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<p class=MsoNormal style='margin-bottom:6.0pt;background:white'><b><span
style='font-size:14.5pt;font-family:"Arial","sans-serif"'>LA billionaires sued
over Calif. water sales<o:p></o:p></span></b></p>
<p class=MsoNormal style='background:#272727'><span style='font-size:8.0pt;
font-family:"Arial","sans-serif"'><img width=364 height=8 id="Picture_x0020_1"
src="cid:image001.gif@01CAD98D.3919AAC0"
alt="http://media3.washingtonpost.com/wp-srv/story/image/slideshow_top.gif"></span><span
style='font-size:8.0pt;font-family:"Arial","sans-serif"'><o:p></o:p></span></p>
<p class=MsoNormal style='background:#272727'><b><span style='font-size:8.5pt;
font-family:"Arial","sans-serif";color:white'>PHOTOS<o:p></o:p></span></b></p>
<p class=MsoNormal style='background:#272727'><b><span style='font-size:7.0pt;
font-family:"Trebuchet MS","sans-serif";color:#333333'> Previous </span></b><b><span
style='font-size:7.0pt;font-family:"Trebuchet MS","sans-serif";color:white'> <a
href="javascript:void(goNext())"><span style='color:#0C4790;text-decoration:
none'>Next</span></a> <o:p></o:p></span></b></p>
<p class=MsoNormal align=center style='text-align:center;background:black'><span
style='font-size:8.5pt;font-family:"Arial","sans-serif";color:white'><img
border=0 width=350 height=226 id="Picture_x0020_2"
src="cid:image002.jpg@01CAD98D.3919AAC0"
alt="In this March 30, 2010 photo, pistachio nuts are displayed at the headquarters of Primex International Trading Corp. in Los Angeles. Ali Amin, a Persian immigrant who owns a processing plant, filed a suit last week in Fresno County Superior Court against Stewart and Lynda Resnick, claiming that they violated California public utilities laws because they turned a profit by selling water to farmers who weren't members of their Bakersfield-based water company, Westside Mutual Water Co. (AP Photo/Damian Dovarganes)"></span><span
style='font-size:8.5pt;font-family:"Arial","sans-serif";color:white'><o:p></o:p></span></p>
<p class=MsoNormal style='background:#272727'><span style='font-size:8.0pt;
font-family:"Arial","sans-serif";color:white'>In this March 30, 2010 photo,
pistachio nuts are displayed at the headquarters of Primex International
Trading Corp. in Los Angeles. Ali Amin, a Persian immigrant who owns a
processing plant, filed a suit last week in Fresno County Superior Court
against Stewart and Lynda Resnick, claiming that they violated California
public utilities laws because they turned a profit by selling water to farmers
who weren't members of their Bakersfield-based water company, Westside Mutual
Water Co. (AP Photo/Damian Dovarganes) </span><span style='font-size:8.0pt;
font-family:"Arial","sans-serif";color:#CCCCCC'>(Damian Dovarganes - AP) </span><span
style='font-size:8.0pt;font-family:"Arial","sans-serif";color:white'><o:p></o:p></span></p>
<p class=MsoNormal align=center style='text-align:center;background:black'><span
style='font-size:8.5pt;font-family:"Arial","sans-serif";color:white;display:
none'><img border=0 width=184 height=270 id="Picture_x0020_3"
src="cid:image003.jpg@01CAD98D.3919AAC0"
alt="In this March. 30, 2010 photo, Primex International Trading Corp. owner, Ali Amin, poses at his international nut trading company headquarters in Los Angeles. Amin, a Persian immigrant who owns a processing plant, filed a suit last week in Fresno County Superior Court claiming that Stewart and Lynda Resnick violated California public utilities laws because they turned a profit by selling water to farmers who weren't members of their Bakersfield-based water company, Westside Mutual Water Co. (AP Photo/Damian Dovarganes)"></span><span
style='font-size:8.5pt;font-family:"Arial","sans-serif";color:white;display:
none'><o:p></o:p></span></p>
<p class=MsoNormal style='background:#272727'><span style='font-size:8.0pt;
font-family:"Arial","sans-serif";color:white;display:none'>In this March. 30,
2010 photo, Primex International Trading Corp. owner, Ali Amin, poses at his
international nut trading company headquarters in Los Angeles. Amin, a Persian
immigrant who owns a processing plant, filed a suit last week in Fresno County
Superior Court claiming that Stewart and Lynda Resnick violated California
public utilities laws because they turned a profit by selling water to farmers
who weren't members of their Bakersfield-based water company, Westside Mutual
