F. CLARK HUFFMAN, ET AL., PETITIONERS V. WESTERN NUCLEAR, INC., ET
AL.

   No. 87-645

   In the Supreme Court of the United States

   October Term, 1987

   On Writ of Certiorari to the United States Court of Appeals for the
Tenth Circuit

   Reply Brief for the Petitioners

   In our opening brief, we demonstrated that the court of appeals'
interpretation of Section 161(v) of the Atomic Energy Act of 1954, 42
U.S.C. 2201(v), cannot be squared with the language, purpose and
history of that provision.  The court of appeals took a statute that
requires the Department of Energy (DOE) to restrict enrichment of
foreign uranium for a stated purpose -- "to assure the maintenance of
a viable domestic uranium industry" (ibid.) -- and converted it into a
blanket command that "if the domestic uranium industry is not viable,
the DOE must restrice enrichment of foreign uranium" (Pet. App. 20a).
Try as they may, respondents have failed to rehabilitate this
remarkable transformation.  Section 2201(v) states its purpose in
plain terms and does not require enrichment restrictions that would
not serve that purpose.  /1/

   1.a. Respondents' principal argument is that Section 2201(v) should
be read as incorporating an implicit finding of fact to the effect
that restrictions on enrichment of foreign uranium will always assure
the maintenance of a viable domestic uranium industry.  See, e.g.,
Resp. Br. 2 ("Section (2201(v)) embodies a congressional determination
that restrictions on enrichment of low-cost foreign uranium would
accomplish the statutory goal * * *.");  see also id. at 15, 18,
19-20, 25.  Congress of course could have made such a finding, and
could have written it into the statute.  But the plain language of the
statute reveals that Congress did no such thing.  Congress directed
DOE to adopt a particular means (restrictions on enrichment of foreign
uranium) "to the extent necessary to assure" a particular end (a
viable domestic uranium industry).  It did not declare, as a matter of
law, that the means always would produce that end, no matter what the
facts or circumstances might be in the future.  Respondents can point
to nothing in the statute that even resembles such a factual finding.

   Nor does the legislative history suggest that Congress intended to
enact any factual finding directly into law.  The Joint Committee on
Atomic Energy emphasized (S. Rep. 1325, 88th Cong., 2d Sess. 19 (1964)
(hereinafter Private Ownership Act Report)) that "(t)he future holds
many uncertainties" and that "many unforeseeable developments may
arise in this field." Mindful of these contingencies, the Committee
drafted a bill that would "permit the Commission to survey
periodically the condition of the domestic and world uranium markets
and to offer or refuse to offer its enrichment services on a basis
which will assure, in its opinion, the maintenance of a viable
domestic uranium industry" (id. at 31).  It would be most peculiar for
a Committee so concerned about future uncertainties and the need for
regulatory flexibility to turn around and enact into law its
understanding of the then-contemporary condition of the domestic and
world uranium markets.  Moreover, there would be no point in enacting
such a statute, when Congress could just as easily enact a statute
that would impose restrictions only when this would fulfill the
statutory purpose -- the maintenance of a viable domestic uranium
industry.  Respondents never explain why Congress would deliberately
choose to pass a statute that would become irrational over time,
rather than one that is capable of adapting to changing circumstances.
 /2/

   Respondents' notion that statutes incorporate the factual
assumptions that may have given rise to their enactment finds no
support in this Court's cases.  See, e.g., Diamond v. Chakrabarty, 447
U.S. 303 (1980);  Fortnightly Corp. v. United States, 392 U.S. 390,
395-396 (1968);  Browder v. United States, 312 U.S. 335, 339-340
(1941).  In Diamond, for example, the Court held that a micro-organism
was patentable, even though the Plant Patent Act of 1930 had been
enacted on the assumption that living things were not patentable (447
U.S. at 310-311).  The Court explained (id. at 312-313) that the 1930
Act did not embody the legal conclusion that organisms could not be
patented;  it merely reflected the belief -- universal in 1930 but
subsequently proven to be false -- that a living organism could not be
designed by man.  The lesson of Diamond -- that Congress will not be
presumed to have bound itself to the exact conditions that prevailed
when a law was enacted -- applies even more strongly where, as here, a
subject has been committed to an expert agency, which is charged with
applying congressional policy to changing circumstances.

   b. Respondents also reiterate the argument (Br. 20) -- advanced for
the first time in their brief in opposition (at 13) -- that enrichment
restrictions may in fact be necessary to assure viability in the sense
that they may be a "necessary" as opposed to a "sufficient" condition
of viability.

