Appendix F — City of Santa Clarita, California v. Los Angeles County, California (No. 05-1462)

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EXCERPTS FROM

[Pages 92-104]

BAKER & McKENZIE

PETER J. ENGSTROM (State Bar No. 121529)

KERRY SHAPIRO (State Bar No. 133912)

Two Embarcadero Center

Twenty-Fourth Floor

San Francisco, CA 94111-3909

Telephone: (415) 576-3000

Facsimile: (415) 576-3099

Attorneys for Plaintiff CEMEX, INC.

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

WESTERN DIVISION

CEMEX, INC., a Louisiana Corporation,

Plaintiff,

v.

COUNTY OF LOS ANGELES, and

DOES 1 through 10, inclusive,

Defendants.

Case No. CV-02-747 DT (FMOx)

SECOND AMENDED COMPLAINT FOR

DECLARATORY AND INJUNCTIVE RELIEF,

WRIT OF MANDATE, AND DAMAGES

* * * *

[Pages 92-104]

FIRST CLAIM FOR RELIEF

(For Declaratory and Injunctive Relief — Federal

Preemption of the Los Angeles County Surface

Mining and Reclamation Approval Process as

Exercised with Respect to CEMEX’s Approved

Federal Project)

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185. Plaintiff refers to and incorporates herein by

reference each and every allegation contained in paragraphs |

through 184, above.

186. The United States’ sale of Federal sand and gravel

resources at Soledad Canyon to CEMEX was conducted

pursuant to a lawful congressional delegation of authority to

the Department of the Interior. The decision of the BLM to

dispose of these sand and gravel resources was a Federal

land-use decision that reflected a careful balancing of

competing interests by the BLM. The Federal Contracts were

awarded to Plaintiff by the BLM in 1990, pursuant to the

Materials Act of 1947, 30 U.S.C. § 601 et seg. The Contract

quantities and other specifications, such as the time period

which the successful bidder has to remove the Contract

quantities, have the force of Federal law. The Federal

government continues to have an interest in the resources.

187. Plaintiff has pursued a Federal process to obtain

review and approval from the BLM of its plan of mining

operations to implement the Federal Contracts. In accordance

with Federal requirements, Plaintiff submitted mining and

reclamation plans to the BLM in May 1991. On August 1,

2000, following a decade of environmental review and

exhaustive input from Federal, state, and local agencies, the

BLM published its ROD, approving CEMEX’s proposed plan

of mining operations subject to the adoption of specific

mitigation measures. This ROD, and all related environmental

review, was affirmed by the IBLA on January 8, 2002.

188. CEMEX first submitted its application for a

surface mining permit and reclamation plan to the County of

Los Angeles in May 1991, more than ten years ago, but the

County still has not approved Plaintiff's application or issued

a permit or reclamation plan. Instead, the County Regional

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Planning Commission denied the Project in 2000, and the

Board twice announced its intent to deny Plaintiff's appeal,

before adopting findings and an order of denial on Aprii 23,

2002. This is the case, notwithstanding the United States’

ownership and reservation of the mineral resources pursuant

to the Stock-Raising Homestead Act, the United States’

Notice of Sand and Gravel Sale and public competitive bid

process for the right to mine its mineral resources, the award

of the Federal Contracts to CEMEX, decisions of this Court

and the Ninth Circuit upholding the bid process and award of

the Federal Contracts, the United States’ $28 million royalty

interest in the Federal Contracts, subsequent litigation in this

Court affirming the dominance of the Federal mineral estate

(again upheld, albeit on other grounds, by the Ninth Circuit),

a ten-year Federal environmental review process pursuant to

the National Environmental Policy Act, two Biological

Assessments under the Federal Endangered Species Act and

two Biological Opinions by the U.S. Fish and Wildlife Service,

a Final Environmenta! Impact Statement (following extensive

analysis and public comment), the BLM’s issuance of its ROD

approving CEMEX’s proposed Project pursuant to the

Federal Contracts, and the IBLA’s affirmance of the ROD.

This is also the case, notwithstanding the State of California,

State Mining and Geology Board’s longstanding designation

of the Project Site as a “Regionally Significant Construction

Aggregate Resource Area,” which designation the County

accepted.

189. Notwithstand:ng that controlling Federal Jand-use

decisions as to these Federal resources have been made,

County officials have engaged in a demonstrable pattern of

obstructive conduct aimed at fatally delaying and/or denying

Plaintiff s application and prohibiting this Federally-Approved

Project, through interminable and unjustified delays and

continuances at virtually every step of the process, through the

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proposed imposition of Project conditions and mitigations that

are not consistent with the Federal land-use decision-making

and/or have no rational nexus to any legitimate environmental

objective, and most recently by announcing its intent to deny

the Project on specious grounds and then adopting findings

and an order to deny the Project.

190. Although Plaintiffs permit and reclamation

application was submitted to the County of Los Angeles in

May 1991, the County Planning Staff did not complete the

Draft EIR until February 1999, and the Regional Planning

Commission did not reach any decision until December 1999,

after a half a dozen continuances (and did not issue any

findings until February 16, 2000), at which point the Planning

Commission categorically denied the Project without so much

as mentioning the Federal Contracts or the Federal

environmental review process in its findings. Moreover, these

findings conflicted with prior recommendations of the

Planning Commission’s own staff, which was recommending

approval of the same Project as was approved by the Federal

BLM in the ROD. During this stage of the County process,

public comment periods were repeatedly, inexplicably, and

unjustifiably re-opened and extended, while numerous

hearings on Plaintiff's application were unfairly postponed.

191. Plaintiff lodged its appeal of the planning

Commission’s denial of its permit application with the Board

of Supervisors of the County more than two years ago, on

March 13, 2000. As at prior stages of the County’s permit

application process, periods for public comment on Plaintiff s

Project were repeatedly, unjustifiably and unreasonably

extended by the Board, hearings were unfairly continued —

another half dozen times — and conditions were considered

and proposed that were in direct conflict with existing Federal

requirements. Indeed, the County’s Draft Conditions and

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Revised Draft Conditions, publicly distributed in April and

November 2001, recommend many requirements that conflict

with the ROD, and many that lack any rational relation to

legitimate environmental objectives. At the public hearing of

April 24, 2001, the Board of Supervisors indicated its “intent

to deny” the Project, notwithstanding that it had no authority

to outright prohibit a Federally-approved mining project on

Federal lands. Moreover, during this hearing, the Board

instructed County Planning Staff to analyze a host of Project

conditions demanded by Project opponents, notwithstanding

the fact that many of these conditions conflicted with the

Federal Contracts and the ROD. Then, at the public hearing

of November 27, 2001, County Supervisors abandoned their

pre-announced agenda in order to raise traffic issues about

CEMEX’s Project that had been resolved years earlier and

which would again bring the County conditions into direct

conflict with the requirements of the Federal Contracts and the

ROD.

192. The Board of Supervisors’ excuse for postponing

a vote on Plaintiff s Project at the November 27, 2001 hearing

came after an eleventh-hour “discovery” by the County’s

Department of Public Works of previously unidentified traffic

concerns that had been “brought to [their] attention” by Fifth

District Supervisor Antonovich, “working behind the scenes.”

Yet these vaguely described traffic issues were resolved to the

DPW’s satisfaction over the course of three departmental

reviews (in 1995, 1998, and 2000), a formal written response

by the DPW (in June 2001) containing no hint that it might

consider the EIR to be inadequate with respect to traffic, and

three years of silence or non-objection by the DPW (including

the Traffic and Lighting Division) to the traffic analysis for the

Project. DPW had also previously reconfirmed the adequacy

of the existing EIR analysis, including PCE ratios. DPW had

also previously concluded that one of the mitigation measures

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discussed on November 27, 2001 — the widening of Soledad

Canyon Road — was infeasible. Other possible areas of further

analysis suggested on November 27 — e.g., rail-haul, and

reducing the size of the Project — had been rejected by the

Federal government and were and are not consistent with the

Federal Contracts and the ROD. Supervisor Antonovich also

seized upon the Soledad Canyon Road questions he had

brought to DPW’s attention “behind the scenes,” by

suggesting there might be some infirmity with respect to the

14 Antelope Valley Freeway impact analysis, even though the

proposed Final EIR had concluded that the Project would

have no significant impacts there, and DPW had voiced no

concerns as to the 14 Antelope Valley Freeway.

193. Concomitant with imposing the multitude of delays

described above, in the course of reviewing Plaintiff's Project

the County of Los Angeles had, during those delays,

consistently subjected the Project to a series of shifting and

novel environmental review standards and criteria for

approval, which were focused not on achieving “reasonable

environmental regulation,” but rather on creating even further

delays and otherwise frustrating the approved Federal Project.

For example, during its January 23, 2001 hearing, the Board

of Supervisors required CEMEX to negotiate with the City of

Santa Clarita and other Project opponents as a prerequisite to

the Board rendering a final decision in April. When the parties

completed that process and returned to the Board on April 24,

2001, with a publicly distributed proposed Final EIR ready for

certification, the Board refused to certify the EIR, refused to

render a final decision on CEMEX’s appeal, continued the

hearing, incorporated the CEMEX-proposed compromise

conditions into the Project, and then, using the CEMEX

conditions as a starting point, initiated a new process in which

it directed that all of the conditions proposed by Project

Opponents be addressed in a future proceeding. At the next

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hearings, when it ultimately occurred in November, that new

process begun in April had been completed by Planning Staff

and included in its November Staff Report analyzing all

Project opponent conditions. Even though CEMEX had been

led to believe the Board would address the merits of the

Project and certify the Final EIR (which, again, had been

publicly distributed), the Board created yet another new

process impediment by questioning whether the traffic analysis

adopted by the County of Los Angeles for several years was

in error, thereby conjuring yet another basis for a continuance.

194. Allofthese process delays at the County occurred

in the context of Project opponents (and CEMEX’s business

competitor Curtis) having vowed to use political influence to

delay the County permit approval process, Fifth District

Supervisor Antonovich “whip[ping] up” crowds in opposition

to the Project and encouraging them to “build a case,”

Supervisor Antonovich’s former field representative and then

City of Santa Clarita Mayor Darcy saying “[we] will do

anything necessary to stop this project,” local opposition to

any mining project on the Site (irrespective of prior Federal

land-use decisions and Federal law), a coordinated opposition

by Supervisor Antonovich and other Project opponents in the

Federal permitting and appeals process, criticism by

Supervisor Antonovich of uniform County traffic analysis

standards as “wrong” or “nonsense,” a $1.2 million public

relations campaign meant to kill the Project (replete with

half-truths and hyperbole, admittedly intended to be

inflammatory), two unsuccessful efforts by a USS.

Congressman to introduce legislation to kill the Project at the

urging of local constituents, an unsuccessful attempt by the

U.S. Congressman (at the request of a busii. 2ss competitor of

CEMEX) to challenge the Federal Contract bid award through

the Department of Interior, Office of Inspector General,

repeated motions for continuances by Supervisor Antonovich

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and/or his local constituents, and more.

195. This process of obstructive delay neared its climax

with the hearing of February 26, 2002 when the Board of

Supervisors approved ariother motion indicating their intent to

deny CEMEX’s appeal, having the effect of prohibiting the

Project altogether. This motion was adopted after CEMEX

had recently paid $40,000 in environmental review fees to the

County, DPW had completed a traffic analysis as presented in

the February DPW Report, DPW testified at the hearing that

the conditions agreed to by CEMEX would address DPW’s

concerns over the need for impact mitigation, and CEMEX is

within its rights to seek recourse from the Courts to stop the

endless delays imposed on it.

196. Supervisor Antonovich brought the February 26,

2002 motion for the Board to deny the Project on account of

CEMEX’s alleged “refusal to cooperate,” supposedly

evidenced by, among other things, CEMEX’s filing of the

present lawsuit to preserve its rights. The motion was passed

by the Board of Supervisors despite the fact that the County

could have either certified the existing EIR and approved the

Project, or the County could have completed and circulated a

revised EIR (especially given that DPW already had

completed a supplemental traffic analysis), since it was the

County’s statutory obligation to complete and certify the EIR.

Moreover, County Counsel specifically instructed the

Supervisors that this was an option. There was no reason at

all for the County to deny the Project at the hearing since

CEMEX had agreed to new traffic mitigations which met

“PW’s concerns and CEMEX had provided further evidence

‘sat the existing EIR was adequate for certification. By

pursuing this procedural stratagem, the County thus avoided

or forestalled any decision on the substantive merits of

CEMEX’s Federally-approved Project, and instead delayed

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that decision further and bought itself some more time to

create even further delays.

197. The County followed its inappropriate February

26, 2002 vote of intent to deny with its April 23, 2002

adoption of findings and an order to deny the Project. In so

doing, the Board instructed Counsel to prepare, and then

adopted, without public discussion, findings that go far

beyond the traffic analysis and CEQA procedural issues which

had been the subject of its hearings and the basis of its

decision-making over the previous five months. The Board

thus denied CEMEX the opportunity to be heard as to

substantive matters made part of the findings.

198. The decade-long County process culminating in a

procedurally-based denial of CEMEX’s permit application has

frustrated and threatens to further impair and frustrate the

implementation of an important Federal land-use decision.

~The attempt by the County of Los Angeles to subvert the

limited albeit legitimate purpose of the local review and

approval process into a never ending delay and then denial of

a Federally-approved Project constitutes a form of prohibition

of the Project. In particular, this abuse of the County’s

permitting and reclamation process has imposed additional

costs, uncertainties and delays on the Project sufficient to

jeopardize the implementation of the Federal land-use

decisions determined in the Federal Contracts and the ROD.

Such a de facto or de jure prohibition is contrary to law and

places the County’s permit and reclamation plan approval

process itself, as applied to Plaintiff CEMEX’s permit and

reclamation plan application, in conflict with Federal land-use

determinations. The County’s permit and reclamation plan

approval process, as actuaily applied to CEMEX’s surface

mining permit and reclamation plan application, has

consequently become a direct obstacle to the accomplishment

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of the full purposes and objectives of Congress in the

Materials Act of 1947. Opponents of the Project have used

and, if the application is remanded to the County, will

continue to use, the local permitting process as a means of

thwarting the authority of the BLM to dispose of mineral

material resources, thereby defying Congressional intent in

enacting the Materials Act of 1947. The current and any

further process of the County for the approval of CEMEX’s

application for a surface mining permit and reclamation plan

is therefore preempted by the Materials Act of 1947, the

Federal Contracts, and the ROD, pursuant to the Property and

Supremacy Clauses of the U.S. Constitution.

199. The County’s de facto prohibition of the Project

through years of delays, the continued consideration of

conditions that would frustrate Federal requirements, and an

interminable environmental review and hearing process,

including its recent de jure prohibition through the

Supervisors’ announced intent and adopted order to deny the

Project, has created adversity to Plaintiff's interests. An

actual and justifiable controversy has therefore arisen and now

exists between Plaintiff and Defendant concerning their rights

and other legal relations with respect to the implementation of

the Federal Contracts and the ROD, for which there is no

adequate remedy at law. The County of Los Angeles

continues to act as though it can delay this Project indefinitely

and impose conditions inconsistent with the Federal Contracts

and the ROD and, after the filing of this lawsuit, has seized

upon specious pretexts toward denial of the Project, before

purporting to deny the Federally-approved Project altogether.

Plaintiff believes that the County cannot so act to frustrate

Federal intent, and Plaintiff will be irreparably harmed if the

County process is allowed to proceed further.

220. Plaintiff CEMEX therefore requests declaratory

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and injunctive relief, as set forth in the Prayer for Relief below.

SECOND CLAIM FOR RELIEF

(For Declaratory and Injunctive Relief — Federal

Preemption of County Actions and Conditions

Inconsistent with Approved Federal Project)

201. Plaintiff refers to and incorporates by reference

each and every allegation contained in paragraphs 1 through

200, above.

202. In its ROD, the BLM approved Plaintiff's mining

and reclamation plan of operations for the Project with

mitigation measures regarding traffic, air quality, cultural

resources, visual qualities, noise, water quality, water

resources, geotechnical considerations and public health. The

BLM also considered and eliminated a variety of alternatives,

such as rail-haul (transporting aggregate and other material by

rail instead of truck) and the mining of reduced quantities of

sand and gravel. The BLM-approved Project was

subsequently affirmed by the IBLA. The BLM’s findings,

elimination of alternatives, approval of Plaintiffs mining plan,

including quantities of mining to allow implementation of the

Federal Contracts, and required mitigation measures, as set

forth in the Federal Contracts and the ROD, have the force of

Federal law. Once the BLM has approved a permittee’s plan

of operations, as Plaintiff's plan has been approved, Federal

regulations require that the permittee not deviate from this

approved plan.

203. At its public hearings, in its written communi-

cations with Plaintiff, and in its proposed Draft Conditions and

Revised Draft Conditions presented in April and November

2001, the County of Los Angeles considered, proposed, and

circulated various conditions for the approval of Plaintiff's

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application for a surface mining permit and reclamation plan

which conflict with, are inconsistent with, or would frustrate

the requirements of the Federal Contracts and the ROD.

Because these conditions are neither reasonable environmental

regulations nor consistent with existing Federal requirements,

they would be preempted by Federal law if imposed. In its

consideration of Plaintiff's application for a surface mining

permit and reclamation plan, the County has given

consideration to conditions that conflict with the ROD, the

Federal Contracts, and the Materials Act of 1947, or that

would frustrate the purposes of the Materials Act, and the

BLM’s mandate under Federal law including but not limited

to the following:

° Operating Hours/Truck Ban or Limi rin

Business Hours: This condition, as described in

paragraph 124, would negatively affect CEMEX’s

ability to compete in the marketplace, thereby

rendering the Project infeasible, and thus frustrating

the ROD and the Federal Contracts.