Water Co. (AP Photo/Damian Dovarganes) </span><span style='font-size:8.0pt;
font-family:"Arial","sans-serif";color:#CCCCCC;display:none'>(Damian Dovarganes
- AP) </span><span style='font-size:8.0pt;font-family:"Arial","sans-serif";
color:white;display:none'><o:p></o:p></span></p>
<p class=MsoNormal style='background:#272727'><span style='font-size:8.0pt;
font-family:"Arial","sans-serif"'><img border=0 width=364 height=8
id="Picture_x0020_4" src="cid:image004.gif@01CAD98D.3919AAC0"
alt="http://media3.washingtonpost.com/wp-srv/story/image/slideshow_bot.gif"></span><span
style='font-size:8.0pt;font-family:"Arial","sans-serif"'><o:p></o:p></span></p>
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<p class=MsoNormal style='background:white'><i><span style='font-size:10.0pt;
font-family:"Arial","sans-serif"'><o:p> </o:p></span></i></p>
<p class=MsoNormal style='background:white'><i><span style='font-size:10.0pt;
font-family:"Arial","sans-serif"'><o:p> </o:p></span></i></p>
<p class=MsoNormal style='background:white'><i><span style='font-size:10.0pt;
font-family:"Arial","sans-serif"'>By GARANCE BURKE<o:p></o:p></span></i></p>
<p class=MsoNormal style='background:white'><i><span style='font-size:10.0pt;
font-family:"Arial","sans-serif"'><o:p> </o:p></span></i></p>
<p class=MsoNormal style='background:white'><span style='font-size:10.0pt;
font-family:"Arial","sans-serif"'>The Associated Press <br>
Sunday, April 11, 2010; 12:43 AM </span><span style='font-size:8.0pt;
font-family:"Arial","sans-serif"'><o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>FRESNO,
Calif. -- They grew their fortune in the California sun, turning pedestrian
fruits and nuts into a vast and varied empire that secured their place in
Hollywood. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Stewart
and Lynda Resnick's flashy bottles of Fiji Water and POM Wonderful are now
coveted across the globe. Their donations keep the lights on in art museums
across the country. And Gov. <a
href="http://www.whorunsgov.com/Profiles/Arnold_Schwarzenegger"><span
style='color:#0C4790'>Arnold Schwarzenegger</span></a> and Arianna Huffington
count them among their dearest friends. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>But
as their marketshare rises worldwide, one of the billionaires' competitors is
fighting back, accusing the Western power couple of profiting at the public's
expense, court records and interviews show. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Now,
as drought-stricken California weighs whether to give private companies more
control in managing its scarce water supplies, a new lawsuit claiming the
Resnicks violated utilities law by making money from a vast, taxpayer-funded
underground reservoir is causing a stir in the state Capitol. <o:p></o:p></span></p>
<p class=MsoNormal style='background:white'><span style='font-size:12.0pt;
font-family:"Times New Roman","serif"'><img border=0 width=100 height=13
id="Picture_x0020_14" src="cid:image005.gif@01CAD98D.3919AAC0" alt="ad_icon"></span><span
style='font-size:12.0pt;font-family:"Times New Roman","serif"'><o:p></o:p></span></p>
<p class=MsoNormal style='background:white'><span style='font-size:12.0pt;
font-family:"Times New Roman","serif"'><o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>"Water
is a public resource, owned by the people," said Democratic Assemblyman
Jared Huffman of San Rafael. "We shouldn't be giving away public funds to
private sector interests, let alone choosing winners and losers in the business
world." <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>The
Resnicks, who live in a Beverly Hills mansion and have a second home in Aspen,
Colo., are among the nation's largest corporate farmers and are generous
philanthropists and political donors, giving $536,000 to Democratic and
Republican California governors in the last decade. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>The
Los Angeles Business Journal estimates the couple's empire is worth $1.5
billion. It includes about 120,000 acres in California's Central Valley - where
they say they own more fresh citrus, almond and pistachio trees than anyone
else in the country - and a facility akin to the Fort Knox of water. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>That
kind of success, Lynda Resnick said in a telephone interview, can inspire
jealousy, and likely motivated this most recent "nuisance" lawsuit.