   This appeal to technical notions of necessary and sufficient
conditions is unavailing.  First, it ignores the "fundamental canon of
statutory construction * * * that, unless otherwise defined, words
will be interpreted as taking their ordinary, contemporary, common
meaning." Perrin v. United States, 444 U.S. 37, 42 (1979), citing
Burns v. Alcala, 420 U.S. 575, 580-581 (1975).  The statute says that
restrictions must be "necessary to assure" a viable domestic industry,
not that they must be a "necessary but not sufficient condition" of
viability.  Respondents' argument "would give an unwarranted rigidity
to the application of the word 'necessary,' which has always been
recognized as a word to be harmonized with its context." Armour & Co.
v. Wantock, 323 U.S. 126, 129-130 (1944), citing M'Culloch v.
Maryland, 17 U.S. (4 Wheat.) 316, 413, 414 (1819).

   Moreover, under the theory elsewhere advanced by respondents (see
Br. 26-29), enrichment restrictions are in fact not a "necessary
condition" of viability.  As respondents note (ibid.), the importation
or the domestic transfer of either enriched or unenriched uranium
require a license from the Nuclear Regulatory Commission (NRC) (see 42
U.S.C. 2073(a) (enriched uranium);  42 U.S.C. 2092 (unenriched
uranium)).  Respondents suggest that the NRC's licensing powers could
be used to give the domestic uranium industry a complete monopoly in
the primary domestic market for uranium and thus to promote the
viability of the domestic uranium industry.  But if that is true, then
restrictions on enrichment of foreign uranium under Section 2201(v)
would not be a necessary condition of viability, since any
contribution such restrictions would make to viability could be made
as well or better by other means.  If the statute requires that this
logic game be played, respondents cannot prevail.

   2. In any event, there is no merit to the contention that Section
2201(v) either requires the NRC to impose an embargo on imports of
enriched uranium, or requires DOE to impose enrichment restrictions if
such restrictions, in combination with an NRC embargo, might make the
domestic industry viable.  /3/ Section 2201(v) refers to one and only
one tool to assure viability -- enrichment restrictions.  It requires
that a specifically identified means -- enrichment restrictions -- be
used to achieve a particular end -- the viability of the domestic
industry -- and imposes no duty with respect to any other policy
measure when the means cannot achieve the end.  Possible actions of
the NRC, and their possible effects on viability, thus have no bearing
on DOE's obligations under Section 2201(v).

   This conclusion has nothing to do with the 1974 division of the
Atomic Energy Commission (AEC) into DOE and the NRC;  contrary to
respondents' suggestion (Br. 29), the same result would follow even if
all the powers of DOE and the NRC were still centralized in one
agency.  The Private Ownership of Special Nuclear Materials Act, Pub.
L. No. 88-489, 78 Stat. 602 (the Private Ownership Act), authorized
the AEC to sell enrichment services.  That same Act also authorized
the AEC to license imports of enriched uranium.  /4/ The provision of
enrichment services was made subject to the proviso at issue in this
case.  However, the Joint Committee on Atomic Energy specifically
declined to require that the AEC exercise its licensing power so as to
assure the maintenance of a viable domestic uranium industry.  Such a
proviso was originally included in the legislation proposed by the
domestic uranium industry that became Section 2201(v), but was not
recommended by the Joint Committee or adopted by Congress.  See
Private Ownership of Special Nuclear Materials:  Hearings Before the
Subcomm. on Legislation of the Joint Comm. on Atomic Energy, 88th
Cong., 2d Sess. 198 (1964) (proposal by Kerr-McGee Co.).  Clearly, had
Congress wanted enrichment restrictions to be used in conjunction with
import restrictions, it would have attached the proviso that appears
in Section 2201(v) to the NRC's licensing authority.  Congress's
refusal to do so cannot be reconciled with respondents' argument.  /5/

   3. In our opening brief, we explained (at 34-37) that the court of
appeals' reading of Section 2201(v) can draw no support from
subsequent congressional consideration of enrichment restrictions and
uranium import restrictions.  Indeed, in 1982, in enacting Section
170(b) of the Atomic Energy Act of 1954, 42 U.S.C. 2210(b), Congress
specifically rejected relief similar to that sought by respondents.

