Free MEMORANDUM in Support - District Court of Delaware - Delaware

Case 1:08-cv-00233-JJF

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE In re: KAISER ALUMINUM CORPORATION, a Delaware Corporation, et al., Debtors. MOSS LANDING COMMERCIAL PARK, LLC, Appellant, v. KAISER ALUMINUM CORPORATION and KAISER ALUMINUM & CHEMICAL CORPORATION, Appellees. MOSS LANDING COMMERCIAL PARK, LLC'S MEMORANDUM OF LAW IN SUPPORT OF EMERGENCY MOTION TO STAY BANKRUPTCY COURT ORDER ENFORCING INJUNCTIONS ISSUED IN CONNECTION WITH PLAN OF REORGANIZATION AND COMPELLING MOSS LANDING TO DISMISS WITHOUT PREJUDICE ITS LAWSUIT AGAINST DEBTORS Mark Minuti (DE No. 2659) SAUL EWING LLP 222 Delaware Avenue, Suite 1200 P.O. Box 1266 Wilmington, DE 19899 (302) 421-6840 Wendy W. Smith (Cal Bar No. 133887) BINDER & MALTER, LLP 2775 Park Avenue Santa Clara, CA 95050 (408) 295-1700 Attorneys for Moss Landing Commercial Park, LLC Dated: April 24, 2008 Thomas H. Clarke, Jr. (Cal. Bar No. 47592) ROPERS, MAJESKI, KOHN & BENTLEY 201 Spear Street, Suite 1000 San Francisco, CA 94105 (415) 543-4800 : : : : : : : : : : : : : : : : : :

Chapter 11 Case No. 02-10429 (JKF) Jointly Administered

Case No. 08-cv-233

558266.1 4/24/08

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precedent was clearly established by relevant Third Circuit authority no "substantial questions of law" were presented that would cause the court to "relax the application of the [likelihood of success] factor").2 Kaiser cites only one unpublished case, Krafczek v. Excide, C.A. No. 00-1965, 2007 WL 1199530 (E.D. Pa. Apr. 19, 2007), to support its argument to deny a private citizen the injunctive relief of RCRA and CWA. This single opinion is inconsistent with the broad range of cases that confirm that a bankruptcy case cannot discharge the purely-injunctive relief provided under RCRA and CWA. The Supreme Court in Meghrig, 516 U.S. at 487-88, held that the injunctive relief under RCRA does not allow a party who is forced to clean-up a site to sue for those response costs in lieu of seeking an injunction. The same is true for injunctive relief under the CWA. 33 U.S.C. § 1365(a)(1); see Fairfiew Twp. v. U.S. EPA, 593 F.Supp. 1311, 1315 (M.D. Pa. 1984), aff'd in part, rev'd in part on other grounds sub nom. Fairview Twp., York County, Comm. of Pa. v. U.S. EPA, 773 F.2d 517 (3d Cir. 1985) ("[m]onetary damages are not available under the Clean Water Act..."). Without the ability to convert the injunctive remedy into a claim for money, it cannot be discharged in bankruptcy. U.S. Hubler, supra..

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Courts outside of the Third Circuit have held that the likelihood of success factor can be satisfied where a party demonstrates that a substantial, difficult, or doubtful legal question is presented and the equitable balancing of hardships tips in the movant's favor. See Arnold v. Garlock, Inc., 278 F.3d 426, 438-39 (5th Cir. 2001) ("[T]he appellant `need not always show a probability of success on the merits; instead, the movant need only present a substantial case on the merits when a serious legal question is involved and show that the balance of equities weighs heavily in favor of granting the stay.'") (quoting Ruiz v. Estelle, 650 F.2d 555, 565 (5th Cir. 1981)); Wilcox v. Stroup, 358 B.R. 835, 838 (D.S.C. 2006); In re Lickman, 301 B.R. 739, 743 (Bankr. M.D. Fla. 2003) ("A `likelihood of success is shown when the movant has raised questions going to the merits so serious, substantial, difficult and doubtful as to make them a fair ground for litigation and thus for more deliberate inquiry.'") (internal citations omitted); In re Hoekstra, 268 B.R. 904, 906 (Bankr. E.D. Va. 2000) (finding that where complex question of law is presented and balance of hardships tips in movant's favor, then movant "need only show some reasonable likelihood of success on the merits"); In re Holtmeyer, 229 B.R. 579, 582 (E.D.N.Y. 1999) (stating that court must consider "the likelihood that the party seeking the stay will succeed on the merits of the appeal or a serious question going to the merits and a tipping of the equities in favor of the movant") (emphasis added).

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE In re: KAISER ALUMINUM CORPORATION, a Delaware Corporation, et al., Debtors. MOSS LANDING COMMERCIAL PARK, LLC, Appellant, v. KAISER ALUMINUM CORPORATION and KAISER ALUMINUM & CHEMICAL CORPORATION, Appellees. CERTIFICATE OF SERVICE I, Mark Minuti, Esquire of Saul Ewing LLP hereby certify that on April 24, 2008, service of the foregoing Moss Landing Commercial Park, LLC's Memorandum Of Law In Support Of Emergency Motion to Stay Bankruptcy Order Enforcing Injunctions Issued in Connection With Plan of Reorganization and Compelling Moss Landing to Dismiss Without Prejudice Its Lawsuit Against Debtor was made on the following parties in the manner indicated. Daniel J. DeFranceschi, Esquire Jason M. Madron, Esquire Richards, Layton & Finger, P.A. One Rodney Square P.O. Box 551 Wilmington, DE 19899 (Via Hand Delivery) Gregory M. Gordon, Esquire Daniel P. Winikka, Esquire Debra K. Simpson, Esquire Jones Day 2727 North Harwood Street Dallas, TX 75201 (Via Electronic Mail and First Class U.S. Mail : : : : : : : : : : : : : : : : : :

Chapter 11 Case No. 02-10429 (JKF) Jointly Administered

Case No. 08-cv-233

558266.1 4/24/08

Case 1:08-cv-00233-JJF

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