Her husband declined to be interviewed. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>After
growing up working class in Highland Park, N.J., Stewart Resnick started a
business waxing floors while in law school at the University of California, Los
Angeles. The couple bought farmland in the 1980s as a hedge against inflation,
gaining access to water contracts attached to those parcels. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>As
drought has hammered the region, leading farmers to abandon their dry fields,
the Resnicks' 48 percent stake in the Kern Water Bank, an underground pool that
stores billions of gallons of freshwater, has become increasingly valuable. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Court
records show that in early 2007, the Resnicks' companies' combined water
holdings reached 755,868 acre feet - more than twice the size of San
Francisco's Hetch Hetchy reservoir. In 2007, that volume would have qualified
as California's 11th largest reservoir, but the firms' water holdings have
diminished significantly since, company officials said. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>That
cache provided enough to nourish the Resnicks' orchards, but it also offered
another benefit. From 2000 to 2007, records show the state paid the Resnicks an
additional $30.6 million for water previously stored there as part of a program
to protect fish native to the ecologically fragile Sacramento-San Joaquin
Delta. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Lynda
Resnick's marketing savvy helped build cachet around her otherwise obscure
brands, such as POM Wonderful pomegranate juice, Cuties mandarins and Teleflora
floral bouquets. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Revered
among advertisers as the "Pom Queen," she has hired medical
scientists to bear out health claims that their fruits and nuts help fight
disease and extend life expectancy. Last year, following a nationwide recall of
pistachios over salmonella fears, she hired Levi Johnston, the teen father of <a
href="http://www.whorunsgov.com/Profiles/Sarah_Palin"><span style='color:#0C4790'>Sarah
Palin</span></a>'s grandson, to promote the snack nuts. The domestic business
grew by 40 percent over the last crop year. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>"We've
done more for the pistachio than anyone ever since it was planted in the Garden
of Eden," she said in the phone interview. "My husband should be
canonized for all the work he's done." <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Others
in agribusiness see it differently. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Ali
Amin, a Persian immigrant who owns a competing processing plant, filed a lawsuit
in late March in Fresno County Superior Court claiming the Resnicks violated
California public utilities laws because they turned a profit by selling water
to farmers who weren't members of their Bakersfield-based water company,
Westside Mutual Water Co. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>"You
feel like David fighting Goliath," Amin said. "If they're allowed to
keep doing this, the rest of the independents and small growers won't be able
to compete." <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Amin's
lawsuit alleges he lost $5.5 million in revenue when growers lured by water
supplies sold their nuts to the Resnicks' plant, which processes almost
two-thirds of the nation's pistachios. Amin controls about 5 percent of the
market. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Resnick
and other water users in agricultural Kern County gained control of the Kern
bank - the largest underground water storage facility in the nation - in the
mid 1990s, following a round of negotiations with the state Department of Water
Resources. Their position was that the state had shorted rural areas in
allotting water in a previous drought. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>To
avoid potential litigation from unhappy water users, state officials ceded
ownership of the Kern Water Bank - developed with $74 million from the
department and $23 million in taxpayer-approved bonds - to a local water
agency. In return, water users gave back 45,000 acre feet from the amount they
contracted to receive each year. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>The
deal was a pivotal moment in the rise of the Resnicks' business interests.
