Lockary v. Kayfetz Appendix

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APPENDIX O

RICHARD E. V. HARRIS
GEORGE A. YUHAS
ORRICK, HERRINGTON & SUTCLIFFE
600 Montgomery Street
San Francisco, CA 94111
Telephone: (415)392-1122

Attorneys for Defendant Bolinas 
Community Public Utility District

IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF CALIFORNIA

MATTHEW LOCKARY, PHYLLIS 
GILBERT; CHARLES GILBERT; 
JAMES MACEY; ANTON 
HOLTER,

Plaintiffs,

v.

PAUL KAYFETZ; VICTOR 
AMOROSO; MARY LOWRY; 
DIANA LOPEZ FARNSWORTH; 
EDWARD C. RILEY; FREDERICK 
B. McCLELLAN; PETER 
WARSHALL; DAVID L. VAN

) Civ. No.
) C-82-6191 SW 
)
) DECLARATION OF 
) RICHARD E.V. HARRIS 
) AND REQUEST FOR 
) JUDICIAL NOTICE RE:
) (a) PACIFIC LEGAL 
) FOUNDATION LAW 
) FIRM AND (b) THE 
) $30 MILLION-PLUS 
) PRAYER 
)
) Date: June 15, 1988 
) Time: 10:00 a.m.



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DUSEN; DORIS ELAINE )
LeMIEUX; JACK BOWEN )
McCl e l l a n ; j . m ic h a e l  )
GROSHONG; WILUAM NIMAN; ) 
JUDITH WESTON, as individuals; ) 
BOUNAS COMMUNITY PUBUC ) 
UTILITY DISTRICT, an )
incorporated public utility district; ) 
BOUNAS PLANNING COUNCIL, ) 
a non-profit corporation; JOHN ) 
GOODCHILD; GREGORY C. ) 
HEWLETT; STEVE MATSON; ) 
PATRICIA L. SMITH; RAY )
MORITZ; ROBERT J. SCAROLA; ) 
DIANE MIDDLETON McQUAID; ) 
FREDERICK G. STYLES, as )
individuals; and the MARIN )
COUNTY PLANNING )
DEPARTMENT, )

)
Defendants. )

)

DECLARATION

I, Richard E.V. Harris, do hereby declare that:

1. I am a member of the Bar of the State of 
California, a member of the bar of this court, and a member 
of the law firm of Orrick, Herrington & Sutcliffe, attorneys 
for defendant Bolinas Public Utility District ("BCPUD") 
herein.

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(a) PLF LAW FIRM

2. I have read the separate opposition papers filed on 
behalf of the Pacific Legal Foundation, which I found rather 
curious. Throughout the separate opposition filed by the 
Pacific Legal Foundation, it refers to itself variously as (i) "a 
California nonprofit corporation qualified under Internal 
Revenue Service Rules to receive tax-deductible donations," 
(ii) "not a party in this case", (iii) "a charitable corporation", 
(iv) 'a nonparty corporation", (v) "a nonparty-nonattomey 
corporation”, and (vi) "neither a party to this case nor an 
attorney admitted to practice before this Court."

3. Nowhere in the papers does the Pacific Legal 
Foundation refer to itself as it, and its attorneys, normally 
describe it -  a "law firm" or, more particularly, a "public 
interest law firm." This declaration provides some 
illustrations. (Unless otherwise indicated, the emphasis in 
quotations in this declaration has been supplied.) Defendant 
BCPUD requests judicial notice of the particular references 
identified. The exhibits (attached hereto and those attached 
to the Harris Declaration filed February 16, 1988) are 
provided in further support of that request.

4. The Pacific Legal Foundation has represented 
itself to be a law firm which participates in litigation "as 
counsel" and which exercises "quality control." For 
example, the Pacific Legal Foundation’s "Tenth Annual 
Report 1973-1983" the first page of text includes the 
following:

It was to evolve into the Pacific Legal 
Foundation, the largest nonprofit public 
interest law firm of its kind . . . .  PLF’s case 
selection . . . .  PLF participates in cases 
nationwide as plaintiff, as counsel and as



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"friend of the court. . . . insured quality 
control . . . .

Harris Decl. filed February 16, 1988, Exh. I.)

) 5. The Pacific Legal Foundation has represented
itself to the Internal Revenue Service and to the Attorney 
Gerteral of California as a "Public Interest Law Firm.6 * * * * 11 A 
copy of the Pacific Legal Foundation’s Periodic Report to 
Attorney General of California for the year March 1, 1982 
through February 28, 1983 which expressly incorporates the 
IRS Form 990, Return of Organization Exempt from Income 
Tax, for the same period, is attached as Exhibit G to the 
Harris Declaration filed February 16, 1988. See IRS Form 
4562 where the business or activity of the Pacific Legal 
Foundation is expressly stated to be "Public Interest Law 
Firm." Attached hereto as Exhibit A is a true and accurate 
copy (provided by the State of California at my request) of 
the Pacific Legal Foundation’s Periodic Report to Attorney 
General of California for the period March 1, 1983 through 
February 29, 1984 (when the amended complaint was filed 
herein), also expressly incorporating IRS Form 990 which 
also includes IRS Form 4562 expressly identifying the 
business or activity of the Pacific Legal Foundation as 
"PUBLIC INTEREST LAW FIRM."

6. Ronald A. Zumbrun (the senior PLF attorney,
whose name is on all or virtually all papers filed in this case
by the PLF) refers to the Pacific Legal Foundation as a "law
firm" and also refers to someone represented as a "Pacific
Legal Foundation client". For example, the May 13, 1985
issue of The Recorder (at page 4) contains a "viewpoint" 
article by Ronald A. Zumbrun entitled "Pacific Legal 
Foundation Reviews Critical Property Rights Cases”. 
Identified as "one of a series of articles by Ronald A. 
Zumbrun, President of the Pacific Legal Foundation," the

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text of the article begins by stating that, when the Pacific 
Legal Foundation was formed in Sacramento in 1973,

it became the first nonprofit public interest 
law firm which litigated in support of the free 
enterprise system . . . .

Halfway through the article, Mr. Zumbrun turns to a Coastal 
Commission matter in this way:

Ponder the plight of another Pacific 
Legal Foundation client. Viktoria Consiglio.

7. On the next day, May 14, 1985, The Recorder (at 
page 2) contained another viewpoint article by Ronald A. 
Zumbrun, who is identified as "President of the Pacific Legal 
Foundation, a Sacramento-based public interest law firm that 
litigates in support of limited government . . .  . ” This 
viewpoint article includes references to the Gilberts’ claim 
against BCPUD, including the following:

If the Gilberts prevail, they will he entitled to 
damages against the members of the hoard of 
directors of the water of district who, under 
the Civil Rights Act, would be personally 
liable to those individuals whom they have 
intentionally damaged. If successful, this 
lawsuit will have precedential value nationally 
and could single-handedly reverse the 
confiscatory trends in the area of land use 
regulation.

This Zumbrun viewpoint article is entitled "Pacific Law 
oundation’s Involvement in Limiting Reach of 
ovemment." Attached hereto as Exhibit B are true and 

accurate copies of these articles from the May 13 and 14,



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1985 issues of The Recorder.

8. The March, 1983 issue of Pacific Legal 
lfoundation’s The Reporter contains a "President’s Message" 
column by Ronald A. Zumbrun which is entitled "Just 
Compensation: The Case We’ve Been Waiting For.” In it, 
tyis references to the Bolinas litigation include:

PLF has filed suit against the district in 
federal court, thus circumventing the 
California courts, which have been decidedly 
reluctant to clarify the just compensation issue 
in other PLF cases. We are seeking 
substantial personal damages from the water 
district board members, putting all government 
entities on notice that we are going to the mat 
with this one.

