Motion-Secondary: IN RE: SAN DIEGO COUNTY WATER AUTHORITY

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                                1010695.01

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KEKER & VAN NEST LLP
JOHN KEKER - # 49092
jkeker@kvn.com

DANIEL PURCELL - # 191424
dpurcell@kvn.com

DAN JACKSON - # 216091
djackson@kvn.com

WARREN A. BRAUNIG - #243884
wbraunig@kvn.com

633 Battery Street

San Francisco, CA 94111-1809
Telephone: (415) 391-5400
Facsimile: (415) 397-7188

Attorneys for Petitioner and Plaintiff

SAN DIEGO COUNTY WATER AUTHORITY

ELECTRONICALLY

FILED

Superior Court of Cattfornta,
County of San Francisco

12/14/2015
Clerk of the Court
BY:NOELIA RIVERA

Deputy Clerk

EXEMPT FROM FILING FEES
[GOVERNMENT CODE § 6103]

SUPERIOR COURT OF THE STATE OF CALIFORNIA

IN AND FOR THE COUNTY OF SAN FRANCISCO

SAN DIEGO COUNTY WATER
AUTHORITY,

Petitioner and Plaintiff,

Vv.

METROPOLITAN WATER DISTRICT OF
SOUTHERN CALIFORNIA; ALL
PERSONS INTERESTED IN THE
VALIDITY OF THE RATES ADOPTED
BY THE METROPOLITAN WATER
DISTRICT OF SOUTHERN CALIFORNIA
ON APRIL 8, 2014 TO BE EFFECTIVE
JANUARY 1, 2015 AND JANUARY 1,
2016; and DOES 1-10,

Respondents and Defendants.

Case No. CPF-14-514004

REPLY DECLARATION OF NICHOLAS
S. GOLDBERG IN SUPPORT OF SAN
DIEGO’S MOTION FOR PARTIAL
LIFTING OF STAY TO REQUIRE MET
TO LODGE THE ADMINISTRATIVE
RECORD, EXHIBITS A-F

Date: December 21, 2015
Time: 3:00 p.m.

Dept.: 304

Judge: Hon. Curtis E.A. Karnow
Date Filed: May 30, 2014

Trial Date: Not Yet Set

REPLY GOLDBERG DECLARATION IN SUPPORT OF SAN DIEGO’S MOTION FOR PARTIAL
LIFTING OF THE STAY TO REQUIRE MET TO LODGE THE ADMINISTRATIVE RECORD, EXH. A-F
Case No. CPF-14-5140041010695.01

xy a

00

I, Nicholas S. Goldberg, declare that:

1. I am an attorney licensed to practice law in the State of California and am an
attorney with the law firm of Keker & Van Nest LLP, located at 633 Battery Street, San
Francisco, California, 94111, counsel for Petitioner and Plaintiff San Diego County Water
Authority (“San Diego”) in the above-captioned action. I have personal knowledge of the facts
set forth herein and, if called to testify as a witness thereto, I would do so competently under oath.

2. Attached hereto as Exhibit A is a true and correct copy of Respondent/Defendant
Metropolitan Water District of Southern California’s (“Met”) Opposition to San Diego’s Motion
to Augment the Administrative Record, dated October 28, 2013, filed in San Diego County Water
Authority v. Metropolitan Water District of Southern California, et al., Case No. CFP-10-510830
and San Diego County Water Authority v. Metropolitan Water District of Southern California, et
al., Case No. CFP-12-512466 (the “2010 and 2012 cases”).

3. Attached hereto as Exhibit B is a true and correct copy of the Court’s Pre Trial
Rulings, dated November 5, 2013, in the 2010 and 2012 cases.

4. Attached hereto as Exhibit C is a true and correct copy of the Memorandum of
Points and Authorities in Support of San Diego’s Motion to Correct the 2012 Record, dated
November 21, 2013, filed in the 2012 case only.

5. Attached hereto as Exhibit D is a true and correct copy of the Stipulation and
Order to Supplement the Administrative Record in the 2012 Action and to Withdraw the Motion
to Correct the 2012 record, dated December 10, 2013.

6. Attached hereto as Exhibit E is a true and correct copy of the Joint Stipulation and
Order Staying Case, dated February 19, 2015, filed in this action.

7. Attached hereto as Exhibit F is a true and correct copy of Met’s Statement
Pursuant to August 28, 2015 Scheduling Order, dated October 23, 2015, filed in the 2010 and
2012 cases.

Executed this 14th day of December 2015 at San Francisco, California.

I declare under penalty of perjury under the laws of the State of California that the foregoing

is true and correct,

NICHOLAS S. G@EBBERG
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REPLY GOLDBERG DECLARATION IN SUPPORT OF SAN DIEGO’S MOTION FOR PARTIAL
LIFTING OF THE STAY TO REQUIRE MET TO LODGE THE ADMINISTRATIVE RECORD, EXH. A-F
Case No. CPF-14-514004Exhibit Aa aA nw Be wW HN

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Bingham McCutchen LLP

JAMES J. DRAGNA (SBN 91492)
COLIN C. WEST (SBN 184095)
THOMAS S. HIXSON (SBN 193033)
Three Embarcadero Center

San Francisco, CA 94111-4067
Telephone: 415.393.2000
Facsimile: 415.393.2286

Morrison & Foerster LLP

SOMNATH RAJ CHATTERJEE (SBN 177019)
425 Market Street

San Francisco, CA 94105-2482

Telephone: 415.268.7000

Facsimile: 415.268.7522

MARCIA SCULLY (SBN 80648)

SYDNEY B. BENNION (SBN 106749)

HEATHER C. BEATTY (SBN 161907)

The Metropolitan Water District of Southern California
700 North Alameda Street

Los Angeles, CA 90012-2944

Telephone: 213.217.6000

Facsimile: 213.217.6980

Attorneys for Respondent and Defendant
Metropolitan Water District of Southern California EXEMPT FROM FILING FEES
[GOVERNMENT CODE § 6103]

SUPERIOR COURT OF THE STATE OF CALIFORNIA
COUNTY OF SAN FRANCISCO

SAN DIEGO COUNTY WATER Case Nos. CPF-10-510830; CPF-12-512466

AUTHORITY,
RESPONDENT/DEFENDANT

Petitioner and Plaintiff, METROPOLITAN WATER DISTRICT OF
SOUTHERN CALIFORNIA’S OPPOSITION TO
ve SAN DIEGO COUNTY WATER AUTHORITY’S
MOTION TO AUGMENT THE
METROPOLITAN WATER DISTRICT | ADMINISTRATIVE RECORD
OF SOUTHERN CALIFORNIA; etal, | pate: ~~ November 4,2013

Time: 9:00 a.m.
Dept.: 304
Judge: Hon. Curtis E, A. Kamow

Respondents and
Defendants.

