IV. The Motions to Withdraw by the EL&L Group and RK&M

As noted above, the May 3 Scoping Memo included (Appendix A) a series of questions that all parties were directed to answer and that were designed to narrow the issues in this proceeding. On June 23, 1999, the EL&L Group filed a pleading that objected not only to these questions, but generally to the resolution of issues in the Scoping Memo. As in many of its prior pleadings, the EL&L Group contended that it was not the subject of this investigation and was not subject to the jurisdiction of the Commission. What was new, however, was that for the first time EL&L contended that because of this status, it was entitled to withdraw as a party to the proceeding and to participate without intervention in accordance with Rule 54. ⁹

Consistent with the position that it was entitled to withdraw, EL&L stated that its pleading constituted a notice of withdrawal from the proceeding. However, EL&L asked to remain on the mailing list for informational purposes.

Shortly after the EL&L pleading was received, RK&M also filed what it claimed was a notice of withdrawal. In its pleading, RK&M alleged that it had no further need to participate in this proceeding, because the Commission had ruled on the jurisdictional motion that RK&M had entered a special appearance to make. At the request of the other parties, RK&M's notice was interpreted by the assigned Administrative Law Judge (ALJ) as a motion to withdraw, to which other parties were allowed to respond.

A. Opposition to the Purported Withdrawal of EL&L

Oppositions to the purported withdrawal of the EL&L Group were filed by Cal-Am, Citizens, CWA and SoCal.

In its opposition, Cal-Am contends that the Commission cannot properly grant leave to withdraw while the EL&L Group is subject to and in violation of Commission discovery orders. Cal-Am points out that EL&L (as well as RK&M) is the source of allegations that influenced the initiation of this investigation, that EL&L presumably has relevant information, and that it has actively asserted rights as a party without performing its obligations to provide relevant information. Cal-Am contends that other parties will be harmed by the EL&L Group's attempted withdrawal under these circumstances, and that the Commission should retain personal jurisdiction over EL&L until it has satisfied its obligations as a party. Cal-Am therefore urges that EL&L's de facto motion to withdraw should be denied without prejudice.

Cal-Am also contends that the Commission has used the test developed in Chadbourne v. Superior Court 60 Cal.2d 723, 731 (1964) and Liberty Mutual Insurance Co. v. Fales 8 Cal.3d 712, 716 (1973) for evaluating withdrawal motions. Under this test, a court determines whether a party should be allowed to withdraw by balancing the litigant's right to control its interaction with government against the government's duty to resolve matters of important public interest. Cal-Am asserts that this proceeding is clearly addressing issues of continuing public importance, a situation that justifies denial of leave to withdraw. Cal-Am also points out that the assigned Commissioner has already rejected the argument that the Commission has no personal jurisdiction over the EL&L Group.

In its opposition to the purported notice of withdrawal, Citizens begins by comparing the questions in Appendix A of the May 3 Scoping Memo with the discussion in the March 12, 1998 OII. Based on this comparison, Citizens argues that the questions in the Scoping Memo clearly do not exceed the boundaries of this proceeding, and that answers to these questions are central to resolving the issues outlined in the OII. Consistent with this position, Citizens vigorously opposes EL&L's attempt to withdraw. After noting that EL&L has filed lengthy comments on other parties' compliance reports and on the DHS report, has participated in prehearing conferences, has received answers to data requests and has obtained a substantial amount of back-up material for the compliance reports, Citizens argues that it would be unjust to allow the EL&L Group to obtain these benefits of participation without subjecting it to a corresponding obligation to answer the respondents' data requests. The EL&L Group should also be obliged, Citizens continues, to provide the Commission with the factual basis for the EL&L contention that drinking water furnished by the respondents has injured the health of EL&L clients.

Citizens also raises three other points in opposing the attempted withdrawal: (1) there is no unilateral right to withdraw from Commission proceedings, any more than there is from civil proceedings, (2) the EL&L Group's argument that the Commission cannot award damages is irrelevant, because the Commission has already ruled that it has jurisdiction over the subject matter of this proceeding, and (3) the expert testimony that EL&L asserts can only be presented in civil court could easily be presented in this forum.

