Dept. of Forestry and Fire Protection v. Howell, C074879

Background

The Moonlight Fire (Sept. 3, 2007) burned ~65,000 acres in Plumas County; Cal Fire (Attorney General) sued Howell (timber operator), landowners, Sierra Pacific, Beaty, and others to recover suppression/investigation costs and other damages.
Cal Fire’s origin theory: metal fragments from a bulldozer operated by Howell employees (Bush, Crismon) ignited vegetation and required firefighting and investigation expenses.
The consolidated cases were designated complex; retired Judge Nichols presided and, one week before trial, announced a pretrial hearing that might include a Cottle-style prima facie proof requirement; at that hearing the court (1) granted judgment on the pleadings as to several defendants for Cal Fire’s statutory claims under Health & Safety Code §§13009/13009.1, and (2) dismissed plaintiffs’ other claims for failure to present a prima facie case in the Cottle proceeding.
Postjudgment, the court awarded defendants costs and large attorney/expert-fee awards against Cal Fire and imposed monetary and terminating discovery sanctions based on findings of pervasive discovery abuses (false reports, destroyed notes, late production of WiFITER documents, false deposition testimony).
On appeal the Court of Appeal (3d Dist.) (published in part) reversed the Cottle-based dismissals for procedural due process defects (inadequate notice/opportunity), affirmed the judgment-on-the-pleadings as to §§13009/13009.1 (statutes do not import common-law negligence or vicarious liability), vacated or remanded various cost/fee awards for recalculation or further proceedings, affirmed terminating sanctions but reversed and remanded monetary sanctions and the §1021.5 fee awards to defendants.

Issues and Key Positions

Issue	Plaintiff's Argument	Defendant's Argument	Held
Validity of Cottle prima facie hearing/due process	Cottle hearing here deprived plaintiffs of meaningful notice and time to present proof; procedurally unfair	Court used its inherent case-management powers to streamline complex litigation; plaintiffs had opportunity at hearing	Reversed Cottle-based dismissals: hearing notice was inadequate and risked erroneous deprivation; due process violated
Statutory scope of Health & Safety Code §§13009/13009.1 (incorporation of common-law negligence/vicarious liability)	"Negligently" in statute and definition of "person" (includes corporations) allows common-law negligence and vicarious liability theories (Cal Fire)	Statute’s plain text and legislative history show recovery is statutory and limited; omission of "personally or through another" (from prior statutes) indicates no vicarious liability or other common-law grafting	Affirmed judgment on the pleadings as to Sierra Pacific, Beaty, and landowners: §§13009/13009.1 do not incorporate common-law negligence or vicarious liability; Cal Fire barred from pursuing such theories under those statutory claims
Postjudgment costs to defendants / apportionment	Costs awarded to defendants should be vacated because Cottle dismissal reversed; if any defendants prevail via judgment on pleadings (Cal Fire only), costs must be apportioned to defense of Cal Fire’s claims	Defendants argued prevailing-party costs appropriate and sought full awards	Costs awards premised on Cottle vacated; award as prevailing parties against Cal Fire may be appropriate but remanded because trial court failed to apportion costs among multiple plaintiffs/claims
Discovery sanctions, monetary fees, and §1021.5 attorney fees	Trial court erred in (a) imposing excessive monetary sanctions (awarded broad attorney/expert fees back to litigation start), (b) awarding prevailing-party attorney fees under Civil Code §1717 and Code Civ. Proc. §1021.5	Defendants contended Cal Fire engaged in pervasive, willful discovery abuse justifying terminating and large monetary sanctions and public-benefit fee awards	Court affirmed terminating sanctions (inherent + statutory authority) as supported by record; reversed monetary sanctions as excessive and not tied to expenses caused by specific discovery abuses and remanded to calculate recoverable expenses; reversed awards of prevailing-party contractual fees and §1021.5 public-interest fees (trial court failed to weigh defendants’ financial exposure vs burden)

Key Cases Cited

Cottle v. Superior Court, 3 Cal.App.4th 1367 (1992) (trial courts may fashion Cottle-type prima facie procedures in complex litigation but timing, notice, and fairness are crucial)
Rutherford v. Owens-Illinois, Inc., 16 Cal.4th 953 (1997) (inherent judicial power limited by constitution and statute)
Lockheed Martin Corp. v. Continental Ins. Co., 134 Cal.App.4th 187 (2005) (trial judge conducted prima facie proof phase in long-running complex litigation after extensive preparation)
Alexander v. Exxon Mobil Corp., 219 Cal.App.4th 1236 (2013) (court noted concerns about imposing detailed affidavits at pleading stage but assumed validity where not challenged)
Stephen Slesinger, Inc. v. Walt Disney Co., 155 Cal.App.4th 736 (2007) (court may impose terminating sanctions under inherent authority when misconduct is deliberate and egregious and no lesser sanction suffices)
Lopez v. Watchtower Bible & Tract Soc. of N.Y., Inc., 246 Cal.App.4th 566 (2016) (terminating sanctions are drastic, to be used sparingly; sanctions should be tailored and incremental absent extreme misconduct)
City of Los Angeles v. Shpegel-Dimsey, Inc., 198 Cal.App.3d 1009 (1988) (recovery of public fire suppression costs is purely statutory; courts must respect statutory limits on who may be held liable)
People v. Southern Pacific Co., 139 Cal.App.3d 627 (1983) (statutory interpretation of fire-cost statutes and limitation of liability theories)

Disposition summary: affirmed in part (judgment on pleadings as to certain defendants; terminating sanctions), reversed in part (Cottle-based dismissals; monetary sanctions; prevailing-party and public-benefit fee awards), and remanded for apportionment and recalculation of permissible cost and sanction awards; no judge recusal ordered.