the three-person mediation panel shall mediate the 18 dispute regarding the proposed Final Site Characterization Plan. Plaintiffs shall pay the fees and 19 costs associated with retention of the mediator they select; CUE VI shall pay the fees and costs 20 associated with retention of the mediator CUE VI selects; and CUE VI shall pay the fees and costs 21 associated with the retention of the mediator the first two mediators select. The mediator(s) shall 22 attempt to mediate any dispute to arrive at a mutually agreeable proposed Final Site 23 Characterization Plan. To the extent this is not possible, the mediator(s) shall determine the 24 contents of the proposed Final Site Characterization Plan. If there are multiple mediators, the 25 content of the proposed Final Site Characterization Plan shall represent the unanimous views of the 26 mediators to the maximum extent feasible. 27 28 The mediation process shall conclude no later than thirty (30) from commencement. CUE VI shall submit said proposed Final Site Characterization Plan to the Regional Board within ten 1111940.4 10 CONSENT DECREE AND ORDER 1 (10) calendar days of the completion of the mediation process. 2 Plaintiffs acknowledge and agree that the process described in this section shall be the 3 sole mechanism for the resolution of any disputes related to the Final Site Characterization Plan 4 and that the Regional Water Board’s decision regarding the Final Site Characterization Plan shall 5 be definitive and not subject to administrative or judicial appeal. 6 13. Support for Agreed Upon Proposed Final Site Characterization Plan. If Plaintiffs and CUE VI develop a mutually acceptable proposed Final Site Characterization Plan through 8 either the informal “meet and confer” or mediation processes described in the preceding section, 9 then Plaintiffs acknowledge and agree: a) that they shall not oppose and/or appeal the issuance of 10 any regulatory permits, approvals or authorizations, including those from the Regional Board, that 11 are necessary for the implementation of the proposed Final Site Characterization Plan; b) that 12 DOWNEY BRAND LLP 7 they shall support that mutually acceptable proposed Final Site Characterization Plan and the 13 earliest possible issuance of any permits that are necessary for the implementation of the mutually 14 acceptable proposed Final Site Characterization Plan; and c) that they shall not provide financial 15 or technical aid or assistance to others for the purpose of opposing or appealing the mutually 16 acceptable proposed Final Site Characterization Plan. 17 If Plaintiffs and CUE VI cannot develop a mutually acceptable proposed Final Site 18 Characterization Plan through either the informal “meet and confer”, the mediation processes 19 described in the preceding section, or if the Plaintiffs fail to provide comments to the Final Site 20 Characterization Plan within fourteen (14) days of initial receipt, then Plaintiffs acknowledge and 21 agree: a) that they shall not oppose and/or appeal the issuance of any regulatory permits, 22 approvals or authorizations, including those from the Regional Water Board, that are necessary 23 for the implementation of the proposed Final Site Characterization Plan; and b) that they shall not 24 provide financial or technical aid or assistance to others for the purpose of opposing or appealing 25 the proposed Final Site Characterization Plan. 26 14. Final Remedial Action Plan. Not later than 30 calendar days prior to submitting a 27 proposed Final Remedial Action Plan to the Regional Water Board, CUE VI shall provide 28 Plaintiffs with a copy of the proposed Final Remedial Action Plan in the form CUE VI intends to 1111940.4 11 CONSENT DECREE AND ORDER 1 submit to the Regional Water Board for approval. Plaintiffs shall have fourteen (14) calendar 2 days from receipt of the proposed Final Remedial Action Plan within which to provide CUE VI 3 with any comments to the proposed Final Remedial Action Plan. Plaintiffs and CUE VI will meet 4 and confer in good faith with regard to the proposed Final Remedial Action Plan and Plaintiffs 5 comments thereto. CUE VI will provide an agreed upon Final Remedial Action Plan or, absent 6 agreement, a modified Final Remedial Action Plan together with Plaintiffs’ comments, to the 7 Regional Water Board, with each Party reserving their rights with respect to the submission. 