Consolidated Edison Co. v. Entergy Nuclear Indian Point 2

Apr 16: In the U.S. Court of Appeals, Federal Circuit, Case No. 2010-5155, -5157. Appealed from the United States Court of Federal Claims. The Appeals Court explains that the case involves the Federal government's breach of its commitment to dispose of spent nuclear fuel.

 

    On appeal, there is no dispute as to the government's liability. However, the government and Entergy Nuclear Indian Point 2, LLC (ENIP) separately appealed the decision of the Court of Federal Claims (Claims Court) with respect to damages. See Consol. Edison Co. of N.Y., Inc. v. United States, 92 Fed. Cl. 466 (2010). The government appeals the Claims Court's award of two categories of damages: (1) ENIP's Unit 1 wet storage costs for the continued operation of its Unit 1 spent fuel pool; and (2) regulatory fees paid to the United States Nuclear Regulatory Commission (NRC). The Appeals Court rules, ". . .we reverse the Claims Court's award of damages for ENIP's Unit 1 wet storage costs and ENIP's NRC fees."

    ENIP cross appeals the Claims Court's denial of damages for: (1) ENIP's indirect overhead costs associated with its mitigation activities; and (2) ENIP's cost of financing its mitigation activities. The Appeals Court rules further that, "The issues on cross appeal are controlled by our recent precedents, which were not available to the Claims Court at the time of its decision. These recent precedents require that we reverse the denial of ENIP's overhead costs, and that we affirm the denial of ENIP's cost of capital."

    In further explanation, the Appeals Court notes, "In Yankee Atomic Electric Co. v. United States, we explained that 'damages for breach of contract require a showing of causation,' which in turn necessitates a 'comparison between the breach and non-breach worlds.' 536 F.3d 1268, 1273 (Fed. Cir. 2008). Thus, 'a plaintiff seeking damages must submit a hypothetical model establishing what its costs would have been in the absence of breach.' Energy Nw. v. United States, 641 F.3d 1300, 1305 (Fed. Cir. 2011) (emphasis added).

    "Here, ENIP's hypothetical model contemplated that if DOE had not breached the Standard Contract, the SNF stored in the Unit 1 spent fuel pool would have been removed in 1998.5 Thus, ENIP argues, in a non-breach world, ENIP would not have incurred any costs related to the continued operation of the Unit 1 spent fuel pool after acquiring Indian Point in 2001. The Claims Court agreed. Consol. Edison, 92 Fed. Cl. at 502-03. The problem with ENIP's theory is that it does not reflect the fact that in the non-breach world, Unit 2 SNF, rather than Unit 1 SNF, would have been removed from Indian Point in 1998, when Consolidated Edison still owned the Indian Point facility. . ."

    Access the complete opinion (click here). [#Energy/Nuclear, #Haz/Nuclear, #CAFed]

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Oral Arguments On Cross-State Air Pollution Rule

Apr 12: The U.S. Court of Appeals for the District of Columbia Circuit is hearing oral arguments in lawsuits over U.S. EPA's Cross-State Air Pollution Rule (CSAPR). The Cross-State Air Pollution Rule reduces the sulfur dioxide and oxides of nitrogen pollution emitted from coal-fired power plants across 28 eastern states. Supporters of the rule indicate that the pollution drifts across the borders of those states, contributing to dangerous -- and sometimes lethal -- levels of particulate and smog pollution in downwind states.

    EPA issued the rule under the "Good Neighbor" protections of the Clean Air Act, which ensure that the emissions from one state's power plants do not cause harmful pollution levels in neighboring states. On December 30, 2011, in one of the last official judicial environmental actions of 2011, the D.C. Circuit issued a ruling to stay U.S. EPA's controversial Cross-State Air Pollution Rule (CSAPR) finalized on July 6, 2011, and published in the Federal Register on August 8, 2011 [See WIMS 7/7/11]. According to the 2-page Court order issued on December 30, the CSAPR, which just became effective on October 7, 2011, is now on hold pending judicial review until at least April 2012 [See WIMS 1/3/12].