   In an effort to create the contrary impression, respondents suggest
that legislators who supported strong measures to protect the domestic
uranium industry in fact believed that Section 2201(v) requires DOE to
impose enrichment restrictions whenever the domestic uranium industry
is not viable (see, e.g., Resp. Br. 30 (quoting remarks of Rep. Lujan,
one sponsor of the Conference Committee proposal that was rejected on
the House floor)).  Little can be learned about the meaning of a
statute enacted in 1964, however, from beliefs expressed in 1982 by
individual legislators whose proposals were mainly not adopted (see
Gov't Br. 35-36 (rejection of both initial Senate bill and subsequent
Conference Committee proposal)).  By contrast, Congress's refusal (see
ibid.) to pass measures that would automatically protect the domestic
uranium industry from imports suggests that Congress as a whole
understood that the domestic industry's problems stem from causes far
more fundamental than foreign competition.

   4. Respondents suggest (Br. 33-37) that DOE's interpretation of
Section 2201(v) does not deserve the deference this Court ordinarily
accords an agency's reading of its statute (see Young v. Community
Nutrition Inst., 476 U.S. 974 (1986)).  Their arguments on this point
are not persuasive.  /6/

   a. Initially, respondents (Br. 5-7, 34) and amici (see, e.g.,
Senators Amici Br. 2-3) maintain the DOE's interpretation of Section
2201(v) should not receive deference because DOE has changed its
position on the provision's meaning.  But DOE's understanding of
Section 2201(v) has not changed over time.  What has changed are the
facts, including the domestic industry's viability and the effects
enrichment restrictions would have on its viability.  Neither the AEC
nor DOE has ever endorsed the court of appeals' interpretation of
Section 2201(v), which would require that restrictions be imposed
whenever the domestic industry is not viable, whatever might be the
effects of restrictions on viability.

   In fact, the statements on which respondents rely all reflect the
understanding that Section 2201(v) applies only when there is a causal
connection between uranium imports or DOE's enrichment of uranium
imports and the viability of the domestic uranium industry.  For
example, in 1974, in explaining the AEC's decision to phase out its
enrichment restrictions, Commissioner Anders (see Resp. Br. 6
(footnote omitted)) stated that "(s)hould there be any indication that
the proposed schedule (permitting increased enrichment of foreign
uranium) is endangering domestic industry viability, U.S.
self-sufficiency, or our national security, the (AEC) will reimpose
restrictions or take such other steps as might be appropriate."
Proposed Modification of Restrictions on Enrichment of Foreign Uranium
for Domestic Use:  Hearings Before the Joint Committee on Atomic
Energy, 93d Cong., 2d Sess. 6 (1974) (hereinafter 1974 Hearings).  In
other words, Commissioner Anders recognized that if DOE's enrichment
activities led to an increased use of foreign uranium that threatened
the domestic industry, restrictions would be reimposed.  He did not
suggest that restrictions would automatically be reimposed if the
domestic industry became non-viable for reasons unrelated to imports,
or because of imports of uranium that would not be affected by
enrichment restrictions.

   At the same hearings, George Quinn, the AEC's Assistant General
Manager for Production and Management of Nuclear Materials, explained
(1974 Hearings 135 (emphasis added)) that during and after the
phase-out the Commission would "monitor the extent of importation of
foreign uranium for domestic use and its effect on the viability of
the domestic uranium producing industry";  he likewise stated (id. at
134 (emphasis added)) that the Commission would be ready "to take any
appropriate action if it appears (to be) necessary to preserve the
viability of the (domestic) industry." Again, these statements make it
plain that Section 2201(v) mandates an inquiry into the causes and
possible cures of the domestic industry's problems, not the unthinking
imposition of restrictions without regard to their effects.

   Similarly, when the then-Assistant Secretary of Energy for Nuclear
Energy testified in 1981 that the difficulties of the domestic uranium
industry did not call for a reconsideration of the phase-out of
enrichment restrictions, he explained that lack of demand, not
imported uranium, was the cause of the domestic industry's depressed
state.  See Status of the Domestic Uranium Mining and Milling
Industry:  The Effects of Imports:  Hearings Before the Subcomm. on
Energy Research and Development of the Senate Comm. on Energy and
Natural Resources, 97th Cong., 1st Sess. 13 (1981) (statement of
Shelby Brewer, Assistant Secretary of Energy for Nuclear Energy).  /7/
Like Commissioner Anders and Mr. Quinn, Assistant Secretary Brewer
emphasized (ibid.) the importance of analyzing the effects of
restrictions on viability.