8 9 15. General Dispute Resolution and Retention of Jurisdiction. With the exception of disputes regarding the proposed Interim Removal Action Work Plan (the sole mechanism for dispute resolution being set forth in section 9 above) and the proposed Final Site Characterization 11 Work Plan (the sole mechanism for dispute resolution being set forth in section 12 above), if a 12 DOWNEY BRAND LLP 10 dispute arises concerning the terms of this Consent Decree, or if any Party believes that a breach 13 of this Consent Decree has occurred, the Parties shall meet and confer within ten (10) calendar 14 days of receiving written notification from the other Party of a request for a conference. This 15 notification shall explicitly state the nature, underlying facts and bases for the dispute or alleged 16 breach. The Parties shall discuss the merits of the dispute and shall seek to develop a mutually 17 agreed upon plan, including implementation dates, to resolve the alleged breach or dispute. 18 If the Parties fail to meet and confer or cannot resolve the issue, and after at least seven (7) 19 calendar days have elapsed since the meet-and-confer conference occurred or should have 20 occurred, either party may bring a motion before the United States District Court for the Northern 21 District of California (Chief Magistrate Judge Maria-Elena James), which shall retain jurisdiction 22 over the action for the limited purposes of enforcement of the terms of this Consent Decree. The 23 Parties agree that in the event that such a dispute is brought before the United States District 24 Court for the Northern District of California, the prevailing Party, as determined by the Court 25 shall be entitled to an award of reasonable attorneys’ fees, expert fees and costs. This Consent 26 Decree constitutes the Parties’ contractual agreement in that regard. 27 28 If CUE VI claims an inability to pay as the basis for its failure to comply with any section of this Consent Decree, CUE VI shall submit adequate financial documentation to Plaintiffs to 1111940.4 12 CONSENT DECREE AND ORDER 1 support its claim of inability to pay no later than thirty (30) days from its failure to comply. 2 Plaintiffs reserve the right to require the submission of additional financial documents in order to 3 analyze any asserted claim of inability to pay, and the party asserting an inability to pay agrees to 4 provide said documents. 5 16. Payments. Within seven (7) calendar days of the Effective Date, CUE VI shall make an irrevocable deposit in an escrow account in the amount of $1,800,000 on behalf of itself 7 and Union Pacific in full satisfaction of any and all monetary relief that was or could have been 8 sought in the Action (the “Escrow Account”). The escrow agent shall make payments from the 9 Escrow Account (individually, a “Payment,” collectively, the “Payments”), according to the 10 following schedule, pursuant to escrow instructions substantially identical to the form attached 11 hereto as Exhibit B, but which shall be updated once the Effective Date occurs to include the 12 DOWNEY BRAND LLP 6 Effective Date, the escrow company, the escrow agent, and the calendar dates (based on the 13 Effective Date) for each of the payments identified below: 14 15 a. fourteen (14) calendar days of the Effective Date of this Consent Decree; 16 17 b. The escrow agent shall pay the Plaintiffs the sum of $400,000 within ninety (90) calendar days of the Effective Date of this Consent Decree; 18 19 The escrow agent shall pay the Plaintiffs the sum of $900,000 within c. The escrow agent shall pay the Plaintiffs the sum of $500,000 within five hundred forty (540) calendar days of the Effective Date (the “Final Payment”); 20 d. As set forth in Exhibit B, each of the Payments shall be made in the form 21 of a check payable to “Lawyers for Clean Water Attorney Client Trust Account” addressed to: 22 1004-A O’Reilly Avenue, San Francisco, CA 94129, sent overnight delivery. Plaintiffs intend to 23 allocate the Payments to their attorneys’ fees and costs, consultant and expert fees and costs, 24 and/or litigation expenses in the Action. 