On the first page of that same issue of the The Reporter, 
there is another article referring to this litigation entitled 
"PLF Files Major Water Rights Case." (Mr. Zumbrun’s 
column expressly references that article.) The article 
includes the following references:

One of the most significant PLF lawsuits in 
recent years was filed late last year in San 
Francisco federal court . . . .

PLF filed suit on behalf of five property 
owners in Bolinas . . . .

By filing this suit in federal court, PLF hopes 
to stem this frightening practice from moving 
nationwide.

***

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As in many land use cases brought hv 
PLF. . . . .

The PLF suit alleges that water district 
policies violate the Fifth Amendment 
g u a r a n t e e  o f  p a y m e n t  o f  j u s t  
compensation, . . . .  This case will be an 
extremely important one for PLF. . . . .

Attached hereto as Exhibit C is another copy of the above 
stories from Pacific Legal Foundation’s March 1983 issue of 
The Reporter.

9. The Pacific Legal Foundation’s literature soliciting 
contributions also describes the PLF as a "law firm." For 
example, the first page of a December 22, 1982 solicitation 
letter (sent shortly after this case was filed) contains the 
following:

Pacific Legal Foundation is an independent 
nationwide public interest law firm defending 
individual freedom, private property rights, 
and the free enterprise system. PLF is 
successfully confronting governmental 
bureaucracies, environmental extremists, 
welfare rights organizations, and other special 
interest groups.

Later, the solicitation letter states:

Today, PLF is handling more than 100 legal 
proceedings across the United States. Your 
financial assistance will make it possible to 
carry this burden to conclusion.

Attached hereto as Exhibit D is a true and accurate copy of



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the PLF’s December 22, 1982 solicitation letter.

10. At the beginning of the PLF’s separate opposition 
papers, there appears this sentence:

' Pacific Legal Foundation has not signed a 
"pleading, motion, or other paper" to be filed 
in this court.

The statement was apparently made in an effort to dispel any 
idea that the Pacific Legal Foundation really has had anything 
to do with this litigation. While I have not reviewed all the 
files, a quick beginning revealed the following examples 
where papers were expressly signed on behalf of the Pacific 
Legal Foundation:

PACIFIC LEGAL FOUNDATION

By: /signed/_________
DARLENE E. RUIZ 
Attorneys for Plaintiffs
MATTHEW LOCKARY; PHYLLIS GILBERT; 
CHARLES GILBERT; JAMES MACEY; 
ANTON HOLTER

(See Docket No. 5)

Pacific Legal Foundation

by /signed/______
Darlene Ruiz 
Attorney for Plaintiffs

(See Docket No. 6)

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Pacific Legal Foundation

by __ /signed/_______
Darlene Ruiz 
Attorney for Plaintiffs

(See Docket No. 9)

PACIFIC LEGAL FOUNDATION

By __ /signed/_______
DARLENE E. RUIZ 
Attorneys for Plaintiffs

(See Docket No. 15)

PACIFIC LEGAL FOUNDATION

By __ /signed/______
Darlene E. Ruiz

Attorneys for Plaintiffs

(See Docket No. 17)

PACIFIC LEGAL FOUNDATION

By /signed/______
DARLENE E. RUIZ 
Attorneys for Plaintiffs

(See Docket No. 18)



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11. Of course, the Pacific Legal Foundation’s logo, 
name, address and telephone number were already preprinted 
on the thousands of pages of papers filed in this action by the 
PLF attorneys. (See, e.g. Complaint, Docket No. 1 and 
Amended Complaint, Docket No. 112.) Other PLF use of 
the law firm logo includes the following example from the 
PLF’s "Tenth Annual Report 1973-1983:"

I

[INSERT LOGO]

(See Harris Deck filed February 16, 1988, Exh. I, last page.) 
In addition, the PLF attorneys’ correspondence with the court 
regarding this litigation, as well as correspondence with 
opposing counsel and others, has been on Pacific Legal 
Foundation letterhead.

(b) THE $30 MILLION -PLUS PRAYER

12. The plaintiffs sought enormous damages from, 
among others, BCPUD and the individual defendants. 
Plaintiff s opposition papers inaccurately suggest that "the 
$30 million prayer for damages and the terrifying effect of 
such a prayer" "was laid to rest nine months after the filing 
of the Complaint." (Opposition, p. 2: 10-16.) The 
opposition papers also suggest that the cloud over BCPUD’s 
finances "could only exist, if at all, for about nine months the 
time between the original Complaint, filed November 10, 
1982, and the Amended Complaint, and that after the

O-ll

° f the claims, "any cloud existing in
BCPUD s imagination surely should have evaporated since 
the basis for trebling damages was gone." (Id., p. 56: 6-15.)

13. The original Complaint’s prayer had numerous 
references to damages, including the following:

WHEREFORE, plaintiffs pray for judgment 
against defendants as follows:

1. Damages for violation of plaintiffs’ civil 
rights in the amount of $10 million.

***

4. Judgments for three times the amnnn| of 
actual damages for violation of Sections 1 and 
2 of the Sherman Act which plaintiffs a lh y . 
are in excess of $10 million to be trebled as 
provided by law.

7. Interim damages for a temporary 
taking . . . .

8 Id the alternative and cumulatively as 
appropriate to plaintiffs’ prayer for 
declaratory, injunctive, and interim damage 
relief prayed for hereinabove, plaintiffs pray 
for judgment against defendants as follows:

a damages for the fpir market vain* 
Sf-the property in an amount not 
presently precisely ascertainable but 
EQUess than $10 mill;™ A more



0-12

precise amount of damages will be 
proven and prayed for at time of trial;

b. Interim damages for a temporary 
taking in an amount not yet precisely 
ascertainable.

12. Other consequential damages flowing 
directly from defendants’ course of conduct 
herein described which plaintiffs may have 
suffered but not discovered or which they may 
hereafter suffer.

***

14. Although the Amended Complaint may have 
dropped the express dollar amounts, nothing alleged that 
plaintiffs had changed their position regarding fair market 
values, the magnitude of actual damages, or the expansive 
damages sought. Indeed, the Amended Complaint filed 
August 3, 1983, increased the number of plaintiffs, the 
number of defendants, and the number of "claims." There 
was no reduction in the amount of property allegedly "taken” 
(which plaintiffs alleged in the original Complaint had a "fair 
market value . . .  not less than $10 million"). Both 
complaints sought a determination and trebling of the actual 
damages resulting from the alleged antitrust violations (which 
the plaintiffs alleged in the original Complaint were "in 
excess of $10 million"). Additionally, the prayers in both 
complaints continued to seek civil rights damages, interim 
damages, attorneys’ fees, litigation costs, and other monetary 
items, including "(ojther consequential damages flowing from 
the defendants’ course of conduct . . . which plaintiffs may 
have suffered but not discovered or which they may hereafter

0-13

suffer."

15. When the Amended Complaint was filed, there 
was no formal or informal statement by plaintiffs or plaintiffs 
counsel that the Amended Complaint sought ]gss in damages 
than was sought in the original Complaint. Although the 
prayers in both complaints state that damages for the fair 
market value of the property allegedly taken would be proven 
and prayed for at the rime of trial, I can find nothing in the 
Amended Complaint which, for example, backs off the 
allegation of the original Complaint that the fair market value 
of the property taken is "not less than $10 million.’’