° Production Restriction: This condition, as described

in paragraph 124, would directly conflict with the

Federal Contracts’ timing provisions, which allow

mining under Phase 1 in less than or up to 10 years,

in conformance with the BLM Mineral Material

Sales Regulations. This restriction would also

restrict the Federal government’s ability to sell

additional minerals it owns in the Project area by

prolonging the duration of CEMEX’s mining

Project, thereby frustrating the Federal government's

future interests to develop the public resources at

the Site.

2

° Project Oversight (Monitor): This condition, as

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described in paragraph 124, would establish an

unnecessary and inappropriate precedent for future

BLM mineral contracts, and given the enormous

cost, would frustrate and interfere with future BLM

bidding for Contracts, thereby potentially restricting

or diminishing Federal royalty revenues.

Reporting Requirements: This condition, as

described in paragraph 124, would impose an

unworkable regulatory scheme which would

frustrate and conflict with the Project and serve to

disclose proprietary information to business

competitors and other parties, and would conflict

with the Federal regulation of mining by establishing

an inappropriate precedent for future Federal mineral

resource contracts. The proposed reporting

requirements relating to water resources, biological

resources, air quality and cultural resources require

reporting that far exceeds that provided for in the

ROD and required under Federal law, thus leading

to potential conflict with the Federal requirements.

Exhaust Particulate Filter Truck Retrofit: As

described in paragraph 124, this condition would

require CEMEX, alone, to implement filters on its

trucks that the County’s own Staff acknowledges

have not been required of any other project, and that

conflict with applicable Federal and state standards.

Cultural Resource: As described in paragraph 124,

this condition exceeds Federal standards, is unrela-

ted to environmental mitigation, and would force

CEMEX to notify Project opponents currently in

litigation against the Project of any discovery of cul-

tural resources within 24 hours of such a discovery.

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Rail-haul: As described in paragraph 124, this

condition would require the Federal government, in

theory, to prepare a new biological assessment, new

biological opinion, new EIS, and new ROD.

However, it is questionable whether a non-jeopardy

biological opinion could be obtained for a rail-haul

project. Thus, the imposition of rail-haul would

make it impossible for CEMEX to comply with the

approval set forth in the existing ROD. Moreover,

County Planning Staff did not recommend requiring

rail-haul because, among other things, it was not

part of the Project before the Board and because it

would result in greater environmental impacts.

Imported Water: As described in paragraph 124,

this condition would conflict with the ROD which

specifically analyzed the importation of water for the

Project and rejected this alternative. Moreover, this

condition, even if feasible, would result in severe

financial costs to CEMEX, which would limit the

feasibility of the Project, thereby impacting the

payment of royalties to the BLM under the

Contracts.

No Ridgeline Reduction: As described in paragraph

124, this condition would conflict with the 56.1

tnillion tons of production approved in the ROD and

the Federal Contracts. Moreover, the BLM

considered and rejected a “Reduced Quantity Mining

Concept Alternative” in the ROD. Finally,

restrictions on Project mining would result in

adverse precedent for future Federal competitive

sales and contracts, thereby impacting the efficacy of

the competitive bidding process under the Materials

Act of 1947.

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° School Air Conditioning Retrofitting: As described

in paragraph 124, this condition, which would result

in virtually no benefit to the community, would

require enormous financial expenditures that would

severely affect the implementation of the Contracts

and the payment of royalties to the BLM. Thus, this

condition would frustrate the Federal decisions

involved, as well as the Congressional intent as

manifested in the Materials Act of 1947.

204. After imposing months of delays to analyze and

debate these violative conditions, and then reviewing

CEMEX’s lawsuit filed on January 25, 2002, cataloging the

numerous examples of County action inconsistent with Federal

law, the Board avoided reaching a substantive determination

on these proposed conditions and instead, on February 26,

2002, announced for a second time its intent to deny

CEMEX’s appeal of the permit application denied by the

Regional Planning Commission, even though it was clear

under existing law that the County could not, and cannot,

block this Federally-approved Project. The second intent to

deny was based on the specious grounds that CEMEX had

refused to cooperate because it disagreed that a new study of

the traffic issue (which DPW had in fact completed) was

needed, it opposed re-circulation of the EIR, and it had filed

this lawsuit to enforce its rights. The County’s frustration of

the Federally-approved Project on these pretexts provides yet

another example of the County’s deliberately acting in a

manner inconsistent with Federal requirements.

205. Still later, on April 23, 2002, the Board went a step

further in defying Federal law and the Federal Contracts, by

adopting findings and an order to deny the Project,

notwithstanding the BLM’s Record of Decision and the

IBLA’s Order upholding that ROD. The County thus brought

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to a close this chapter of its dilatory process, but not before

instructing its Counsel to prepare findings to justify the

Board’s decision on grounds that it did not discuss or hear.

Furthermore, the County made clear that it was denying the

Project “as currently presented”; in other words, the County

anticipates that any further County administrative process will

include further consideration of the above-described

conditions, notwithstanding that they would conflict with and

interfere with the Federally-approved Project.

206. The County’s repeated and continued consideration

and circulation of proposed conditions inconsistent with

Federal requirements as conditions for approval of Plaintiff

CEMEX’s application for a surface mining permit and

reclamation plan, followed by its intended prohibition of the

Federally-approved Project, and order of denial, have created

adversity between Plaintiff and Defendant. An actual and

justiciable controversy has therefore arisen and now exists

between Plaintiff and Defendant concerning their rights and

other legal relations with respect to the implementation of the

Federal Contracts and the ROD, for which there is no

adequate remedy at law. Plaintiff will suffer irreparable harm

if Defendants are allowed to impose conditions on the Project

that are inconsistent with existing Federal conditions, or to fail

to act in a timely manner to approve a Project consistent with

the Federal land-use planning and decisions embodied in the

ROD, or to deny the Project outright.

207. Plaintiff CEMEX accordingly seeks declaratory relief

and injunctive relief, as set forth in the Prayer for Relief below.

APPENDIX G

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CARL K. NEWTON (SBN 33576) FILING FEE EXEMPT

CITY ATTORNEY, GOV’T CODE § 6103

CITY OF SANTA CLARITA

Deborah C. Prosser, Esq. (SBN 109856)

Geralyn L. Skapik, Esq. (SBN 145055)

Timothy H. Irons, Esq. (SBN 191758)

BURKE, WILLIAMS & SORENSEN, LLP

61! West Sixth Street, Suite 2500

Los Angeles, CA 90017

(213) 236-0660; Fax (213) 236-2700

Attorneys for City of Santa Clarita,

Defendant-in-Intervention

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

CEMEX, INC., a Louisiana Corporation,

Plaintiff,

V.

COUNTY OF LOS ANGELES, and

DOES 1 THROUGH 10, INCLUSIVE

Defendants.

UNITED STATES OF AMERICA,

Plaintiff-in-Intervention.

City of Santa Clarita,

Defendant-in-Intervention.

Case No. 0200747 DT (FMOx)

Judge Dickran Tevrizian

Courtroom 880

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ANSWER OF THE CITY OF SANTA CLARITA

TO SECOND AMENDED COMPLAINT OF

CEMEX

Date: TBD

Time: 10:00 a.m.

Dept: 880

Complaint Filed: 01/25/02

First Amended

Complaint Filed: 04/11/02

Second Amended ;

Complaint Filed: 05/09/02

Trial Date: None set

COMES NOW the City of Santa Clarita (“City”), by and

through its undersigned attorneys, and pursuant to

Fed.R.Civ.P. 24(c), sets forth its claims and defenses to

CEMEX, Inc.’s Second Amended Complaint for Declaratory

and Injunctive Relief, Writ of Mandate, and Damages.

INTRODUCTION

1. The allegations set forth in paragraph 1 are denied.

2. The allegations set forth in paragraph 2 are denied.

3. The allegations set forth in paragraph 3 are denied.

4. Withregard to the allegations set forth in paragraph

4, the City admits that members of the Los Angeles County

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Board of Supervisors (“LABOS”) have continued to advance

feasible alternatives and mitigation measures, including the

“rail-haul’ alternative and a reduction in quantity of sand and

gravel to be mined. The City also admits that members of the

LABOS have moved to deny the Soledad Canyon Sand and

Gravel Project (“Soledad Canyon Project”) outright. The City

denies, however, any and all allegations set forth in paragraph

4 that the above-described actions of members of the LABOS

are inappropriate, illegal, or exceed County authority over the

Soledad Canyon Project.

5. The allegations set forth in paragraph 5 are denied.

6. The allegations set forth in paragraph 6 are denied.

7. With regard to the allegations set forth in paragraph

7, the City admits that on February 26, 2002 the LABOS

voted its intent to deny CEMEX’ surface mining permit

application. The reasons for the denial are set forth in the

LABOS April 18, 2002 Findings. All remaining allegations in

paragraph 7 are denied.

JURISDICTION AND VENUE

8. The allegations set forth in paragraph 8, insofar as

they assert that the County, and other unnamed defendants,

have violated the rights of CEMEX, are denied.

9. The allegations set forth in paragraph 9, insofar as

they assert that this Court has jurisdiction to hear CEMEX’s

claims, are denied.

10. The allegations set forth in paragraph 10, insofar as

they assert that this Court has jurisdiction to hear CEMEX’s

claims, are denied.

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11. With regard to paragraph 11, the City admits that the

County acts under the color of law when reviewing an

application for a surface mining permit.

12. The allegations set forth in paragraph 12 are denied.

13. Withregard to paragraph 13, the City admits that the

Soledad Canyon Project site is in the Central District of

California. The City denies any and all allegations set forth in

paragraph 13 insofar as they assert that this Court has

jurisdiction hear CEMEX’s claims.

14. The allegations set forth in paragraph 14 are denied.

THE PARTIES

15. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 15. ©

16. Withregard to paragraph 16, the City admits that the

County is public body and a subdivision of the State of

California, and that the County can be subjected to suit. The

City denies, however, any and all allegations set forth in

paragraph 16 insofar as they assert that this Court has

jurisdiction to hear CEMEX’s claims.

17. With regard to paragraph 17, the City admits that the

County can be a “lead agency” for review and approval of

surface mining permits.

18. Withregard to paragraph 18, the City admits that the

County can act as a “lead agency” under the California

Environmental Quality Act (“CEQA”).

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19. The allegations set forth in paragraph 19, insofar as

they assert that other unnamed defendants have violated the

rights of CEMEX, are denied.

20. The allegations set forth in paragraph 20 are denied.

STATEMENT OF FACTS

21. Withregard to paragraph 21, the City asserts that the

federal laws and regulations set forth therein speak for

themselves. The City denies that the surface estate is held in

private ownership as the City purchased the fee ownership of

the site in February of 2004. The City is without sufficient

information in which to form a belief as to the accuracy of all

other allegations set forth in paragraph 21.

22. Withregard to paragraph 22, the City asserts that the

Supreme Court decision cited therein speaks for itself. The

City is without sufficient information in which to form a belief

as to the accuracy of the other allegations set forth in

paragraph 22.

23. Withregard to paragraph 23, the City asserts that the

United States District Court case cited therein speaks for

itself. The City is without sufficient information in which to

form a belief as to the accuracy of the other allegations set

forth in paragraph 23.

24. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 24.

25. Withregard to paragraph 25, the City asserts that the

California State Mining and Geology Board Guidelines for

Classification and Designation of Mineral Lands, California

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Surface Mining and Reclamation Policies and Procedures

speaks for itself. The City denies all the allegations set forth in

paragraph 25 insofar as they assert that the opposition to the

Soledad Canyon Project is a land use conflict or that

opponents of the Project claim mining is incompatible with the

area.

26. Withregard to paragraph 26, the City asserts that the

letter written by JoAnn Darcy speaks for itself. The City is

without sufficient information in which to form a belief as to

the accuracy of all other allegations set forth in paragraph 26.

27. Withregard to paragraph 27, the City asserts that the

Stipulation for Compromise Settlement cited therein speaks

for itself. The City is without sufficient information in which

to form a belief as to the accuracy of all other allegations set

forth in paragraph 27.

28. The City is without sufficient information in which

to form a belief as to the accuracy of all other allegations set

forth in paragraph 28.

29. Withregard to paragraph 29, the City asserts that the

1989 Environmental Assessment cited therein speaks for itself.

The City is without sufficient information in which to form a

belief as to the accuracy of all other allégations set forth in

paragraph 29.

30. The City admits that CEMEX, formerly TMC, was

the successful bidder for the federal contract to mine sand and

gravel from Soledad Canyon. The City is without sufficient

information in which to form a belief as to the accuracy of all

other allegations set forth in paragraph 30.

31. Withregard to paragraph 31, the City asserts that the

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two federal contracts cited therein speak for themselves.

32. Withregard to paragraph 32. the City asserts that the

United States District Court and Ninth Circuit Court of

Appeals cases speak for themselves. The City is without

sufficient information in which to form a belief as to the

accuracy of all other allegations set forth in paragraph 32.

33. Withregard to paragraph 33, the City asserts that the

United States District Court decision cited therein speaks for

itself. The City is without sufficient information in which to

form a belief as to the accuracy of all other allegations set

forth in paragraph 33.

34. The City is without sufficient information in which

to form a belief as to the accuracy of all other allegations set

forth in paragraph 34.

35. The City is without sufficient information in which

to form a belief as to the accuracy of all other allegations set

forth in paragraph 35.

36. Withregard to paragraph 36, the City asserts that the

November 14, 1997 Statement of Uncontroverted Facts and

Conclusions of Law cited therein speaks for itself. The City is

without sufficient information in which to form a belief as to

the accuracy of all other allegations set forth in paragraph 36.

37. Withregard to paragraph 37, the City asserts that the

December 3, 2000, news article appearing in the Newhall

Signal speaks for itself. The City denies, however, any and all

allegations set forth in paragraph 36 insofar as they assert that

the City acted inappropriately and illegally, or has attempted

to unduly influence decisions made by the County.

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38. The allegations set forth in paragraph 38, insofar as

they assert that the City’s opposition to the Soledad Canyon

Project was for any reason other than the Project’s impact to

the environment, are denied.

39. With regard to paragraph 39, the City admits that

CEMEX submitted a proposed mining and reclamation plan to

the BLM sometime in 1990.

40. Withregard to paragraph 40, the City admits that the

BLM issued a Notice of Intent to prepare a Draft

Environmental Impact Statement (“DEIS”) in 1995. The City

is without sufficient information in which to forma belief as to

the accuracy of all other allegations set forth in paragraph 40.

41. Withregard to paragraph 41, the City admits that the

BLM released a Final Biological Assessment in June 1996,

which analyzed the Soledad Canyon Project’s impact on the

unarmored threespine stickleback. The City also admits that

the BLM initiated formal consultation with the United States

Fish & Wildlife Service (“FWS”) to analyze the Project’s

impact on the stickleback. The City denies, however, any

allegations set forth in paragraph 41 insofar as they assert that

the BLM’s evaluation of the Soledad Canyon Project’s impact

on endangered and threatened species was adequate. and in

compliance with applicable law.

42. Withregard to paragraph 42, the City admits that the

FWS released a Biological Opinion evaluating the Soledad

Canyon Project’s impact on the unarmored threespine

stickleback on January 14, 1998. The City also admits that

the 1998 Biological Opinion concluded that the Soledad

Canyon Project would not jeopardize the continued existence

of the stickleback. The City denies, however, all allegations

set forth in paragraph 42 insofar as they assert that the FWS’

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evaluation of the Soledad Canyon Project’s impact on

endangered or threatened species was adequate and in

compliance with applicable law.

43. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 43.

44. Withregard to paragraph 44, the City admits that the

BLM completed the DEIS in May 1999. The City denies,

however, all allegations set forth in paragraph 44 insofar as

they assert that the BLM’s evaluation of the Soledad Canyon

Project’s impact on the environment was adequate and in

compliance with applicable law.

45. With regard to paragraph 45, the City admits that

two public hearings were held by the BLM on June 2, 1999.

The City also admits that the comment period for the DEIS

was extended by the BLM. The City is without sufficient

information in which to form a belief as to the accuracy of all

other allegations set forth in paragraph 45.

46. Withregard to paragraph 46, the City admits that the

BLM prepared a supplement to the DEIS (“SDEIS”), which

identified the Reduced North Fines Storage Area Alternative

(“RNFSA”) as the agency’s preferred alternative. The City

also admits that the SDEIS was subject to a two-month

comment period. The City is without sufficient information in

which to form a belief as to the accuracy of all other

allegations set forth in paragraph 46.

47. The allegations set forth in paragraph 47, insofar as

they assert that the City, and/or City representatives, acted

inappropriately or illegally during the April 2000 meeting with

the BLM and County officials, are denied.

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48. Withregard to paragraph 48, the City admits that the

BLM published a Final EIS on June 2, 2000. The City denies,

however, any allegations set forth in paragraph 48 insofar as

they assert that the Final EIS adequately evaluated the

Soledad Canyon Project’s impact on the environment or was

in compliance with applicable law.

49. Withregard to paragraph 49, the City asserts that the

August 1, 2000 Record of Decision (“ROD”) cited therein

speaks for itself. The City denies all allegations set forth in

paragraph 49 insofar as they assert that there has been a

decade of environmental review of the Soledad Canyon

Project.

50. Withregard to paragraph 50, the City asserts that the

August 1, 2000 ROD cited therein speaks for itself.

51. With regard to paragraph 51, the City admits that it

filed an appeal of the August 1, 2000 ROD with the Interior

Board of Land Appeals (“IBLA”) in Virginia. The City also

admits that it petitioned the IBLA for a stay of proceeding

pending appeal. The City asserts that the [BLA declined to

take action on the stay request pending final determination by

the County.

52. With regard to paragraph 52, the City admits that the

BLM filed a Request for Expedited Review of the appeals by

the IBLA. The City asserts that the letter from the Assistant

Secretary of the Interior speaks for itself.

53. With regard to paragraph 53, the City admits that the

IBLA granted the BLM’s request for expedited review.