   In short, none of the statements cited by respondents ignored the
need for a causal connection between enrichment restrictions and
viability, or suggested that restrictions should be imposed even if
they would not assure a viable domestic industry.  These statements in
no way support the court of appeals' reading of Section 2201(v).

   b. Respondents also seek to distinguish this case from Young by
arguing (Br. 34) that in Young the FDA had two methods of achieving
the statutory purpose, while in this case Congress has prescribed only
one way of achieving the statute's stated goal.

   This attempted distinction is without substance.  First, Young made
it clear that the legal question involved was the deference to be paid
to an agency's interpretation of an ambiguous statute (see 476 U.S. at
981 ("(t)he FDA has therefore advanced an interpretation of an
ambiguous statutory provision")).  Significantly, respondents have
conceded (Br. 34) that in Section 2201(v) the phrase "to the extent
necessary" modifies the phrase "shall not offer such (enrichment)
services." Accordingly, the syntactical ambiguity identified in Young
is not even present in this case:  it is undisputed that the critical
phrase "to the extent necessary to assure the maintenance of a viable
domestic uranium industry" qualifies DOE's mandatory duty to restrict
enrichment services.

   Faced with the clear holding of Young -- that agency readings of
ambiguous texts deserve deference -- respondents (see Br. 33-34)
simply attempt to distinguish this case on its facts.  But there is
nothing in the Court's opinion in Young to suggest that it applies to
cases in which the interpretive question involves two ways to reach
the statutory goal, but not to cases in which the goal cannot be
achieved.  Young stands for the principle that reasonable agency
interpretations should receive deference.  As we have explained, DOE's
interpretation of Section 2201(v) is an eminently reasonable
explication of both the text of the provision -- which refers to the
goal of viability -- and of its underlying rationale.  To read Young
as giving deference to reasonable agency interpretations only if they
happen to fulfill the statutory purpose in particular ways is to
narrow that case's holding to its facts.  /8/

   For these reasons and those stated in our opening brief, the
judgment of the court of appeals should be reversed.

   Respectfully submitted.

   LAWRENCE G. WALLACE

      Acting Solicitor General

   ERIC J. FYGI

      Acting General Counsel Department of Energy

   APRIL 1988

   /1/ Respondents mischaracterize our position as the claim that "as
a result of changed circumstances, compliance with the statute would
not achieve the statutory goal" (Br. 2-3).  Amici States (e.g., Br.
18) and Senators (Br. 3-4) make similar assertions.  As we have
explained (Pet. 21 n.14, 27-28;  Br. 34 n.24), however, the dispute in
this case is about the meaning of the statute, not whether the
Secretary has the discretion to ignore it.  We maintain that Section
2201(v) imposes a mandatory duty on the Secretary to restrict
enrichment of foreign uranium when this is necessary to assure the
viability of the domestic uranium industry, but it does not impose any
duty on the Secretary to take actions that would not achieve its goal.

   /2/ Respondents' argument rests on the assumption that Congress did
not foresee the day when enrichment restrictions would lose their
effectiveness because of competition from other suppliers of
enrichment services.  Respondent's confident assertion (Br. 25 n.35)
that Congress did not foresee the possible demise of DOE's monopoly in
enrichment services, however, is unwarranted.  In fact, as both
respondents (Br. 27 n.37) and we (Gov't Br. 29 n.21) have noted, in
the process of considering the Private Ownership Act, the Joint
Committee on Atomic Energy questioned the General Counsel of the
Atomic Energy Commission (AEC) on the effectiveness of enrichment
restrictions in the face of potential foreign competition in the
market for enrichment services from Great Britain.  Private Ownership
of Special Nuclear Materials:  Hearings before the Subcomm. on
Legislation of the Joint Comm. on Atomic Energy, 88th Cong., 1st Sess.
30 (1963).  In addition, at the 1964 hearings Chairman Seaborg, in
response to questions from the Joint Committee, stated (Private
Ownership of Special Nuclear Materials:  Hearings Before the Subcomm.
on Legislation of the Joint Comm. on Atomic Energy, 88th Cong., 2d
Sess. 339-340) that other countries might begin selling uranium to
American users in the late 1970s.