Actions Filed: June 11, 2010; June 8, 2012
_| Trial Date: December 17, 2013

MWD’S OPPOSITION TO SDCWA’S MOTION TO AUGMENT THE ADMINISTRATIVE RECORDCm ya DH FW Ne

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I, INTRODUCTION
I. BACKGROUND
Ill. DISCUSSION

TABLE OF CONTENTS

A Permitting SDCWA To Augment The Administrative Record Now Would
Prejudice MWD u.sssesssessessrecsesserersesnsessnrsneerscesansesneetuensensnnusnnannesuaeentennensebannnsesiits 4
B. The Documents SDCWA Seeks To Add Are Not Proper Additions To The
Administrative Record ......... 5
Cc, Exhibits 24-69 Are Extra- Revord D Documents 5
1. There Is No Exception For “Earlier Studies” .....escsscsssssscessesconesenienss 3
2. The Western States Exception Does Not Apply ....cesssessessesresersereennreses 7
3. There Is No Applicable Exception For “Agency Misconduct” Or
“Background Information”... 9
D. Discovery Responses And Deposition Testimony (Exhibits 70-77) Are
Not Part Of The Administrative Record
E. Documents Potentially Subject To Judicial Notice (Exhibits 79-84) Are
Nevertheless Not Part Of The Administrative Record.......cssesseeerneeessrsssnseey 11
TV. — CONCLUSION W.....seessessssssssesesssessesnoubusonisasissivaiasanvesnsintenreanéabeeuesnedsnnasecunonsnseabannnsanveereney 12

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TABLE OF AUTHORITIES
Page(s)

CASES
Cal. Ass’n of Nursing Homes etc., Inc. v. Williams,

4 Cal. App. 3d 800 (1970)....ssssssesssssecssssssessecbecessaetssbedchsvnnasonrsestaeasseasteuicdsesbsseneeensnaaeuansessvare 7
Carrancho v. Cal. Air Resources Bd.,

111 Cal. App. 4th 1255 (2003)....sosssssssesversnensessnvesncsssrassnstnincenessnneennssrseesasetneennensnsennenseane 11
City of Orange v. Barratt Am. Inc.,

150 Cal. App. 4th 420 (2007). .icscesersssnnssisnssspsvavaayenasiatavigvernsiessenueraasannasaineenyevescessenniaponitnetirk 11

City of Santa Cruz v, Local Agency Formation Commiss
76 Cal. App. 3d 381 (1978)...

County of Los Angeles v. Super. Ct
13 Cal. 3d 721 (1975) wees

Evans y. City of San Jose,
128 Cal. App. 4th 1123 (2005).ssessecssssesssessesstessuntuetssestsnetsebuniienssutsesesustnsssnssensi 5,7

Nasha L.L.C. v. City of Los Angeles,
125 Cal. App. 4th 470 (2004)..csscssssssssssssnnsesneresscseteueoterisseevstserietsisteetnesuassessanennsiese i

Outfitter Properties LLC vy. Wildlife Conservation Bad.,
207 Cal. App. 4th 237 (2012).

Pajaro Valley Water Mgmt. Agency v. Amrhein,
150 Cal. App. 4th 1364 (2007)

Rivera v. Div. of Indus, Welfare,
265 Cal. App. 2d 576 (1968) ...cassiesssisronssresniningerventsqrsaitavanssqotneetordndanedaninesttheotssStanasbdnaaiionsabatine 6

San Joaquin Local Agency Formation Comm'n y. Super. Ct.,

162 Cal, App. 4th 159 (2008)...cssesssessseresnetsnesnenene 29,11
Town of Tiburon v. Bonander,

180 Cal. App. 4th 1057 (2009)..csesessiessssiscsessesssansnanecostecstansounsesssnesssatenssneressnicsabadensidesstaioennsarsée 6
Western States Petroleum Ass'n v. Super. Ct.,

9 Cal. 4th 559 (1995) » passim

Wilson v, Hidden Valley Mun. Water Dist.,
256 Cal, App. 2d 271 (1967) sesscssssssssssssiseesssssveerseveivestessnunsccssserecenssatestestsnserstinsnansenssssnaeesennonaie 9

it

MWD’S OPPOSITION TO SDCWA’S MOTION TO AUGMENT THE ADMINISTRATIVE RECORDSTATUTES

California Code of Civil Procedure § 1094.5...ccccssecseesecsuserteeseesieressteessinsecusaneennasniesssssssaneey 11

MWD Act § 133 sssssssscsessessnssesnsintesteetsseestacertsttteieesneiseeitisisistcrsiessbnyisitabnsbonsensiionie

MWD Act § 51.

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Respondent and Defendant Metropolitan Water District of Southern California (“MWD”)
respectfully submits this opposition to San Diego County Water Authority’s (“SDCWA”) motion
to augment the administrative records (“motion”) in the 2010 Action (Case No. CPF-10-510830)
and the 2012 Action (CPF-12-512466).

L INTRODUCTION

This Court should reject SDCWA’s motion. First, SDCWA has had abundant
opportunities before now to augment the administrative record, which is the evidence that “was
before the agency at the time it made its decision.” Western States Petroleum Ass'n v. Super. Ct,
9 Cal. 4th 559, 574 n.4 (1995), As amember agency of MWD with seats on MWD’s Board of
Directors, SDCWA actively participated in the rate-setting process that it now challenges, and
had the right and opportunity to add to the administrative record it now claims is insufficient. In
fact, it did so, and those documents are part of the administrative records MWD filed with this
Court.’ If SDCWA wanted the Board to consider additional particular documents in setting its
rates, it could have submitted those documents for review at the public hearings regarding
MWD?’s water rates, making them part of MWD’s administrative record.