16. In April 1984, other defense counsel and I met 
with plaintiffs’ counsel to discuss various matters relating to 
discovery. Following up on oral requests made at that 
meeting, I wrote plaintiffs’ counsel on April 23, 1984 
requesting, among other things, their contentions as to the 
amount of damages each plaintiff was seeking plus the basis 
for the claimed damages. A true and accurate copy of my 
letter of April 23, 1984 is attached hereto as Exhibit E. The 
information was not provided, despite repeated requests, both 
oral and written. Attached hereto as Exhibit F is a copy of 
my letter dated May 9, 1985 to plaintiffs’ counsel, which 
contains another written request for the damages contention 
information. The requested information regarding the 
damages amounts (and bases) was never provided.

17. As recently as the Ninth Circuit prebriefing 
conference, which was held on March 28, 1988 plaintiffs’ 
counsel informed me and other defense counsel that plaintiffs 
were not willing to eliminate any claims against any 
defendants from their appeal. Plaintiffs’ suggestion that the

em ymg effect” of their damages claims "was laid to rest”



0-14

in August 1983 is, I believe, inconsistent with the record in 
this litigation.

| Executed this 1st day of June, 1988 at San Francisco, 
California.t

i I declare under penalty of peijury that the foregoing 
is true and correct.

Richard E. V. Harris

P-1

APPENDIX P

RICHARD E. V. HARRIS
GEORGE A. YUHAS
ORRICK, HERRINGTON & SUTCLIFFE
600 Montgomery Street
San Francisco, California 94111
Telephone: (415)392-1122

Attorneys for Defendant Bolinas 
Community Public Utility District

IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF CALIFORNIA

MATTHEW LOCKARY; 
SUSAN IRLAND 
LOCKARY;
PHYLLIS GILBERT; 
CHARLES GILBERT; 
JAMES MACEY;
ANTON HOLTER; MESA 
RANCH INC., a 
California limited 
partnership,

Plaintiffs,

)
)
)
)
)Civ.No. C-82-6191SW/WDB
)
) SUPPLEMENTAL 
DECLARATION 
)OF RICHARD E.V. 
)HARRIS RE: (a) PLF’S 
)STATUS, AND (b) 
SANCTIONS PAID BY 
)PLF IN CONNECTION 
)WITH 1983 PUBLIC

\



P-2

V .

BOLlNAS COMMUNITY 
PUBLIC UTILITY 
DISTRICT; PAUL 
KAYFETZ;
VICTOR AMOROSO; 
MARY LOWRY;
DIANA LOPEZ 
FARNSWORTH;
C. RILEY; PETER 
WARSHALL; DORIS 
ELAINE LeMIEUX;
JACK BOWEN 
McCl e l l a n ,
J. MICHAEL GROSHONG, 
WILLIAM NIMAN; 
ORVILLE SCHELL; 
MARGUERITTE HARRIS; 
JUDITH WESTON; 
BOLINAS COMMUNITY 
PUBLIC UTILITY 
DISTRICT, an 
incorporated public 
utility district;
BOUNAS PLANNING 
COUNCIL, a non-profit 
corporation; JOHN 
GOODCHILD; GREGORY 
C. HEWLETT; STEVE 
MATSON; PATRICIA L. 
SMITH; RAY 
MORITZ; ROBERT J. 
SCAROLA; DIANE 
MIDDLETON McQUAID;

)RECORDS ACT 
)LITIGATION 
)AGAINST BCPUD AND 
^SUBSEQUENT APPEAL
)
)
)Status Conference
)
)Date: March 14, 1989 
)Time: 10:00 a.m.
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)

P-3

FREDERICK G. STYLES; )
and the COUNTY OF )
MARIN, )

)
Defendants. )

___ )

I, Richard E.V. Harris, do hereby declare as
follows:

1. I am a partner with the law firm of Orrick, 
Herrington & Sutcliffe and one of the attorneys for defendant 
Bolinas Community Public Utility District ("BCPUD"). If 
called as a witness, I could testify to the following of my 
own personal knowledge.

A. PLF’S STATUS

2. This portion of this declaration supplements the 
DECLARATION OF RICHARD E.V. HARRIS AND 
REQUEST FOR JUDICIAL NOTICE RE: (a) PACIFIC 
LEGAL FOUNDATION LAW FIRM AND (b) THE $30 
MILLION-PLUS PRAYER, filed June 1, 1988, and made 
pan of BCPUD’s APPENDIX filed January 6, 1989, at Tab 
No. 9. In paragraphs numbered 2-11, and the exhibits 
thereto, I referred to various Pacific Legal Foundation 
CPLF") statements that it was a "law firm," that it 
participated in cases "as counsel," and that a person 
represented was a "Pacific Legal Foundation client. " In 
P^graph 10, I also referred to specific instances in this 
Court’s files where papers were expressly signed on behalf 
of the Pacific Legal Foundation.

F to its recent "RESPONSE OF PACIFIC LEGAL
UNDATION TO THE MOTION FOR SANCTIONS," the



P-4

PLF states on page 1 that "PLF is neither a party to this case 
nor an attorney for a party." On page 4 the PLF states that 
"BCPUD requests sanctions against ’plaintiffs and their 
attorneys’ — a group that does not include Pacific Legal 
Foyndation within its membership.” And, on page 6, the 
PLF states that ’’PLF was not ’plaintiffs’ counsel’ in this 
action, . .

4. The recent statements by the PLF in its response 
to the motion for sanctions seemed to me to be at odds with 
not only the PLF’s statements in its own publications and the 
record referred to above, but also with PLF correspondence 
with BCPUD after this case had been pending for 
approximately one year. In a letter to BCPUD s general 
manager from PLF attorney James I. Collins on Pacific Legal 
Foundation letterhead, Mr. Collins stated:

PLF is the attorney for plaintiffs in Lockary; it
is not a party.

Attached hereto as Exhibit A is a true and accurate copy of 
the November 2, 1983 letter from PLF attorney Collins to 
BCPUD General Manager Buchanan, which copy is attached 
to a Declaration of Phil Buchanan in Wolfs v. Bolin_as 
Community Puhlic Utility District (Marin County Superior 
Court No. 115257).

B. SANCTIONS PAID BY PLF

5. In its response to the motion for sanctions and 
attorneys fees herein, the PLF apparently is attempting to 
distance itself from the state court decisions in Wolfe v. 
Rolinas Community Public Utility District by stating that "no 
sanctions were expressly levied against PLF." (Emphasis 
original.) A true and accurate copy of the Marin County

P-5

Superior Court’s January 19, 1984, Order is in BCPUD s 
Appendix filed January 6, 1989 at Tab No. 8, Exhibit E. It 
states, in part:

Respondent would be entitled to attorneys fees if 
the Court finds that the "plaintiffs case is clearly 
frivolous . . . "

It would appear that petitioner 
brought this action to harass respondent district. 
Petitioner is represented by Pacific Legal 
Foundation as is the plaintiff in the federal 
action. It appeared that the disclosures plaintiff 
sought in this action were to be used in 
prosecuting the federal action. A review of 
events leading to the filing of this action 
convinces this Court that this action was brought 
for an improper motive. Therefore, respondent 
is entitled to reasonable attorneys fees and costs. 
A reasonable fee for such services is $1,360.00 
plus court costs of $14.50. Respondent shall 
have judgment against petitioner for said sums.

6. The Marin Court Superior Court’s decision was 
affirmed by the Court of Appeal for the First Appellate 
District. A true and accurate copy of that appellate decision 
can be found in BCPUD’s Appendix at Tab No. 8, Exhibit F. 
In a unanimous decision, the court stated, in part:

Appellant argues that the judgment 
must be reversed because . . . and (3) the action 
was brought in good faith. We disagree with 
each of these contentions.