25 17. Force Majeure. No Party shall be considered to be in default in the performance of 26 any of its obligations when a failure to perform is due to circumstances beyond the Party’s 27 reasonable control, which shall be referred to as a “Force Majeure.” A Force Majeure event 28 renders performance impossible, or impracticable, and includes such events as an act of God, war, 1111940.4 13 CONSENT DECREE AND ORDER 1 fire, earthquake, flood, restraint by court order, or action or inaction by, or inability to obtain the 2 necessary authorizations or approval from, any governmental agency. If a Party seeks to invoke 3 this paragraph, it shall notify the other Party in writing as soon as reasonably possible, specifying 4 the particular action that could not be performed and the specific reason for the non-performance. 5 The Parties will thereafter meet and confer regarding an alternative schedule for completion of 6 the action that could not be performed, or an alternative action. Any dispute regarding the 7 applicability of this paragraph, or any future action to be taken, that remains after the meet and 8 confer session will be handled as a dispute pursuant to section 15. 9 18. 10 Releases. a. Plaintiffs’ Release of CUE VI. Upon receipt of the Final Payment, Plaintiffs, on their own behalf and on behalf of their voting members, subsidiaries, successors, 12 DOWNEY BRAND LLP 11 assigns, affiliated entities, directors, officers, agents, attorneys, representatives, and employees, 13 do hereby release CUE VI and its officers, directors, employees, shareholders, agents, attorneys, 14 representatives, related or affiliated companies including without limitation Security National 15 Master Holding Company, LLC, Security National Properties, SN Servicing Corporation, or any 16 of their affiliates, parents, subsidiaries, predecessors, successors and assigns, past and present 17 (collectively, the “Security National Entities”), from any and all liens, losses, claims, debts, 18 liabilities, demands, obligations, promises, acts, agreements, costs, and expenses (including, 19 without limitation, attorneys’ fees), injunctive relief, penalties, fines, sanctions, mitigation, 20 damages, whether known or unknown, anticipated or not anticipated, actual or contingent, 21 suspected or unsuspected, including, without limitation, those based on, arising out of, incidental 22 to, appertaining to, in connection with and/or emanating from, in any way, the facts and matters 23 set forth in the Recitals, the CUE VI Notice Letter, and/or the Action up to and including the 24 Effective Date of this Consent Decree. 25 b. Plaintiffs’ Release of Union Pacific. Upon receipt of the Final Payment, 26 Plaintiffs, on their own behalf and on behalf of their voting members, subsidiaries, successors, 27 assigns, affiliated entities, directors, officers, agents, attorneys, representatives, and employees, 28 do hereby release Union Pacific and its officers, directors, employees, shareholders, agents, 1111940.4 14 CONSENT DECREE AND ORDER 1 attorneys, representatives, related or affiliated companies including without limitation, parents, 2 subsidiaries, predecessors, successors and assigns, past and present, from any and all liens, losses, 3 claims, debts, liabilities, demands, obligations, promises, acts, agreements, costs, and expenses 4 (including, without limitation, attorneys’ fees), injunctive relief, penalties, fines, sanctions, 5 mitigation, damages, whether known or unknown, anticipated or not anticipated, actual or 6 contingent, suspected or unsuspected, including, without limitation, those based on, arising out of, 7 incidental to, appertaining to, in connection with and/or emanating from, in any way, the facts and 8 matters set forth in the Recitals, the Union Pacific Notice Letter, and/or the Action up to and 9 including the Effective Date of this Consent Decree. 