The lawsuit alleges that by lining the canal, California would harm the farmers of the Mexicali Valley, who have come to depend on seepage from the canal.
Lawyers involved expect the litigants to seek a restraining order blocking the water agencies from awarding contracts for the lining project, expected to cost more than $200 million.
And while the litigation is fought in Sacramento and Las Vegas, the owners of some farm service companies in the Imperial Valley are crying foul, saying their businesses are being hurt by the fact that 12,000 acres of farmland are being left fallow to save water for San Diego.
The crying may increase greatly as fallowing -- in which farmers are paid not to plant crops -- is slated to double in the next decade so that even more water can be sent to San Diego.
Two of the three economists assigned to evaluate the economic effect of the water deal have declared that it is a net positive for the valley, which has 150,000 residents and more than 500,000 acres of farmland.
As long as the economists' ruling stands, millions of dollars set aside to help farmworkers and business owners hurt by fallowing cannot be distributed.
Orby Hanks, 72, whose family has lived in the Imperial Valley since the 1930s, thinks the economists and a local committee assigned to work with them don't understand the farm economy.
"I went to the meetings and basically was told to sit down and shut up," said Hanks, whose company provides equipment for grain harvesting and hauling. "They see us as rich like the farmers. But we're not."
The Imperial Irrigation District is appealing the economists' decision. It had been politically very painful for the district to decide to sell water to San Diego in the first place.
Only after the federal government sued to reduce the valley's allocation from the river -- without compensation -- did the district vote 3-2 to sell water to San Diego.
The board member who was the swing vote in favor of the deal was promptly defeated by John Pierre Menvielle, a third-generation Imperial County farmer, who ran on a platform opposing the deal.
There is no easy way for the district to back out of the deal, which is meant to last for 45 years with a possibility of another 30.
Still, Menvielle and other board members say the matter of whether the district can get out of the deal is not settled.
"If we keep getting kicked around by San Diego, I'll take another hard look at how things are going," said Menvielle.
