Court Rules for Utilities in Nuclear Waste Case

(CN) - The Federal Circuit reinstated a ruling that the federal government can't blame its failure to collect radioactive waste from utilities on "unavoidable delays." The court ruled 11-1 to overturn a federal claims court's ruling that the D.C. Circuit lacked jurisdiction to order the government to fulfill its contracts.

Sitting en banc, the Washington, D.C.-based appeals court ruled that the D.C. Circuit had jurisdiction to review the Department of Energy's failure to comply with the Nuclear Waste Policy Act (NWPA), and that the court's mandate barring the agency from using the "unavoidable delay" argument was not void, as the U.S. Court of Federal Claims had ruled.

For years the nation's nuclear energy facilities have been paying the DOE some $750 million per year under waste storage contracts that have yet to be honored. The DOE has not accepted any nuclear waste from any of the utilities, even though the law required it do so by 1998 - a fact that has generated dozens of breach of contract complaints and more than $1 billion in judgments against the government.

The DOE argued that it had no duty to start accepting nuclear waste in 1998, because it hasn't been able to build a proper repository due to "unavoidable delays" -- specifically the failure of its long-term plan to build a storage facility at Yucca Mountain in Nevada.

The Nebraska Public Power District sued the DOE in federal claims court for breach of contract, arguing that the D.C. Circuit's ruling for the utilities was binding.

The claims court sided with the government, holding that the D.C. Circuit lacked jurisdiction to force the government to comply with the NWPA.

On review, the Federal Circuit disagreed, saying the D.C. Circuit correctly interpreted the NWPA as requiring the DOE to begin accepting nuclear waste in 1998, and that the government's failure to do so could not be excused as unavoidable delay, Judge William Bryson wrote for the majority.

The ultimate question before the Federal Circuit, Bryson said, was whether the D.C. Circuit had jurisdiction to rule on an issue of "statutory construction," or "whether the doctrine of sovereign immunity barred it from reviewing the government's compliance" with the Act.

The majority of the 12-judge panel agreed that the D.C. Circuit had jurisdiction.

"The mandamus order was issued pursuant to the D.C. Circuit's authority to construe the NWPA and to direct DOE to comply with its obligations under the statute," Bryson wrote. "The order did not address any issue of contract breach, direct the implementation of any remedy, or construe any contract defense, except to the extent that the proposed interpretation of the contract would conflict with the statutory directive. Those issues are all left to the Court of Federal Claims to decide in the contract breach action before it. We are satisfied that the D.C. Circuit's order was confined to the issue of statutory interpretation and did not impermissibly invade the jurisdiction of the Court of Federal Claims to adjudicate the parties' rights and remedies under the contract between them."

The panel reversed the order of the claims court and remanded for further proceedings.

Judge Arthur Gajarsa filed the only dissenting opinion.

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