10 c. Union Pacific and CUE VI’s Release of Plaintiffs. Upon delivery of the Final Payment, CUE VI and Union Pacific, on their own behalf and on behalf of their 12 DOWNEY BRAND LLP 11 subsidiaries, successors, assigns, affiliated entities, directors, officers, agents, attorneys, 13 representatives, and employees, do hereby release Plaintiffs and their member, officers, directors, 14 employees, shareholders, agents, attorneys, representatives, related or affiliated companies 15 including without limitation, parents, subsidiaries, predecessors, successors and assigns, past and 16 present, from any and all liens, losses, claims, debts, liabilities, demands, obligations, promises, 17 acts, agreements, costs, and expenses (including, without limitation, attorneys’ fees), injunctive 18 relief, penalties, fines, sanctions, mitigation, damages, whether known or unknown, anticipated or 19 not anticipated, actual or contingent, suspected or unsuspected, including, without limitation, 20 those based on, arising out of, incidental to, appertaining to, in connection with and/or emanating 21 from, in any way, the facts and matters set forth in the Recitals and/or the Action. 22 d. Waiver of California Civil Code § 1542. The Parties further expressly 23 waive any rights or benefits available to them under the provisions of California Civil Code § 24 1542, which provides as follows: 25 A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor. 26 27 19. Covenant Not to Sue. Except for the pending actions identified in the last sentence 28 1111940.4 15 CONSENT DECREE AND ORDER 1 of this section 19, for the period beginning on the Effective Date and ending on the Termination 2 Date, Plaintiffs agree that neither they, their officers, directors, voting members, agents, 3 representatives, or affiliates will file or maintain any lawsuit against the Defendants and/or the 4 Security National Entities, or commence any formal administrative petition or administrative 5 appeal proceedings involving Defendants and/or the Security National Entities, relating in any 6 way, directly or indirectly, to allegations in the Union Pacific Notice Letter, the allegations in the 7 CUE VI Notice Letter, the allegations in the Action, the Site, and/or Clark Slough. Regarding the 8 pending actions known as Humboldt Baykeeper v. City of Eureka and CUE VI, Humboldt County 9 Superior Court Case Nos. CV 090822 and CV100494, Plaintiffs agree they will not seek a 10 remedy that would prevent the implementation of the Interim Removal Actions or Final Site 11 Characterization Plan, as set forth in sections seven (7) and eleven (11). DOWNEY BRAND LLP 12 20. Comment on Monitoring Program. CUE VI shall continue to monitor surface 13 water on the Site pursuant to the Monitoring Program, in its current form or as modified by the 14 Regional Water Board. Notwithstanding any other section of this Consent Decree, Plaintiffs may 15 comment to the Regional Water Board regarding monitoring and reporting requirements for the 16 Site. 17 21. Dismissal. Plaintiffs will dismiss their Third Amended Complaint with prejudice 18 immediately after the Defendants provide confirmation of deposit of the Payments into the 19 Escrow Account pursuant to section 16 of this Consent Decree. 20 22. Notice Sections. Any notices given hereunder shall be provided as follows: 21 If to CUE VI, LLC: 24 25 26 27 28 1111940.4 Robert C. Bylsma Senior Regional Environmental Counsel Union Pacific Railroad 10031 Foothills Blvd. Roseville, CA 95747 with copy to Clifton McFarland Andrew Collier Downey Brand LLP 621 Capitol Mall, 18th Floor Sacramento, CA 95814 23 If to Union Pacific Michael Casey Vice President, CUE VI, LLC Security National Properties 3665 Bleckely Street Mather, CA 95655 22 with copy to Christopher Locke Paul P. “Skip” Spaulding, III Farella Braun + Martel LLP 235 Montgomery St., 17th Floor San Francisco, CA 94104 16 CONSENT DECREE AND ORDER 1 If to Plaintiffs: 2 4 Michelle D. Smith Humboldt Baykeeper 217 E St Eureka, CA 95501 5 Any notices or documents required or provided for by this Consent Decree or related 3 Layne Friedrich Lawyers for Clean Water, Inc. 1004A O’Reilly Ave San Francisco, CA 94129 6 thereto that are to be provided shall be sent both by facsimile or email transmission and first class 7 mail to the above representatives. Notices or communications shall be deemed given and 8 received on the date received by facsimile or email transmission, if such notice is given by 9 facsimile or e-email transmission to all recipients between 9:00 a.m. and 5:00 p.m. Pacific Standard Time (“PST”) on a business weekday. If notice is given by facsimile or email 11 transmission after 5:00 pm. PST on a weekday or at any time on a weekend day, notice shall be 12 DOWNEY BRAND LLP 10 deemed received the next succeeding weekday. Any change of address or addresses shall be 13 communicated in writing in the manner described above for giving notices. 