February 18, 2014 — Misguided. Deceptive. Not truthful. Corrupt. Tainted. Egregious. Systematic misdirection. Reprehensible conduct.
Those are some of the words Judge Leslie C. Nichols used last week to describe the tactics of CalFire and two of its lawyers. Nichols threw out the state’s $8 million lawsuit against Sierra Pacific Industries; and then ordered CalFire to pay SPI and its legal team $25 million for wasting their time.
We were pleased to hear about the judge’s ruling. It is vindication for the family-owned timber company with strong connections to Plumas County.
Sierra Pacific Industries has argued from the beginning that it had nothing to do with starting the 2007 Moonlight Fire.
Despite producing overwhelming evidence to that effect, the timber company was forced to hand over $122 million ($55 million in cash and 22,500 acres of prime timberland) to the federal government in 2012. The company really had no choice. It agreed to pay the largest settlement of its kind in U.S. history because the judge in the case (U.S. District Judge Kimberly J. Mueller) told SPI it could be held responsible for starting the fire even if it could prove it didn’t.
State and federal investigators were quick to place the blame on one of SPI’s subcontractors, saying a spark from a bulldozer ignited the fire. SPI was adamant that it could prove otherwise. But it never got its day in court.
SPI’s lawyers were fuming. They argued that the fact the government settled for a fraction of the $700 million it wanted proved that the timber company had a good case.
Sierra Pacific blasted the government for its bounty hunter mentality. It said the government went after SPI because the company had the deepest pockets — even though a $700 million loss would have amounted to a financial death penalty for the company.
SPI claimed it was named a suspect just two days after the fire started. The company said the investigation by CalFire and the Forest Service was, at the very least, flawed … if not corrupt.
When the settlement was announced two years ago, SPI said it couldn’t wait for the chance to present its case in civil court, where CalFire was seeking $8 million from SPI to pay for the costs of fighting the 65,000-acre fire.
Once again, the case never made it that far. Judge Nichols said the case wasn’t worthy of a jury trial. Nichols hardly minced words in his rebuke of the state and two of its attorneys.
While the victory for SPI is substantial, it doesn’t make up for the damage caused by the 2012 ruling. Since SPI agreed to the $122 million settlement, there is probably very little chance for an appeal.
Regardless who wins or loses cases like this, the bigger issue is the outrageous size of the financial settlements and penalties associated with these lawsuits. How can legitimate, vital companies like Sierra Pacific Industries justify doing business in a state as litigious as this one is?
Would you want to work in a place where one misstep could put you out of business?