On September 30, 1983,



P 6

appellant, through his attorneys, the Pacific 
Legal Foundation, contacted respondent. He 
requested that he be permitted to inspect, as the 
trial court put it, ’virtually all of [respondent’s] 
records. ’

Finally, appellant disputes the trial 
court’s finding that he brought the action for an 
improper motive and meant ’to harass respondent 
district.’ Considering the sheer volume of 
documents which appellant designated, his 
demands of immediate compliance with these 
extensive requests; his insistence on filing suit in 
spite of respondent’s keeping him constantly 
informed of its progress; and his going forward 
with the December 9 hearing even though 
respondent had already made the records 
available to his satisfaction, the trial court’s 
determination was reasonable and well supported 
by the evidence. Respondent was properly 
awarded costs and attorneys fees. (Emphasis in 
original)

7. Although the recent PLF response states that "no 
sanctions were expressly levied against PLF," it does not 
state that the sanctions were not, in fact, paid by the PLF. 
As outlined below, the PLF, not Wolfe, apparently did pay 
the sanctions/attomey fees resulting from the two state court 
decisions in Wolfe.

P-7

8. With respect to request for BCPUD’s documents, 
the formal application signed by PLF attorney lists the 
"Pacific Legal Foundation" as the "applicant," not Wolfe or 
anyone else. A true and accurate copy of the BCPUD form 
signed by the PLF attorney is attached hereto as Exhibit B.

9. The bad faith and harassment findings having 
been affirmed along with the Government Code Section 6259 
attorneys fee award, BCPUD sought additional fees and costs 
of $4,708.80 under that Government Code Section in a state 
court filing on July 21, 1986.

10. I was informed shortly after September 5, 1986 
that the $4,708.80 was paid by a Pacific Legal Foundation 
check, numbered 2602, dated 8-25-86, drawn on a PLF 
account at the Great American Federal Savings and Loan 
Association in Sacramento, California, sent to BCPUD’s 
attorney in Wolfe. Attached hereto as Exhibit C is a true and 
accurate copy of the cover letter I received together with a 
copy of the PLF check. I have subsequently been informed 
that the remainder of the $6,274.25 (the $1,274.50 awarded 
by the trial court in 1984 and $190.90 interest) were paid 
using Great American cashier’s checks, dated 7-10-86 and 
7-17-86, which were also sent by the PLF to BCPUD’s 
attorney in Wolfe.

Executed this 6th day of March, 1989, in the City 
and County of San Francisco.

I declare under penalty of peijury that the 
foregoing is true and correct.

Richard E. V. Harris



I

Q-i

APPENDIX Q

RICHARD E. V. HARRIS
GEORGE A. YUHAS
ORRICK, HERRINGTON & SUTCLIFFE
Old Federal Reserve Bank Building
400 Sansome Street
San Francisco, California 94111
Telephone: (415)392-1122

Attorneys for Defendant Bolinas 
Community Public Utility District

IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF CALIFORNIA

MATTHEW LOCKARY, ) Civ. No.
SUSAN IRLAND LOCKARY; ) C-82-6191 SW/WDB 
PHYLIJS GILBERT; CHARLES)
GILBERT; JAMES MACEY; 
ANTON HOLTER: MESA 
RANCH INC., a California 
limited partnership,

Plaintiffs,

v.

PAUL KAYFETZ, VICTOR 
AMOROSO; MARY LOWRY

) DECLARATION OF 
) RICHARD E. V.
) HARRIS IN 
) FURTHER SUPPORT 
) OF BCPUD’S 
) APPLICATION FOR 
) SANCTIONS/FEES 
) [STAGE II 
) PROCEEDINGS]
)

1



Q-2

DIANA LOPEZ )
FARNSWORTH; EDWARD C. ) 
RILEY; PETER WARSHALL; ) 
DpRIS ELAINE LeMIEUX; ) 
JACK BOWEN McCLELLAN; ) 
J. MICHAEL GROSHONG; ) 
VfILUAM NIMAN; ORVILLE ) 
SCHELL; MARGUERITTE ) 
HARRIS; JUDITH WESTON; ) 
BOLIN AS COMMUNITY )
PUBLIC UTILITY DISTRICT, ) 
an incorporated public utility ) 
district; BOLINAS PLANNING ) 
COUNCIL, a non-profit )
corporation; JOHN )
GOODCHILD; GREGORY C. ) 
HEWLETT; STEVE )
MATSON;PATRICIA L. )
SMITH; RAY MORITZ; )
ROBERT J. SCAROLA, DIANE ) 
MIDDLETON McQUAID; ) 
FREDERICK G. STYLES; and ) 
the COUNTY OF MARIN, )

)
Defendants. )

)

I, Richard E.V. Harris, do hereby declare as follows:

1. I am a member of the Bar of the State of 
California and member of the Bar of this Court. I am also 
a member of the law firm of Orrick, Herrington & Sutcliffe, 
attorneys for defendant Bolinas Community Public Utility 
District ("BCPUD") in this action. If called as a witness, I 
could testify to the following of my own personal knowledge.

Q-3

PLF OPERATIONS: 
FINANCIAL RESOURCES

2. According to the IRS Form 990’s filed by the 
Pacific Legal Foundation ("PLF") with its Periodic Reports 
to the Attorney General of California, the PLF’s annual 
revenues have been substantial during each of the years that 
the Lockarv case has been pending. Total PLF revenues (by 
fiscal year) are shown on those reports as follows:

PLF
Fiscal PFL Revenues Per
Year___________________IRS Form 99Q

1982- 1983
1983- 1984
1984- 1985
1985- 1986
1986- 1987
1987- 1988
1988- 1989
1989- 1990

$2,559,274
2,446,651
2,481,839
2,265,076
2,405,115
2,905,457
4,217,701
5,835,885

From 1982-83, when Lockarv was filed, through February 
1990, the PLF’s total revenues, as shown on these reports, 
were $25,116,998. True and accurate copies of excerpts 
from the IRS 990’s filed as part of those reports are attached 
as Exhibit A.

3. The PLF publishes In Perspective, a 
newsletter. The Winter 1989 issue contained the PLF’s 
description of one of its fundraising activities. Entitled "PLF 
Fundraising Event Brings Private Property Advocates 
Together," the PLF description contained the following:

More than 250 members of the nation’s



Q-4

real estate development community gathered in 
Sacramento on November 2 for a special 
fundraising tribute to PLF’s activities in the

| land use and private property arena.

• ' * * */

1 Following Zuntbrun, Raymond Watt,
chairman of Watt Industries in Los Angeles 
and a member of the Host Committee, 
expressed his thanks to the Foundation and 
asked everyone present to carry the PLF 
fundraising flag.

"If every PLF supporter would call just 
one other potential supporter, we could take 
care of PLF’s funding needs overnight." he 
said.

Attached as Exhibit B is a true and accurate copy of the page 
from the Winter 1989 issue of the PLF’s In Perspective.

PLF OPERATIONS:
LITIGATION LAW FIRM STATUS, LITIGATION 

AND TRAINING FUNCTIONS

4. Additional information regarding the PLF and 
its operations is provided below. Most of the information 
comes directly from the PLF’s own publications; that 
information is provided first.

5. According to its annual reports, the PLF 
claims a very close relationship to the litigation process and 
the courts. The annual reports indicate that the PLF is not 
merely a law firm but that it is a litigation law firm. At least 
one report says that the PLF regards "the courtroom" as its

Q-5

"forum." Another says that the PLF’s "main function is 
litigation."

6. Excerpts from some annual reports and other 
PLF publications are identified and highlighted below. (The 
emphasis in quotations below has been supplied unless 
otherwise indicated.) True and accurate copies of the 
referenced pages from those annual reports are attached 
hereto as Exhibits C through J.