CWA opposes EL&L's attempted withdrawal for the same reasons as Cal-Am and Citizens. CWA urges the Commission not to allow withdrawal while the discovery rulings in the May 3 Scoping Memo remain outstanding and unsatisfied. CWA contends that the EL&L Group is seeking to withdraw because it disagrees with the discovery rulings in the May 3 Scoping Memo. CWA concludes that a withdrawal under these circumstances would be unfair to all parties and would set a dangerous precedent for practice before the Commission.

In its opposition to the purported withdrawal, SoCal advances many of the same arguments as Citizens and CWA. SoCal also argues, however, that in the event the Commission decides to permit withdrawal, it should require that the following conditions be met:

1. The EL&L Group must provide responses to the questions in the Scoping Memo along with supporting documents.

2. Alternatively, if EL&L continues to refuse to provide responses, the Commission should prohibit EL&L from presenting any evidence in this proceeding regarding allegations against utilities.

3. The Commission should find that the EL&L Group has willfully and without lawful justification refused to comply with a lawful order of the Commission (i.e., the May 3 Scoping Memo).

4. The Commission should find that EL&L has presented no substantial evidence that any regulated utility has delivered water to any plaintiff that failed to comply with applicable state and federal water quality standards, or contained a substance which caused injury to any plaintiff.

B. Opposition to the Purported Withdrawal of RK&M

Oppositions to the purported withdrawal of RK&M were filed by San Gabriel and by McDonnell Douglas Corporation (McDonnell Douglas).

In its opposition, San Gabriel argues that RK&M's contention that it has made only a special appearance in this proceeding is belied by the record and by the extent of RK&M's participation. RK&M's petition to intervene (from which San Gabriel quotes) makes no mention of a special appearance, and RK&M's service upon the respondents of data requests seeking background materials for the utilities' compliance filings is obviously inconsistent with a special appearance, according to San Gabriel.¹⁰

In its opposition, McDonnell Douglas argues that RK&M has mischaracterized D.99-06-054, the interim decision in this docket. Contrary to RK&M's assertions, that decision did not state or suggest that this investigation will have no impact on the lawsuits filed by RK&M and the EL&L Group; rather, McDonnell Douglas states, the Commission in D.99-06-054 simply confined its discussion to whether it has jurisdiction to conduct this investigation.

C. Discussion

In Re Application of Southern California Gas Company, 43 CPUC2d 639 (1992), holds that withdrawal from a proceeding in which the Commission has invested substantial time and resources is not a matter of right, but an action that requires Commission approval.

In SoCal Gas, we concluded that the standards for evaluating requests to withdraw from proceedings that have resulted in a significant record should be analogous to those used by the California Supreme Court in the Chadbourne and Liberty Mutual cases cited above. We said:

"The issue [of withdrawal] requires a balancing of a general disposition to permit litigants to control their interaction with governmental bodies with the necessity that entities such as courts and this Commission advance the public business while disposing of private claims and petitions. While earlier California cases suggested that litigants had [an unlimited] right [to withdraw], those cases were arrested by the decision of the Supreme Court in Chadbourne v. Superior Court, 60 Cal.2d 723, 731 n.5 (1964) . . .

* * *

"We need not speculate on the possible circumstances which would cause us to regard dismissal or withdrawal as no longer a matter of right. It is sufficient that we indicate that submission of a matter upon an evidentiary record and obtaining a proposed decision within the meaning of Section 311(d) involve steps which clearly make termination a matter of the Commission's discretion." (43 CPUC2d at 640-41.)

In SoCal Gas, the issue was whether the utility should be allowed to withdraw its application for pre-approval of gas purchase contracts even though the Commission had invested considerable resources by holding hearings on the application and having the ALJ prepare a proposed decision. Because we agreed that the applicant would be "adversely affected" if it were required to perform under the gas contracts, we permitted withdrawal of the application. (43 CPUC2d at 641.)

