By Nick Cahill, Courthouse News

Nestle’s longstanding bottled-water operation in California sprang a leak last week after state regulators warned the Swiss business giant to drastically cut the water it pipes from the San Bernardino National Forest.

The notice follows a 20-month investigation by the State Water Resources Control Board sparked in part by public outcry over Nestle pumping millions of gallons of Southern California spring water for its Arrowhead brand during a historic drought.

The 37-page report said Nestle is only permitted to pipe from Strawberry Creek each year about 8.5 million gallons of water; Nestle reported pumping about 32 million gallons in 2016. According to the regulator, diversions from Nestle’s sites averaged 62.5 million gallons per year from 1947 to 2015.

“While Nestle may be able to claim a valid basis of right to some water in Strawberry Canyon, a significant portion of the water currently diverted by Nestle appears to be diverted without a valid basis of right,” the report, released Thursday, states.

Investigators advised Nestle to immediately limit its water diversions until it can prove it has “valid water rights,” and reiterated that unauthorized diversions may be penalized.

“Please note that the water board has the authority to initiate enforcement action at its discretion for alleged unauthorized diversion or use of water. Therefore, you should take all necessary actions to ensure that your diversion is authorized,” the certified letter, addressed to Nestle and the Phoenix law firm Maguire, Pearce & Storey, said.

The food and drink company said Friday it had done nothing wrong and downplayed implications that it’s overpumping water in the national forest.

“We are pleased that they have confirmed we have a right to these ‘authorized diversions,’ and we will continue to operate lawfully according to these existing rights and will comply fully with California law,” Nestle spokesperson Alix Dunn said in a statement.

The company claims its water rights in Strawberry Canyon date back to 1865, and that the San Bernardino County Superior Court affirmed the rights in 1931.

Critics claim Nestle, which was recently sued in Connecticut on false advertising claims regarding its Poland Spring Water, pays the federal government just $524 a year to tap into the creek. Nestle sources its California bottling operation via a 4-mile pipeline at Strawberry Creek, 70 miles east of Los Angeles.

Regulators acknowledged citizen complaints and media reports helped spur the investigation into Nestle’s lucrative bottling operation.

“As a result of the complaints and due to repeated media and private citizen inquiries, the division determined that an investigation into the basis of right and possible public trust injuries was appropriate,” the report states.

Two of the complaints came from resident Amanda Frye and Story of Stuff Project. The activists said the report validates their claims that Nestle was operating on expired permits and pilfering water.

Frye said she hopes the federal government prosecutes Nestle for making false water right claims.

“A great deal of damage has been done by Nestle’s water withdrawal and actions. The headwater at Strawberry Creek spring is damp and the upper creek bed is dry, severely altering our forest’s valuable ecosystem,” Frye, a resident of nearby Redlands, said in a statement.

“As the people of California grieve the loss of life, livelihood, and land that has been devastated by this year’s tragic wildfires, we have a moral imperative to safeguard water,” added Michael O’Heaney, executive director of Story of Stuff Project.

In 2016, a federal judge ruled that Nestle gave the U.S. Forest Service proper notice of its intent to renew a 1988 permit in a case brought by the Courage Campaign Institute and Story of Stuff Project.

The company’s spring water diversion site is located at the headwaters of Strawberry Creek in the San Gabriel Mountains. The creek feeds Southern California’s largest stream, the Santa Ana River, which provides water to reservoirs such as Big Bear Lake, Lake Perris and Lake Elsinore. The Santa Ana watershed covers nearly 2,700 square miles.