Ownership of the bank ultimately was transferred to a joint powers authority
including the local water agency, the Resnicks' Westside Mutual Water Co. and
four water districts. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Westside
distributes water stored there to its members, the operations that grow
Resnick's fruits and nuts, according to court records. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>To
prevent price-gouging, the California Public Utilities Commission requires most
mutual water companies to register as public utilities and subject their rates
to state regulation if they sell water to nonmembers for profit. There are some
exceptions, such as a "water emergency," but the PUC rules require
those sales to nonmembers to be at cost. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>PUC
staff attorney Fred Harris said Westside had not registered with the PUC. If
the company skirted the law, by selling water to nonmembers at a profit - as
the Amin suit alleges - Harris said Westside could be required to register and
set up rates with the commission. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Assemblyman
Huffman and Sen. Dean Florez, D-Shafter, said those allegations in the Amin
lawsuit touch on a broader debate about whether companies should be able to
profit from taxpayer-funded waterworks amid a drought. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>An
$11.1 billion water bond signed last year by Schwarzenegger would allow private
companies to partially own, operate and profit from dams, reservoirs and water
banks built with billions in public funds. It won't become law unless voters
approve it on the November ballot, and it's unclear how the bond proposal would
interact with current laws on public-private partnerships. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>"I
don't think anyone wants to see this become a gift of public funds to private
corporations," said Huffman, who is considering introducing a bond
amendment to remove or clarify the language. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Bill
Phillimore, who directs Resnick's water company, said the company has managed
scarce water supplies responsibly, and he and his bosses have spent "a
considerable amount of time to make sure we get value out of the last drop."
<o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Rob
Six, a spokesman for the couple's private holding company, Roll International
Corp., said the Amin suit was "frivolous," and said the company would
seek sanctions against Amin's processing business. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Both
sides claim victory in a previous suit in which many of the same claims were
raised. A jury awarded Amin $3.46 million late last month after deciding a
pistachio grower who had supplied his plant breached his contract by later
sending his nuts to the Resnicks. A Fresno County Superior Court judge granted
the Resnicks' request to be dismissed from the suit. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>After
Amin's first suit was filed, two of Resnick's companies filed a federal suit in
Los Angeles against Amin, his processing plant and his agricultural consultant,
alleging Amin's plant engaged in false advertising that Resnick's companies to
suffer up to $15 million in damages. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>"There
are very jealous people out there," Lynda Resnick said. "But we
usually win because we have such good in-house counsel." <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>The
Resnicks, who have had legal tangles with everyone from Tiger Woods to the
Diana, Princess of Wales Memorial Fund, have a good track record at winning. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>Their
suit to kill the California Pistachio Commission, a board farmers paid to do
generic marketing for the snack nut, proved so expensive that after spending
more than $2 million in legal fees, farmers gave up and voted to disband the
commission three years ago. <o:p></o:p></span></p>
<p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;
background:white'><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'>"Here
you had one man who had the money and thought he knew what was best, and didn't
want to take part in a democratic organization," said Brian Blackwell,
president of the Western Pistachio Association, which now represents smaller
growers. "Whatever he's doing, he's going to try to run the show." <o:p></o:p></span></p>
<p class=MsoNormal><b><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'><o:p> </o:p></span></b></p>
<p class=MsoNormal><b><span style='font-size:12.0pt;font-family:"Times New Roman","serif"'><o:p> </o:p></span></b></p>
<p class=MsoNormal><i><span style='color:#A6A6A6'>Byron Leydecker, JcT<o:p></o:p></span></i></p>
<p class=MsoNormal><i><span style='color:#A6A6A6'>Chair, Friends of Trinity
River<o:p></o:p></span></i></p>
<p class=MsoNormal><i><span style='color:#A6A6A6'>PO Box 2327</span></i><i><span
style='color:#BFBFBF'><o:p></o:p></span></i></p>
<p class=MsoNormal><i><span style='color:#BFBFBF'>Mill Valley, CA 94942-2327<o:p></o:p></span></i></p>
<p class=MsoNormal><i><span style='color:#A6A6A6'>415 383 4810 land/fax <o:p></o:p></span></i></p>
<p class=MsoNormal><i><span style='color:#A6A6A6'>415 519 4810 mobile<o:p></o:p></span></i></p>
<p class=MsoNormal><b><i><u><span style='color:#4F81BD'>http://www.fotr.org <o:p></o:p></span></u></i></b></p>
<p class=MsoNormal><o:p> </o:p></p>
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