    According to EPA and supporters, CSAPR would reduce power plant sulfur dioxide emissions by 73 percent and oxides of nitrogen by 54 percent from 2005 levels. These emissions and the resulting particulate pollution and ozone (more commonly known as soot and smog) impair air quality and harm public health -- both near the plants and hundreds of miles downwind. They indicate that CSAPR would provide healthier air for 240 million Americans in downwind states. EPA estimates that the Cross-State Air Pollution Rule, when fully implemented, would: Save up to 34,000 lives; Prevent 15,000 heart attacks; Prevent 400,000 asthma attacks; and Provide $120 billion to $280 billion in health benefits for the nation each year.

    Nine states (CT, DE, IL, MA, MD, NY, NC, RI, VT), the District of Columbia, five major cities (Baltimore, Bridgeport, Chicago, New York and Philadelphia), Environmental Defense Fund (EDF), the American Lung Association, the Clean Air Council, NRDC, Sierra Club, and several major power companies (Calpine, Exelon and Public Service Enterprise Group) have all intervened in support of the clean air protections. On the other side are: other power companies (AEP, Southern, GenOn, Luminant) and states including AL, FL, GA, IN, KS, LA, MI, MS, NE, OH, OK, SC, TX, VA, WI .

    Access a release from EDF (click here). Access the briefs for and against the rule posted on the EDF website and link to fact sheets and economic benefits by states (click here). Access EPA's CSAPR website for complete background and details (click here). [#Air, #CADC]

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S.R.P. v. U.S. (National Park Service)

Apr 10: In the U.S. Court of Appeals, Third Circuit, Case No. 10-4011. On Appeal from the District Court of the Virgin Islands – Appellate Division Division of St. Croix. As explained by the Appeals Court, S.R.P., a minor, appealed from an order of the District Court dismissing his claims for lack of subject matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1).

 

    The action arose out of a 2004 incident in which S.R.P. was bitten by a barracuda while playing near the shore of Buck Island Reef National Monument (Buck Island Monument or the Monument). S.R.P., through his mother, filed suit against the United States under the Federal Tort Claims Act (FTCA), 28 U.S.C. § 2671 et seq., alleging that the Government negligently failed to warn of the danger posed by barracudas to shallow water bathers. The District Court dismissed the case on the basis that the discretionary function exception to the FTCA deprived it of jurisdiction, and thus immunized the Government from suit. The Appeals Court affirmed the District Court decision.

 

    Access the complete opinion (click here). [#Wildlife, #CA3]

 

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Luminant Generation Company, et al v. U.S. EPA

Mar 27: In the U.S. Court of Appeals, Fifth Circuit, Case No. 10-60891. On Petition for Review of an Order of U.S. EPA. The Appeals Court explains that the case requires us to review the EPA's disapproval, more than three years after the time within which it was statutorily required to act, of three regulations promulgated by the State of Texas. Pursuant to Texas's duty under the Clean Air Act (CAA), to adopt and administer a statewide plan for implementing Federal air quality standards, the regulations provide for a standardized permit for certain projects that reduce or maintain current emissions rates. The Appeals Court ruled, "Because the EPA had no legal basis on which to disapprove those regulations, we vacate the agency's disapproval of Texas's regulations and remand with instructions."

 

    In a lengthy conclusion, the Appeals Court said, "This chapter in regulatory history has lasted almost two decades. Texas submitted its first two standard permits for PCPs [pollution control projects] to the EPA for approval in 1994. Texas made various amendments to these permits over the years, and promptly submitted each amendment to the EPA. The most recently amended version is the PCP Standard Permit at issue in this case. Despite an eighteen month statutory deadline, the EPA did not take action on any of these submissions until September 15, 2010. At that late date, the EPA disapproved the PCP Standard Permit -- submitted four and a half years earlier -- based on its purported nonconformity with three extra-statutory standards that the EPA created out of whole cloth. Moreover, the EPA did this in the context of a cooperative federalism regime that affords sweeping discretion to the states to develop implementation plans and assigns to the EPA the narrow task of ensuring that a state plan meets the minimum requirements of the Act. The EPA applied these unauthorized standards to disapprove of a state program for projects that reduce air pollution and that, under the Act's plain terms, is subject to only the most minimal regulation.