23. 14 Construction. The language in all parts of this Consent Decree shall be construed 15 according to its plain and ordinary meaning, except as to those terms are defined by law, in the 16 CWA, RCRA, in regulations implementing these statutes, or specifically herein. 24. 17 Severability. In the event that any section or sentence of this Consent Decree is 18 held by a court to be unenforceable, the validity of the enforceable sections shall not be adversely 19 affected. 25. 20 Counterparts. This Consent Decree may be executed in any number of 21 counterparts, all of which together shall constitute one original document. Telecopy, .pdf, and/or 22 facsimile copies of original signature shall be deemed to be originally executed counterparts of 23 this Consent Decree. 26. 24 Assignment. Subject only to the express restrictions contained in this Consent 25 Decree, all of the rights, duties and obligations contained in this Consent Decree shall inure to the 26 benefit of and be binding upon the Parties, and their successors and assigns. 27. 27 28 Modification of the Consent Decree. This Consent Decree, and any sections herein, may not be changed, modified, waived, discharged or terminated, unless by a written 1111940.4 17 CONSENT DECREE AND ORDER 1 BOLDT BAYKEEPER 2 Date: 9 . Date: '1- 20 - 10 3 JO 4 5 6 7 8 APPROVED AS TO FORM: For UNION PACIFIC RAILROAD COMPANY: 9 Date: 10 _ By: FARELLA, BRAUN + MARTEL LLP 11 12 For CUE VI, LLC: ....l ....l Q 13 Z <t:: 14 co 15 Date: _ By: DOWNEY BRAND LLP >-< Z 0 Q 16 For HUMBOLDT BAYKEEPER and ECOLOGICAL RIGHTS FOUNDATION 17 18 19 By: Michelle D. Smith HUMBOLDT BAYKEEPER 20 21 22 23 24 25 26 27 28 --------- ------------------ 1111940.4 19 CONSENT DECREE AND ORDER 1 2 3 4 5 6 7 8 9 10 11 DOWNEY BRAND LLP 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1111940.4 20 CONSENT DECREE AND ORDER 1 EXHIBITS A-1 THROUGH A-5, INCLUSIVE 2 3 Map of Site and Locations of Interim Removal Action 4 5 6 7 8 9 10 11 DOWNEY BRAND LLP 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1111940.4 21 CONSENT DECREE AND ORDER 1 Exhibit B 2 3 Form of Joint Escrow Instructions 4 5 6 7 8 9 10 11 DOWNEY BRAND LLP 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1111940.4 22 CONSENT DECREE AND ORDER Andrew L. Collier acollier@downeybrand.com 916/520 5244 Direct 916/520 5644 Fax 621 Capitol Mall, 18 t h Floor Sacramento, CA 95814 916/444 1000 Main 916/444 2100 Fax downeybrand.com [DATE], 2010 VIA ELECTRONIC MAIL AND FACSIMILE: [INSERT] [NAME] [TITLE] [COMPANY] [ADDRESS] Re: Humboldt Baykeeper, et al. v. CUE VI, LLC, et al. United States District Court, Northern District of California Case No. C-06-02560 [INSERT] Dear [INSERT]: We represent Defendant CUE VI, LLC (“CUE VI”) in connection with the above referenced matter (the “Action”). We submit these joint escrow instructions (the “Joint Instructions”) on behalf of CUE VI and also on behalf of Defendant Union Pacific Railroad Company (“Union Pacific”) and Plaintiffs Humboldt Baykeeper and Ecological Rights Foundation (collectively, the “Plaintiffs” and together with CUE VI and Union Pacific, the “Parties”) with reference to the Action and the following: A. On or about [INSERT], the above entitled Court approved and entered that certain Consent Decree by and between the Parties in connection with the settlement of the Action (the “Consent Decree”). A true and correct copy of the Consent Decree is attached hereto as Exhibit A. B. The Effective Date of the Consent Decree is [INSERT], the date of Court approval (the “Effective Date”). C. Pursuant to section 16 of the Consent Decree, within seven (7) calendar days of the Effective Date, on behalf of itself and Union Pacific, CUE VI shall make an irrevocable deposit into an escrow account in the total amount of $1,800,000 (the “Payment”). D. Pursuant to section 16 of the Consent Decree, the Payment is to be disbursed to the Plaintiffs pursuant to the instructions specifically set forth herein, which were attached as Exhibit B to the Consent Decree. 