Second, SDCWA has had abundant opportunities to address the adequacy of the records
compiled for this litigation to ensure that what MWD filed contained all of the evidence the
Board considered. It has ignored those opportunities, and further ignored MWD’s many efforts
to meet and confer over the administrative record’s contents, Indeed, SDCWA’s counsel told the
Court this year that SDCWA had “no dispute” with the 2012 administrative record, 1/15/2013
Tr. at 34:13.

Permitting SDCWA to now add over twenty-five hundred pages to the administrative

record, with no explanation for its delay, and with no warning that such a motion would be

' SDCWA submitted several documents to MWD’s Board for consideration during rate-setting
hearings, and they are part of the administrative record. See, e.g., 2010/2012 Administrative
Records Document Nos. 594, 595, 601; 2012 Administrative Record Document No. 922, 923,
924, 988.

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coming, would be unfair and prejudicial to MWD, and simply gamesmanship, which this Court
need not and should not permit.

Third, with few exceptions, none of the documents SDCWA now seeks to add are proper
additions to the administrative record, i.e., evidence that was “before the agency at the time it
made its decision.” Western States, 9 Cal. 4th at 574 n.4. Many—such as the discovery
responses from this litigation that SDCWA seeks to add—were not in existence when MWD’s
Board made the rate decisions at issue in this case. Others may have been in existence, but
SDCWA offers no evidence that MWD’s Board considered them. As to many of these latter
documents, SDCWA’s point seems to be that MWD should have considered them, but did not.
However, again, if SDCWA wanted the Board to consider these documents, it could have put
them before the Board. Adding them to the administrative record by submitting them to the
Court now would make the administrative record counterfactual, because it would no longer be
the evidence that was before the agency at the time it made its decision.

Fourth, SDCWA’s goal in filing this motion could not be any more transparent. At the
November 4, 2013 pretrial hearing, the Court will be called upon to decide whether extra-record
evidence can be admitted in the rate challenges. Concerned that the Court may (properly) say
no, SDCWA has simply taken the extra-record evidence it wants to use in the December hearing,
and moved to put it in the administrative record. This motion is a sham, intended as an end run
around an anticipated Court order. Also, what SDCWA is doing is exactly what California law
forbids: SDCWA’s purpose for adding these documents is to “question the wisdom” of MWD’s
rates or “contradict the evidence [MWD] relied on”—a purpose for which “extra-record evidence
can never be admitted.” Western States, 9 Cal. 4th at 578-79 (emphasis added).

IL. BACKGROUND

During this litigation, SDCWA has had numerous opportunities to seek inclusion of
documents it believes should have been part of the administrative record. On February 11, 2011,
MWD sent SDCWA a proposed index of documents to be included in the administrative record
in the 20/0 Action, along with copies of the documents, and sought input on its contents.

Declaration of Colin West in Support of MWD’s Opposition to SDCWA’s Motion to Augment
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the Record (“West Dec.”), Ex. A. SDCWA did not have objections to any items in the index.
West Dec., Ex. B.

On April 8, 2011, SDCWA provided a partial list of proposed additions to the
administrative record, and on June 6, 2011 MWD agreed to include all of the documents that it
was able to locate. West Dec., Exs. C, D. MWD asked SDCWA to send the documents MWD
was not able to locate. West Dec., Ex. D. SDCWA did not respond,

On May 20, 2011, SDCWA provided an additional list of 31 proposed additions to the
administrative record. West Dec., Ex. H. In correspondence dated June 3, 6, and 8, 2011, MWD
agreed to include several of the items in that list, but objected to others.” On August 5 and again
on August 17, 2011, MWD proposed to SDCWA that they meet and confer to resolve any
remaining disputes about the content of the administrative record. SDCWA did not accept these
offers, West Dec., Ex. I; see also id. 11, On December 13, 2011, having received no further
communication about the 20/0 Action administrative record from SDCWA, MWD filed it with
the Court. This record consists of 40 volumes, totaling 11,574 pages and contains the documents
MWD’s Board considered when setting the 2011/2012 water rates, including Board letters,
presentations to the Board, comments from interested parties, agendas and minutes for the
relevant time period, as well as relevant documents from approximately fifteen years leading up
to that rate-setting. That was almost two years ago. Although SDCWA has often since 2012
stated in Court filings that the record is deficient, SDCWA has never until now sought to
augment the record with a single document.

After SDCWA filed a challenge to the 2013/2014 water rates, MWD prepared the
administrative record that MWD’s Board considered when setting these rates. That record
consists of 61 volumes, totaling 17,522 pages and contains, e.g., Board letters, presentations to
the Board, comments from interested parties, and agendas and minutes for the additional relevant

time period (May 2010 to April 2012), plus all of the documents from the 2010 Action record,

? MWD objected to the documents as being either staff-level documents not considered by the
Board, or pleadings from a previous lawsuit that were also not considered by the Board, and thus
not proper additions to the administrative record. West Dec., Exs. E, F, G.

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Ata hearing before the Court in January of this year, SDCWA represented that it had “no
dispute” with the contents of the 20/2 Action record and the Court asked MWD to provide an
estimate of when it could be filed. 1/15/2013 Tr. at 34:5-13; 36:1-4, MWD subsequently
informed the Court that it would be able to file the 20/2 Action record by March 19, 2013, and,
because SDCWA had indicated it had no dispute with its contents, MWD filed the record on that
date. Since then, SDCWA has not, until now, offered any documents it would like to add to the
2012 Action record. As with the 20/0 Action record, SDCWA has also never until now sought to
augment the record with a single document. Indeed, even after the Court confirmed that the
“usual situation in a review of administrative decisions” is that review is “based . . . solely on the
administrative record,” SDCWA remained silent. See April 29, 2013 Order at 2,

I. DISCUSSION

A. Permitting SDCWA To Augment The Administrative Record Now
Would Prejudice MWD

Allowing SDCWA to add these documents now would not only sandbag MWD on the
eve of the final hearing/trial, it would also prevent MWD from complying with this Court’s July
19, 2013 Order, which specifically requested that the parties file by October 18, 2013 pretrial
briefs setting forth “why the court ought not to consider evidence likely to be offered by
opposing parties.” See July 19, 2013 Case Management Order at 3, On the same day these
briefs were due, SDCWA filed this motion. There was no way that MWD could have known
that SDCWA would contend that these documents should be part of the administrative record,
and thus be able to brief that issue in time for the October 18 pretrial brief. MWD now has one
week to respond to SDCWA and IID’s substantial pretrial briefs and to cull through SDC WA’s
thousands of pages of documents to determine the propriety of their inclusion in the

administrative record. This huge, eleventh-hour sandbag is improper.