 

    "Because the EPA waited until more than three years after the statutory deadline to act on Texas's submission, we order the EPA to reconsider it expeditiously. On remand, the EPA must limit its review of Texas's regulations to ensuring that they meet the minimal CAA requirements that govern SIP revisions to minor NSR, as set forth in 42 U.S.C. § 7410(a)(2)(C) and § 7410(l). If Texas's regulations satisfy those basic requirements, the EPA must approve them, as § 7410(k)(3) requires. That is the full extent of the EPA's authority in the SIP-approval process because that is all the authority that the CAA confers. See La. Pub. Serv. Comm'n v. FCC, 476 U.S. 355, 374 (1986) ('[A]n agency literally has no power to act . . . unless and until Congress confers power upon it.').

 

    "We vacate the EPA's disapproval of 30 Tex. Admin. Code §§ 116.610(a), 116.610(b), and 116.617 and remand with instructions that the EPA reconsider these regulations and approve or disapprove them most expeditiously."

 

    Access the complete opinion (click here). [#Air, #CA5]

 

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SCOTUS Rules In Sackett v. U.S. EPA Wetlands Case

Mar 21: In the U.S. Supreme Court, Case No. 10-1062. Appealed from the U.S. Court of Appeals, Ninth Circuit [See WIMS 9/21/10]. Oral arguments were held January 9, 2012 [See WIMS 1/10/12]. The opinion was unanimous with two separate concurring opinions.

 

    Chantell and Michael Sackett own a small lot in a built-out residential subdivision that they graded to build a home. Thereafter, the Sacketts received an Administrative Compliance Order from EPA claiming that they filled a jurisdictional wetland without a Federal permit in violation of the Clean Water Act. At great cost, and under threat of civil fines of tens of thousands of dollars per day, as well as possible criminal penalties, the Sacketts were ordered to remove all fill, replace any lost vegetation, and monitor the fenced-off site for three years. The Sacketts were provided no evidentiary hearing or opportunity to contest the order. And, the lower courts have refused to address the Sacketts' claim that the lot is not subject to Federal jurisdiction. The questions presented to the Supreme Court were: Do Petitioners have a right to judicial review of an Administrative Compliance Order issued without hearing or any proof of violation under Section 309(a) (3) of the Clean Water Act?

 

    The district court granted the EPA's Federal Rule of Civil Procedure 12(b)(1) motion to dismiss the Sacketts' claims for lack of subject-matter jurisdiction. The Appeals Court ruled, "In conclusion, we hold that it is 'fairly discernable' from the language and structure of the Clean Water Act that Congress intended to preclude pre-enforcement judicial review of administrative compliance orders issued by the EPA pursuant to 33 U.S.C. § 1319(a)(3). We further interpret the CWA to require that penalties for noncompliance with a compliance order be assessed only after the EPA proves, in district court, and according to traditional rules of evidence and burdens of proof, that the defendants violated the CWA in the manner alleged in the compliance order. Thus we do not see any sharp disconnect between the process given a citizen and the likely penalty that can be imposed under the CWA. Under these circumstances, preclusion of pre-enforcement judicial review does not violate the Sacketts' due process rights. The district court properly dismissed this case for lack of subject-matter jurisdiction."

 

    The High Court said, "The particulars of this case flow from a dispute about the scope of 'the navigable waters' subject to this enforcement regime. Today we consider only whether the dispute may be brought to court by challenging the compliance order -- we do not resolve the dispute on the merits."

 

    Despite that fact the Supreme Court said, "The reader will be curious, however, to know what all the fuss is about" and cited its various cases regarding "navigable waters" including: United States v. Riverside Bayview Homes, Inc., 474 U. S. 121 (1985); Solid Waste Agency of Northern Cook Cty. v. Army Corps of Engineers, 531 U. S. 159 (2001); and Rapanos v. United States, 547 U. S. 715 (2006).

 

    In the opinion, the Supreme Court indicates in part, ". . .the Government notes that Congress passed the Clean Water Act in large part to respond to the inefficiency of then-existing remedies for water pollution. Compliance orders, as noted above, can obtain quick remediation through voluntary compliance. The Government warns that the EPA is less likely to use the orders if they are subject to judicial review. That may be true -- but it will be true for all agency actions subjected to judicial review. The APA's presumption of judicial review is a repudiation of the principle that efficiency of regulation conquers all. And there is no reason to think that the Clean Water Act was uniquely designed to enable the strong-arming of regulated parties into 'voluntary compliance' without the opportunity for judicial review -- even judicial review of the question whether the regulated party is within the EPA's jurisdiction. Compliance orders will remain an effective means of securing prompt voluntary compliance in those many cases where there is no substantial basis to question their validity."