54. Withregard to paragraph 54, the City admits that the

IBLA did issue an order closing briefing in the appeal. The

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City further asserts that the [BLA decision cited in paragraph

54 speaks for itself. All other allegations set forth in

paragraph 54 are denied.

55. Withregard to paragraph 55, the City asserts that the

January 8, 2002 IBLA decision cited therein speaks for itself,

The City denies, however, all allegations set forth in paragraph

55 insofar as they assert that the IBLA decision was legally

supportable or in compliance with applicable law.

56. The City is without sufficient information in which

to form a belief as to the accuracy of all other allegations set

forth in paragraph 56. .

57. The City is without sufficient information in which

to form a belief as to the accuracy of all other allegations set

forth in paragraph 57.

58. The City is without sufficient information in which

to form a belief as to the accuracy of all other allegations set

forth in paragraph 58.

59. Withregard to paragraph 59, the City asserts that the

press release cited therein speaks for itself. The City is

without sufficient information in which to form a belief as to

the accuracy of all other allegations set forth in paragraph 59.

60. The allegations set forth in paragraph 60, insofar as

they describe the purpose of the TMC Advisory Executive

Committee, are denied.

61. Withregard to paragraph 61, the City asserts that the

press release cited therein speaks for itself.

62. The City is without sufficient information in which

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to form a belief as to the accuracy of the allegations set forth

in paragraph 62.

63. The allegations set forth in paragraph 63 are

admitted.

64. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 64.

65. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 65.

66. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 66.

67. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 67.

68. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 68.

69. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 69.

70. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 70.

71. The City is without sufficient information in which

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to form a belief as to the accuracy of the allegations set forth

in paragraph 71.

72. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 72.

73. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 73.

74. Withregard to paragraph 74, the City admits that the

public review process for the Draft EIR was nine months. The

City denies, however, any allegations set forth in paragraph 74

insofar as they assert that the nine-month review process was

in violation of CEQA.

75. With regard to paragraph 75, the City admits that an

Additional Environmental Information to the Draft EIR

(“AEIDEIR”) document was prepared in August 2000 and

circulated for a four-month public review. The City is without

sufficient information in which to form a belief as to the

accuracy of all other allegations set forth in paragraph 75.

76. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 76.

77. The allegations set forth in paragraph 77, insofar as

they assert that the County’s authority under SMARA and

CEQA, as it relates to the Soledad Canyon Project, is limited

by federal law, are denied.

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78. Withregard to paragraph 78, the City asserts that the

1999 Staff Analysis for the Project cited therein speaks for

itself.

79. Withregard to paragraph 79, the City admits that the

April 21, 1999 Planning Commission hearing resulted in a

60-day continuance to provide time for CEMEX to respond

to issues raised during the hearing. The City denies, however,

all allegations set forth in paragraph 79 insofar as they assert

that the City improperly or unduly influenced the County’s

decision to continue the hearing.

80. With regard to paragraph 80, the City admits that a

hearing was held on June 2, 1999 and that the comment period

for the Draft EIR was continued an additional 90 days. The

City denies, however, all allegations set forth in paragraph 80

insofar as they assert that the City improperly or unduly

influenced the County’s decision to continue the comment

period.

81. With regard to paragraph 81, the City admits that a

hearing was held on July 14, 1999 and that the matter was

continued until September 22, 1999. The City denies,

however, all allegations set forth in paragraph 81 insofar as

they assert that the City improperly or unduly influenced the

County’s decision to continue the hearing.

82. The allegations set forth in paragraph 82 are

admitted.

83. With regard to paragraph 83, the City admits that a

hearing was held on September 15, 1999 and that the

comment period for the Draft EIR was continued for an

additional 60 days. The City denies, however, all allegations

set forth in paragraph 83 insofar as they assert that the City

G-15

improperly or unduly influenced the County’s decision to

continue the comment period.

84. The allegations set forth in paragraph 84 are

admitted.

85. Withregard to paragraph 85, the City admits that the

BLM did decide to prepare a supplement to the federal DEIS

and that members of the LABOS did move to have the

Soledad Canyon Project taken off calendar as a result of the

BLM’s decision.

86. Withregard to paragraph 86, the City admits that the

County Planning Commission did vote to deny CEMEX’s

application for a surface mining permit. The City denies,

however, all allegations set forth in paragraph 86 insofar as

they assert that the Planning Commission’s decision to deny

the application was improper, illegal, or in excess of the

Planning Commission’s authority.

87. Withregard to paragraph 87, the City admits that the

Planning Commission issued its findings in support of denial

on February 16, 2000.

88. The allegations set forth in paragraph 88 are

admitted.

89. With regard to paragraph 89, the City admits that the

AEIDEIR was prepared and circulated on August 17, 2000.

The City is, however, without sufficient information in which

to form a belief as to the accuracy of all other allegations set

forth in paragraph 89..

90. With regard to paragraph 90, the City admits that a

rally in opposition to the Soledad Canyon Project was held

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prior to the scheduled October 24, 2000 hearing and was

attended by 5th District Supervisor Antonovich. The City

denies, however, all allegations set forth in paragraph 90

insofar as they assert that the rally held by the City, or

Supervisor Antonovich’s attendance, was improper or illegal.

91. With regard to paragraph 91, the City admits that it

has taken a position in opposition of the Soledad Canyon

Project, as presently proposed. The City further asserts that

the press released cited in paragraph 91 speak for themselves.

92. With regard to paragraph 92, the City admits that it

the LABOS granted its motion to extend the comment period

for the AEIDEIR for an additional 60 days. The City denies,

however, all allegations set forth in paragraph 92 insofar as

they assert that the City’s motion to continue the comment

period was for an improper purpose, or that the LABOS’

decision to extent the comment period was improper,

unnecessary, or illegal.

93. With regard to paragraph 93, the City admits that it

has acted to ensure that the Soledad Canyon Project does not

adversely and unnecessarily impact City resources. The City

asserts that the statements cited in paragraph 93 speak for

themselves. The City denies, however, all allegations set forth

in paragraph 93 insofar as they assert that statements made by

the City were exaggerations or half-truths.

94. Withregard to paragraph 94, the City asserts that the

editorial cited therein speaks for itself.

95. Withregard to paragraph 95, the City admits that the

LABOS convened to consider CEMEX’s appeal of the

Planning Commission’s decision on January 23, 2001. The

City is, however, without sufficient information in which to

G-17

form a belief as to the accuracy of all other allegations set

forth in paragraph 95.

96. The allegations set forth in paragraph 96 are

admitted.

97. With regard to paragraph 97, the City admits that it

participated in negotiations with CEMEX. The City denies,

however, all allegations set forth in paragraph 97 insofar as

they assert that CEMEX offered numerous conditions that

were beyond what was required to mitigate the impacts that

the Soledad Canyon Project would have on the environment.

98. With regard to paragraph 98, the City admits that it,

along with several other opponents to the Soledad Canyon

Project, created the TMC Executive Advisory Committee.

The City also admits that Ben Curtis has attended several

TMC Executive Advisory Committee meetings. The City

denies all other alle;ations set forth in paragraph 98.

99. Withregard to paragraph 99, the City admits that the

cited proposals were made to CEMEX during negotiations but

denies that the TMC Executive Advisory Committee made the

proposals. The City denies, however, all allegations set forth

in paragraph 99 insofar as they assert that the proposals are in

violation or conflict with federal law or are preempted by

federal law, or place CEMEX at a competitive disadvantage.

100. The allegations set forth in paragraph 100, insofar as

they assert that the proposals made to CEMEX were in

conflict with federal law or otherwise preempted by federal

law, are denied.

101. With regard to paragraph 101, the City admits that

some of the proposed conditions were added by the County as

G-18

conditions to the Soledad Canyon Project. The City denies,

~ however, that virtually all of the conditions were added to the

Project by the County.

102. With regard to paragraph 102, the City admits that

the LABOS held a hearing to consider CEMEX’s appeal of

the Planning Commission’s decision on April 24, 2001. The

City is, however, without sufficient information in which to

form a belief as to the accuracy of all other allegations set

forth in paragraph 102.

103. With regard to paragraph 103, the City admits that

on April 24, 2001, the LABOS indicated an intent to deny the

Soledad Canyon Project, as currently proposed, and instructed

the Regional Planning Department to study the various

alternatives and mitigation measures introduced by the

community. The City also admits that the hearing was

continued until June 26, 2001. The City denies, however, all

allegations set forth in paragraph 102 insofar as they assert

that the LABOS’ actions on April 24, 2001 were improper,

illegal, or outside its authority.

104. With regard to paragraph 104, the City admits that

members of the LABOS were critical of the environmental

review process for the Soledad Canyon Project and questioned

the method used to evaluate the Project’s traffic impacts. The

City denies, however, all allegations set forth in paragraph 104

insofar as they assert that the LABOS’ criticism of the

Soledad Canyon Project’s environmental review was

improper, inappropriate, or outside its authority.

105. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 105.

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106. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

‘ in paragraph 106.

107. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 107.

108. With regard to paragraph 108, the City admits that

Supervisor Antonovich has, at various times, attended public

hearings held by the Santa Clarita City Council. The City

denies, however, all allegations set forth in paragraph 107

insofar as they assert that Supervisor Antonovich’s attendance

at any public hearing held by the Santa Clarita City Council is

improper or illegal.

109. With regard to paragraph 109, the City admits that

in May and June 2001, biologists hired by the City discovered

the presence of the endangered southwestern arroyo toad at

the Project site. The City also admits that it petitioned the

BLM to re-initiate formal consultation with the FWS under

the Federal Endangered Species Act (“ESA”) and the County

to recirculate the EIR under CEQA.

110. With regard to paragraph 110, the City admits that

the scheduled June 26, 2001 hearing was continued to August

28, 2001 and that CEMEX initiated the request to have the

hearing continued.

111. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 111.

112. With regard to paragraph 112, the BLM news

release speaks for itself.

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113. With regard to paragraph 113, the City admits that

on August 6, 2001, the BLM issued a Supplemental Biological

Assessment addressing the discovery of the arroyo toad at the

Project site. The City also admits that the BLM requested

re-initiation of formal consultation under ESA. The City

denies, however, all allegations set forth in paragraph 113

insofar as they assert that the BLM’s Supplemental Biological

Assessment adequately evaluated the Soledad Canyon

Project’s impact on the arroyo toad or was in compliance with

applicable law.

114. With regard to paragraph 114, the City admits that

‘the August 28, 2001 hearing was continued until November

27, 2001 to provide time for the FWS’ evaluation of the

Soledad Canyon Project’s impact on the arroyo toad.

115. With regard to paragraph 115, the City admits that

on October 25, 2001, the FWS issued a non-jeopardy opinion

regarding the Soledad Canyon Project’s impact on the arroyo

toad. The City denies, however, all allegations set forth in

paragraph 115 insofar as they assert that the Biological

Opinion issued by the FWS adequately evaluated the Soledad

Canyon Project’s impact on the arroyo toad or was in

compliance with applicable law.

116. With regard to paragraph 116, the City admits that

on November 13, 2001 the County publicly distributed a

proposed Fina] EIR, which addressed the Soledad Canyon

Project’s impact on the arroyo toad. The City denies,

however, all allegations set forth in paragraph 116 insofar as

they assert that the County’s evaluation of the Project’s

impact on the arroyo toad was adequate or in compliance with

applicable law.

117. With regard to paragraph 117, the City admits that

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it requested a continuance of the November 27, 2001 hearing

in order to fully evaluate the recent publication by the county

of the proposed final EIR.

118. With regard to paragraph 118, the City admits that

the LABOS denied a motion to continue the November 27,

2001 hearing.

119. With regard to paragraph 119, the City admits that

the Planning Staff issued a report on November 5, 2001,

which analyzed the project alternatives and mitigation

measures proposed by the community. The City asserts that

the Planning Staff's report speaks for itself.

120. With regard to paragraph 120, the City asserts that

Planning Staff's report and the Regional Solicitor’s opinion

cited therein speak for themselves. The City denies, however,

all allegations set forth in paragraph 120 insofar as they assert

that the County cannot outright deny CEMEX’s application

for a surface mining permit.

121. With regard to paragraph 121, the City asserts that

the Planning Staff's report speaks for itself. The City denies,

however, all allegations set forth in paragraph 121 insofar as

they assert that the project alternatives and mitigation

measures proposed by the community were improper, in

conflict with federal law, or in violation of CEMEX’s rights.

122. With regard to paragraph 122, the City admits that

the Planning Staff's report did adopt a number of the

mitigation measures proposed by the community.

123. The allegations set forth in paragraph 123 are denied.

124. With regard to paragraph 124, the City asserts that

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the Planning Staff's report speaks for itself. The City denies,

however, all allegations set forth in paragraph 124 insofar as

they assert that the conditions recommended for approval by

the Planning Staff were improper, illegal, in conflict with

federal law, or violative of CEMEX’s rights.

125. With regard to paragraph 125, the City admits that

the BLM issued a letter to the County expressing concerns

over the mitigation measures recommended by the Planning

Staff.

126. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 126.

127. With regard to paragraph 127, the City admits that

the November 27, 2001 hearing was continued. The City

denies, however, all allegations set forth in paragraph 127

insofar as they assert that the continuance of the hearing was

improper or illegal.

128. With regard to paragraph 128, the City asserts that

the statements made by members of the LABOS cited therein

speak for themselves.

129. With regard to paragraph 129, the City asserts that

the actual statements made by County officials speak for

themselves. The City denies, however, all allegations set forth

in paragraph 129 insofar as they assert that the statements

made by County officials were incorrect, improper, or illegal.

130. With regard to paragraph 130, the City admits that

the LABOS continued the November 27, 2001 hearing until

January 22, 2002. The City is without sufficient information in

which to form a belief as to the accuracy of all other

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allegations set forth in paragraph 130.

131. With regard to paragraph 131, the City admits that

Supervisor Antonovich questioned the adequacy of the

evaluation of the traffic impacts of the Soledad Canyon

Project.

132. With regard to paragraph 132, the City admits that

Supervisor Antonovich questioned the adequacy of the

standard used to determine the traffic impacts of the Soledad

Canyon Project.

133. With regard to paragraph 133, the City asserts that

statements by County Counsel speak for themselves. The City

denies, however, all allegations set forth in paragraph 133

insofar as they assert that the position taken by County

Counsel was proper and legally correct.

134. With regard to paragraph 134, the City admits that

the January 22, 2002 hearing was continued to February 26,

2002. The City is without sufficient information in which to

form a belief as to the accuracy of all other allegations set

forth in paragraph 134.

135. With regard to paragraph 135, the City asserts that

the official minutes cited therein speak for themselves.

136. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 136.

137. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 137. The City denies, however, all allegations

set forth in paragraph 137 insofar as they assert that the

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Department of Public Works’ (“DPW”) concern over traffic

impacts is the result of political pressure from the Fifth District

and Supervisor Antonovich.

138. With regard to paragraph 138, the City admits that

the DPW has now expressed concerns regarding the Soledad

Canyon Project’s impact on traffic. The City denies, however,

all allegations set forth in paragraph 138 insofar as they assert

that the DPW has suddenly, and inexplicably, changed its

position, or that the DPW’s position is the result of undue

political pressure.

139. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 139.

140. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 140.

141. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 141.

142. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 142.

143. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 143.

144. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 144.

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145. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 145.

146. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 146.

147. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 147.

148. The City denies the allegations of paragraph 148

insofar as they assert that issues raised concerning the

Project’s traffic impacts were merely a pretext for delay or

that the County of Los Angeles abused the environmental

review process in an effort to delay the Project. The City

further denies allegations that the County had established a

“pattern of conduct” against CEMEX. The City asserts that

the article cited speaks for itself.

149. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 149.

150. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 150.

151. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 151.

152. The City denies the allegations implying that traffic ,

issues were resolved by the DPW’s February 21, 2002 report.

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AS to the remaining allegations in paragraph 152, the City is

without sufficient information in which to form a belief as to

the accuracy of the allegations.

153. The City denies the allegation in paragraph 153 that

the DPW’s February Planning Staff Report reflected a “last

minute change of position on traffic by DPW”. The City

asserts that the Report speaks for itself. The City denies the

allegation that CEMEX is entitled to damages for alleged

delays during the environmental review process. The City

asserts that LABOS reasons for denying CEMEX’ surface

mining permit were set forth in the April 18, 2002 Findings.

As to the remaining allegations, the City is without sufficient

information in which to form a belief as to the accuracy of the

allegations.

154. The City asserts that the Report referred to in

paragraph 154 speaks for itself. The City asserts that a traffic

impact study should have been prepared to determine the

Project’s impact on the Antelope Valley Freeway and on

Interstate 5, pursuant to Caltrans Guide for the Preparation of

Traffic Impact Studies. The City asserts that rail-haul is

needed to mitigate traffic impacts of the Project. The City at

this time is without sufficient information in which to form a

belief as to the accuracy of the remaining allegations set forth

in paragraph 154.

155. The City asserts that the documents referenced in

paragraph 155 speak for themselves. The City is without

sufficient information in which to form a belief as to the

accuracy of the allegations set forth in paragraph 155.

156. The City is without sufficient information in which

to form a belief as to the accuracy of the allegations set forth

in paragraph 156. The City asserts that the referenced “Press

G-27

Release” speaks for itself.

157. The City asserts that CEMEX’ February 25, 2002

letter referenced in paragraph 157 speaks for itself. The City

denies the allegations in paragraph 157 to the extent CEMEX’

claims that the County’s environmental review process was

improper or deficient. The City is without sufficient

information in which to form a belief as to the accuracy of the

other allegations set forth in paragraph 157.

158. The City admits that the LABOS held a hearing on

February 26, 2002 and at the conclusion of the hearing voted

its intent to deny CEMEX’ surface mining permit application.

