The 4th District Appellate court has ruled in favor of Poseidon Water in the case of Surfrider Foundation vs California Regional Water Quality Control Board, San Diego Region. From the ruling:
"Surfrider Foundation (Surfrider) appeals from the trial court's denial of its petition for a writ of mandamus challenging the approval of the National Pollutant Discharge Elimination System (NPDES) permit by the California Regional Water Quality Control Board, San Diego Region (the Regional Board) for a desalination facility that Poseidon Resources (Channelside), LLC (Poseidon) plans to build on the coast in Carlsbad, California.
Surfrider contends that in issuing the NPDES permit the Regional Board failed to comply with the requirements of Water Code section 13142.5, subdivision (b) (section 13142.5(b)),1 which provides that "[f]or each new or expanded coastal powerplant or other industrial installation using seawater for cooling, heating, or industrial processing, the best available site, design, technology, and mitigation measures feasible shall be used to minimize the intake and mortality of all forms of marine life." (Ibid.) We reject Surfrider's arguments and conclude that the Regional Board complied with section 13142.5(b). Accordingly, we affirm the judgment." 
Download the full ruling.

With deal in place, construction on the plant expected to start early next year
The San Diego County Water Authority Board of Directors has approved the purchase of the water produced by the proposed Carlsbad Desalination Project, a seawater desalination plant that will produce enough water to meet about 7 percent of the region's water needs in 2020, reducing San Diego's dependence on imported water and significantly improving water reliability in the region.

SAN DIEGO—An effort to build the Western Hemisphere's largest seawater desalination plant faces a key test as San Diego's regional water agency decides whether to buy all its output despite criticism that cheaper alternatives may be overlooked.
The San Diego County Water Authority board on Thursday will consider a 30-year contract to buy the water from Poseidon Resources LLC, which needs the deal to move ahead with plans to sell bonds that would pay for more than 80 percent of $984 million project. The plant in Carlsbad would produce 50 million gallons of highly purified drinking water a day, enough to supply about 8 percent of the region in 2020." By ELLIOT SPAGAT Associated Press. Read the full AP article.