Valley Water settles with San Jose residents over 2017 flood

Valley Water has agreed to pay $8.25 million to the victims of a devastating 2017 flood in San Jose, marking the conclusion of a four-year lawsuit.

The water district recently announced the settlement in a joint statement with the plaintiffs on its website, noting all parties are pleased to have reached a resolution.

“From the onset, both sides sought to resolve this case fairly. The $8.25 million settlement was reached because Valley Water and those affected by the flood event engaged in good-faith settlement discussions,” the statement said. It also noted Valley Water is developing flood protection and management projects along nine miles of flood-prone areas near Coyote Creek.

Sources told San José Spotlight in April the consolidated lawsuit was on the verge of settling. Plaintiff attorneys wouldn’t disclose details about the case at the time, citing concerns about derailing the offer.

Anne Kepner, lead attorney for the plaintiffs, told San José Spotlight the settlement will be divided between 231 plaintiffs depending on people’s damage claims. She said the case should be completely resolved by June 15, but couldn’t say when plaintiffs will receive payment.

“There’s a level of relief among everybody that it’s resolved after a long time,” Kepner said. “I commend the plaintiffs for having the perseverance they did. We’ve been through the pandemic together—it’s been a long haul to get here.”

Valley Water board member Richard Santos told San José Spotlight he’s happy the parties could find a resolution to the case.

“I’m pleased for all of us, especially the victims who went through a tough time,” Santos said.

Residents filed numerous lawsuits against Valley Water following a storm on Feb. 18, 2017 that breached Anderson Dam in South San Jose. The 20-year-flood caused an estimated $100 million in damages and displaced 14,000 residents from neighborhoods near Coyote Creek, including Rock Springs, Naglee Park and the South Bay Mobile Home Park. The flood was financially ruinous for residents like Teresa Pedrizco, who previously told San José Spotlight repairing her family’s house would cost approximately $400,000.

The lawsuits, eventually consolidated in one case, initially named San Jose as a defendant, with some residents claiming they didn’t receive flood warnings from the city. Last year, San Jose councilmembers approved a $750,000 settlement, although the city denied the allegations.

Valley Water tried to stem litigation by offering flood victims a non-negotiable $5,000 payout, which would have required them to forfeit the right to sue. According to the district’s latest financial report, Valley Water had received 423 claims to date. It also settled 162 claims in September 2019 for roughly $700,000. It’s not immediately clear how much Valley Water has spent on litigation over the past four years.

In the months after San Jose’s settlement, Valley Water refused to settle. In January, the district made a failed attempt to dismiss the case on a motion for summary judgment. Santa Clara County Superior Court Judge Sunil Kulkarni ruled the district had failed to show proof of how Anderson Dam operated as a flood control project before the 2017 storm, and how the agency’s operational plan was not faulty.

Sandra Moll, a resident of Naglee Park, told San José Spotlight six feet of water flooded the downstairs of her house causing significant damage. Moll said she doesn’t know yet how much money she will receive from the settlement, but she’s glad the case is over—even if it means there won’t be a trial to hold the district accountable.

“The advantage of a public trial would have been, I think, greater exposure about how the water district has not really taken flood protection seriously,” Moll said. “But that’s okay, I think our attorneys did a great job and the settlement was the right thing to do.”

Contact Eli Wolfe at [email protected] or @EliWolfe4 on Twitter.

Editor’s Note: Valley Water CEO Rick Callender is on San José Spotlight’s board of directors.