The City asserts that CEMEX was provided sufficient time to

show a 30 minute video tape and to present evidence or

argument concerning traffic impact issues. The City admits

that Rick Putnum was the only Project opponent that made a

presentation at the hearing. The City denies all allegations

that the hearing’s procedures were improper or illegal.

159. The City denies the allegations that the LABOS

decided to deny the Project prior to the February 26, 2002

hearing or that the length of presentations or the number of

speakers is evidences a “pre-decisional” position.

160. The City admits that it produced documents

referencing TMC meetings. The City denies the allegations

that the LABOS decided to deny the Project prior to the

February 26, 2002 hearing or that documents referenced in

paragraph 160 evidence a “pre-decisional” position. The City

denies the allegations that the City representatives’ attendance

at meetings concerning the Project were improper or illegal.

Due to the vague and ambiguous nature of these allegations,

the City lacks sufficient information with which to inform a

belief as to the accuracy of the other allegations.

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161. The City denies the allegations that the LABOS

decided to deny the Project prior to the February 26, 2002

hearing. The City lacks sufficient information with which to

inform a belief as to the accuracy of the other allegations in

paragraph 161.

162. The City admits that CEMEX was granted

approximately thirty (30) minutes to make its presentation to

the board. The City asserts that CEMEX was provided

additional time to respond to comments and concerns raised

by the Board. The City asserts that statements made by Board

Chairman Zev Yaroslavsky and referenced in paragraph 162,

pertain to CEMEX’ refusal to mitigate significant traffic

impacts of the Project. The City asserts that CEMEX’

complaint seeks approval of the Project, without regard to

mitigation measure CEMEX agreed to but are not included in

the Final Environmental Impact Statement.

163. The City admits that CEMEX showed a videotape

for approximately 30 minutes at the February 26, 2002

hearing. The City denies the allegations that the videotape is

evidence that the Project will not have significant impacts on

Soledad Canyon Road. The City denies the allegations that

the County Department of Public Works position on the traffic

analysis was either improper or unreasonable. The City

asserts that a thirty (30) minute videotape is not a proper

analysis of the traffic impacts of the Project on Soledad

Canyon Road.

164. The City admits that at the conclusion of the

February 26, 2002 hearing CEMEX agreed to some of the

mitigation measures identified in the February Department of

Public Work’s Report. The City asserts that CEMEX’s offer

did not address all of the concerns relating to Project traffic

impacts raised by DPW and the City. The City asserts that at

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the hearing CEMEX refused to revise the Environmental

Impact Report (“EIR”’) and re-circulate the revised EIR. The

City asserts that CEMEX was put on notice for weeks

regarding the DPW’s traffic issues but refused to provide any

further analysis to DPW or agree to any reasonable mitigation

measures.

165. The City denies the allegations that CEMEX was not

provided sufficient time to address traffic issues raised by the

County DPW. The City asserts that traffic issues have been a

concern throughout the review process. The City denies the

allegations that the Project has no significant impacts to the 14

Antelope Valley Freeway or that there is no need for rail-haul.

166. The City admits that LABOS voted its intent to deny

the surface mining permit application on February 26, 2002.

The City asserts that the LABOS reasons for the denial are set

forth in the LABOS April 18, 2002 Findings. The City asserts

that the motion on the intent to deny speaks for itself. The

City denies all allegations that the vote on intent to deny was

improper of illegal.

167. The City asserts that the record of the February 26,

2002 hearing speaks for itself. The City denies the allegations

set forth in the parenthetical comments by CEMEX. The City

asserts that CEMEX< refused to revise and re-circulate the EIR

to address the traffic issues raised by County DPW.

168. The City admits that the LABOS voted its intent to

deny and instructed County Counsel to prepare findings for

denial, following an approximately hour long hearing on the

issue. The City denies the other allegations in paragraph 168.

169. The City admits the allegations in paragraph 169.

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170. The City admits the allegations in paragraph 170.

The City asserts that on April 18, 2002 the LABOS issued its

findings.

171. The City admits the allegations in paragraph 171.

172. The City asserts that the supplemental agenda

referred to in paragraph 172 speaks for itself.

173. The City lacks sufficient information and belief to

either admit or deny the allegations set forth in paragraph 173.

174. The City asserts that CEMEX’s April 22 letter

speaks for itself. The City denies the merits of the letter’s

contents.

175. The City asserts that the transcript of the February

26, 2002 County Board hearing and the findings referred to in

paragraph 175 speak for themselves. The City denies all

allegations concerning the meaning or impact of the Board’s

Statements and Findings.

176. The City denies all allegations insofar as they assert

that the County’s findings and denial of the Project were in

any way improper, illegal or unsupportable.

177. The allegations set forth in paragraph 177 are denied.

178. The City denies all allegations insofar as they assert

that the County Board’s adoption of the findings was in any

manner improper or illegal.

179. The City asserts that the minutes of the County

Board’s April 23, 2002 hearing speak for themselves. The

City admits the County unanimously denied surface mining

G-31

permit No. 91-165-(5). The City denies CEMEX’s

characterization of the April 23, 2002 hearing or that the

County’s action was in any way improper or illegal.

180. The allegations set forth in paragraph 180 are denied.

181. The allegations set forth in paragraph 181 are denied.

182. With regard to paragraph 182, the City asserts that

the article cited therein speaks for itself and denies the article’s

accuracy. The City denies, however, all allegations set forth

in paragraph 182 insofar as they assert that the City has an

improper relationship with County officials, or has acted in an

improper or illegal manner to unduly influence the County.

183. With regard to paragraph 183, the City asserts that

the IBLA has issued a decision affirming, in part, and denying,

modifying, in part, the BLM’s ROD. The City denies,

however, all allegations set forth in paragraph 183 insofar as

they assert that the IBLA’s decision was proper or legally

correct.

184. The allegations set forth in paragraph 184 are denied.

FIRST CLAIM FOR RELIEF

185. With regard to paragraph 185, the City refers to and

incorporates by reference each and every answer contained in

paragraphs | through 185.

186. The allegations set forth in paragraph 186 are denied.

187. With regard to paragraph 187, the City asserts that

CEMExX has submitted a mining and reclamation plan to the

BLM and that on August |, 2000, the BLM approved the plan

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through the issuance of a ROD, and on January 8, 2002, the

IBLA affirmed, in part, and modified, in part, the BLM’s

decision. All other allegations set forth in paragraph 187 are

denied.

188. With regard to paragraph 188, the City admits that

the County has not approved CEMEX’s application for a

surface mining permit. The City denies, however, all

allegations set forth in paragraph 188 insofar as they assert

that the County’s refusal, up to this point, to approve

CEMEX’s application is improper, illegal, or in excess of the

County’s authority.

189. The allegations set forth in paragraph 189 are denied.

190. With regard to paragraph 190, the City admits that

the Planning Commission denied CEMEX’s application for a

surface mining permit. The City denies, however, all

allegations set forth in paragraph 190 insofar as they assert

that the Planning Commission’s denial was improper, illegal,

or in excess of its authority.

191. With regard to paragraph 191, the City admits that

the LABOS has not approved CEMEX’s application for a

surface mining permit. The City denies, however, all

allegations set forth in paragraph 191 insofar as they assert

that the LABOS’ action with regard to CEMEX’s permit

application were improper, illegal, or in excess of its authority.

192. The allegations set forth in paragraph 192, insofar as

they assert that the LABOS has acted improperly, illegally, or

in excess of its authority with regard to CEMEX’s permit

application, are denied.

193. The allegations set forth in paragraph 193, insofar as

G-33

they assert that the LABOS has acted improperly, illegally, or

in excess of its authority with regard to CEMEX’s permit

application, are denied.

194. The allegations set forth in paragraph 194, insofar as

they assert that the City has acted improperly or illegally with

regard to CEMEX’s permit application, are denied.

195. The allegations set forth in paragraph 195, insofar as

they assert that the LABOS has acted improperly, illegally, or

in excess of its authority with regard to CEMEX’s permit

application, are denied.

196. The allegations set forth in paragraph 196, insofar as

they assert that the LABOS has acted improperly, illegally, or

in excess of its authority with regard to CEMEX’s permit

application, are denied.

197. The allegations set forth in paragraph 197 are denied.

198. The allegations set forth in paragraph 198 are denied.

199. The allegations set forth in paragraph 199 are denied.

200. With regard to paragraph 200, the City requests that

CEMEX be denied all relief requested therein.

SECOND CLAIM FOR RELIEF

201. With regard to paragraph 201, the City refers to and

incorporates by reference each and every answer contained in

paragraphs | through 200.

202. The allegations set forth in paragraph 202, insofar as

they assert that the decisions made by the BLM regarding

G-34

determination of alternatives and quantities to be mined have

the force of federal law, are denied. The City denies all other

allegations set forth in paragraph 202 insofar as they assert

that federal regulations preclude a permittee from deviating

from an approved plan.

203. The allegations set forth in paragraph 203, insofar as

they assert that the conditions imposed, or recommended to be

imposed, by the County are improper, illegal, or in conflict

with federal law, are denied.

204. The allegations set forth in paragraph 204, insofar as

they assert that the LABOS has acted improperly, illegally, or

in excess of its authority with regard to CEMEX’s permit

application, are denied.

205. The allegations set forth in paragraph 205 are denied.

206. The allegations set forth in paragraph 206 are denied.

207. With regard to paragraph 207, the City requests that

CEMEX< be denied all relief requested therein.

THIRD CLAIM FOR RELIEF

208. With regard to paragraph 208, the City refers to and

incorporates by reference each and every answer contained in

paragraphs 1 through 207.

209. With regard to paragraph 209, the City asserts that

the Due Process Clause of the Fourteenth Amendment speaks

for itself. .

210. With regard to paragraph 210, the City asserts that

42 U.S.C. § 1983 speaks for itself.

G-35

211. The allegations set forth in paragraph 211 are denied.

212. The allegations set forth in paragraph 212 are denied.

213. Theallegations set forth in paragraph 213 are denied.

214. The allegations set forth in paragraph 214 are denied.

215. The allegations set forth in paragraph 215 are Geited:

216. The allegations set forth in paragraph 216, insofar as

they assert that the LABOS has acted improperly, illegally, or

in excess of its authority with regard to CEMEX’s permit

application, are denied. The City asserts that the reasons for

denial of the surface mining permit are set forth in the LABOS

April 18, 2002 Findings.

217. The allegations set forth in paragraph 217 are denied.

218. The allegations set forth in paragraph 218, insofar as

they assert that the LABOS has acted improperly, illegally, or

in excess of its authority with regard to CEMEX’s permit

application, are denied. The City asserts that the reasons for

denial of the surface mining permit are set forth in the LABOS

April 18, 2002 Findings.

219. The allegations set forth in paragraph 219 are denied.

220. The City lacks sufficient information to form a belief

as to the allegations in paragraph 220.

221. The allegations set forth in paragraph 221 are denied.

222. With regard to paragraph 222, the City requests that

CEMEX be denied all relief requested therein.

223

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FOURTH CLAIM FOR RELIEF

. With regard to paragraph 223, the City refers to and

incorporates by reference each and every answer contained in

paragraphs 1| through 222.

224

. With regard to paragraph 224, the City asserts that

the Due Process Clause of the Fourteenth Amendment speaks

for itself.

225

42 US.

226

227.

228.

229.

230.

231.

232.

233.

. With regard to paragraph 225, the City asserts that

C. § 1983 speaks for itself.

. Theallegations set forth in paragraph 226 are denied.

The allegations set forth in paragraph 227 are denied.

The allegations set forth in paragraph 228 are denied.

The allegations set forth in paragraph 229 are denied.

The allegations set forth in paragraph 230 are denied.

The allegations set forth in paragraph 231 are denied.

The allegations set forth in paragraph 232 are denied.

The City is without sufficient information to form a

belief concerning the allegations in paragraph 233.

234

. The City is without sufficient information to form a

belief concerning the allegations in paragraph 234.

235

. With regard to paragraph 235, the City requests that

CEMEX be denied all relief requested therein.

G-37

FIFTH CLAIM FOR RELIEF

236. With regard to paragraph 236, the City refers to and

incorporates by reference each and every answer contained in

paragraphs | through 235.

237. With regard to paragraph 237, the City asserts that

the Equal Protection Clause of the Fourteenth Amendment

speaks for itself.

238. With regard to paragraph 238, the City asserts that

42 U.S.C. § 1983 speaks for itself.

239. The allegations set forth in paragraph 239 are denied.

240. The allegations set forth in paragraph 240 are denied.

241. The allegations set forth in paragraph 241 are denied.

242. The allegations set forth in paragraph 242 are denied.

243. Tueallegations set forth in paragraph 243 are denied.

244. The allegations set forth in paragraph 244 are denied.

245. With regard to paragraph 245, the City requests that

CEMEX be denied all relief requested therein.

SIXTH CLAIM FOR RELIEF

246. With regard to paragraph 246, the City refers to and

incorporates by reference each and every answer contained in

paragraphs 1 through 245.

247. With regard to paragraph 247, the City asserts that

G-38

the mandates under CEQA cited therein speak for themselves.

248. The City is without sufficient knowledge in which to

form a belief as to the accuracy of the allegations set forth in

paragraph 248.

249. With regard to paragraph 249, the City admits that

the AEIDEIR was prepared and circulated in August 2000.

250. The allegations set forth in paragraph 250, insofar as

they assert that two EIRs were presented to the LABOS

during 2001 that were sufficient for certification, are denied.

251. The allegations set forth in paragraph 251, insofar as

they assert that the EIR presented to the LABOS at the

February 26, 2002 hearing was sufficient for certification, are

denied. The City asserts that the reasons for denial of the

surface mining permit are set forth in the LABOS April 18,

2002 Findings. The City denies the allegations in paragraph

251 to the extent they assert that the LABOS denial of the

surface mining permit was improper, illegal or in excess of the

LABOS’ authority.

252. The allegations set forth in paragraph 252 are denied.

253. The allegations set forth in paragraph 253 are denied.

254. The allegations set forth in paragraph 254 are denied.

255. The allegations set forth in paragraph 255 are denied.

256. With regard to paragraph 256, the City requests that

CEMEX be denied all relief requested therein.

G-39

SEVENTH CLAIM FOR RELIEF

257. With regard to paragraph 257, the City refers to and

incorporates by reference each and every answer contained in

paragraphs | through 256.

258. With regard to paragraph 258, the City asserts that

the Takings Clause of the Fifth Amendment speaks for itself.

259. With regard to paragraph 259, the City asserts that

42 U.S.C. § 1983 speaks for itself.

260. The allegations set forth in paragraph 260 are denied.

261. The allegations set forth in paragraph 261 are denied.

262. The allegations set forth in paragraph 262 are denied.

263. The City is without sufficient information to form a

belief concerning the accuracy of the allegations in paragraph

263.

264. The allegations set forth in paragraph 264 are denied.

265. The allegations set forth in paragraph 265 are denied.

266. With regard to paragraph 266, the City requests that

CEMEX be denied all relief requested therein.

EIGHTH CLAIM FOR RELIEF

(For Just Compensation-Inverse Condemnation,

pursuant to the California Constitution, Art. I, § 19)

267. With regard to paragraph 267, the City refers to and

incorporates by reference each and every answer contained in

G-40

paragraphs 1 through 266.

268.

The City asserts that the reference section of the

California Constitution speaks for itself.

269.

270.

ait.

272.

273.

274.

Aid.

276.

The allegations set forth in paragraph 269 are denied.

The allegations set forth in paragraph 270 are denied.

The allegations set forth in paragraph 27 | are denied.

The allegations set forth in paragraph 272 are denied.

The allegations set forth in paragraph 273 are denied.

The allegations set forth in paragraph 274 are denied.

The allegations set forth in paragraph 275 are denied.

With regard to paragraph 276, the City requests that

CEMEX be denied all relief requested therein.

NINTH CLAIM FOR RELIEF

(For Writ of Administrative Mandates, Cal. Civ. Proc.

Code § 1094.5 — To Reconsider Denial and Compel

Approval of the Federally-Approved Project With

Conditions Consistent With Federal Requirements)

277.

With regard to paragraph 277, the City refers to and

incorporates by reference each and every answer contained in

paragraphs 1 through 276.

278.

The City admits the County is the “lead agency” for

issuance of a surface mining permit to CEMEX. The City

denies the County’s discretion is limited by Federal law as

G-41

denies the County’s discretion is limited by Federal law as

alleged by CEMEX.

279. The City admits the allegations set forth in paragraph

279.

280. The allegations set forth in paragraph 280 are denied.

281. The allegations set forth in paragraph 281 are denied.

282. The allegations set forth in paragraph 282 are denied.

283. The allegations set forth in paragraph 283 are denied.

284. The allegations set forth in paragraph 284 are denied.

285. Withrespect to paragraph 285, the City requests that

CEMEX be denied all relief requested therein.

GENERAL DENIAL

All allegations set forth in CEMEX’s Complaint that were

not specifically admitted or denied are hereby denied.

AFFIRMATIVE DEFENSES

Based upon information and belief, the City asserts the

following affirmative defenses:

FIRST AFFIRMATIVE DEFENSE

CEMExX has failed to exhaust necessary administrative

remedies. Accordingly, this Court does not have jurisdiction

to hear CEMEX’s claims.

G-42

SECOND AFFIRMATIVE DEFENSE

CEMEX’s claims are not ripe for judicial review.

Accordingly, this Court does not have jurisdiction to hear

CEMEX’s claims.

THIRD AFFIRMATIVE DEFENSE

This Court does not have jurisdiction to hear CEMEX’s

federal claims. Accordingly, supplemental jurisdiction under

28 U.S.C. § 1367 does not exist to hear CEMEX’s state law

claim under CEQA.

FOURTH AFFIRMATIVE DEFENSE

CEMEX has failed to give the requisite 60-day notice of

its intent to bring a claim for damages against the County.

FIFTH AFFIRMATIVE DEFENSE

CEMExX fails to state a claim for which relief can be

granted.