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B The Documents SDCWA Seeks To Add Are Not Proper Additions
To The Administrative Record?

In the index attached to its motion, SDCWA lists 54 exhibits it seeks to have admitted.
However, SDCWA fails to provide a foundational showing as to why each of these documents
should be admitted (i.¢., SDCWA provides no factual showing that the Board considered the
documents but failed to include them in the administrative record). In addition to its failure to
submit evidence, such as a declaration, showing why any of these documents should be included
in the administrative record, SDCWA can provide no legal support for their inclusion.
Uncontradicted authority holds that courts must limit their review of quasi-legislative agency
decisions to the administrative record. See MWD Pretrial Brief at 26-30 (citing, e.g., Western
States, 9 Cal. 4th at 574). These cases make clear that the administrative record consists of
documents that the agency considered when making its decision. See, e.g., Western States, 9
Cal. 4th at 574 n.4; Evans vy. City of San Jose, 128 Cal. App. 4th 1123, 1144 (2005) (“ a court’s
review is confined to an examination of the record before the administrative agency at the time it
takes the action being challenged.”). A narrow exception exists for documents that were in
existence, but were impossible to produce “at the administrative level in the exercise of
reasonable diligence.” Western States, 9 Cal. 4th at 578. This exception applies to none of
SDCWA’s documents, and SDCWA’s other rationales for admitting the documents fail.

Cc Exhibits 24-69 Are Extra-Record Documents

Each justification SDCWA offers for including these documents lacks merit.
1. There Is No Exception For “Earlier Studies”

First, SDCWA argues that some of these documents (it only cites to Exhibits 25 and 36)
should be included in the administrative record because they are “earlier studies, reviews and
reports made . . . in response to the agency’s mandate” that MWD excluded from the
administrative record. Motion at 2-3; SDCWA Pretrial Brief at 54, There is no such exception

under Western States, or in any other case.

3 Exhibits 37 and 46 are in the 20/0 and 2012 Action administrative records. See 2010/2012
Administrative Records Document Nos. 183, 376.

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SDCWA primarily relies on City of Santa Cruz v. Local Agency Formation Commission,
76 Cal, App. 3d 381 (1978), which does not support creating an exception to Western States for
pre-existing documents simply because they are in some way topically related to a quasi-
legislative decision. Santa Cruz upheld the trial court’s review of the second administrative
record the agency filed, which contained a previous study the agency had prepared. /d. at 391,
395. The study was one that the agency’s enabling statute required it to prepare as part of the
decision-making process at issue in that case. Jd. at 385, The court presumed that the agency
had considered the study because it was “initially produced at the hearings” at which the agency
made the decision at issue in the case, and because the agency included it in its administrative
record. Id, at 391-92,

Exhibits 25 and 36 are clearly distinguishable from the study in Santa Cruz. Exhibit 25 is
a 1969 report that, by SDCWA’s own admission, MWD commissioned in response to the State
Assembly Committee on Water’s recommendation regarding MWD’s water pricing policies in
effect decades before MWD unbundled its rates into its current rate structure. SDCWA Pretrial
Brief at 7. SDCWA has made no showing that this document was present at any of the relevant
hearings or was considered by MWD’s Board when setting the rates at issue. Similarly,
SDCWA has made no showing that Exhibit 36, a report drafted by Raftelis in 1999, was present
at or considered by the Board during the rate-settings at issue here,’

The other cases SDCWA cites are equally inapplicable. See Town of Tiburon v.
Bonander, 180 Cal. App. 4th 1057, 1075-76 (2009) (case does not involve review based on the
administrative record); Rivera v. Div. of Indus. Welfare, 265 Cal. App. 2d 576, 584, 593-94
(1968) (where the record before the agency was at issue because petitioners claimed they did not

have access to certain reports and investigations, court rejected petitioners’ claim and held that

4 In fact, SDCWA has been in possession of Exhibit 36 since at least December of 2010, when
MWD produced it to SDCWA in response to a Public Records Act request, and thus SDCWA
could have presented it to MWD’s Board. See, e.g., West Dec., Ex. J. SDCWA’s failure to
move to augment the administrative record with Exhibit 36 until now is even more perplexing
considering that SDCWA submitted to MWD’s Board one of its consultant’s cost-of-service
reviews, which references this document. See 2012 Administrative Record No. 922 at
MWDRECORD2012_016163 (FCS Group discussing the 1999 Rafielis report).

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the Commission complied with procedural requirements governing its hearings); Cal. Ass'n of
Nursing Homes etc., Inc. y. Williams, 4 Cal. App. 3d 800, 816 (1970) (where the record before
the agency was at issue because it was non-existent, court never admitted extra-record evidence,
it simply held that the Medi-Cal administrator failed “to hold hearings establishing an
evidentiary record”). Western States contains no exception for “earlier materials” and the cases
SDCWA cites do not support adding Exhibits 25 and 36.

Moreover, SDCWA’s claim that MWD “excluded” Exhibits 25 and 36 from the record is
without merit. Motion at 3. Putting aside the lack of any evidence to support this claim, mere
allegations that an agency excluded evidence are insufficient bases to augment the administrative
record, Evans v. City of San Jose, 128 Cal. App. 4th 1123, 1144 (2005). In Evans, the appellate
court upheld the trial court’s denial of plaintiffs request to augment the administrative record
where plaintiff sought to add evidence supporting her position and contradicting the evidence in
the administrative record. Id. The court rejected plaintiff's allegation that the evidence had been
“improperly excluded” from the administrative record, stating that such an allegation was “not a
sufficient showing” to warrant augmenting the record. Jd. SDCWA has made no showing that
MWD’s Board considered Exhibits 25 and 36 when setting the rates at issue here.

