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2013-07-12
Ceres, CA. Appeals Court Orders Wal-Mart To Produce Hundreds of Documents

Residents in Ceres, California have been boxing out a Wal-Mart superstore since 2007. This week, they won an important first-step victory in a court battle against the retail giant. The ruling ends a year and a half effort by Wal-Mart and city officials to block local residents from seeing communications between a developer and the city that should have been part of the public record.

The case stems from a lawsuit filed by Citizens for Ceres in October 2011 challenging the Ceres City Council's vote to approve Wal-Mart's controversial proposed Mitchell Ranch Center project with a supercenter as its only specified tenant. The project would allow Wal-Mart to abandon its existing store in Ceres and to build a new store less than two miles away. The back of the supercenter would face a residential neighborhood.

Pursuant to the California Environmental Quality Act, the city of Ceres was required to prepare and certify an "administrative record" which included all documents in the city's files related to addressing the project's environmental effects. From the outset of the trial court lawsuit, the Citizens for Ceres asked the city of Ceres to prepare the "administrative record" of all of the proceedings, documents and communications in the city's possession regarding the project. The trial court will review this record to determine whether the city abused its discretion in approving the project.

According to a press release from Citizens for Ceres, on Monday, July 8, 2013, the California Court of Appeal, Fifth Appellate District in Fresno, ruled that the city of Ceres and Wal-Mart unlawfully withheld hundreds of documents based on improper claims of privilege in the matter of Citizens for Ceres v. Superior Court. A Stanislaus Superior Court judge last year ruled in favor of Wal-Mart and the city, who wanted to exclude from the record these documents. But Citizens for Ceres did not give up, and they challenged the decision. The Appellate Court ruled with the Citizens on July 8th.

The Appellate Court ruled that the administrative record produced by the city of Ceres was incomplete as it excluded thousands of documents from the city's files, many of which were email exchanges between representatives for the city and Wal-Mart. As the Court describes it, "The city first withheld thousands of documents in silence, then acknowledged it had withheld them but would not provide any information about them, and finally provided a log asserting that they were all privileged without providing the supporting facts."

In short, many of the withheld documents were communications between the city and Wal-Mart prior to the Ceres City Council's vote to approve the project. The city and Wal-Mart claimed that these documents were protected by attorney-client or attorney work-product privilege and they had not waived these privileges by sharing with each other because they had a common interest in preparing a legally defensible environmental impact report (EIR).

In the published portion of its opinion, the Court strongly disagreed holding that the city and Wal-Mart were not on the same "team" prior to final project approval. The Court states, "In our view, the lead agency's obligation not to commit to the project in advance, but instead to carry out an environmental review process and create environmental documents that reveal the project's impacts without fear or favor, and only then make up its mind about project approval, means the agency cannot have an interest, prior to project approval, in producing a legally defensible EIR or other environmental document that supports the applicant's proposal. At the same time, of course, the applicant's primary interest in the environmental review process is in having the agency produce a favorable EIR that will pass legal muster. These interests are fundamentally at odds."

The court further explained, "The purpose of the attorney-client privilege is to enhance the effectiveness of the adversarial system by encouraging candid communication between lawyers and their clients. This purpose does not include encouraging strategizing between a private applicant and a government agency to meet a future challenge by members of the public to a decision in favor of the applicant if, at the time of the strategizing, the agency has not, and legitimately could not, have yet made that decision. The purpose of the attorney workproduct doctrine is to allow attorneys to advise and prepare without risk of revealing their strategies to the other side or of giving the other side the benefit of their efforts. Before completion of environmental review, the agency cannot have as a legitimate goal the secret preparation, in collaboration with the applicant, of a legal defense of a project to which it must be still uncommitted."

The court also concluded that the California Environmental Quality Act (CEQA)does not wholly eliminate the claimed privileges, but those privileges must be established by the party asserting them. The city and Wal-Mart did not meet this burden with respect to the challenged documents.

The court also rejected several claims by the city and Wal-mart that Citizens' objections were not properly presented or that Citizens' had not been prejudiced by the city's withholding of the documents.

The Modesto Bee newspaper called the court's ruling "a small victory" for anti-Wal-Mart force. But Citizens For Ceres hailed the court ruling as a victory for corporate transparency.

"The city and Wal-Mart took it upon themselves to withhold from public disclosure hundreds of documents regarding their behind-the-scenes communications over this project," said Citizens' member Sherri Jacobson. "We look forward to reviewing these public documents as a result of this victory. This ruling is important for those who believe government should be open and transparent rather than a series of secretive, back-room dealings. The city and Wal-Mart have been preventing any public access to the documents since December 2011."

"We couldn't have asked for a better result from the Appellate Court," explained Citizens' attorney Brett Jolley, a partner with Herum\Crabtree Attorneys in Stockton. "The opinion is well reasoned and creates legal precedent to be followed in other cases addressing this issue. At the same time the Court was careful to not overreach in its opinion and has remanded some issues to the trial court for further review."

Regarding Wal-Mart's claims that Citizens is simply obstructing progress, Attorney Jolley responded, "The opinion confirms that my client's objections to the withheld documents were spot-on and any delay to the project is entirely self-induced."

What you can do: In the coming weeks, this matter will be sent back to the Stanislaus County Superior Court in Modesto, California to conduct further proceedings in accordance with the Appellate Court's ruling. As the city's attorney explained to the Modesto Bee, "had the plan proceeded without litigation, scheduled construction would be well under way." So this "small victory" has had a big financial impact on Wal-Mart.

There are other impacts in addition to lost sales. The judge also ruled that the defendants must pay the Citizens for Ceres' court costs associated with the appeal. The city told the media that city taxpayers will not be liable for any legal fees, because the city has an agreement with Wal-Mart that the retailer will be responsible for all legal fees. According to the city, Wal-Mart has spent "well into six figures" defending itself against Citizens For Ceres. So as a result of concealing documents, Wal-Mart is now having to paying for Citizens for Cere's attorney fees.

Readers are urged to link the the Appellate Court's decision and share it with friends who think Wal-Mart can't be stopped through litigation:

http://www.courts.ca.gov/opinions/documents/F065690.PDF

For earlier stories about Ceres, search this Newsflash database by "Ceres."










 
 
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