SIXTH AFFIRMATIVE DEFENSE

The Doctrine of Unclean Hands bars CEMEX from

obtaining the equitable relief sought in its Complaint.

SEVENTH AFFIRMATIVE DEFENSE

The Materials Act of 1947 and BLM regulations do no

prevent the County from imposing additional environmental

conditions upon CEMEX’s application for a surface mining

permit or outright denying CEMEX’s permit application.

G-43

EIGHTH AFFIRMATIVE DEFENSE

The relief sought violates the federal Administrative

Procedure Act, the National Environmental Policy Act and

Title 40 of the Code of Federal Regulations Parts 1505 and

1506.

NINTH AFFIRMATIVE DEFENSE

The conditions imposed, or recommended to be imposed,

upon CEMEX’s permit application by the County do not

prevent the federal government from disposing of sand and

gravel on federal land and are not, therefore, in conflict, or

inconsistent, with federal law.

TENTH AFFIRMATIVE DEFENSE

All actions taken by the City and the County are protected

actions pursuant to authorized processes under CEQA and

SMARA.

ELEVENTH AFFIRMATIVE DEFENSE

Any and all delays, if any, have been caused by CEMEX’s

conduct in the processing of CEMEX’s application for a

surface mining permit.

TWELFTH AFFIRMATIVE DEFENSE

All delays and/or continuances in the processing of

CEMEX’s application for a surface mining permit were the

result of legitimate needs to further evaluate the Soledad

Canyon Project’s impact on the environment.

G-44

THIRTEENTH AFFIRMATIVE DEFENSE

CEMEX does not have a protectable property interest in

its federal contracts or the ROD within the meaning of the

Due Process Clause or Equal Protection Clause of the

Fourteenth Amendment, or within the meaning of the Takings

Clause of the Fifth Amendment.

FOURTEENTH AFFIRMATIVE DEFENSE

All conditions imposed, or recommended to be imposed,

by the County on CEMEX’s application for a surface mining

permit are rationally related to a legitimate governmental

interest.

FIFTEENTH AFFIRMATIVE DEFENSE

The Planning Commission’s decision to deny CEMEX’s

application for a surface mining permit had a rational basis

relating to a legitimate governmental purpose.

SIXTEENTH AFFIRMATIVE DEFENSE

The Soledad Canyon Project is not similarly situated to

other mining operations in the area within the meaning of the

Equal Protection Clause of the Fourteenth Amendment.

SEVENTEENTH AFFIRMATIVE DEFENSE

The delays and continuances during the CEQA review

process, if any, were the result of actions taken by CEMEX.

The one-year mandate under CEQA is not, therefore,

applicable to CEMEX’s application for a surface mining

permit.

G-45

EIGHTEENTH AFFIRMATIVE DEFENSE

CEMEX appealed the Planning Commission’s denial of its

permit application. The Planning Commission’s denial

constitutes action on the part of the County within the

meaning of CEQA. The County has, therefore, acted within

the one-year period in compliance with CEQA.

NINETEENTH AFFIRMATIVE DEFENSE

The County has not denied CEMEX all beneficial use of

its property within the meaning of the Takings Clause of the

Fifth Amendment.

TWENTIETH AFFIRMATIVE DEFENSE

CEMEX has not alleged, and the County has not engaged

in, any conduct that warrants an award of attorney’s fees and

costs to CEMEX.

TWENTY-FIRST AFFIRMATIVE DEFENSE

The actions of the County in processing CEMEX’s

applications are expressly authorized and mandated by the

Federal contracts and the ROD.

TWENTY-SECOND AFFIRMATIVE DEFENSE

The Court lacks subject matter jurisdiction to hear this

case.

TWENTY-THIRD AFFIRMATIVE DEFENSE

The Court must abstain from hearing this case under the

Younger abstention doctrine or other applicable authority.

G-46

TWENTY-FOURTH AFFIRMATIVE DEFENSE

The requested relief is an unlawful abdication of the

County’s police powers as guaranteed by Article 11, §§ 4 and

11 of the California Constitution, and other applicable laws

and regulations.

TWENTY-FIFTH AFFIRMATIVE DEFENSE

The requested relief violates the separation of powers

doctrine in violation of the United States Constitution and

Article 3, § 3 of the California Constitution.

TWENTY-SIXTH AFFIRMATIVE DEFENSE

The requested relief violates the City of Santa Clarita’s

right of petition as guaranteed by the First Amendment to the

United States Constitution and under Article 1 § 3 of the

California Constitution.

TWENTY-SEVENTH AFFIRMATIVE DEFENSE

The requested relief violates the City’s right of

consultation under Public Resources Code § 21153 and

violates the public review provisions of CEQA.

TWENTY-EIGHT AFFIRMATIVE DEFENSE

The relief sought violates public policy.

TWENTY-NINTH AFFIRMATIVE DEFENSE

The relief sought violates property rights of the City which

is the fee owner of the land on which the proposed mining

project is located.

G-47

PRAYER FOR RELIEF

WHEREAS, the City prays for judgment against CEMEX

as follows:

1. That CEMEX take nothing by its Complaint;

2. For attorney’s fees and costs associated with this

action; and :

3. For such other relief as the Court deems just and

proper.

DATED: March 8, 20104

RESPECTFULLY SUBMITTED,

BURKE, WILLIAMS & SORENSEN, LLP

By: /s/ Carl K. Newton

Carl K. Newton, City Attorney

City of Santa Clarita

Deborah C. Prosser

Geralyn L. Skapik

Timothy H. Irons

Attorneys for

CITY OF SANTA CLARITA

G-48

CERTIFICATE OF SERVICE

I, the undersigned, hereby certify that I caused a true and

correct copy of ANSWER OF THE CITY OF SANTA

CLARITA TO SECOND AMENDED COMPLAINT OF CEMEX

to be served via regular mail this 8th day of March, 2004, to

the following:

Fox & Sohagi, LLP

Deborah Fox, Esq.

Jocelyn Julian, Esq.

10960 Wilshire Boulevard, Suite 1270

Los Angeles, CA 90024-3702

Tele: (310)444-7805

Fax: (310)444-7813

Attorneys for Defendant, County of Los Angeles

Kerry Shapiro, Esq.

Jeffer, Mangels, Butler & Marmaro, LLP

Two Embarcadero Center, 5th Floor

San Francisco, CA 94111

Tele: (415)398-8080

Fax: (415)398-5584

Attorneys for CEMEX, Inc.

Edward S. Gelderman

U.S. Department of Justice

Environmental & Natural Resources

General Litigation Section, P.O. Box 4390

Washington, D.C. 20044-4390

Tele: (202)305-0242

Fax: (202)305-0506

Attorneys for Plaintiff-in-Intervention, United States

/s/_ Maxine Maritz

APPENDIX H

H-1

CARL K. NEWTON (SBN 33576) FILING FEE EXEMPT

CITY ATTORNEY, GOV’T CODE § 6103

CITY OF SANTA CLARITA

Deborah C. Prosser, Esq. (SBN 109856)

Geralyn L. Skapik, Esq. (SBN 145055)

Timothy H. Irons, Esq. (SBN 191758)

BURKE, WILLIAMS & SORENSEN, LLP

611 West Sixth Street, Suite 2500

Los Angeles, CA 90017

(213) 236-0600; Fax (213) 236-2700

Attorneys for City of Santa Clarita,

Defendant-in-Intervention

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

CEMEX, INC., a Louisiana Corporation,

Plaintiff,

v.

COUNTY OF LOS ANGELES, and

DOES 1 THROUGH 10, INCLUSIVE

Defendants.

UNITED STATES OF AMERICA,

Plaintiff-in-Intervention.

City of Santa Clarita,

Defendant-in-Intervention.

Case No. 0200747 DT (FMOx)

Judge Dickran Tevrizian

Courtroom 880

H-2

CITY OF SANTA CLARITA’S NOTICE OF

MOTION AND MOTION FOR SUMMARY

JUDGMENT/ADJUDICATION

[STATEMENT OF UNCONTROVERTED

FACTS AND CONCLUSIONS OF LAW;

DECLARATION OF DEBORAH PROSSER;

DECLARATION OF TIMOTHY IRONS;

REQUEST FOR JUDICIAL NOTICE; AND

PROPOSED ORDER FILED CONCURRENTLY]

Date: April 26, 2004

Time: 10:00 a.m.

Dept: 880

Complaint Filed: 01/25/02

First Amended

Complaint Filed: 04/11/02

Second Amended

Complaint Filed: 05/09/02

Trial Date: None set

TO ALL PARTIES AND THEIR ATTORNEYS OF

RECORD:

PLEASE TAKE NOTICE that on April 26, 2004, at 10:00

a.m. in Courtroom 800 in the above-entitled Court, located at

the Roybal Center & Federal Building, 255 East Temple

Street, Los Angeles, California, City of Santa Clarita (“City”),

Defendant-in-intervention, will move the Court for Summary

Judgment, or in the alternative Summary Adjudication,

(“Motion”) pursuant to the Court’s November 20, 2003

H-3

scheduling order setting April 26, 2004 as the deadline to hear

motions for summary judgment. This Motion is brought

pursuant to Federal Rule of Civil Procedure 56 on the

following grounds:

(1) Based on the undisputed facts, Plaintiffs’, CEMEX,

Inc. (““CEMEX”’) and United States (collectively “Plaintiffs’’),

federal preemption claims fail as a matter of law [CEMEX’s

First and Second Claims for Relief; United States’ First,

Second and Third Claims for Relief],

(2) CEMEX’s Procedural Due Process and Takings

claims are premature and fail as a matter of law [CEMEX’s

Third and Seventh Claims for Relief]' ,

(3) CEMEX’s Equal Protection claim against the

County of Los Angeles (“County”) fails as a matter of law

[(CEMEX’s Fifth Claim for Relief],

(4) If Plaintiff's federal ciaims are dismissed, the court

lacks jurisdiction to hear the pendant state claims [CEMEX’s

Sixth, Eighth and Ninth Claims for Relief], and

(S) The application of the Younger Abstention Doctrine

requires dismissal of all claims.

This Motion is made following the conference of counsel

pursuant to Local Rule 7-3 which took place on March 12,

2004.

This Motion is based on this Notice of Motion and

Motion, the memorandum of points and authorities, attached,

' — CEMEX’s Fourth Claim for Relief for violation of Substantive Due

Process was dismissed pursuant to the Court’s July 29, 2002 Order.

H-4

the Statement of Uncontroverted Facts and Conclusions of

Law in support of the Motion, the Declaration of Timothy H.

Irons, and the City’s Request for Judicial Notice, all filed

concurrently, the pleadings and papers filed herein, the

County’s Administrative Record lodged with the Court, any

Reply papers filed by the City and all matters that may be

raised at the hearing on the Motion.

DATED: April 2nd, 2004

RESPECTFULLY SUBMITTED,

BURKE, WILLIAMS & SORENSEN, LLP

By: /s/

~ Carl K. Newton, City Attorney

City of Santa Clarita

Deborah C. Prosser

Geralyn L. Skapik

Timothy H. Irons

Attorneys for

CITY OF SANTA CLARITA

I.

Il. FACTUAL BACKGROUND

TI.

SUMMARY OF ARGUMENTS

A.

LEGAL ARGUMENT

H-5

TABLE OF CONTENTS

The Undisputed Facts Establish That

Plaintiffs Federal Preemption Claims Fail as

a Matter of Law

l.

Plaintiffs’ Preemption Claims Fail as a

Matter of Law Because Federal

Administrative Procedures Act

Remedies Have Not Been Exhausted . .

Congress Has Not Expressed Its In-

tent to Occupy the Field of Surface

PE es is. Sig aa 65 N's aoe p0 ah o's

Federal Materials Act of 1947 Does

Not Conflict With CEQA or SMARA ....

The Federal Decisions Do Not Preempt

CEQA orSMARA But Rather Mandate

Ne Ss SA ile wea aise 8 8's

The Federal Clean Air Act and Clean

Water Act Mandate Compliance With

NN eh Wie ees Ak 45700 4 $8 ©

H-6

6. The County Approval Process, County

Conditions and County Denial Are Not

RE oo igs a ot S ecooenew wk bs 30

a. The County Review Process and

Denial Are Not Preempted ........ 30

b. |The County’s “Consideration” of

Conditions Is Not Preempted ...... 33

B. CEMEX’s Takings Claim and Claim That It

Has Been Deprived of Property Without

Due Process Are Premature And Fail as a

PE CE OG SER Ob See wee 34

1. Fifth Amendment Takings Claim ........ 34

2. CEMEX’s Due Process Claim ......... 36

C. CEMEX’s Claim That It Has Been Denied

Equal Protection Fails as a Matter of Law .... 37

D. Dismissal of Plaintiffs’ Federal Claims

Requires Dismissal of CEMEX’s Pendant

PU NM oe os a os ER Os 39

E. Pursuant to the “Younger” Abstention

Doctrine the District Court Must Abstain

From Taking Jurisdiction and Dismiss the

PS ES EOE es ke ees 39

1. The Relief Sought by CEMEX

Interfered With State Proceedings ....... 41

2. The State Proceedings are Ongoing ..... nal

IV.

H-7

3. The State Has An Important Interest in

the SMARA and CEQA Process ........

4. CEMEX Can Raise its Federal Claims

in the State Proceedings ..............

CARMEN ove cc traces can ee ee wi

H-8

TABLE OF AUTHORITIES

Federal Cases

Page

Arroyo Vista Partners v. County of Santa Barbara,

Tae 2s EE. BONO in baa RRR ON AD 37, 38

Barcellos and Wolfsen, Inc. v. Westlands Water District,

S90 F270 S14 (9th Cir. T990) on oe Se ies 36

Beltran v. California,

SER UM Meee Lm Bhp ne aememetres es 42, 43

Bennett v. Spear,

520 U.S. 154, 117 S. Ct. 1154 (1997) .. 2.6... 21

Brady v. Town of Colchester,

SOS F2k 2a (2 CW EGE) oc eee ee 38

California Coastal Commission v. Granite Rock Co.,

480 U.S. 572, 107 S. Ct. 1419,

PO hi BUN, 20 O71 CEWGE) vis cen See ena 22, 24-26

California Department of Health Services v. Babbitt,

467; Supp. 24 13 (DDS. 1999) ne ees 21

Cassettari v. County of Nevada,

ee ale fe Ca Ee) es wooo Ode 34, 37

Celotex Corp. v. Catrett,

477 U.S. 317, 106 S. Ct. 2548,

FE Bs Se: AO POLAT: 6 00.55 Kae SA eR SRA 20

H-9

Citizens to Preserve Overton Park, Inc. v. Volpe,

401 U.S. 402, 91 S. Ct. 814,

PD fin ROG ee A ONE ERD, 5 ics ciate le be nea ls Ce

City of Chicago v. International College of Surgeons,

Ded Abs LOLS oy Gh. O29. CEST) 6 eee Sm

Clause Millet v. Campbell County,

945: Fi.ae o00 (10h Cit. 1991). i cece oes

Communications Telesystems v. California Public,

14 F. Supp. 2d 1165 (N.D. Cal.1998) ...........

Communities for a Better Environment v.

Cenco Refining Co.,

180 F. Supp. 2d 1062 (C.D. Cal. 2001) ....... 28, 29

Environmental Defense Center, Inc. v.

United States EPA,

Oe ae ee CR BS) Fs sks ae eee nv od

Firemans Fund Insurance Co. v. City of Lodi,

Oe Re ee (RO 20CS) ins cv a cece Van

First English Evangelical Lutheran Church y.

County of Los Angeles,

482 U.S. 304, 107 S. Ct. 2378,

PO Ei te ETD ha OA oa es MER Ss

Fresh International Corp. v. Agriculture

Labor Relations Board,

ePe SE POO hile ke AO ko OU eRe N 40-42

Friends of the Earth v. United States Navy,

EE Wie MET oka Pekin s Kees we Farce

H-10

Grand Metropolitan PLC v. Pillsbury Co.,

702 F. Supp. 236 (D. Ariz.1988) ............ 40, 43

Green v. City of Tucson,

man Fad 6 CG. ZOO oss ewes 40, 41

Kim-Stan, Inc. v. Department of Waste Management,

732 ©, Supe. G46 ED. Va.1990). i 6 ooo cs Se oes 43

Kleppe v. New Mexico,

426 U.S. 529, 96 S. Ct. 2285,

Ne hs Sa A DORADO) ves ase eS be Nab eee 22

Lake Nacimiento Ranch Co. v. San Luis Obispo County,

BO Fe OIE TONE. B9OI) ia os Skee 3s ces ees 37

._ Lynce v. Mathis,

519 U.S. 433, 117 S. Ct. 891,

SF av Sees eS REN sass Be Wk oe eS 35

Madera Irrigation District v. Hancock,

Wa Te Saat COU AIFS) oo vo vo tbh eae enes 36

McDonald v. Metropolitan-North

Commuter Railroad Division,

Jee Pi DUN. ST SII TASB) oie ne oe yee os 43

Middlesex County Ethics Committee v.

Garden State Bar Association,

457 U.S. 423, 102 S. Ct. 2515,

FS bs Ws BE ERLE os oe NA CO awn 40

Mineral Policy Center v. Norton,

EOE Bs ONE: AO SO OOD 5 05.4.5 os OR we 20

H-11

Mission Oaks Mobile Home Park v. City of Hollister,

Jes F Qa: STARS 6 SS ce ew wae 40

Mission Oaks Mobile Home Park v. City of Hollister,

788 F. Supp. 1117 (N.D.Cal.1992) ..... 39-40, 42-43

New Orleans v. Dukes,

427 U.S. 297, 96 S. Ct. 2513,

QFE. AG 28 Sik CAST oe ei ee eee 38

Ohio Civil Rights Commission v.