7. The PLF’s first annual report, "Pacific Legal 
Foundation, The First Report: A Record of Achievement, 
Winter 1973-74” began with a "Message From the 
Chairman" on the inside cover which said:

The Pacific Legal Foundation, a 
non-profit public interest law firm, was 
established to correct an imbalance in the 
presentation of issues in litigation that involves 
major public policy.

m m m

Although it has been operating less 
than one year, the Foundation has won several 
important victories and is involved in scores of 
legal cases . . . .  It is protecting your 
interests, assisting the courts, and performing 
a vital public service by presenting "the other 
side" on issues of major public interest.

8. The chairman’s message in that same annual 
report was followed with a "Statement of Purpose" which 
said, among other things:



Q-6

The Foundation has received wide 
support . . . .  The legal activities of the 
Foundation will be guided by these principal 

| policies, adopted by the Board of Trustees:

1. The Foundation shall represent 
, California citizens, individual or corporate,

and citizens of the United States, on matters of 
public interest at all levels of the 
administrative and judicial process.

2. The Foundation shall insure that 
all interests are fully and properly represented 
in court on issues affecting the public and 
private sectors.

4. The Foundation shall not derive 
any Financial benefit from the legal services it 
provides.

10. A Board of Trustees shall be 
appointed, consisting of not less than 16 nor 
more than 19 members, of which a majority 
shall be members in good standing of the State 
Bar of California.

9. The "Report of the Executive Vice President- 
Administrator" in the PLF "Third Annual Report, 1975" 
expressly identified the central nature of litigation:

Because we recognize that the Foundation’s 
main function is litigation, the vast majority of 
our funds are directed to legal activities.

Q-7

10. The PLF’s "Fourth Annual Report begins by 
asserting on page one that "the courtroom" is the PLF’s 
forum:

Pacific Legal Foundation 
Our client: The taxpayer 
Our Forum: The courtroom

* * *

Reason and responsibility are our arguments. 
The courtroom is our forum.

* + +

Our purpose is to present to the courts . . . . 

* * *

Since its founding in 1973, the Foundation has 
been actively involved in more than 100 legal 
proceedings . . . .

* + m

Pacific Legal Foundation is governed by a 
board of prominent citizens, the majority 
attorneys . . . .

Ronald Zumbrun’s "President Message" on the third page 
continues the theme, stating among other things:

During the past fiscal year, the 
Foundation handled more litigation than the 
total for its first three years combined.



Q-8

The Foundation will continue to be 
| highly selective in choosing litigation in which 

to enter.
/

, 11. The PLF’s "Fifth Annual Report” continued
the litigation theme, introducing the PLF on page one with 
such comments as:

Since its founding, [PLF] has been 
actively involved in more than 150 legal 
proceedings, winning 80 percent of those 
which have reached final decision.

It . . . has litigating offices in Sacramento, 
California, and Washington, D.C., a liaison 
office in Seattle, Washington, and a project 
office in San Diego, California.

The PLF record of legal victories is 
impressive by any standard — proof of the 
impact possible when aggressive, independent 
and dedicated professionals speak rationally 
for the broad public interest.

Ronald Zumbrun’s "President’s Message" on page three 
continues the litigation law firm theme:

. . .  for Pacific Legal Foundation 
handled and won more cases than in any past 
year.

* * *

Q-9

As the pioneer of law firms advocating the 
broad public interest of working men and 
women in business, agriculture and industry, 
PLF remains the model to be followed in this 
field.

PLF’s winning team of attorneys is supported 
by an exceptional legal and administrative 
staff . . . backed by an outstanding Board of 
Trustees.

We select cases which deal with key 
precedent-setting issues. Every case is a test 
case.

The same annual report describes PLF activities using such 
phrases as "PLF successfully defended a lawsuit . . . [p. 9], 
"Pacific Legal Foundation successfully represented individual 
employees 11], "frlepresenting various builders and
contractors, PLF challenged a federal law . . . "  [id.], and 
"Pacific Legal Foundation is involved in numerous suits 
challenging . . . [id.].

12. The PLF’s "Sixth Annual Report, 1978-1979" 
introduces the PLF on page one with such comments as:

PLF brings the viewpoint of this segment of 
the public before the courts.

In the beginning, PLF’s litigation 
focused on issues that surfaced in the Pacific 
region.

* * *



Q 12

Years," that PLF annual report contains the already noted, 
succinct summary statement: "PLF participates in cases
nationwide, as plaintiff, as counsel and as ’friend of the 
co|irt.’"

; 17. The PLF’s annual reports are but one of the
PLF publications describing the PLF’s litigation activities in 
this manner. Similar descriptions have continued right 
through the pendency of BCPUD’s sanctions/fees motion. 
The Autumn 1989 issue of the PLF’s In Perspective, page 
two, contained a "President’s Message" by Ronald A. 
Zumbrun which began as follows:

There are a number of different ways 
that the PLF pursues its litigation efforts. We 
can file a legal action on behalf of a private 
individual . . ., we can represent a party by 
intervening in an ongoing lawsuit . . or 
. . .  we can file an amicus curiae or "friend 

of the court" brief.

The President’s message, which was entitled "Why Amicus 
Curiae Briefs are Important," also included the following
comments:

When you think of the many thousands 
of lawsuits filed each day, . . . you realize 
that the PLF could not possibly represent 
parties in all but a small fraction of the cases 
that could impact on you legal rights.

We will continue to represent parties in 
bringing, defending, and intervening in 
lawsuits.

Q-13

A true and accurate copy of page two of the Autumn 1989 
issue of the PLF’s In Perspective is attached as Exhibit K.

18. Both prior to and during the course of the 
Lockarv action, the PLF has also suggested that it has a role 
in training attorneys. For example, in its "Sixth Annual 
Report" in "A Message from the President and Chairman of 
the Board” on page three, the report refers to a fellowship 
program where law school graduates "will be given training 
and experience in public interest litigation bv PLF staff 
attorneys. ” On page eleven of the same report, there is 
another reference to "education and training under the direct 
supervision of PLF senior trial attorneys." The report 
continues: "The purpose of the program is to train the future 
leaders of the legal profession in the new and expanding field 
of public interest law." See Exhibit G.

19. In the November 1981 issue of the California 
Lawyer, roughly one year before this action was filed, the 
description of the PLF’s activities included the following 
attributed to Robert Best, one of the PLF attorneys in this 
action:

Once it enters a case, PLF stays no 
matter how costly, says Best. "While we 
rarely get into a war of attrition, government 
opponents have tried to play that with us. But 
they’ve never won. We won’t back off. We 
go an eye for an eye -- it’s part of our 
reputation," he says.

A true and accurate copy of the article from the November 
1981 California Lawyer is attached hereto as Exhibit L.

Executed th is__day of July, 1990, in the City and
County of San Francisco.



Today, PLF litigates from coast to coast . . . .

Q 10

PLF litigates in all areas of the public 
{ interest . . . .

"X Message from the President and Chairman of the Board" 
on page three of the same annual report continues with 
references to "a PLF suit," "[t]he Foundation is litigating," 
"[t]hree PLF actions," "in two cases before the Ninth Circuit 
Court of Appeals, PLF argued," "PLF has filed suit," and 
"PLF has an ambitious litigation program for the coming 
year." The same annual report contains such references to 
PLF activities as "PLF represented the supervisors suing 
HEW . . . "  [p. 7] and "PLF is assisting the plaintiff to 
obtain a rehearing and has been asked to act as 
co-counsel . . . "  [p. 9].

13. The PLF’s "Seventh Annual Report,
1979-1980" introduces the PLF on page one by quoting from 
the "policy concept" adopted by the first Board of Trustees 
and referring to itself as a "law firm." On page three, 
"Looking Ahead," signed by Ronald Zumbrun begins: "PLF 
is a public interest law firm . . . "  In the annual report, 
descriptions of PLF’s activities include "frlepresenting the 
city of Chula Vista, PLF is also challenging the commission’s 
authority . . . "  [p. 8],

14. The PLF’s "Eighth Annual Report, 1980-1981” 
has a "Year in Review" on page one which begins:

Q l i

In its eighth year of litigating in the public 
interest, [PLF] participated in more than 100 
cases from coast to coast.