   /3/ It is entirely speculative whether granting the domestic
uranium industry even a total monopoly in the primary domestic market
would be enough to make the domestic uranium industry profitable;  it
is even more uncertain whether this step would make it "viable" within
the meaning of the statute and implementing criteria (see Gov't Br.
40-42).  The domestic uranium industry was in serious decline well
before uranium imports reached a significant level.  See Status of the
Domestic Uranium Mining and Milling Industry:  The Effects of Imports:
 Hearings Before the Subcomm. on Energy Research and Development of
the Senate Comm. on Energy and Natural Resources, 97th Cong., 1st
Sess. 12, 16 (1981) (through August of 1981, 5% of ore delivered to
DOE for enrichment was of foreign origin) (statement of Shelby Brewer,
Assistant Secretary of Energy for Nuclear Energy).  Indeed, that
decline set in at a time when restrictions on DOE's enrichment of
foreign ore had not yet been completely phased out.  See 39 Fed. Reg.
38016-38017 (1974) (schedule of phase-out).  Moreover, domestic
uranium users have accumulated large stockpiles of enriched uranium,
and a substantial secondary market has developed (51 Fed. Reg. 3625
(1986)).  These factors suggest that the problems of the domestic
industry are due to fundamental economic conditions -- especially a
serious imbalance of supply and demand -- not to imports of uranium
ore.  See 51 Fed. Reg. 27135 (1986).

   /4/ Under 42 U.S.C. 2077(c), the AEC (now the NRC) may not "issue a
license pursuant to (42 U.S.C. 2073) to any person within the United
States if the Commission finds that the * * * issuance of such license
would be inimical to the common defense and security or would
constitute an unreasonable risk to the health and safety of the
public." Section 2077(c) makes no mention of the domestic uranium
industry or any economic policy considerations.

   /5/ Moreover, as we have noted (page 5, supra), restrictions on the
importation of both enriched and unenriched uranium could provide any
relief that could be provided through enrichment restrictions alone.
Had Congress wished the agencies to protect the domestic industry with
all means and at all costs, as respondents seem to assume, it would
have adopted Kerr-McGee's entire proposal.

   /6/ Respondents also assert (Br. 36) that DOE's interpretation of
Section 2201(v) deserves no deference because of a continuing
resolution which states that "no provision of this joint resolution or
the July 24, 1986, criteria (in which DOE declined to adopt enrichment
restrictions and explained its rationale for doing so) shall affect
the merits of the legal position of any of the parties concerning the
question() whether section 161(v) of the Atomic Energy Act requires
restriction of enrichment of foreign-origin source material destined
for use in domestic utilization facilities * * *." Act of Oct. 18,
1986, Pub. L. No. 99-500, Section 305, 100 Stat. 1783-210.  As we have
explained (Reply Memo. 5-6;  Br. 15 n.12), we do not argue that the
rulemaking affects the merits of this case.  We have referred to the
rulemaking because it sets out the Secretary's views on the legal and
factual questions relevant here.

   /7/ Respondents' insinuation (see Br. 8) that the "economic
disaster" in the domestic industry resulted from DOE's failure to
re-impose restrictions under Section 2201(v) is thus without
foundation.

   /8/ Respondents have not addressed any arguments concerning the
General Agreement on Tariffs and Trade (GATT), Jan. 3, 1947, pts. 5,
6, 61 Stat. A3, T.I.A.S. No. 1700, asserting (Br. 37 n.44) that the
GATT issue was not fairly presented in the petition.  Certain amici,
however, have discussed GATT in considerable detail (see Gov't of
Australia Br.; Gov't of Canada Br.).

   This case involves the meaning of 42 U.S.C. 2201(v), and does not
call for an adjudication of the United States' obligations under GATT.
 This does not mean, however, that it would be improper for the Court
to consider the role of trade policy in ascertaining the congressional
intent underlying Section 2201(v).  As amici have noted (see, e.g.,
Gov't of Canada Br. 11-13), Congress, when it adopted the Private
Ownership Act, was concerned with the effects of enrichment
restrictions on United States international trade relations (see
Private Ownership Act Report 17 (Section 2201(v) not inconsistent with
GATT)).  It might be appropriate to infer therefore that Congress
would have been reluctant to require enrichment restrictions that
would not make the domestic industry viable, thereby incurring the
cost of offense to our trading partners without any benefit to the
national interest.  Similarly, it might be reasonable to infer that
Congress resisted the suggestion that the AEC be required to restrict
imports of enriched uranium in order to assure domestic viability (see
page 7, supra) at least in part in order to minimize disruptions of
our trade relations.  Any such argument concerning the meaning of
Section 2201(v) would, we believe, be properly encompassed within the
question raised in the petition.

   /*/ The Solicitor General is disqualified in this case.