Finally, SDCWA’s argument that these early documents, dating back to the 1960s, are
relevant to this litigation is clearly a new thought. All of SDCWA’s requests for production of
documents in these actions that concerned rates sought only documents from 2008 forward;
except one that sought documents only from 1998 to 2002.

2. The Western States Exception Does Not Apply

%

SDCWA next contends that any “evidence that MWD had in its possession at the time”
of the rate-settings should be admitted under the Western States exception for evidence
impossible to “produce[] at the administrative level in the exercise of reasonable diligence.”
Motion at 3. As its one example of such evidence, SDCWA claims that MWD “hid” from
SDCWA Exhibit 32, a one-page memorandum written by an MWD staff member in 1997.

Motion at 3-4, SDCWA is wrong.

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As Western States cautioned, the exception for evidence that could not be produced at the
administrative level in the exercise of reasonable diligence must be “very narrowly construed.”

9 Cal. 4th at 578. To interpret the exception to cover any internal discussions, notes, or other
impressions among MWD staff members such as those SDC WA tries to admit here would
impermissibly broaden the exception to a point where it would swallow the rule limiting review
to the administrative record. SDCWA has made no showing that the Board reviewed or
considered any of the MWD staff-level documents in its index. To the extent SDCWA is trying
to imply that any information in the possession of any of MWD’s nearly two thousand
employees should automatically be imputed to the Board, SDCWA offers no factual or legal
support for that proposition, and none exists, Further, as the Court may recall, MWD’s Board
consists entirely of representatives designated by MWD’s member agencies (e.g., SDCWA itself,
the City of Anaheim, and so on); there are no MWD staff members on the Board. MWD Act §
51. Thus, aside from the administrative record actually considered by the Board, the information
known to individual Directors likely differs according to which member agencies the Directors
represent. ‘The only information that is reasonable to attribute to the Board as a whole — which is
the entity that sets MWD’s rates, MWD Act § 133 — is what is in the actual administrative record
considered by the Board. Further, SDCWA’s argument proves too much; if every document at
MWD is considered to be within the knowledge of MWD’s Board, then SDCWA itself, through
its representatives on the Board, already had knowledge of all documents.

Moreover, it is well established under California law that MWD has no duty to disclose
the subjective thoughts of individual members of its Board, let alone its staff members. This is
because courts recognize that the subjective thoughts of individual legislators are not the basis
for, and are thus irrelevant to, a legislature’s ultimate decision. County of Los Angeles v. Super.
Ct, 13 Cal. 3d 721, 727 (1975) (“[T]he validity of a legislative act does not depend on the
subjective motivation of its draftsmen but rests instead on the objective effect of the legislative
terms”). It follows from this precedent that the subjective thoughts of MWD staff members
would be even more irrelevant to MWD’s Board’s rate-making decision. Exhibit 32 is a

memorandum discussing the potential impacts to California residents of not having a state plan
8

MWD’S OPPOSITION TO SDCWA’S MOTION TO AUGMENT THE ADMINISTRATIVE RECORDCoe IN KR Hh ke WN me

Mb NM YP NY NR NN NR Y SF SF SS
&® Aaa e oH se FSF SCE ADR AE BH ETS

for Colorado River Aqueduct supplies. It was never presented to or considered by MWD’s
Board when it set the 2011/2012 or 2013/2014 water rates.

Finally, SDCWA’s admitted purpose for seeking to include documents such as Exhibit 32
in the administrative record is to contradict and challenge the wisdom of MWD’s rate-setting
decisions, See SDCWA Pretrial Brief at 10 (citing Exhibit 32 and claiming that MWD
“admit[ed] internally” that SDCWA’s purchase of water from IID “creates a clear supply benefit
to MWD”). As the Court in Western States made clear; regardless of the applicability of an
exception to the no extra-record evidence rule, such evidence can “never be admitted . . . to raise

a question regarding the wisdom of that decision.” 9 Cal. 4th at 579.

3. There Is No Applicable Exception For “Agency
Misconduct” Or “Background Information”

Finally, SDCWA offers an untenable catchall argument, asserting that, to the extent its

2” &,

other arguments fail, the documents qualify as purported “procedural unfairness,” “agency
misconduct,” or “background information” exceptions, supposedly established by Western
States, Motion at 4 (citing Western States). MWD, and the Court, are apparently supposed to
guess which of these supposed exceptions apply to which documents, since SDCWA makes no
effort to do so. In any event, Western States established no such exceptions.

With regard to “procedural unfairness” and “agency misconduct,” the Western States
Court merely noted that some commentators have suggested that courts should admit evidence
relevant to these issues, but because those issues were not before the Court, it did not consider
them. See Western States, 9 Cal. 4th at 575 n.5. Moreover, SDCWA has not asserted a claim of
procedural violation or agency misconduct against MWD and, in the absence of such claims,
California law is clear that allegations of agency bias are improper and irrelevant to the inquiry
of whether an agency’s decision was reasonable. See, e.g., Wilson v. Hidden Valley Mun. Water
Dist., 256 Cal. App. 2d 271, 286 (1967) (“Any claim of prejudgment, bias or prejudice” on the
part of an agency “is beside the point” in reviewing the legality of quasi-legislative decisions);
San Joaquin Local Agency Formation Comm’n y, Super. Ct., 162 Cal. App. 4th 159, 170 (2008)

(improper motive is no grounds for admitting extra-record evidence where agency can cite a

9

MWD’S OPPOSITION TO SDCWA’S MOTION TO AUGMENT THE ADMINISTRATIVE RECORDeC eo YN DA mH & BW NY

PRP RP RP RP RR RR Da
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legitimate reason for its decision in the administrative record). Indeed, SDCWA’s half-hearted
attempts to allege a procedural violation were rejected when this Court ruled that SDCWA’s
allegations of a “cabal” were “not a part of this case.” 7/2/2012 Tr. at 40:26-43:1 and 62:27-63:6.
With regard to “background information,” again, Western States did not establish this as
an exception; it simply noted that federal courts sometimes look to extra-record evidence as
background information for the agency’s decision, 9 Cal. 4th at 578-79.° Furthermore, if a
“background information” exception were to exist in the way that SDCWA seeks to use it in its
motion (i.e., to cover selected documents that support its position that MWD’s rates are
unreasonable) it would eviscerate the holding of Western States. Exhibits 24-69 are not a part of

the administrative record and it would be error to consider them as such.