Dayton Christian Schools, Inc.,

477 U.S. 619, 106 S. Ct. 2718,

SEL MG De Oke ce oa a eee ee 42, 43

PUD NO. I v. Washington Department of Ecology,

511 U.S. 700, 114 S. Ct. 1900,

R26 1. BG. 2 TIO CIO ik os han Be ee 29, 30

Robertson v. Methow Valley Citizens Council,

490 U.S. 332, 109 S. Ct. 1835,

ROA ES Te. Pr Cae) as 5 Sw eek ee eke eas 26

South Dakota Mining Association v. Lawrence County,

OTT F.BUDD: TSI9O aa IIIT) ne wea eek es o's 25

United Mine Workers of America v. Gibbs,

383 U.S. 715, 86 S. Ct. 1130,

16 1. EA. 20 ZIS AAS e e ceee 39

United States v. Consolidated Mines & Smelting Co.,

ASS Pit S32 (He Ce. TITS) icc seeks ean 21

Wien Consolidated Airlines, Inc. v. C.LR.,

DES Eke 1 5F CU GO. UO oo ck ee ees 35

H-12

Williams v. Red Bank Board of Education,

ie eee PS Ct CFB) sok wee ee ee eee 43

Williamson County Regional Planning Commission

v. Hamilton Bank, 473 U.S. 172,

105 S. Ct. 3108,

ee RMSE ONES 25 ao kine 3 doe bela oases 5 es 34

Wisconsin Public Intervenor, et. al. v. Mortier,

501 U.S. 597, 111 S. Ct. 2476,

SEN SEES LP OED 066570 ks ghee aces a 850 22

Younger v. Harris,

401 U.S. 37, 91 S. Ct. 746,

reg te Ge 2. BE LS) » SEEN ee nee 39-42

State Cases

Baldwin Park Redeveiopment Agency v. Irving,

150 Cat App. 30426 (1984)... ce eee 34

McMahan's of Santa Monica,

A Bn PO, BO OG (ESOS) 6 ios hers chee es wes 34

McQueen v. Board of Directors of

Mid-Peninsula Regional Open Space District,

202 Cal. App. 3d 1136,

ASOD os pice so os wie eb ew be 18

Federal Statutes

43 C.F.R.

EE Ogg Lc iva’ bac) w 68 Soa OK Be also 00's 22

ar eh ss va Gon ag Ik wae 8 8 23

SI IISA IA cg a aD 24, 26

I 6 es Siu big Gla we Ae 88 Vb oy We a 24

FRR ek es Oe alta ela FRR Mc lee wk ee ee 21

SN GEai Mics SMU ic 5505 2 kook Sk ce ie a 23

33. U.S.C.

RCROR” a: <a! biotech 6 be es CSRS OR ek eae 28

oh RRR ns Sep Atria kg ay ae phy ey 8 ae 28

BRC RR eee tea crap ie aap ras te mr 29

42 U.S.C.

Th 5 SRR Risener ae nae bee agiur ur SERRA g ay ORNS CBS 39

CMR ao Pcie wk CET se COREE ES ORE ERR 18

43 U.S.C.

Oe: E RUD 0 dip em bb erbidn a aa eda eo Oa 23

PPR hc nls ks eee hd ve ck ee 23, 28

OES aha et Va Rk ees TREE EERE EES OR 28

65 F.R.

NEI Ese tish coin Kinin edd hacks a ee ae ena 23

«| FERRIED ae sae enn a ne cee PITT «LR LNG ETFS = Be oN 23

FE 23 a es ORS cee a ODE aie 24

Federal Rule of Civil Procedure

NS ao oes ok ko RS Ree AE ee ee 20

NE PRE cvs ee aN ee mk a a wie & nearer 20

State Statutes

14 Cal. Code of Regs.

AL SE AGRE ee DG age UA RUOR IRS ata me 26

PR Ci cll ae ete ree Ree owaces 32

EARN ON os o's c's RNS SD Ss REN ee Pee RUSE Les 26

RRR cs iain ie Wi's ceas kee awe 28, 29

H-14

Cal. Code Civ. P.

Be ee ee eb FAK Ae ew ee lees bed eed 34

OR Fe» BARR Res Sigitearten dar meso gig tan tenga. rar RD RNa 34

Cal. Pub. Res. Code

Ae an os ER OR Ee A ee 16

ge yo kd AE ole a nee alien ae 15, 25

Ree es Res Su yeh oak orn Pe a 18

DASE 6a ee oo E ee Pee sa oe a ss 32

Cal. Water Code

SES Soke BRS EAE ER ev EER EN 29

O 499G0 ma ka eee eee Stas A Gory 1a Wily Resales mee Se 28

DR Siva nc PRUE CR OES SER OE a 29

DAE 5S va EAH 8 ae eae TAT OR eK Tae 29

H-15

MEMORANDUM OF POINTS AND AUTHORITIES

I. SUMMARY OF ARGUMENTS

(1) There is no legal or factual basis supporting Plaintiffs’

claims that federal mining law and a federal mining decision

preempt state environmental laws and regulations designed to

protect the public. It is undisputed that the federal decision to

mine fifty six (56) million tons of sand and gravel in Soledad

Canyon, California expressly conditions federal approval on

the applicant’s compliance with state laws and regulations.

Statement of Uncontroverted Facts (“SUF’) Nos. 1-7. The

Bureau of Land Management (“BLM”) expressly conditioned

its Record of Decision (“ROD”) on local review and approval,

including compliance with the California Environmental

Quality Act (“CEQA”), Pub. Res. Code § 21000 et seq. SUF

Nos. 8-14. It is undisputed that the federal government signed

a Memorandum of Understanding (“MOU”) with the State of

California acknowledging the applicability of state

environmental laws to federal surface mining activities. SUF

Nos. 15-16. These federal conditions are consistent with the

purpose and intent of the federal Materials Act of 1947, which

is to dispose of sand and gravel in a manner that is not

detrimental to the public’s interest.

At its heart, this case is not as much about the preemption

of the local environmental regulation as it is about Plaintiffs

asking the court to rescind these federal decisions, in violation

of the federal Administrative Procedure Act (“APA”); as well

as other federal law. CEQA does not mandate particular land

uses but requires only that, however land is used, damage to

the environment is kept within prescribed limits. The only

“condition” the County Board of Supervisors imposed on

CEMEX, Inc. (““CEMEX”) was recirculation of the Project’s

Environmental Impact Report (“EIR”), to fully address the

H-16

Project’s effect on traffic. This condition amounts to

reasonable environmental regulation, not a land-use decision.

Therefore, it is not preempted.

(2) CEMEX’s Procedural Due Process and Takings

claims are premature. Fifth Amendment Takings claims

require a taking without just compensation. Where state law

provides procedures to compensate for the deprivation, a Fifth

Amendment Taking is not ripe until the state procedures have

been exhausted. CEMEX has failed to exhaust available state

procedures. Procedural Due Process claims alleging a

deprivation of the same property rights are subsumed under

the Takings claim and therefore must also satisfy the

exhaustion requirement. As noted above, local review and

approval is a condition precedent to CEMEX’s right to the

sand and gravel, pursuant to the express terms of the federal

contracts. As such, CEMEX has not been deprived of any

vested rights under the federal contracts.

(3) CEMEX’s Equal Protection claim fails as a matter of

law. To state an equal protection claim, CEMEX must charge

the County of Los Angeles (“County”) not only with

deliberately acting against it, but also with singling it out for

selective enforcement on an impermissible basis. There is no

allegation that the County intentionally discriminated against

CEMEX for constitutionally suspect motives. Moreover, the

County’s approval process and ultimate denial is rationally

related to its legitimate authority under CEQA, the Surface

Mining and Reclamation Act of 1975, Cal. Pub. Res. Code

§ 2710, et seg. (““SMARA”), the federal contracts, the ROD

and federal law.

(4) CEMEX’s state claims for inverse condemnation,

traditional mandate and administrative mandamus are only

properly before the Court as pendant state claims. If

H-17

Plaintiffs’ federal claims are without merit, then the Court

lacks pendant jurisdiction over the remaining state law claims.

(5) The Younger Abstention doctrine requires dismissal.

Abstention is mandatory if: (a) at the time of the filing of the

lawsuit the state proceedings are ongoing; (b) the proceedings

implicate important state interests; and (c) the state

proceedings provide an adequate opportunity to raise federal

questions. CEMEX filed its lawsuit prior to a previously

scheduled hearing on its appeal before the County Board of

Supervisors. The state proceeding was ongoing at the time of

filing the complaint, adequate opportunities to raise federal

questions were available to CEMEX and compliance with

state environmental laws is an important state interest.

fl. FACTUAL BACKGROUND

This lawsuit arises from CEMEX’s ill-founded frustration

with the County’s administrative review of Surface Mining

Permit Application Number 91-165(5) (“Permit”). The Permit

is for the extraction of up to 69.2 million tons of material to

produce and sell approximately fifty six (56) million tons of

sand and gravel, in Soledad Canyon, California (“Project”).

Consent Decree, Exhibit H, pg. 7, J] aa. The City has actively

opposed the granting of the Permit for the Project, on the

grounds that the Project, as proposed, will cause significant

detrimental impacts to the City’s air, water and land resources

as well as to the health, safety and welfare of its citizens. See,

City’s Renewed Motion to Intervene filed May 28, 2002,

docket numbers 40 to 43.

In 1990, the BLM contracted the sale of sand and gravel

(the “Contracts”) to Transmix Corporation, predecessor in

interest to CEMEX. (CEMEX Second Amended Complaint

(“SAC”) 11:16-19). The sand and gravel contracts require

H-18

compliance with state and local rules and regulations.’

Pursuant to a force majeure clause, the Contracts may be

terminated if state and local rules, regulations and decisions

prevent CEMEX, through no fault of its own, from mining.

SUF Nos. 6 and 7. One of the contract conditions is the

applicant’s compliance with SMARA. SUF No. 5. Under

SMARA, CEMEX is required to obtain a surface mining

permit from the County. Thus, CEMEX is subject to two

independent environmental schemes: federal review and

approval under the National Environmental Policy Act, 42

U.S.C. § 4321, et seg. (“NEPA”) and local review and

approval under SMARA and the CEQA.’

In May of 1990 Transit Mixed Concrete (“TMC”)

(predecessor to CEMEX) submitted a proposed mining and

reclamation plan for the Project to the BLM. SUF No. 18.

The following year, TMC submitted its Permit application to

the County. SUF No. 19. In 1995, TMC’s consultant

prepared a Screencheck EIR on the Project. SUF No. 20. On

February 17, 1999 County released the Draft EIR for public

review and comment. SUF No. 21. After conducting the

CEQA review, the County Planning Commission denied the

Permit application on February 16, 2000. SUF No. 22.

2 The Contracts expressly require compliance with the rules and

regulations of the South Coast Air Quality Management District

(“SCAQMD”), the rules and regulations of the State of California,

Regional Water Quality Control Board (“SCWQCB’’) and with SMARA.

SUF Nos. 4 and 5.

> Approval of a mining permit is a “project” subject to the

requirements of CEQA. Public Resources Code § 21065; McQueen v.

Board of Directors of Mid-Peninsula Regional Open Space District, 202

Cal. App. 3d 1136, 1143, 249 Cal. Rptr. 439 (1988) [The term ‘project’

is given a broad interpretation in order to maximize the protection of the

environment].

H-19

Approximately six months later, on August 1, 2000, the BLM,

issued its ROD, pursuant to NEPA. SUF No. 23. Each of

these decisions was appealed. SUF Nos. 24 and 25. On

January 8, 2002, the Interior Board of Land Appeals

(“IBLA”) issued its ruling affirming the ROD. SUF No. 26.

On February 26, 2002 -- after CEMEX filed the instant

lawsuit -- the County Board held a hearing on CEMEX’s

Permit and voted its intent to deny the appeal. SUF Nos.

27-29.

At the February 26, 2002 hearing on CEMEX’s appeal,

Supervisor Molina sought to clarify whether or not CEMEX

was willing recirculate the EIR for public review and

comment, due to a dispute over traffic impacts. SUF Nos. 28

and 29; SAC, 78:19-79: 6. CEMEX, however, refused to

recirculate the EIR. SUF No. 28. Based on CEMEX’s refusal

to subject the EIR to additional public review and comment,

particularly with regard to the traffic analysis. and the fact that

CEMEX filed suit against the County to preempt the County’s

environmental review, the County Board voted its intent to

deny the Permit. SUF No. 29; SAC, 78:19-79: 6. On April

23, 2002 the County Board issued findings in support of the

denial. SUF No. 30.

The City actively sought to intervene shortly after the

filing of the lawsuit. City was twice denied intervention

status. On February 24, 2004, the Ninth Circuit Court of

Appeals overturned the second denial. One day prior to the

Ninth Circuit’s decision, the original parties filed a Motiwn for

Entry of Consent Decree. The Proposed Consent Decree

finds that federal law preempts the County denial of the Permit

and that any further application of CEQA or SMARA is

preempted, even if significant new information was added to

the Final EIR. Consent Decree, 53: 20-28. Despite the

County’s previously stated position that it must recirculate the

H-20

Final EIR prior to certification, the proposed Consent Decree

finds that any further recirculation or review is preempted.

iil. LEGAL ARGUMENT

A motion for summary judgment is appropriate where

there is no genuine issue of material fact and where the

moving party is entitled to a judgment as a matter of law. See,

Federal Rule of Civil Procedure, Rule 56 (c). A motion for

summary judgment “pierces” the pleadings and puts the

opponent to the test of affirmatively coming forward with

sufficient evidence for its claims or defenses to create a

genuine issue for trial. Celotex Corp. v. Catrett, 477 U.S.

317, 325, 106 S.Ct. 2548, 2554, 91 L.Ed. 2d 265 (1986).

Because this court’s review is based upon the County’s

administrative record, summary judgment is especially

appropriate. Mineral Policy Center v. Norton, 292 F. Supp.

2d 30, 36 (2003).

A. The Undisputed Facts Establish That

Plaintiffs Federal Preemption Claims

Fail As A Matter Of Law

CEMEX’s First and Second Claims for Relief and the

United States’ First, Second and Third Claims for Relief each

allege that federal Jaw and the federal decision to mine in

Soledad Canyon preempt local environmental review pursuant

to CEQA and SMARA. These claims are without merit for

the following reasons: (1) Plaintiffs have failed to exhaust

administrative remedies under the federal Administrative

Procedures Act, (2) Congress has not expressed an intent to

occupy the field of surface mining, (3) the Federal Materials

Act of 1947 does not conflict with CEQA or SMARA, (4) the

MOU, federal contracts and ROD mandate compliance with

CEQA and SMARA, (5) the Federal Clean Air Act and Clean

H-21

Water Act mandate compliance with CEQA and (6) the

County approval process, the conditions the County

considered and the County’s denial all concern environmental

regulation, not land-use decisions.

1. Plaintiffs’ Preemption Claims Fail

As a Matter Of Law Because

Federal Administrative

Procedures Act Remedies Have

Not Been Exhausted

The Plaintiffs seek relief to preempt CEQA and SMARA,

effectively rescinds the Federal Contracts and the ROD in

violation of the federal Administrative Procedures Act

(“APA”). If the BLM believes that compliance with CEQA is

no longer advisable or occurs only in a truncated or advisory

fashion, its first duty under the APA is to rescind the ROD.

Such an action is subject to notice and public comment

requirements and judicial review as a “final agency action.”

See, 5 U.S.C. § 704; California Dep’t of Health Servs. v.

Babbitt, 46 F. Supp. 2d 13, 27 (D.D.C. 1999) [the decision

rescinding Secretary Lujan’s ROD was a final agency action];

Bennett v. Spear, 520 U.S. 154, 177, 117 S. Ct. 1154, 1168

(1997). Plaintiffs’ preemption arguments are a disguised

attempt to overturn the ROD without satisfying the notice and

procedural requirements of the APA.

Likewise, if CEMEX believed that compliance with

CEQA was preempted, CEMEX was required to

administratively appeal the ROD’s CEQA determination.

Agencies may require by rule that an appeal be taken to a

superior agency authority before judicial review may be

sought. United States v. Consolidated Mines & Smelting Co.,

455 F.2d 432, 440 (9th Cir. 1971). Here, the Department of

Interior requires by rule that appeals be taken to the IBLA

H-22

before being subject to judicial review. 43 Code of Federal

Regulations § 4.21 (c) CEMEX’s failure to pursue the

required appeal relieves this court of jurisdiction.

2. Congress Has Not Expressed Its

Intent to Occupy the Field of

Surface Mining

While Congressional power over federal lands is absolute,

“States are free to enforce their criminal and civil laws on

federal land so long as those laws do not conflict with federal

law.” Kleppe v. New Mexico, 426 U.S. 529, 543, 96 S.Ct.

2285, 2293, 49 L.Ed. 2d 34 (1976). “State law can be

preempted [by federal law] in either of two general ways.”

California Coastal Commission v. Granite Rock

Co.( “Granite Rock”), 480 U.S. 572, 581, 107 S.Ct. 1419,

1425, 94 L.Ed. 2d 577 (1987). “If Congress evidences an

intent to occupy a given field, any state law falling within that

field is preempted.” Jd. Congress’ intent to supplant state

authority in a particular field may be expressed in the terms of

the statute, or can be implicit if a scheme of federal regulation

is “so pervasive as to make reasonable the inference that

Congress left no room for the [s]tates to supplement it.”

Wisconsin Public Intervenor, et. al. v. Mortier, 501 U.S. 597,

605, 111 S.Ct. 2476, 2481, 115 L.Ed. 2d 532 (1991).

When considering preemption, the court must “start with

the assumption that the historic police powers of the [s]tates

were not to be superseded by the Federal Act unless that was

the clear and manifest purpose of Congress.” Jd., 501 U.S. at

605, 111 S. Ct. at 2482. “In the absence of a strong indication

to the contrary, we adhere to the presumption,” that Congress

does not intend to “deny local communities throughout the

National significant powers of self-protection.” Firemans

Fund Ins. Co. v. City of Lodi, 302 F.3d 928, 943 (9th Cir.

a)

H-23

2002), (quoting Wisconsin Public Intervenor vy. Mortier, 501

U.S. at 621).