In New York, PLF represented construction workers . . . ."

Other references to PLF activities in the annual report 
included ”[i]n Alaska PLF brought suit . . . [p. 1], "[i]n
an unrelated action, PLF helped defend . . . ." [id.], "PLF 
represented San Francisco’s controller, who was sued by the 
city . . . "  [id.], a list limited to "only litigation in which 
PLF actively participated," [p. 4], "PLF has litigated case 
after case . . . "  [p. 8], "ELF agreed to represent them . . . 
" [id ], "Jacobs . . . asked PLF to represent him" [p. 10], 
and "PLF represented him and his office in the successful 
suit argued before the court of appeal" [p. 12].

15. The PLF’s "Ninth Annual Report, 1981-1982” 
contains a list on page three of "litigation in which PLF 
actively participated in 1981-82” identifying eighty cases. 
Elsewhere descriptions of the PLF’s activities include "[i]n 
a similar case, PLF represented 13 farmworkers who were 
fired . . . "  [p. 6], "Justice Kaufman asked PLF to represent 
him" [id.], "[i]n San Francisco, PLF is defending the city 
controller who is being sued . . . "  [id-], and "frlepresenting 
the California Grange and individual owners of small farms, 
PLF has intervened in the case . . . "  [id.].

16. These foregoing excerpts reflect the 
self-described role of the PLF and its relationship to litigation 
and the to courts during the nine years of PLF activities 
immediately prior to the filing of this action. The PLF’s
Tenth Annual Report", issued during the year in which this 

action was filed, was reviewed in an earlier declaration, 
which appears at Tab 8, Exhibit I, Appendix With Selected 
Materials. On page one, under the heading "The First 10

i



Q 14

I declare under penalty of perjury that the foregoing 
is true and correct.

Richard E. V. Harris

I

R-l

APPENDIX R
ENDORSED

FILE
Nov 22 1991

RENE C. DAVIDSON, County Clerk 
By: /»/ Lillian C. Don 
Lillian C. Don, Deputy

SUPERIOR COURT OF THE STATE OF CALIFORNIA 
IN AND FOR THE COUNTY OF ALAMEDA

CHARLES GILBERT; )
PHYLLIS GILBERT; )
MATTHEW LOCKARY; )
SUSAN IRLAND )
LOCKARY; and )
I AMES MACEY, )

) No. 636481-0 
Petitioners and )
Plaintiffs, ) STATEMENT

vs. ) OF
) DECISION



R-2

STATE OF CAUFORNIA; )
DEPARTMENT OF )
HEALTH SERVICES; )
KENNETH KIZER, in )
his official capacity as )
Director )
of the Department of ) 
Hfealth Services; )
BOLIN AS COMMUNITY ) 
PUBLIC UTILITY )
DISTRICT; and )
DOES I through XX, )

)
Respondents and ) 
Defendants. )

)

* * *

Essentially, petitioners attack the validity of the Bolinas 
moratorium on additional water hookups and the 
administrative process by which petitioners were denied those 
hookups.

For the reasons set forth below, the Court is 
determined to deny both petitions.

* * %

HI. IS THERE A WATER SHORTAGE EMERGENCY?

Accordingly, the threshold issue in this case is 
whether there is, in fact, a water shortage emergency. The 
resolution of this issue will determine not only the validity of 
the moratorium itself, but also will facilitate the resolution of 
petitioners many other claims which are premised on the

R-3

assumption that the water emergency is a sham.

* * +

By way of expert testimony which challenges the 
factual predicates for the moratorium, petitioners rely almost 
exclusively on the testimony and declaration of Dietrich 
Stroeh. Stroeh’s analysis is directed at the 1982 engineering 
report of the Department of Health Services which was 
prepared by Robert Hultquist. Although the DOHS report 
was not relied on by the District in determining the propriety 
of the moratorium, it does shed some light on the continuing 
validity of the water shortage emergency and, thus, on the 
continuing validity of the moratorium.

As the District points out, Stroeh’s disagreement with 
the DOHS report is largely philosophical.

* * *

Even to the untutored eye, problems with Stroeh’s 
analysis are apparent. First, as the District points out, Stroeh 
"ignores the fact that [the District’s] summer time use is not 
limited to water taken from Arroyo Honda. [The District] 
also takes water from its supply of stored water." Thus, 
"demand” is substantially understated.

* * *

Second, there is no evidence whatsoever that the years 
from 1982 to 1986 represent a fair sampling for determining 
long-range water policy. In fact, several of those years were 
exceptionally "wet".

Third, the assertion that 39 acre-feet annually is 
available from Arroyo Honda is without demonstrable



R-4

foundation.

In sum, the District had substantial expert evidence 
available to them upon which to make a reasoned decision to 
declare a water shortage emergency and to enact and 
maintain a water hookup moratorium.

I * * *

In order to obtain the added benefit of objectivity and 
the additional confidence that the Court has not been misled 
by the testimony of an expert possibly more persuasive than 
correct, the Court appointed a special master in accord with 
Evidence Code section 730. The task of this court-appointed 
expert was to evaluate the current conditions of the District’s 
water system and to advise the Court as to whether the 
current and projected water supply conditions in Bolinas 
constitute a valid water shortage and, thus, justify the 
continuance of the moratorium.

* * *

In light of this evidence, the Court finds that there is 
a solid factual basis for declaring a water shortage emergency 
and, thus, for imposing a moratorium which precludes 
potential water users from tapping into the water supply 
which is both fragile and limited. The Court cannot conclude 
that the District acted in an arbitrary or capricious manner or 
that their actions were entirely lacking in evidentiary support.

♦ * *

In this case, the bottom line is whether there is valid water 
shortage emergency which justifies the moratorium.

Based upon the Administrative record, it seems

R-5

apparent that the moratorium has been justified from its 
inception to the present based upon realistic concerns about 
the capacity of the district’s water system to meet 
conservative demands in times of continuing drought, 
particularly given the marginal capacity not only of the 
storage system, but the delivery system, as well.

n . WERE PETITIONERS AFFORDED A FAIR 
HEARING?

* * *

The Administrative Record reflects the comprehensive 
presentation permitted petitioners in the pursuit of their 
petitions before the Board. There are numerous appearances, 
the submission of hundreds of pages of evidence, the 
opportunity to respond to the District’s evidence, and full 
unencumbered representation by counsel. Apart from the 
allegations of "inherent" and "personal" biases, petitioners 
are bereft of any realistic argument that the hearings were 
deficient in any way. As noted, petitioners’ assertions of 
bias are without foundation in the record.

* * *

The petitions for peremptory and administrative writs 
are denied.