1111968.2 Exhibit B to Consent Decree [INSERT] [DATE], 2010 Page 2 E. Pursuant to section 16 of the Consent Decree, CUE VI directed the Escrow Agent [identify] to establish an escrow account, and the Escrow Agent has established an interest bearing account, number [INSERT] with [INSERT] for distribution according to these Joint Instructions (the “Escrow Account”). In light of the foregoing, and upon CUE VI’s and Plaintiffs’ receipt of your acknowledgement of these Joint Instructions, you are authorized to take the following actions. 1. Pursuant to section 16 the Consent Decree, disburse the following amounts, according to the following schedule, to the Plaintiffs in the form of a check made payable to “Lawyers for Clean Water Attorney Client Trust Account,” addressed to 1004-A O’Reilly Avenue, San Francisco, CA 94129, via overnight delivery: i. The sum of $900,000 on [14TH CALENDAR DATE FROM EFFECTIVE DATE]; ii. The sum of $400,000 on [90TH CALENDAR DATE FROM EFFECTIVE DATE]; iii. The sum of $500,000 on [540TH CALENDAR DATE FROM THE EFFECTIVE DATE]. 2. All escrow fees and charges shall be borne by CUE VI. 3. Interest shall accrue to the funds in the Escrow Account. At the time the final payment is made, pursuant to Section 1.iii above, accrued interest shall be paid as follows: 1) If the accrued interest exceeds the total escrow fees and charges incurred to that date, payment of accrued interest in the amount equal to such total incurred fees and charges shall be made to CUE VI. The remainder of the accrued interest, if any, shall be divided in half, with one half paid to Plaintiffs and one half paid to CUE VI. 2) If the accrued interest does not exceed the total escrow fees and charges, all accrued interest shall be paid to CUE VI. 4. All Parties have had the opportunity to seek the advice of counsel or other advisor of their choice and authorize you to comply with these Joint Instructions pursuant to the signatures below. 5. You are authorized to accept a facsimile transmission of these Joint Instructions with facsimile signatures in lieu of original signatures. These Joint Instructions may be executed in counterparts, each of which shall be deemed an original, but all of which, taken together, shall constitute one and the same instrument. 1111968.2 [INSERT] [DATE], 2010 Page 3 6. These Joint Instructions are irrevocable and cannot be modified, amended, supplemented, or rescinded in any manner without the express written notarized consent of all of the Parties. Please acknowledge your receipt of these instructions and your agreement to act in accordance herewith by executing and dating a copy of this letter where indicated below and returning the same to the undersigned at the address listed above, with a copy to: Layne Friedrich, Lawyers for Clean Water, 1004-A O’Reilly Avenue, San Francisco, CA 94129. 1111968.2 [INSERT] [DATE], 2010 Page 4 Very truly yours, DOWNEY BRAND LLP Andrew L. Collier PARTY AUTHORIZATIONS CUE VI By: _________________________ Michael Casey Vice President Union Pacific Railroad Company By: _________________________ Name: [INSERT] Title: [INSERT] Ecological Rights Foundation: By: 1111968.2 __________________________ Name: [INSERT] Title: [INSERT] [INSERT] [DATE], 2010 Page 5 Humboldt Baykeeper: By: __________________________ Name: [INSERT] Title: [INSERT] ACKNOLWEDGED AND AGREED: By: 1111968.2 _________________________ Name: [INSERT] Title: [INSERT] 1 ORDER 2 3 4 IT IS HEREBY ORDERED that the Court shall retain jurisdiction over the Parties for the purpose of enforcing compliance with the terms of the Consent Decree pursuant to Section 15. All proceedings relating to enforcing compliance with the Consent Decree shall be before Chief 5 Magistrate Judge Maria-Elena James. 6 7 Date: November 9, 2010 __________ 8 9 _________________________________ Honorable Jeffrey S. White United States District Court Judge Northern District of California 10 11 DOWNEY BRAND LLP 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1111940.4 23 CONSENT DECREE AND ORDER

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