D. Discovery Responses And Deposition Testimony (Exhibits 70-77)
Are Not Part Of The Administrative Record

As the Court recently confirmed, discovery is generally prohibited in a traditional
mandamus case decided on an administrative record. April 29, 2013 Order at 2. Accordingly,
the Court allowed only narrow discovery under the Wheeling Statute for the limited purpose of
“see[ing] what’s out there.” 1/6/2012 Tr. at 5:16-21; 9:8; see also id. at 9:8-11 (after discovery
“there would be the need to screen what was relevant and what is not relevant”). Then, earlier
this year in a dispute over IID’s deposition notices, the Court disallowed the depositions because
“(t]he proposed discovery in essence demands that Metropolitan explain itself, including why its

determinations were in accord with law,” but “Metropolitan will presumably do so during the

5 In its Pretrial Brief SDCWA points to a case that admitted limited background information in a
circumstance not applicable here. SDCWA Pretrial Brief at 30 (Outfitter Properties LLC v.
Wildlife Conservation Bd., 207 Cal. App. 4th 237 (2012)). This case underscores the
inadmissibility of any of the documents SDCWA is trying to add. In Ouifitter, plaintiff alleged
that an agency violated several statutory spending provisions, one of which limited allocations to
state agencies. Jd, at 250. The court could not discern from the administrative record whether a
particular expenditure went to a state or federal agency, so it looked at limited extra-record
evidence, which established the agency allocated the payment to a federal agency and thus did
not violate the spending limit. /d. at 251. The court stressed that this evidence was purely
informational and “did not contradict the information considered by the Board . . . and did not
call into question the wisdom of that decision.” Jd.

10

MWD’S OPPOSITION TO SDCWA’S MOTION TO AUGMENT THE ADMINISTRATIVE RECORDCoe aD nH ke WN em

RP MR RP RP RR RR DH Be eH Bemis
ect AH YW Ne Se SC KG IA DAH BF HW RY S&S

briefing to be scheduled in connection with the final hearing in this matter.”° May 28, 2013
Order at 2. Ignoring these facts, and Western States,’ SDCWA now attempts to add to the
administrative record extensive interrogatory responses and testimony elicited in the narrow
Wheeling Statute discovery.

With regard to deposition testimony (Exhibits 74-78), California law is clear that it
cannot be considered part of the administrative record. See, e.g., Carrancho y. Cal. Air
Resources Bd., 111 Cal. App. 4th 1255, 1271 (2003) (prohibiting depositions of California Air
Resources Board personnel about a quasi-legislative proposal because “[t]he trial court correctly
ruled that extra-record evidence was not admissible” and “review is properly confined to the
administrative record”); San Joaquin, 162 Cal. App. 4th at 172 (deposition testimony would
violate the no extra-record evidence rule and the deliberative process privilege).

By definition, responses and testimony SDCWA has obtained through discovery is extra-
record evidence under Western States, as it was not something that MWD’s Board considered in
setting the rates at issue. 9 Cal. 4th at 573-574, 573 n.4. Accordingly, the Court should not allow

Exhibits 70-77 into the administrative record,

E. Documents Potentially Subject To Judicial Notice (Exhibits 79-84)
Are Nevertheless Not Part Of The Administrative Record

SDCWA does not move this Court to augment the administrative record to include
Exhibits 79-84, it simply asks the Court to take judicial notice of these documents. MWD does
not contest that these documents are proper subjects of judicial notice. However, to the extent
SDCWA later seeks to admit these documents for the purpose of contradicting the evidence in
the administrative record or questioning the reasonableness of MWD’s water rates, MWD

maintains that such a use of the documents would be improper.

© MWD does not intend to introduce extra-record evidence to explain or justify its rate structure
at trial, and thus there is no reason for SDC WA to be allowed to do so either.

7 The three cases SDCWA cites to support admitting extra-record discovery into evidence are
inapplicable. See Motion at 5 (citing to Pajaro (where there is no discussion of or ruling on what
was before the agency), Barratt (distinguished in MWD’s Reply to SDCWA’s and IID’s Pretrial
Briefs at 10), and Nasha (inapplicable quasi-judicial determination case under California Code of
Civil Procedure Section 1094.5)).

ll

MWD’S OPPOSITION TO SDCWA’S MOTION TO AUGMENT THE ADMINISTRATIVE RECORDoem I DH RB WN Mm

B® N BP BW RP NR RM NR RD em
e2raname ORS S SeBARAKREBE ES

IV. CONCLUSION

For the foregoing reasons, the Court should deny SDCWA’s motion,

DATED: October 28, 2013 Bingham McCutchen LLP

By:

12

1.7

Thomas 8S. Hixson
Attorneys for Respondent and Defendant
Metropolitan Water District of Southern
California

MWD’S OPPOSITION TO SDCWA’S MOTION TO AUGMENT THE ADMINISTRATIVE RECORDCeO yd De ek Ww Ye

yoN YP YM YR RN NY Ye em ot
&2 &§agaR ORES SERDAR E GREE S

San Diego County Water Authority v. Metropolitan Water District of Southern California, et al.,
San Francisco County Superior Court Case Nos, CPF-10-510830 and CPF-12-512466

PROOF OF SERVICE
I am over eighteen years of age, not a party in this action, and employed in San
Francisco County, California at Three Embarcadero Center, San Francisco, California 94111-
4067. Lam readily familiar with the practice of this office for collection and processing of
correspondence for mail/fax/hand delivery/next business day Federal Express delivery, and they
are deposited that same day in the ordinary course of business.