Dated: November 22, 1991

LsL_________________
Richard A. Hodge,
Judge of the Superior Court

I



S-l

APPENDIX S

FILED
Apr 2 - 1990

RICHARD W. WIEKING 
CLERK, U.S. DISTRICT 

COURT
NORTHERN DISTRICT 

OF CALIFORNIA 
SAN JOSE

UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF CALIFORNIA

MATTHEW LOCKARY, ) 
et al., )

)
) C-82-6I91(SW) 

Plaintiffs, )
) ORDER ADOPTING 

v. ) FINDINGS OF
) MAGISTRATE BRAZIL 

PAUL KAYFETZ, et al., )
Defendants. )

-- ----------------------------------  )

I have carefully reviewed the Report and 
Recommendations by Magistrate Brazil acting as Special 
master and filed on January 11, 1990, with respect to the 
liability of plaintiffs’ attorneys for sanctions. I have also 
read and considered the comments on that Report submitted 
by the parties. I HEREBY ADOPT THE FINDINGS OF



S-2

FACT AND CONCLUSIONS OF LAW AND ACCEPT 
THE RECOMMENDATIONS CONTAINED THE REPORT 
BY MAGISTRATE BRAZIL. I Find that the circumstances 
of this case clearly support the imposition of substantial 
monetary sanctions on the Pacific Legal Foundation. In 
addition, the Magistrate’s findings of fact and conclusions of 
law clearly justify his issuing an order requiring attorneys 
Darlene Ruiz, Ronald Zumbrun, Harold Hughes, Onin 
Finch, and Robert Best, to show cause why they should not 
be sanctioned in their individual capacities. However, I 
concur with the comment made by Pacific Legal Foundation 
in the objection filed January 29, 1990, that Ms. Ruiz may 
not be held liable for attorneys’ fees under Rule 11 for 
signing the Motion to Strike referred to on page 100 of the 
Report, because that motion had been signed several months 
before the effective date of amended Rule 11, and an award 
of attorneys’ fees is not provided for the old Rule 11.

I hereby ORDER Magistrate Brazil to commence 
further proceedings on the issue of the amount of the 
sanctions to be imposed on the Pacific Legal Foundation, and 
on the issue of the liability for the sanctions of the individual 
attorneys noted in the Report. If the Magistrate concludes 
that any attorney or attorneys should be sanctioned in their 
individual capacities, he should also make findings and 
recommendations with respect to the nature and degree of 
those sanctions.

IT IS SO ORDERED.

Dated: April 2, 1990 /s/Spencer Williams 
UNITED STATES 
DISTRICT COURT JUDGE



No. 92-1544

In  T h e

Supreme Court of tije iHmteb States
O ctober  Te r m , 1992

P acific  Legal  Fou nda tio n ,
Petitioner,

v.

Paul  Ka y fftz , et al,
Respondents.

O n Petition for a W rit of C ertiorari to the 
United States Court of Appeals 

for the Ninth Circuit

M OTION FO R LEAVE TO FILE BRIEF AM ICI CURIAE 
AND BRIEF OF THE NAACP LEGAL DEFENSE 

AND EDUCATIONAL FUND, IN C , AS AM ICI CURIAE 
IN  SUPPORT OF THE PETITION FO R A 

WRIT OF CERTIORARI

Antonia  H ernandez 
E. R icha rd  Larson 
Mexican American 
Legal Defense and 
Educational Fund 

634 South Spring St. 
Eleventh Floor 
Los Angeles. CA 90014 
(213) 629-2512

Elaine R. Jones 
Charles Stephen  Ralston 
(Counsel of Record)
NAACP Legal Defense and 
Educational Fund, Inc.

99 Hudson Street 
Sixteenth Floor 
New York, NY 10013 
(212) 219-1900

Attorneys for Amicus Curiae



No. 92-1544

In  T h e

Supreme Court of tfje Mmteb States
O ctober  Te r m , 1992

Pacific  Legal  Fo u n d a tio n ,
Petitioner,

v.

Paul Ka y fe tz , et al,
___ _______  Respondents.

On Petition for a Writ of Certiorari to the 
United States Court of Appeals 

for the Ninth Circuit

MOTION FOR LEAVE TO FILE BRIEF OF THE 
NAACP LEGAL DEFENSE AND EDUCATIONAL FUND, 

INC., AND THE MEXICAN AMERICAN LEGAL 
DEFENSE AND EDUCATIONAL FUND AS AMICI 

CURIAE IN SUPPORT OF THE PETITION 
FOR A WRIT OF CERTIORARI

The NAACP Legal Defense and Educational Fund, 
Inc., and the Mexican American Legal Defense and 
Educational Fund move the Court for leave to file the 
attached brief amici curiae in support of the grant of a writ 
of certiorari in the present case.1 The motion for leave to 
file states the interest of amici.

The Petitioner has consented to the filing of the attached brief, 
but respondent has refused consent.



( The NAACP Legal Defense and Educational Fund, 
Inc. ( rLDF") is a non-profit corporation that was established 
for the purpose of assisting black citizens in securing their 
constitutional and civil rights. It was established in 1940 as 
a legal aid society under the laws of the state of New York, 
and is one of the oldest public interest legal organizations in 
the United States. This Court has noted the Fund’s 
"reputation for expertness in presenting and arguing the 
difficult questions of law that frequently arise in civil rights 
litigation." NAACP v. Button, 371 U.S. 415, 422 (1963).

The Mexican American Legal Defense and 
Educational Fund ("MALDEF') is a non-profit national civil 
nghts organization headquartered in Los Angeles. Its 
principal objective is to secure, through litigation and
education, the civil rights of Hispanics living in the United 
States

2

As public interest legal organizations LDF and
MAL,DE^. haVC a deep concern with the use of a federal 
courts "inherent power” to impose sanctions on 
organizations seeking to carry out the Congressional policy 
of private enforcement of the civil rights laws and other laws 
impacting on the public interest. Further, we are concerned 
with the use of the sanctioning power on plaintiffs and
private counsel who seek to vindicate their rights in federal 
court.

We believe our long experience as public interest 
organizations will be of assistance to the Court in deciding 
whether to grant certiorari in this case. Therefore, we pray



3

that leave be granted to file the accompanying amicus curiae 
brief in support of the petition for a writ of certiorari.

Charles Stephen  Ralston 
(Counsel of Record)
NAACP Legal Defense and 
Educational Fund, Inc.

99 Hudson Street 
Sixteenth Floor 
New York. NY 10013
(212) 219-1900

Antonia  H ernandez 
E. R ichard  Larson 
Mexican American 
Legal Defense and 
Educational Fund 

634 South Spring St. 
Eleventh Floor 
Los Angeles, CA 90014
(213) 629-2512

Attorneys for Amicus Curiae



1

TABLE OF CONTENTS

M o tio n  fo r  Lea v e  to  F ile  Br ie f  Am icus Cu r ia e  . 1

Ar g u m en t  .................................................................................. 1

T h e  D ecision  Below  Raises Im portant  Q uestions 
Con cern ing  t h e  Scope  a n d  M ea n in g  o f  this 
C o u r t ’s D ecision  in  Cha m bers v . Nasco . Inc . . . .  1

C onclusion  .............................................................................  5



u

TABLE OF AUTHORITIES

Cases: Pages:

Albemarle Paper Co. v. Moody, 422 U.S. 405 (1975) . . .  3

Alyeska Pipeline Serv. Co. v. Wilderness Soc’y, 421 U.S.
240 (1975) ............................................................................5

Chambers v. Nasco. Inc., I l l  S.Ct. 2123 (1991).........  4, 5

Griggs v. Duke Power Co., 401 U.S. 424 (1971)..............3

In re Primus, 436 U.S. 412 (1978).......................................4

Lockary v. Kayfetz. 974 F.2d 1166 (9th Cir. 1992) ............. 2

NAACP v. Button. 371 U.S. 415 (1963)....................... 2, 4

Sassower v. Fields. No. 92-1405, cert, denied, April 19,
1993 ....................................................................................... 5

Statutes and Rules: Pages:

28 U.S.C. § 1927 .....................................................  2, 4, 5

Rule 11, F.R.Civ. Proc...............................................  2, 4, 5

Rule 23, F.R. Civ. Proc......................................................... 3



No. 92-1544

In  T h e

Supreme Court of tfte Mmteb States
O ctober  Te r m , 1992

Pacific  Legal  F o u n d a tio n ,
Petitioner,

v.

Paul Ka y fetz , et al,
Respondents.