    The High Court ruled, "We conclude that the compliance order in this case is final agency action for which there is no adequate remedy other than APA review, and that the Clean Water Act does not preclude that review. We therefore reverse the judgment of the Court of Appeals and remand the case for further proceedings consistent with this opinion."

    Justice Ginsburg in a concurring opinion said in part, "The Court holds that the Sacketts may immediately litigate their jurisdictional challenge in federal court. I agree, for the Agency has ruled definitively on that question. Whether the Sacketts could challenge not only the EPA's authority to regulate their land under the Clean Water Act, but also, at this pre-enforcement stage, the terms and conditions of the compliance order, is a question today's opinion does not reach out to resolve. Not raised by the Sacketts here, the question remains open for another day and case."

 

    In a lengthier concurring opinion, Justice Alito said, "The position taken in this case by the Federal Government -- a position that the Court now squarely rejects -- would have put the property rights of ordinary Americans entirely at the mercy of Environmental Protection Agency(EPA) employees. The reach of the Clean Water Act is notoriously unclear. Any piece of land that is wet at least part of the year is in danger of being classified by EPA employees as wetlands covered by the Act, and according to the Federal Government, if property owners begin to construct a home on a lot that the agency thinks possesses the requisite wetness, the property owners are at the agency's mercy. . . Allowing aggrieved property owners to sue under the Administrative Procedure Act is better than nothing, but only clarification of the reach of the Clean Water Act can rectify the underlying problem."

 

    Access the complete opinion and concurring opinions (click here). Access the transcript of the oral arguments (click here). Access the merit briefs and numerous amicus briefs filed in the case (click here). Access the SupCt docket in the case (click here). [#Water, #SCOTUS]

U.S. v. Oceanpro Industries, Ltd.

Mar 23: In the U.S. Court of Appeals, Fourth Circuit, Case No. 10-5239, 10-5284 and 10-5285. Appeals from the United States District Court for the District of Maryland, at Greenbelt. Oceanpro Industries, Ltd., doing business as "Profish, Ltd." (Oceanpro), a seafood wholesaler in the District of Columbia, and two Oceanpro employees, Timothy Lydon (officer and fish buyer) and Benjamin Clough, III (fish buyer), were convicted for purchasing untagged and oversized striped bass, in violation of the Lacey Act, 16 U.S.C. § 3372(a)(2)(A) (prohibiting the purchase in interstate commerce of fish or wildlife sold in violation of state law). Oceanpro and Clough were also convicted for giving a false statement to Federal law enforcement officers during the course of the investigation of the crimes, in violation of 18 U.S.C. § 1001. In addition to imposing fines and prison sentences, the district court ordered the three defendants, jointly and severally, to pay Maryland and Virginia $300,000 in restitution, to be divided equally between the States.

 

    On appeal, Oceanpro and Clough challenge the District of Maryland's venue for the false statement offense because the false statement was made at the offices of Oceanpro in the District of Columbia, not in Maryland. In addition, all of the defendants contend that the order of restitution to the States was improper because the States did not have a sufficient interest in the illegally caught fish so as to make them "victims," as is required for receiving the benefit of a restitution order.

 

    The Appeals Court ruled, "We reject both arguments, concluding that venue for the false statement charge was proper in the District of Maryland and that Maryland and Virginia's interest in striped bass was sufficient to make the States 'victims' and therefore to justify an award to them of restitution. Accordingly, we affirm." In its conclusion, the Appeals Court added, "To qualify as victims, Maryland and Virginia need not even have been 'owners' of the striped bass, although they were after the fish were illegally caught; they merely had to have interests that were 'harmed' as a result of the defendants' criminal conduct. Because we have concluded that their interests were indeed harmed, the States were victims and therefore properly awarded restitution."

 

    Access the complete opinion (click here). [#Wildlife, #CA4]

 

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