On October 28, 2013, I served the attached:

RESPONDENT/DEFENDANT METROPOLITAN WATER
DISTRICT OF SOUTHERN CALIFORNIA’S OPPOSITION TO
SAN DIEGO COUNTY WATER AUTHORITY’S MOTION TO
AUGMENT THE ADMINISTRATIVE RECORD

kk] (VIA LEXISNEXIS) by causing a true and correct copy of the document(s) listed
above to be sent via electronic transmission through LexisNexis File & Serve to
the person(s) at the address(es) set forth below.

as indicated on the following Service List.
I declare under penalty of perjury under the laws of the State of California that the

foregoing is true and correct and that this declaration was executed on October 28, 2013, at San

Francisco, California. i (Wy if. Men

/Kelley A. Garcia

PROOF OF SERVICEaI A nA B WN

ow

10
1
2
13
14
15
16
17
18
19
20
21
22
23
4
25
26
27
28

SERVICE LIST

VIA E-SERVICE

John W. Keker, Esq.

Daniel Purcell, Esq.

Dan Jackson, Esq.

Warren A, Braunig, Esq.

Keker & Van Nest LLP

633 Battery Street

San Francisco, CA 94111-1809

Telephone: (415) 391-5400

Facsimile: (415) 397-7188

Email: jkeker@kvn.com
dpurcell@kvn.com
djackson@kvn.com
whbraunig@kvn.com

Counsel for Petitioner and Plaintiff San Diego
County Water Authority

VIA E-SERVICE

Dorine Martirosian, Deputy City Attorney
Glendale City Attorney’s Office

613 E. Broadway, Suite 220

Glendale, CA 91206

Telephone: (818) 548-2080
Facsimile: (818) 547-3402

Email: DMartirosian@ci.glendale.ca.us

Counsel for City of Glendale

VIA E-SERVICE

Steven M. Kennedy, Esq.

Brunick, McElhaney & Kennedy, Professional
Law Corporation

P.O. Box 13130

San Bernardino, CA 92423-3130

Telephone: (909) 889-8301

Facsimile: (909) 388-1889

Email: skennedy@bmblawoffice.com

Counsel for Three Valleys Municipal Water
District

VIA E-SERVICE

Daniel S. Hentschke, Esq.

San Diego County Water Authority
4677 Overland Avenue

San Diego, CA 92123-1233
Telephone: (858) 522-6790
Facsimile: (858) 522-6566
Email: dhentschke@sdewa.org

Counsel for Petitioner and Plaintiff San Diego
County Water Authority

VIA E-SERVICE

John L. Fellows III, City Attorney

Patrick Q, Sullivan, Assistant City Attorney

Office of the City Attorney

3031 Torrance Blvd.

Torrance, CA 90503

Telephone: (310) 618-5817

Facsimile: (310) 618-5813

Email: PSullivan@TorranceCA.Gov
JFellows@TorranceCA.Gov

Counsel for the City of Torrance
VIA E-SERVICE

Patricia J. Quilizapa, Esq.

Aleshire & Wynder, LLP

18881 Von Karman Avenue, Suite 1700
Irvine, CA 92612

Telephone: (949) 223-1170
Facsimile: (949) 223-1180

Email: pquilizapa@awattorneys.com

Counsel for Municipal Water District of
Orange County

PROOF OF SERVICECO tt DH mR WN

RB MR RW YW NR NR RR Dm em a ata
ctw A A kB YH Ne S&F Ss CHM A AH BF BH HY SF TS

SERVICE LIST (Continued)

VIA E-SERVICE

Steven P. O’Neill, Esq.

Michael Silander, Esq.

Christine M. Carson, Esq.

Lemieux and O’Neill

4165 E. Thousand Oaks Blvd., Suite 350

Westlake Village, CA 91362

Telephone: (805) 495-4770

Facsimile: (805) 495-2787

Email: steve@lemieux-oneill.com
michael@lemieux-oneill.com
christine@lemieux-oneill.com
kathi@lemieux-oneill,com

Counsel for Foothill Municipal Water District,
Las Virgenes Municipal Water District, and
West Basin Municipal Water District

VIA E-SERVICE

Michael N. Feuer, City Attorney
Richard M. Brown, General Counsel
Julie Conboy Riley, Deputy City Attorney
Tina P. Shim, Deputy City Attorney
City of Los Angeles
111 North Hope Street, Room 340
Los Angeles, CA 90012
Telephone: (213) 367-4615
Facsimile: (213) 367-1430
Email: tina.shim@ladwp.com
julie.riley@lawp.com

Counsel for The City of Los Angeles, Acting by
and Through The Los Angeles Department of
Water and Power

VIA E-SERVICE

Donald Kelly, Esq.

Utility Consumers’ Action Network
3405 Kenyon Street, Suite 401

San Diego, CA 92110

Telephone: (619) 696-6966
Facsimile: (619) 696-7477

Email: dkelly@ucan.org
Counsel for Utility Consumers’ Action Network

VIA E-SERVICE

Patrick J, Redmond, Esq,

Law & Resource Planning Associates, P.C.
201 Third Street NW, Suite 1750
Albuquerque, NM 87102

Telephone: (505) 346-0998
Facsimile: (505) 346-0997

Email: pr@Irpa-usa.com

Counsel for Imperial Irrigation District

VIA E-SERVICE

Amrit S, Kulkarni, Esq.

Julia L. Bond, Esq.

Dawn A. McIntosh, Esq.

Edward Grutzmacher, Esq.

Meyers, Nave, Riback, Silver & Wilson

555 12th Street, Suite 1500

Oakland, CA 94607

Telephone: (510) 808-2000

Faesimile: (510) 444-1108

Email: akulkarni@meyersnave.com
jbond@meyersnave.com
dmcintosh@meyersnave.com

egrutzmacher@meyersnaye.com

Counsel for The City of Los Angeles, Acting by
and Through The Los Angeles Department of
Water and Power

PROOF OF SERVICEExhibit BJCB

casaasat \

Nov 08 2013, }

San Fransiseo Coumy E. |

ROV 05 2013 Sse
CLERK.OF F TPE COURT
BY SLivevont Mi eae.
Deputy Clerk

SUPERIOR COURT OF CALIFORNIA

COUNTY OF SAN FRANCISCO
SAN DIEGO COUNTY WATER Case No. CFP-10-510830
AUTHORITY, Case No, CFP-12-512466

Plaintiff/Petitioner,
PRE TRIAL RULINGS

vs.

METROPOLITAN WATER DIST. OF
SOUTHERN CALIFORNIA, et al.