The Materials Act of 1947, 30 U.S.C. § 601, et seq

(“Act”) controls disposal of federal sand and gravel. There is

no express language in the Act evidencing any Congressional

intent to supplant state and local authority over the

environmental regulation of surface mining. To the contrary,

there is language that shows an intent not to preempt. By

enacting the Act, Congress gave the Secretary of the Interior

the authority to dispose of sand and gravel deposits located on

federal land. 30 U.S.C. § 601. _ This authority, however, is

qualified. Under the Act, the Secretary cannot dispose of sand

and gravel located on federal land if such disposal would be

detrimental to the public’s interest. Id. (emphasis added).

Regulations promulgated under the Act provide that it is

BLM’s policy “to protect public land resources and the

environment and minimize damage to public health and safety

during the exploration for and the removal of such minerals;”

43 Code of Federal Regulations (“C.F.R.”) § 3601.6 (d), 66

Federal Register (“F.R.”) 58892, 58902 (2001). The

commentary to the Final rule adopting these regulations

specifically provides that “the rule does not preempt State

law.” (emphasis added) 66 FR 58892, 58900.

The Federal Land Policy and Management Act

(“FLPMA”) establishes standards for the BLM to regulate

mining activities on public lands. FLPMA balances the need

for domestic sources of minerals against the need to mitigate

mining impacts to “protect the quality of scientific, scenic,

historical, ecological, environmental, air, and atmospheric,

water resource, and archeological values,’ 43 U.S.C.

§ 1701(a)(8). FLPMA directs the BLM to “take any action

necessary to prevent unnecessary or undue degradation of the

[public] lands.” 43 U.S.C. § 1732(b). “Unnecessary or undue

H-24

degradation” means, in part, “[a] voiding substantial irreparable

harm to significant scientific, cultural, or environmental

resource values of the public lands that cannot be effectively

mitigated.” 43 C.F.R. § 3809.415(d), 65 F.R. 69998, 70122

(2001).

FLPMA regulations provide

“filf State laws or regulations

conflict with this subpart regarding

operations on public lands, you must

follow the requirements of this subpart.

However, there is no conflict if the State

law or regulation requires a higher

standard of protection for public lands

than this subpart.” (Emphasis added) see,

43 C.F.R. § 3809.3, 65 F.R. at 70114.

The BLM’s commentary on section 3809.3 recognizes

that “[o}]ne purpose of subpart 3809 is to establish a minimum

level of protection for public lauds...States may continue to

assert jurisdiction over mining operations on the public lands.”

65 F.R. at 70008-9.* The commentary cites Granite Rock as

authority. Jd. In Granite Rock, 480 U.S. 572, the Supreme

Court determined that neither the federal Mining Act of 1872

nor land use statutes nor federal land management statutes

preempted the California Coastal Commission’s imposition of

a permit requirement for operation of an unpatented mining

claim in a national forest. The Supreme Court determined that

* Indeed, the commentary provides a specific example where State

law or regulations may provide a higher standard of protection, i.e. the

restriction on cyanide leaching-based operations approved by voters in

Montana. “In this situation, the State law or regulation will operate on

public lands.” Jd.

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Congress had not expressed an intent to displace state and

local environmental regulation of mining claims in national

forest lands. Granite Rock, 480 U.S. at 588. There is no

reasonable basis to find that Congress intended to “occupy the

field” of environmental regulation of surface mining.

3. Federal Materials Act of 1947

Does Not Conflict With CEQA or

SMARA

Conflict preemption occurs when there is a conflict

between federal and state law. South Dakota Mining

Association v. Lawrence County, 977 F. Supp. 1396, 1401

(D.S.D. 1997). A conflict exists when the local enactment

“stands as an obstacle to the accomplishment and execution of

the full purposes of Congress,” or “when it is impossible to

comply with both federal and state law.” Id. In this matter,

SMARA and CEQA do not stand as an obstacle to meeting

Congress’ full purposes. It is also not impossible to comply

with both SMARA and CEQA, and the Materials Act of 1947.

In fact, SMARA® and CEQA® complement the Materials Act

* The purpose of SMARA is to assure that: (1) adverse environmental

impacts from surface mining are prevented or minimized and that mined

lands are reclaimed; (2) the production and conservation of minerals are

encouraged, while giving consideration to other values relating to

recreation, watershed, wildlife, range and forage, and aesthetic

enjoyment; and (3) residual hazards to the public health and safety are

eliminated. Cal. Pub. Res. Code, § 2712.

® CEQA is also consistent with the Materials Act of 1947. The

purpose of CEQA is to: (1) disclose to decision makers and the public the

significant environmental effects of proposed activities; (2) identify ways

to avoid or reduce environmental damage; (3) disclose to the public

reasons for agency approval of projects with significant environmental

effects; and (4) foster intra-agency cooperation and enhance public

participation in the planning procees. Pub. Res. Code, §§ 21000, et. seg.

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of 1947. Like the Materials Act, SMARA encourages the

disposal of mineral deposits in a manner that is not detrimental

to the public’s interest. CEQA’s core activity is environ-

mental.protection, not land use. CEQA does not mandate

particular land uses but requires only that, however the land is

used, damage to the environment is kept within prescribed

limits. See, Granite Rock, 480 U.S. at 587. Moreover,

CEQAimay provide for a higher level of environmental

protection than its federal counterpart, NEPA. While NEPA

is largely procedural, CEQA requires that significant impacts

be reduced to insignificant to the extent feasible. See, 14 Cal.

Code Regs. §§ 15021, 15091; Robertson v. Methow Valley

Citizens Council, 490 U.S. 332, 109 S. Ct. 1835, 104 L.Ed.

2d 351 (1989). As provided by BLM regulation 43 C.F.R. §

3809.3, there is mo conflict if the State law or regulation

requires a higher standard of protection for public lands.

4. The Federal Decisions Do Not

Preempt CEQA or SMARA But

Rather Mandate Compliance

The federal government acknowledged the legitimacy of

SMARA and CEQA in the environmental review of federal

surface mining operations in an MOU entered into between

the State of California, the United States Department of

Interior, and the United States Department of Agriculture.

SUF Nos. 15-16. Specifically, the MOU provides for

cooperation “to imsure that conditions required of operators

(as defined by Federal law and by SMARA and any other

relevant regulations or ordinances) in minimizing adverse

environmental impacts conform to all applicable local, State,

and Federal regulations.” SUF No. 16. It is clear from the

MOU that the federal government anticipates the State of

California’s right to impose environmental regulations on

federal surface mining projects.

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The ROD mandates, as a condition of approval, that

CEMEX consult with, and obtain approval from stav2

regulatory agencies, including the County of Los Angeles.

SUF Nos. 9-14. The ROD also requires CEMEX to comply

with CEQA. SUF No. 10. The ROD expressly recognizes

that the County Planning Commission had already denied

CEMEX’s permit and that the fate of CEMEX’s appeal to the

County Board of Supervisors was uncertain. County

Administrative Record (“AR”) 09931. Thus, the federal

government recognized at the time it approved the mining

operation that the County could prevent CEMEX from mining

if CEMEX refused to comply with reasonable local

environmental regulations or procedures.’

The federal Contracts that CEMEX signed specifically

grant CEMEX< the right to void the contracts if CEMEX is

prevented from mining by rulings or decisions of municipal,

federal, state, or other governmental agencies, or any laws or

regulations of such entities. SUF Nos. 6-7. The force majeure

clauses expressly contemplate the possibility that CEMEX’s

state permit applications could be denied. The Contracts

contain no language limiting SMARA’s applicability, nor do

the Contracts provide any justification for preempting the local

environmental review process. To the contrary, every federal

decision addressing the Project has conditioned approval on

compliance with state laws and regulations.

’ In refusing to submit a new traffic study as the County requested,

CEMEX has indeed refused to comply with reasonable environmental

regulation. The additional traffic study requirement is per se reasonable

because it is required under state law. AR 20442-20444.

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5. The Federal Clean Air Act and

Clean Water Act Mandate Comp-

liance With CEQA

It is undisputed that the federal Clean Air Act (“CAA”),

42 U.S.C. § 7401 et seq., and federal Clean Water Act

(“CWA”), 33 U.S.C. § 1251 et seq., apply to the Project. In

enacting the CAA, Congress delegated responsibility for

implementing the provisions of the Act to the states through

State Implementation Plans (“SIPs”). Requirements of SIPs

are “binding as a matter of federal law.” Communities for a

Better Environment v. Cenco Refining Co.( “Cenco”), 180 F.

Supp. 2d 1062, 1069 (C.D. Cal. 2001). Under the CWA, the

State Water Resources Control Board (“SWRCB”) is

designated as the agency authorized to exercise powers

delegated to it under the CWA. 33 U.S.C. § 1313; Cal. Water

Code § 13160.

FLPMA mandates that any contract issued by the federal

government for the “use, occupancy, or development of the

public lands” must contain a provision requiring compliance

with “applicable State or Federal air or water quality

standard[s] or implementation plan{s].” 43 U.S.C. § 1732

(West 2004). The ROD is consistent with Congressional

intent because it specifically requires that CEMEX obtain air

and water permits from the SCAQMD, the California

Regional Water Quality Control Board—Los Angeles Region

(“RWQCB-Los Angeles”) and the California State Water

Resources Control Board ("SWRCB"). SUF No. 11-13.

Where a specialized agency issues a permit for a discrete

aspect of a project (here, air and water quality), it acts as a

“responsible agency” under CEQA. Cenco, 180 F. Supp. 2d

at 1069; 14 Cal. Code Reg. § 15381. Under California law, a

responsible agency must review and consider the EIR

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prepared by the lead agency and, if necessary, may impose

additional mitigation measures and required further public

participation prior to approval. 14 Cal. Code Reg. §§ 15050

(b), 15041(b). 14 Cal. Code Reg. § 15050(b). Pursuant to

SCAQMD regulations, an applicant for a permit must submit

an EIR where one has been prepared by the lead agency.

SCAQMD Regulations, Regulation II, List and Criteri~

SCAQMD Rule 210(d). SCAQMD Regulations promulgated

under the authority of an approved SIP are “binding as a

matter of federal law.” Cenco, 180 F.Supp. 2d at 1068.

Similarly, the ROD requires approval or review of a

General Industrial Activities Stormwater Permit (“GIASP’’),

a Section 401 Certification and a permit to appropriate water

frointhe SWRCB.° The state agency is charged with review

of CEMEX’s Notice of Intent (“NOT”) to operate under the

applicable GIASP. The NOI is the functional equivalent of

permit. Environmental Defense Center, Inc. v. United States

EPA, 344 F.3d 832, 857 (9th Cir. 2003). Therefore, the state

agency is a “responsible agency” under CEQA for purposes of

reviewing CEMEX’s NOI. Cenco, 180 F.Supp. 2d at 1069;

14 Cal. Code Reg. § 15381.

Moreover, pursuant to Section 401 of the CWA, the State

must certify that the Project complies with applicable water

quality requirements. 33 U.S.C. § 1341(a); PUD NO. J v.

Washington Department of Ecology, 511 U.S. 700, 1148S. Ct.

* California effectuates the requirements of the CWA primarily

through institutions and procedures set out in certain provisions of the

California Water Code (the “Water Code’), including those of the

California Porter-Cologne Water Quality Act, Cal. Water Code § 13000,

et seq. The Porter-Cologne Act established nine California Regional

Water Quality Control Boards, Cal. Water Code §§ 13200, 13201, which

operate under the purview of the State Board, see id. § 13225.

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1900, 128 L. Ed. 2d 716 (1994). The states may condition

certification upon any limitations necessary to ensure

compliance with state water quality standards or any other

appropriate requirement of State law. PUD NO.1, 511 U.S.

700, 713-4, 114 S. Ct. 1900, 1910; Friends of the Earth v.

United States Navy, 841 F.2d 927, 930. Prior to certification,

state regulations require review of a document prepared in

accordance with CEQA (in this case the FEIR). Jn the Matter

of the Petition of North Star Hydro, LTD, Order No. WQ

92-07, § 401 Certification, 1992 Cal. ENV LEXIS 13 (August

20, 1992). Each of these attendant local air and water permit

requirements require the responsible agencies to comply with

CEQA. Here, CEQA is not only a state mandate but a federal

mandate.

6. The County Approval Process,

County Conditions and County

Denial Are Not Preempted

All the federal authorities confirm that local review and

approval is a prerequisite to approval of CEMEX’s mining

operation. Plaintiffs may argue that they are not seeking to

preempt CEQA and SMARA, but simply to preempt the

County’s particular application of CEQA and SMARA. There

is no legal authority for the proposition that federal mining

laws or any of the federal decisions in this case cut short the

local environmental review process, prevent the County from

considering Project conditions or prevent the County from

denyins; the proposed Project.

a. The County Review Process and

Denial Are Not Preempted

CEMEX’s First Claim for Relief alleges that the County’s

subversion of “the local review and approval process into a

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never ending delay and then denial of a Federally-approved

Project constitutes a form of prohibition of the Project.”

SAC, 98:22-25. CEMEX further alleges that the abuse of

process “has imposed additional costs, uncertainties and

delays on the Project sufficient to jeopardize the

implementation of the Federal land-use decisions...” SAC,

98:25-99:1. The result, as alleged by CEMEX, is that “the

current and any further process of the County for the approval

of CEMEX’s application for a surface mining permit and

reclamation plan is therefore preempted...” SAC, 99:11-14.°

Although CEMEX contends that the County review and

denial “frustrate federal intent,” the undisputed facts establish

the opposite as a matter of law. Indeed, preemption of the

County review process frustrates the full implementation of

federal law and the federal decisions. Truncating the CEQA

process is detrimental to the public interest.

By comparison to the federal review, the local

environmental review process was per se timely. First, it is

undisputed that the County Planning Commission issued its

denial prior .o the BLM issuing the ROD on the August 1,

2000, in which it adopted the reduced North Fines Storage

Area Alternative (RFNSA). SUF Nos. 22-23. In anticipation

of the Planning Commission’s denial, County staff offered to

prepare a FEIR for the record. SUF No. 31. CEMEX

* The United States makes similar allegations in its First and Third

Claims for Relief alleging that “[t]he County's denial of a permit stands

as an obstacle to the fulfillment of the congressional objective, evidenced

in the Materials Act of 1947, to authorize the Department of Interior to

administer a mineral materials sales program.” U.S. Complaint,

25:26-28 And “(t]he County’s delay in making the final decision

concerning CEMEX’s permit application stands as an obstacle to the

fulfillment of BLM’s mineral materials sales contracts, as contemplated

by the Materials Act of 1947, and thus is preempted by federal law.”’ U.S.

Complaint, 32:9-12.

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opposed this. Jd. Second, it is undisputed that the IBLA’s

final federal decision on the Project was made January 8,

2002, less than two months prior to the County Board’s vote

_ of intent to deny on February 26, 2002. SUF Nos. 26-27. The

County’s Findings of Denial were issued shortly thereafter on

April 23, 2002. SUF No. 30. Thus, the County’s procedural

denial occurred less than four months after the federal decision

became final.

As to the procedural denial,'® the County has authority

under CEQA to disapprove a project if necessary in order to

avoid one or more significant effects on the environment that

would occur if the Project were approved, as proposed. 14

Cal. Code of Regs. § 15042; Cal. Pub. Res. Code § 21081."

The County exercised its authority and found that CEMEX

failed to cooperate in substantiating that the action would not

adversely affect the health, safety and welfare of persons

residing in the surrounding area.'* SUF No. 28. Had

CEMEX agreed to a revised traffic analysis and to recirculate

the FEIR for public review and comment, the CEMEX mine

might be operational today. “An unreasonable delay by an

applicant in meeting requests by the lead agency necessary for

the preparation of an EIR shall suspend applicable time

10

The procedural denial specifically leaves open review of future

mining proposals. AR 20443.

'' Certification of a Final EIR is only required prior to approval of a

project, not a denial. 14 Cal. Code of Regs. § 15090. The Planning

Commission denied the Permit in 2000, therefore the County Board had

no duty to certify the EIR unless it intended to approve the Permit.

2 Any inquiry into the motives of administrators in the context of a

challenge to administrative action is strongly disfavored. Citizens to

Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 420, 91 S. Ct. 814,

825, 28 L. Ed. 2d 136 (1971).

H-33

requirements.” 14 Cal. Code of Regs. §§ 15108, 15109;

Carmel Valley View, Ltd. v. Maggini, 91 Cal. App. 3d 318.

b. The County’s “Considera-

tion” of Conditions Is Not

Preempted

CEMEX’s Second Claim for Relief, alleging that

conditions imposed by the County that are inconsistent with

the conditions set forth in the federal ROD are preempted, is

without merit. CEMEX does not allege that the County ever

imposed unreasonable conditions but merely that “County has

given consideration to conditions that conflict with the ROD,

the Federal Contracts, and the Materials Act of 1947....”

SAC, 101:4-7. If, as CEMEX alleged, the County is

preempted from even considering conditions that conflict with

the federally approved Project, then the local review process

is rendered meaningless. CEMEX’s suggestion that the

County is barred from considering conditions amounts to an

argument that it wants a pro forma rubber stamp from the

County. Similarly, the United States fails to allege that the

County Board ever actually imposed any local land-use

policies inconsistent with the Project, only that the County

made “efforts to impose local land-use policies” and

“entertained” housing projects near the mine. U.S. Complaint,

27:4-27:19. As noted above, the only “conditions” the

County Board imposed which CEMEX found unacceptable is

the recirculation of the FEIR concerning traffic impacts.

These conditions amount to reasonable environmental

regulation and have no connection to a “land-use policy.”