On Petition for a W rit of C ertiorari to the 
United States Court of Appeals 

for the Ninth Circuit

BRIEF OF THE NAACP LEGAL DEFENSE AND 
EDUCATIONAL FUND, INC., AND THE MEXICAN 

AMERICAN LEGAL DEFENSE AND EDUCATIONAL 
FUND AS AMICI CURIAE IN SUPPORT O F THE 

PETITION FOR A WRIT OF CERTIORARI

A r g u m e n t

T h e  D ecision  Below  Raises Im portant  Q uestions 
Co n cern in g  th e  Scope  and  M ea n in g  o f  this 
Co u r t s  D ecision  in  Cham bers v . Na sco , In c .

I.

Amici believe that review of the Ninth Circuit’s 
decision is particularly important because of the basis on 
which that court justified the use of "inherent authority" to 
impose sanctions on a not-for-profit public interest legal



2

organization that was supporting litigation. The decision 
below was founded on assumptions about the manner in 
which such an organization functions that are, with all due 
respect  ̂ not accurate. These assumptions were the basis of 
the holding that the district court had the authority to 
impose sanctions on the Pacific Legal Foundation even 
though the foundation was not subject to Rule 11, F.R.Civ. 
Proc 28 U.S.C. § 1927, or any other rule or statute that 
provided for the imposition of sanctions.

"^lus* court below cited the acknowledgement of 
Pacific Legal Foundation in its appellate brief that it seeks 
to participate in precedent setting litigation in the public 

interest as inconsistent with the Foundation’s position that 
it was furnishing counsel to plaintiffs who could not 
otherwise afford to bring suit. The court held that because 
he Foundation’s goal was to "establish a legal precedent" 

the plaintiffs were merely "nominal" and "were merely pawns 
° r puf  pets in thls effort." Lockary v. Kayfetz, 97 A F.2d 1166,

ici urge that the fact that an organization has as 
one, or even a primary goal, the establishment of precedent 
oes not in any way lead to the conclusion that the plaintiffs 

in the lawsuits it supports are either nominal or "pawns or 
puppets. rganizations such as the Foundation and amici 
are limited in resources. They cannot serve as general legal 
aid providers and represent everyone who seeks their 
services, even if the cases are within the scope of their 
purposes and expertise. They are necessarily selective, and 
attempt to choose those cases that will have the greatest 
impact either in terms of establishing precedent that can 
hen be used by others in similar circumstances, or by 

bringing actions that will in themselves affect many persons.
e ideal case, of course, is one that accomplishes both 

purposes. r

Thus, an employment discrimination case brought as a class
“ '.h°d,rcal'hh lf ° r a 8n>Up of WOTkers at * Particular plan, can boih directly benefit the plaintiffs and establish a precedent that can



3

In either event, the interests of the real people with 
real claims on whose behalf actions are brought are not only 
central but, properly, paramount. Attorneys who work for 
public interest organizations are fully aware of their ethical 
obligations to represent the interests of their clients, and do 
not subordinate them to the dictates of "a higher cause." 
While the decision whether or not to take a case in the first 
instance may be dictated by whether that case, among many 
other possible cases, is compatible with and will further the 
objectives of the organization, once representation has been 
assumed, litigation decisions are made based on whether the 
interests of the clients will be served.

For example, it is not uncommon that a case that was 
taken as a vehicle for the vindication of a legal principle, will 
result in a settlement that provides appropriate relief for the 
plaintiffs. Organizations such as amici fully understand that 
if such is the case, the settlement must be presented to their 
clients and accepted on their behalf if that is their decision. 
This is mandated not only by ethical standards, but also, in 
the case of class actions, by the requirements of Rule 23, 
F.R. Civ. Proc.

Of course, disagreements between public interest 
lawyers and their clients may arise, just as they arise between 
any other lawyers and their clients. If conflicts do arise, they 
must and are resolved consistent with the ethical obligations 
of the lawyers, and there are instances in which a public 
interest legal organization may have to seek to be relieved 
as counsel if the differences are irreconcilable. Although, in 
the experience of amici, such instances are rare, they have 
occurred in the many years of the our work.

Thus, certiorari should be granted to make clear the 
extent to which, if any, the fact that an organization supports 
litigation that is consistent with its purposes is a proper basis

benefit large numbers of other persons. Two examples from the 
work-of LDF are Griggs v. Duke Power Co., 4G1 U.S. 424 (1971) and 
Albemarle Paper Co. v. Moody, 422 U.S. 405 (1975).



4

for holding that it can be sanctioned for abuses that occur 
during the course of the litigation. The activities of such 
organizations have long been held to be protected by the 
first amendment. NAACP v. Button, 371 U.S. 415 (1963); In 
re Primus, 436 U.S. 412 (1978). The decision of the Ninth 
Circuit has grave implications for the ability of such 
organizations to carry out constitutionally protected activities 
free of the chilling effect of the danger of the imposition of 
sanctions based on pre-conceived notions of their role in 
supporting litigation.

II.

Certiorari should also be granted in the present case 
because it presents an opportunity for the Court to deal with 
a broader issue of great importance for the guidance of the 
lower courts, the proper application of the decision in 
Chambers v. Nasco, Inc., I l l  S.Ct. 2123 (1991). In Chambers 
this Court affirmed the use of inherent powers to sanction 
a party before the district court for actions taken by that 
party in and out of court with the intent of impeding or 
directly disobeying the rulings and orders of the court, such 
out-of-court actions not being within the reach of the terms 
of the various fees acts, Rule 11, section 1927, or other bases 
for imposing sanctions. Rather than applying Chambers to 
comparable factual situations, in a number of instances the 
lower courts have extended Chambers far beyond its 
appropriate reach.

Thus, Chambers involved a party who was responsible 
for litigation carried out for abusive purposes and for out-of- 
court actions designed to undermine the district court’s 
jurisdiction. The award of sanctions was based on record- 
based factual findings that established responsibility for the 
sanctioned actions. In the present case, on the other hand, 
the sanctions were based on assumptions that formed the 
predicate for a holding that the named plaintiffs were not 
the real parties in interest, but that rather an organization 
that supported the litigation was. Moreover, the present



5

case involves alleged improper litigation conduct that 
occured entirely in court, all of which could ahve been 
reached through Rule 11 or section 1927. Yet the district 
court resorted to the use of inherent power.

Another case that involves an unwarranted extension 
of Chambers is Sassower v. Fields, No. 92-1405, cert, denied, 
April 19, 1993. In that case, the court of appeals first held 
that fee shifting was not proper under the fee provision of 
the Fair Housing Act, that sanctions were not proper under 
Rule 11 and only partly proper under section 1927, but then 
affirmed the entire award of sanctions under the authority 
of Chambers. The present case and Sassower, amici submit, 
are indicative of a growing trend to undermine the American 
Rule as explicated in Atyeska Pipeline Serv. Co. v. Wilderness 
Socy, 421 U.S. 240 (1975), by swallowing it up through the 
over-expansion of exceptions to it. We urge that it is 
essential that the Court provide guidance to the lower 
federal courts as to the proper scope and meaning of 
Chambers v. Nasco, supra.

C o n c l u sio n

For the foregoing reasons, the petition for a writ of 
certiorari should be granted.

Respectfully submitted.

Antonia Hernandez 
E. Richard Larson 
Mexican American 
Legal Defense and 
Educational Fund 

634 South Spring St. 
Eleventh Floor 
Los Angeles. CA 90014 
(213) 629-2512

Elaine R. Jones 
Charles Stephen Ralston 
(Counsel of Record)
NAACP Legal Defense and 
Educational Fund. Inc.

99 Hudson Street 
Sixteenth Floor 
New York, NY 10013 
(212) 219-1900

Attorneys for Amicus Curiae