Defendants/Respondents.

On November 4, 2013, I heard argument on a series of pretrial issues. The parties had
previously filed First Pretrial Briefs and then Replies to those. This order treats (i) motions in
limine, (ii) San Diego’s request to augment the administrative record, and (iii) standards of

review, burdens of prof and nature of the admissible record for the various claims.

1. Motions In Limine
A. Introduction
The central cases on in imine motions ate Amtower v. Photon Dynamics, Inc., 158

Cal.App.4th 1582 (2008); Kelly v. New West Federal Savings, 49 Cal.App.4th 659 (1996); and R& B Auto Center, Inc. v. Farmers Group, Inc., 140 Cal.App.4th 327 (2006) (Rylaarsdam, Acting
P.J., concurring).

The key function of these motions is to ensure juries do not hear inadmissible evidence,
and in particular inadmissible evidence which may prejudice the jury. “The advantage of such
motions is to avoid the obviously futile attempt to unring the bell in the event a motion to strike
is granted in the proceedings before the jury.” Amfower, 158 Cal.App.4th at 1593, quoting Hyatt
v. Sierra Boat Co., 79 Cal.App.3d 325, 337 (1978). Secondly, in limine motions can help speed
the trial and allow for a more considered decision on difficult evidentiary issues. Kelly, 49
Cal.App.4th at 669-70, They are not a good device for resolving what are in effect dispositive
motions such as motions for judgment on the pleadings or for summary adjudication. /d.; David
N. Finley, CiviL PRACTICE GUIDE: CALIFORNIA MOTIONS IN LIMINE § 1:4.!

It is, therefore, not useful—indeed, it is pointless—to file in imine motions in a bench
trial when the central asserted problem is prejudice under Evid. C. § 352, because judges usually
can be relied on avoid the bias, and, more practically, because the same judge will be viewing the
evidence to evaluate it in the § 352 analysis anyway.’ Too, when the main issue is undue
consumption of time under § 352, in limine motions are pointless when either little time is at
stake, or when about the same amount of time would be expended on e.g. a § 402 hearing (or
reading voluminous depositions extracts or teviewing the documents) as at trial; and where the

court has imposed time limits, the ‘undue consumption of time’ criterion under § 352 is in any

' More—more than any reader would want—is found at e.g., George P. Schiavelli, “Effective Use of Motions In
Limine,” http://ceb,com/reporter/freeAccess/articles/cvart805 pdf, C, Karnow, “Trial and Tribulations,”
http:/Avorks, bepress.com/curtis_karnow/10/

? For similar reasons § 352 objections should neyer be made in connection with motions for summary judgment.
People ex rel. City of Dana Point v. Holistic Health, 213 Cal.App.4th 1016, 1029 (2013).

2event of less concern since the advocates can, by and large, be relied on to spend time on what
matters most to their case.?

It is generally not useful to ask for the exclusion of ‘irrelevant’ evidence, or immaterial
evidence, or evidence which does not support the theories advanced in pleadings, unless
specifically identified evidence is called out by the motion. These sorts of motions in limine are
not much more than a request that the trial judge implement the law. We hope he will.

Finally, there are generally serious problems with motions which seek to exclude
evidence just because it was not produced during discovery. The failure to produce discovery is
not a sufficient basis; for example, there might have not have been a discovery demand for the
item. Usually there are four requirements for this sort of preclusion order (and J mean aside from
other grounds such as spoliation): (i) there was a discovery demand for the item; (ii) the party
either (a) unqualifiedly responded that it would produce it, or that it had no objection to doing so,
or (b) a court ordered its production; (iii) the item was extant (or the party knew the facts, if the
demand was an interrogatory or deposition question) at the time the party was to produce it, and
(iv) the party did not produce it.

B. Rulings

Metropolitan MIL No. 1 — Seeking to exclude all evidence outside the administrative
record.

Denied. No specified evidence is cited. In any event for certain issues in the case, certain

evidence outside the record may be admissible, including for (as the parties agree) the RSI and

> Thus some judges believe these sorts of motions are just out of place in a bench trial. E.g.,
http://judgebonniesudderth.wordpress.com/tag/motion-in-limine/; John N. Sharifi, “Techniques for Defense Counsel
in Criminal Bench Trials,” 28 AM. J. TRIAL ADVOC. 687, tan. 12, http:/Ayww.scribd.com/doc/31439427/Bench-
Trial-How-To; Randy Wilson, “The Bench Trial: It Really Is Different," ADVOCATE (2009),

http/www justex.net/JustexDocuments/12/Articles/Bench%20Trial.pdfthe preferential rights claims, and probably for the Wheeling statute claim. To assist the court in
distinguishing the evidence which is within from that without the administrative record, future
briefs should indicate the latter with, for example, an asterisk (*) or other agreed-on convention.

Metropolitan MIL No. 2 - Seeking to exclude all evidence of unpled theories or claims.

Denied. No specified evidence is cited.

Metropolitan MIL No. 3 ~ Secking to exclude evidence of working groups of certain
Metropolitan agencies and the motives and mental processes of Metropolitan’s Board of
Directors.

Denied. No specified evidence is cited. However, the parties may be able to use a
lengthier discussion here.

This motion has two parts; there is no dispute as to the first part, that is, that evidence of
the ‘working group” including the ‘secret society’ and ‘cabal’ are not admissible. The second
part of the motion has to do with the motives, mental processes and biases of Metropolitan’s
board of directors. 1 agree with San Diego that the deliberative process privilege is not directly
applicable here, because it is a bar to discovery and inquiry, not necessarily to the admissibility
of the evidence. I might bar questions of the board members concerning their mental processes,‘
but if they had for example penned a memo revealing those mental processes, a memo already in
the hands of San Diego, the privilege probably would not bar its admission. The question is
whether the mental processes and biases are relevant. It is not good enough to suggest, as San
Diego does, that evidence outside the record might be relevant.’ I assume it might, but that tells

me little about what sort of extra-record evidence is admissible. The cases cited by San Diego do

* Regents of University of California v, Superior Court, 20 Cal.4" 509, 540 (1999).
As San Diego notes, under the Wheeling statutes I am to consider “all relevant evidence.”

4not tell us that mental processes, bias, and the like, a