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B. CEMEX’s Takings Claim and Claim

That It Has Been Deprived Of Property

Without Due Process Are Premature

And Fail As a Matter of Law

CEMEX’s Takings Claim fails as a matter of law for three

reasons: (1) CEMEX’s claim is premature, (2) CEMEX has

no vested property interest in the sand and gravel, and (3) no

taking can occur as a result of lawful government action.

Moreover, because CEMEX’s procedural due process claim

concerns deprivation of the same property right alleged in its

Takings claim, the due process claim is subsumed into the

Takings claim and is also premature.

1. Fifth Amendment Takings Claim

CEMEX’s Takings Claim is premature. The Supreme

Court has held that if adequate State remedies exist for

seeking just compensation, “the property owner cannot claim

a violation of the Just Compensation Clause until it has used

the procedure and been denied just compensation.” In

Williamson County Regional Planning Commission v.

Hamilton Bank, 473 U.S. 172, 194-7, 105 S. Ct. 3108, 87 L.

Ed. 2d 126 (1985); see also, Cassettari v. County of Nevada,

824 F.2d 735, 737-8 (9th Cir. 1987). California law permits

a property owner to bring an inverse condemnation action to

obtain just compensation for an alleged taking of property.

See Cal. Code Civ. P. § 1245.260. Under California Code of

Civil Procedure section 1235.170, “‘property’ [for purposes of

eminent domain and inverse condemnation] includes real and

personal property and any interest therein.” Baldwin Park

Redevelopment Agency v. Irving, 156 Cal. App. 3d 428, 435

(1984); McMahan’s of Santa Monica, 146 Cal. App. 3d 683,-

700 (1983). In 1987, California recognized inverse

condemnation claims based on regulatory takings. First

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English Evangelical Lutheran Church v. County of Los

Angeles, 482 U.S. 304, 107 S. Ct. 2378, 96 L. Ed. 2d 250

(1987). |

CEMExX alleges that “Plaintiff has a protectible property

interest in its Federal Contracts with the United States and the

ROD, including all conditions, decisions and approvals

relating thereto.” SAC, 118: 21-23. CEMEX claims all

beneficial use of its property interests were taken by the

County. SAC, 118: 24-28. If the County did indeed deprive

CEMEX of a property interest, without payment, just

compensation can be obtained by using California's inverse

condemnation procedures. Whether or not CEMEX has

legitimate federal claims and is permitted to pursue its related

state claims in this court, does not alter the conclusion that the

Fifth Amendment Takings claim is premature. See, Court’s

July 29, 2002 Order, 15:21-25, citing City of Chicago v.

International College of Surgeons, 522 US. 156,

160-165,118 S. Ct. 523 (1997).

Not only is CEMEX’s claim premature, but CEMEX’s

property interest in the sand and gravel has not yet vested.

County and State approval is a condition precedent to

CEMEX’s rights under the contracts to extract sand and

gravel. A condition precedent requires certain performance

or a condition which must take place before a legal right can

vest. See, e.g., Wien Consolidated Airlines, Inc. v. C.I.R., 528

F.2d 735 (9th Cir. 1976). A night that has not as yet vested is

not a property interest for purposes of a Fifth Amendment

Takings claim. Lynce v. Mathis, 519 U.S. 433, 440, 117 S.

Ct. 891, 895, 137 L. Ed. 2d 63 (1997). Although CEMEX

may have certain rights under the contracts, i.e. as to price and

tonnage, the right to extract sand and gravel is expressly

subject to CEMEX’s compliance with local rules and

regulations. The Contracts expressly provide: “{t]itle to

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materials sold hereunder shall pass to Purchaser only upon

severance or extraction of and proper payment of such

materials.” SUF No. 3. If CEMEX is unable to obtain

approval, the force majeure clause of the contract excuses

CEMEX’s performance. SUF Nos. 6 and 7. CEMEX has no

vested property right in the sand and gravel and therefore no

taking claim.

Cases cited by the Court in its July 29, 2002 Order are

inapposite. See, Madera Irrigation District v. Hancock, 985

F.2d 1397, 1399 (9th Cir. 1992) [Court found that water

district had a vested property right where contract did not

contain any condition precedent to right to a “permanent

water supply”] and see, Barcellos and Wolfsen, Inc. v.

Westlands Water District, 899 F.2d 814 (9th Cir. 1990)

{Court determined that sale of “excess lands” within 10 years

was a condition precedent to the landowners rights to receive

subsidized water after the 10 years expired. Landowners who

failed to sell their excess lands had no contractual right to the

subsidized water for more than 10 years, despite the fact that

they were enjoined from selling their “excess land” during part

of the 10 year period.] Finally, CEMEX has not been

deprived of property as a result of unlawful government

action. As discussed above, County’s environmental review

and conditional denial are lawful actions required under

CEQA and SMARA, as mandated by federal law and the

federal decisions.

2. CEMEX’s Due Process Claim

When a plaintiff alleges that he was denied a property

interest without due process, and the loss of that property

interest is the same loss upon which the plaintiff's takings

claim is based, the plaintiff must utilize the remedies applicable

to the takings claim. “It is appropriate in this case to subsume

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the more generalized Fourteenth Amendment due process

protections within the more particularized protections of the

‘Just Compensation Clause.’” Millet v. Campbell County, 945

F.2d 348, 352 (10th Cir. 1991); see, Cassettari v. County of

Nevada, 824 F.2d 735, 738-739 (1987); and Lake Nacimiento

Ranch Co. v. San Luis Obispo County, 841 F.2d 872, 879

(9th Cir. 1987). Accordingly, until a plaintiff has resorted to

the condemnation procedures to recover compensation for the

alleged taking, the procedural due process claim is not ripe

because it is in essence based on the same deprivation. (/d.)

The procedural due process argument that CEMEX

asserts here is that the County’s implementation of

environmental regulations deprived it of its contractual

interests. The property interest supporting this due process

claim is exactly the same one that CEMEX asserts has resulted

in the taking of its property without just compensation in

violation of the Fifth Amendment.’ Under these circum-

stances, CEMEX must first obtain a final adverse decision

with respect to the environmental review by the County, and

then make use of the available inverse condemnation remedies,

before its procedural due process claim may be considered

ripe for determination. /d.

C. CEMEX’s Claim That It Has Been

Denied Equal Protection Fails As a

Matter of Law

To state an equal protection claim, CEMEX must charge

the County not only with deliberately acting against it, but also

with singling it out for selective enforcement on an

impermissible basis. Arroyo Vista Partners v. County of Santa

' City incorporates by reference the arguments made in section

IlI.B(1), above.

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Barbara, 732 F.Supp. 1046, 1055, citing Brady v. Town of

Colchester, 863 F.2d 205, 216 (2nd Cir. 1988). Because

CEMEX< does not fall within a suspect class, the County need

only show that its actions were rationally related to a

legitimate state interest. New Orleans v. Dukes, 427 U.S.

297, 303-304, 96 S. Ct. 2513, 2516-2517, 49 L. Ed. 2d 511

(1976).

CEMEX’s lawsuit is against the “County of Los Angeles.”

Therefore, CEMEX must allege that the “County of Los

Angeles,” not individual board members, staffers or even the

Board itself, deliberately acted against it by singling it out for

selective enforcement. CEMEX has failed to allege that the

County, i.e. the voting public, has taken any action against its

interests. Instead, CEMEX alleges that the County Board

“proposed conditions that have not been applied to other

similar projects or applicants.” SAC, 112:2-3. CEMEX

further alleges that a single supervisor “disregarded the

County-wide requirements for distribution of EIRs...” and

that County staff imposed “arbitrary and discriminatory

requirements and standards for the traffic analysis of impacts

of CEMEX’s Project.” SAC, 113:11-24.

None of these allegations sufficiently state an Equal

Protection claim against the County of Los Angeles. In

Arroyo Vista, 732 F. Supp. 1046, plaintiffs brought an action

against the entire Board of Supervisors and the County of

Santa Barbara. The court found the equal protection

challenge defective because plaintiffs failed to allege that the

majority of the Board acted with suspect motives. Allegations

against a single Board member were insufficient to implicate

the Board. Similarly, CEMEX’s allegations against the

County Board for proposing conditions, and against County

staff and an individual Board member are insufficient.

H-39

Moreover, there is no “similar project” to the Soledad

Canyon Project. It is undisputed that the Project would be

one of the largest, federal sand and gravel contracts permitted

by the BLM. SUF 17. This Project is per se unique.

CEMEX cannot, as a matter of law, establish that it was

treated differently from similar applicants because none exist.

Finally, the County Board’s condition that the FEIR be

recirculated concerning traffic issues is rationally related to the

Board’s authority as lead agency under CEQA,

D. Dismissal Of Plaintiffs’ Federal Claims

Requires Dismissal of CEMEX’s

Pendent State Claims

CEMEX’s state claims of traditional mandate,

administrative mandamus and inverse condemnation are

predicated on pendent jurisdiction. If Plaintifis’ federal

preemption claims and constitutional claims brought under 42

U.S.C. § 1983 are without merit and dismissed, the Court is

without jurisdiction over the pendent state claims. United

Mine Workers of America v. Gibbs, 383 U.S. 715, 86 S. Ct.

1130, 16 L. Ed. 2d 218 (1996). The United States is not a

party to these pendent state claims. As such, CEMEX’s Sixth,

Eighth and Ninth claims must be dismissed.

E. Pursuant to the “Younger” Abstention

Doctrine the District Court Must

Abstain From Taking Jurisdiction and

Dismiss the Action

In Younger v. Harris, 401 U.S. 37, 91 S.Ct. 746, 27 L.

Ed. 2d 669 (1971) the United States Supreme Court held that

a federal court may not enjoin pending state court criminal

proceedings. See, Mission Oaks Mobile Home Park v. City of

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Hollister, 788 F.Supp. 1117, 1120 (N.D.Cal.1992). The

principles of Younger have been expanded to apply to pending

state court civil actions between private litigants, and state

administrative proceedings that are adjudicatory in nature.

See, Fresh International Corp. v. Agriculture Labor Relations

Board, 805 F. 2d at 135:6-1357; see also, Green vy. City of

Tucson, 255 F. 3d 1086, 1095 (9th Cir. 2001); Mission Oaks

Mobile Home Park vy. City of Hollister, 768 F. Supp. at 1120;

Grand Metropolitan PLC v. Pillsbury Co., 702 F. Supp. 236,

238 (D. Ariz.1988) ancl Communications Telesystems v.

California Public, 14 F. Supp. 2d 1165, 1167 (N.D.

Cal. 1998).

The Supreme Court has established a three-part test for

determining whether abstention in favor of a state proceeding

is appropriate in a given situation. Abstention is proper if: (1)

the state proceedings are ongoing; (2) the proceedings

implicate important state interests; and (3) the state

proceedings provide an adequate opportunity to raise federal

questions. Fresh International Corp. v. Agriculture Labor

Relations Board, 805 F.2d at 1357-1358; citing Middlesex

County Ethics Committee v. Garden State Bar Association,

457 U.S. 423, 432 ,102 S.Ct. 2515, 2521, 73 L. Ed. 2d 116

(1982). The Ninth Circuit Court of Appeals has supplemented

this three-part test with the additional requirement that the

relief sought in the federal litigation must actually “interfere”

with the ongoing state proceedings. Green vy. City of Tucson,

255 F.3d at 1098.

Abstention is the exception, not the rule. /d. at 1089.

fi: wever, “[wlhen a case falls within the proscription of

, “unger, 2 district court must dismiss the federal action.”

Communications Telesystems v. California Public, 14 F.Supp.

2d at 1168. “Where a case is properly within {the Younger]

category of cases, there is no discretion to grant injunctive

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relief.” Fresh International Corp. y. Agriculture Labor

Relations Board, 805 F.2d at 1356. Abstention is

inappropriate if a challenged state action “clearly conflicts with

preemptive federal law.” Fresh International Corp. v.

Agriculture Labor Relations Board, 805 F.2d at 1361. As

outlined above, there is no preemption.

1. The Relief Sought by CEMEX

Interfered With State Proceedings

A threshold condition for abstention under Younger is

actual “interference” with ongoing state proceedings that are

judicial in nature. Green v. City of Tucson, 225 F.3d at 1096.

The relief sought in the federal action must in some manner

directly “interfere” in the state proceedings by either

truncating or terminating the proceedings. /d. at 1097-98.

The relief CEMEX seeks in its federal lawsuit will either

truncate or terminate the County’s adjudicatory proceedings.

In its federal complaint, CEMEX is seeking two alternative

forms of relief. CEMEX< is seeking in the first place to have

the District Court preempt (i.e., terminate) the County’s

SMARA and CEQA proceedings. SAC, Prayer for Relief.

Alternatively, CEMEX is asking the Court to enjoin the

County from conducting further environmental analyses under

CEQA and order the County to immediately issue CEMEX a

surface mining permit under SMARA. Jd. CEMEX’s relief

would result in a substantial truncation of the SMARA and

CEQA proceedings. The threshold condition for abstention

under Younger has, therefore, been met.

2. The State Proceedings are Ongoing

The first part of the three-part test is that the state

proceedings must be ongoing. “Abstention is required only

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when the state proceedings have been initiated “before any

proceedings of substance on the merits have taken place in

federal court.’” Fresh International Corp. v. Agriculture

Labor Relations Board, 805 F.2d at 1358. “{T]he ‘critical

question is not whether the state proceedings are still ongoing,

but whether the state proceedings were underway before the

initiation of the federal proceedings.’” Mission Oaks Mobile

Home Park v. City of Hollister, 788 F. Supp. at 1121; citing

Beltran v. California, 871 F.2d 777, 782 (9th Cir.1988).

According to its complaint, when CEMEX filed its federal

lawsuit, a hearing was already scheduled before the Board of

Supervisors for February 26, 2002 to consider CEMEX’s

appeal. SAC: 58 24-59:1. It is clear from CEMEX’s federal

complaint that the state proceedings under SMARA were

ongoing when the federal litigation was initiated. The fact that

the County subsequently denied CEMEX’s permit application

has no relevance. “Where Younger abstention is appropriate,

a district court cannot refuse to abstain, retain jurisdiction

over the action, and render a decision on the merits after state

proceedings havg ended.” Beltran v. State of California, 871

F.2d at 782. “Younger abstention requires dismissal of the

federal action.” /d. (emphasis in original).

3. The State Has an Important

Interest in the SMARA and

CEQA Process

“Younger abstention is appropriate only where important

state interests would be affected by the federal action.” Fresh

International Corp. v. Agriculture Labor Relations Board,

805 F.2d at 1358. Important state interests can include

interests in the elimination of prohibited sex discrimination,

Ohio Civil Rights Commission v. Dayton Christian Schools,

Inc., 477 U.S. 619, 627, 106 S.Ct. 2718, 2723, 91 L. Ed. 2d

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512, Williams v. Red Bank Board of Education, 662 F.2d

1008, 1018 (3d Cir.1981)(abstaining in deference to teacher

tenure termination proceedings), education, police disciplinary

proceedings, McDonald v. Metro-North Commuter Railroad

Division, 565 F. Supp. 37, 40 (S.D.N. Y.1983)(state interest

in police officer disciplinary proceedings for making false

Statements), interests for purposes of abstention in the control

and transfer of liquor licenses, Grand Metropolitan PLC v.

Pillsbury Co., 702 F. Supp. at 238, and the regulation of

mobile home rents. Mission Oaks Mobile Home Park y. City

of Hollister, 788 F. Supp. at 1121-22. The State of California

has an important interest in prote—ting the health, safety and

welfare of its citizens. Ensuring that the objectives of

SMARA and CEQA (pg. 10 f.n. 4-5) above, are fulfilled is

crucial to this interest.'*

4. CEMEX Can Raise its Federal

Claims in the State Proceedings

A state appellate court review of an agency decision

satisfies Younger’s third prong. Beltran v. State of California,

871 F.2d at 783. “[I]t is sufficient . . . that constitutional

claims may be raised in state-court judicial review of the

administrative proceeding.” Ohio Civil Rights Commission v.

Dayton Christian Schools, Inc., 477 U.S. at 629, 106 S.Ct. at

2724. The California Appellate Courts provide a full and fair

opportunity for a litigant to bring federal claims. Mission Oaks

Mobile Home Park v. City of Hollister, 788 F.Supp. at 1122.

14

See, Kim-Stan, Inc. v. Department of Waste Management, 732

F.Supp.646, 652 (E.D.Va.i990)(holding that, for purposes of abstention

under Younger, the State of Virginia has a vital interest in the health,

safety and welfare of its citizens and that protecting the waters from

environmental hazards was crucial to that interest).

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CEMEX brought its federal claims of preemption, due

process, and equal protection before the County of Los

Angeles. Even if the County cannot properly rule on these

claims, the issues have been preserved and can be asserted in

any state court review of the County’s decision. The final part

of the three-part test for abstention has, therefore, been

satisfied.

IV. CONCLUSION

Based on the foregoing, City respectfully requests that its

Motion for Summary. Judgment be granted in full. In the

alternative, City requests that summary adjudication be

granted as to each and every claim for relief.

DATED: April 2nd, 2004

RESPECTFULLY SUBMITTED,

BURKE, WILLIAMS & SORENSEN, LLP

By: /s/

Carl K. Newton, City Attorney

City of Santa Clarita

Deborah C. Prosser

Geralyn L. Skapik

Timothy H. Irons

Attorneys for

CITY OF SANTA CLARITA

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CERTIFICATE OF SERVICE

I, the undersigned, hereby certify that I caused a true and

correct copy of CITY OF SANTA CLARITA’S NOTICE OF

MOTION AND MOTION FOR SUMMARY JUDGMENT /

ADJUDICATION to be served via overnight mail this 2nd day

of April, 2004, to the following:

Fox & Sohagi, LLP

Deborah Fox, Esq.

Jocelyn Julian, Esq.

10960 Wilshire Boulevard, Suite 1270

Los Angeles, CA 90024-3702

Tele: (

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