Fires

Judge slows Sierra Pacific’s effort to overturn Moonlight fire settlement

Indian Valley residents John Shower, 65, left, and Jason Moghaddas, 35, in 2008 show on a map of Plumas County the devastation of the Moonlight fire in the heavily-forested county.
Indian Valley residents John Shower, 65, left, and Jason Moghaddas, 35, in 2008 show on a map of Plumas County the devastation of the Moonlight fire in the heavily-forested county. Sacramento Bee file

A judge on Monday slowed down Sierra Pacific Industries’ attempt to breathe life back into the government’s lawsuit against the timber giant over the cause of the 2007 Moonlight wildfire.

Despite the mountain of paper filed by the parties in the past six weeks, U.S. District Judge William B. Shubb told opposing counsel at a status hearing that the “threshold question” is whether there has been fraud perpetrated on the Sacramento federal court.

If not, Shubb declared, Sierra Pacific has no standing to reopen the suit, which was settled more than two years ago. A one-year statute of limitations prevents the company from claiming it was defrauded by the government. If a fraud by the government on the court can be shown, however, it would not be subject to such a restriction, the judge said.

Sierra Pacific lead counsel William Warne said he envisioned taking some sworn depositions, then a final round of briefing followed by an evidentiary hearing where witnesses would be called.

“There is no authority that entitles you to any of that until we make a determination regarding fraud upon the court,” the judge told him. “That has to be decided before I can consider any of these other matters.”

Shubb said he wants both sides focused only on whether the court was victimized by false and misleading evidence presented by the government, as Sierra Pacific’s lawyers claim. He set oral arguments on the issue for April 6.

“We believe we have already made that showing,” Warne told Shubb in reference to a voluminous motion-and-exhibits package his team filed on Oct. 9, asking that the settlement be set aside and the suit dismissed.

The judge didn’t appear to agree with Warne.

“I need to have you prove that these various acts of misconduct that you allege constitute a fraud on the court,” Shubb told the defense lawyer. “It would be helpful, also, if you can tell me when and how you learned of this alleged fraud.”

The Moonlight fire ravaged 65,000 acres in Plumas and Lassen counties, including 46,000 acres of national forestland, in 2007.

The government’s suit sought compensation for fire-related damages and costs, and targeted Sierra Pacific as bearing ultimate responsibility for the fire.

The company insists that the government’s case was built on evidence tainted by the corrupt strategy of lawyers in the U.S. attorney’s office and a fraudulent report compiled by two fire investigators.

Warne pressed Monday for a ruling on Sierra Pacific’s motion to stay continued execution of the settlement agreement pending the outcome of its effort to wipe out the settlement.

Sierra Pacific has already paid the government $29 million of the $47 million called for in the agreement, with another $3 million payment due Jan. 1. The company, the largest private landowner in California, also conveyed approximately 1,500 acres of the 22,500 acres it agreed to deed to the government as part of the settlement.

The entire pact, including comparatively small payments to the government by secondary defendants, is valued at $100 million.

“I don’t think it would be appropriate to consider a motion to stay at this time,” Shubb said.

Call The Bee’s Denny Walsh, (916) 321-1189.

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