In this case, the issue is whether the law firm intervenors should be allowed to withdraw even though they have subjected the other parties to significant discovery burdens and have refused to answer reasonable discovery requests. The reasons for not allowing withdrawal under such circumstances were well summarized by Commissioner Fessler in his concurring opinion in SoCal Gas. In agreeing that withdrawal under the circumstances of that case should require the Commission's consent, he said:

"In the absence of such a policy all manner of mischief may go unchecked. Parties would be free to engage our resources and put opponents or intervenors to considerable expense and no little risk only to moot the controversy in the event of an adverse proposed decision. Further, our ability to discharge our own public responsibilities could be thwarted . . . by the sudden removal of a vehicle which presents the occasion to answer certain vital questions of general interest." (Id.; emphasis supplied.)

The concerns expressed by Commissioner Fessler clearly militate against permitting withdrawal from this proceeding by the law firm intervenors. It seems clear that the EL&L Group's principal justification for withdrawing is that it continues to believe that (1) the Commission has no personal jurisdiction over its members, and (2) EL&L has made only a special appearance in this proceeding for the purpose of challenging jurisdiction. As noted above, both of these claims were firmly rejected in the May 3 Scoping Memo. As one opposing party has suggested, it appears that after incurring adverse legal rulings from the Commission and receiving discovery responses that are inconsistent with its allegations of wrongdoing, the EL&L Group believes it may simply "pick up its marbles and go home."

On the other hand, the consequences for the Commission of withdrawal in this case would be quite different from those in SoCal Gas. Here, allowing the EL&L Group (and RK&M) to withdraw will not require that this proceeding be dismissed, nor will it prevent the Commission from reaching a final determination on the merits. Instead, it will simply mean that we will not have the benefit of input from parties who raised similar issues in the civil lawsuits that initially attracted the Commission's attention. However, because the respondent utilities and DHS have assisted in our investigation of these issues, we have an adequate record and do not need to rely on the law firm intervenors as a significant source of information on the water quality and other issues before us. Instead, we can base our final decision on the evidence offered by DHS staff and the utilities.

In addition, we believe that our analysis should take into account the possible advantages that might accrue from permitting withdrawal. In view of the EL&L Group's behavior in connection with the recent discovery motions, it seems clear that their further participation in this docket (or other proceedings that arise out of this docket) will be neither beneficial nor desirable. In addition, EL&L wasted significant time and resources by requesting an oral argument before the full Commission on jurisdictional issues, and then not bothering to notify the ALJ on a timely basis that EL&L attorneys would not attend the argument.¹¹ After weighing these factors, we have decided to grant the EL&L Group's request to withdraw.

The same reasoning applies to RK&M's request to withdraw. Like EL&L, RK&M has provided no relevant facts to support its contentions that the regulated utilities have violated drinking water regulations or caused personal injury by delivering contaminated drinking water. Under these circumstances, it is obvious that RK&M does not intend to participate in this proceeding in any meaningful way. It is therefore in the best interests of the Commission and the other parties to grant RK&M's motion to withdraw and to resolve the issues in this proceeding on the ample record that other parties have provided.

We decline to grant RK&M's request that it be permitted to reassert party status in this proceeding in the event it later concludes that this proceeding will impact the pending civil lawsuits. We agree with McDonnell-Douglas that it is obvious now, and that no additional time is needed to confirm that a final order in this proceeding may impact these lawsuits. Thus, we hereby state that our granting of RK&M's request to withdraw from this proceeding will terminate RK&M's present participation in this docket.

D. Conclusions

Based upon the discussion above, we conclude that Cal-Am's motion to compel the EL&L Group to comply with the discovery ruling in the May 3, 1999 Scoping Memo should be denied. Because it is unlikely that EL&L will provide any meaningful answers to Cal-Am's data requests, we will not order EL&L to answer these data requests. We also decline to order monetary sanctions because of the incomplete record.

RK&M's motion to withdraw from this proceeding is granted, effective immediately. RK&M's request for permission to "reappear" as a party in the event that RK&M eventually concludes that such an action is appropriate is premature and denied. Any request to "reappear" will abide by existing rules governing intervention in a Commission proceeding. However, both EL&L and RK&M will remain on the mailing list as "Information Only" for this proceeding.

Suburban's motion to compel with respect to the questions in Appendix A of the May 3 Scoping Memo is denied for the same reason as above.