in november two thousand and eleven fifty thirty three for my yankee nuclear power against the united states and specifically the obligation to pay the one time fee second the trial court for legal error in failing to conduct a proper inquiry concerning the foreseeability of the cost of the cost of energy agreed to pay to the state of vermont as a condition to work to its construction of a federally licensed and fuel storage facility and third the trial court failure to hold entergy to its urban approach with regard to sell transport and spent fuel characterization cost and it's that it's forcing upon the government that burden beginning first with the validity of the assignment what happens if you win on the solution if we win on this issue your honor the consequence is simply that the government would not be found to be in privity with entergy and as a consequence  judgment forty five million dollar judgment would have to be reversed because of a lot of pretty between united states and japan but if you if you prevail the effect of that is to split the ownership of the facility and the fuel from the contract obligations which is exactly what the cost of the standard contract seems to permit well you are we are not personal seeking to in any way on wind the transaction that ultimately what you're saying the government can ignore well you know what we have done is to point out promptly and might have promptly we pointed out in two thousand and six as soon as the government was informed of the nature of this arrangement that the terms of the assignment contract are signed however and both entergy and vermont yankee when they purported to notify the government of the transfer of the contract neglected to mention the hundred forty million dollar elephant in the room when did you find out about that we didn't find our i think reasonable and justified belief that all of the terms of the all of the obligations under the contract had been transferred to entergy given that you not really answering the question how can the government continue to accept payments from energy at the same time say that the  amount of spent fuel that's being generated and by law that that spent fuel triggers an obligation to pay now i understand that the consequence of our argument may be that there is no privity of contract with united states and entergy but   i think the government kind of was to accept the money with the with the caviar and with the reservation of the right to contest the validity of the assignment and you met after you say that when you accepted the payment no you government was notified of the terms of the assignment for the first time it did what it could to say wait this is not what the standard contract provides and the terms this time it was such that were inconsistent with what had previously been described to the governor i think it bears noting that when entergy in two thousand and two and this is on page two sixty eight of joint appendix notified the government of the transfer it said please be advised at the moment yankee has as of today signed it's right title and interest  entergy from and after today entergy will assume and discharge the obligations of vermont yankee under the contract you know lou a vermont yankee that was the opera that was the understanding that the government has in two thousand to two thousand and six and that was the problem and said we will assume the liability to pay the one time face but it has neglected to do so it has chosen not to do so when i can presume only presume that the reason it is chosen not to do so is that it's not sure that when the time comes for actual payment that vermont yankee is going to pay the full amount as distinct from some smaller amount and the fact that we're in court at this point in time contesting what the money and he owns versus what entergy owns i think probably is it a good reason for entergy to not be by the government i'm not suggesting that they won't pay what they perceive to be do but i am suggesting that there is a substantial question before this court today as to how much money he's going to say is due and i might get entergy is approach to this was you mean because  that will be settled one way or not presumably your honor but i think it's important to note that the validity of the assignment has to be measured not as of today but as at the time at the time it was made and the risks to the united states as of the time of the assignment were understand it correct correct so no pay no collect well it was isn't that the perfectly solid basis on which you can expect to be paid i don't think so you not paid you know for i don't think so for several reasons and section three seventeen eighteen and nineteen of her statements speak to the time to speak to the factors that are really considered to be considered when ascertaining the risks of the transfer of obligations to a third party and what one of the things they talk about in each of those provisions is the public policy component and i know that entergy suggest that well public policy doesn't trump contract of statutes but the validity of the assignment is to be measured visa v the public policy implications of that assignment and in the event that there is a refusal by one party to pay the amount due the consequence of that is twofold first  may well be that entergy says us for additional costs because of the additional length of time it spent fuel has to sit out on a pad somewhere and second it is also possible that as a consequence of this the spent fuel doesn't actually get transferred to wherever the federal repositor may be and there is a public interest that the government has been charged with under the end to be ate it up that fuel promptly and in the event that there is an ongoing dispute either with its party vermont yankee or with some third party that remark making may ultimately assign the obligation to pay the consequences is of it is that that fuel sits out even longer and this is ultra hazardous waste this is the most interest substance known to man and it is in the united states interest in the public policy interest to have that fuel transferred as soon as possible  and that's the nature of the rest and that's set forth not only section three seventeen of the restatement as well three eighteen and nineteen govern the transfer of duties and obligations under contract i want to move if i can to the issue of the trial court legal error and failure to ascertaining the foreseeability of the licensing costs that entergy incurred but let me ask you a question whether i understand your your argument about the clean energy fund and some other aspects of this but the one thing that troubles me all of it is the legal and lobbying costs i mean it just it doesn't seem to have been foreseeable in one nine hundred eighty three that there might be some legislative approval required for constructing the dry storage facility so why shouldn't the government in to support it or that there could be at least some measure of legal and lobbying the costs required to secure that approval yarn this is first of all not an issue that the trial court independently considered most of the most of the analysis was with regard to the entirety of the nine million with regard to the to the lobby of that change in the law and the needs and go engage in this extensive and very lengthy negotiation but that seems to be a challenge to this thing with the amount wasn't foreseeable but certainly some portion of it was foreseeable in the sense that you might have to get a bill through to get the approval or there might be actioned to require additional approvals wasn't wasn't at least that foreseeable i mean that's what might be called the blackmail aspect of it perhaps wasn't foreseeable into that but that some some action by the legislature to require approval on some legal lobbying plus seems to have been a possibility of a three no well i think that the inquiry has to be whether or not all the stark each of the circumstances that led to this particular type of loss were foreseeable and as we explained in our break the statutory scheme as it existed in  three was and as n v even understood it as at the time that it purchased that plant was that no legislative approval whatsoever would be required in order to in order to to build  spent fuel storage facility the but it might have been the state of the law but there was zero line on a specific legislative exemption the fact that the legislature had gone so far as to create an exemption suggests that there might be further legislative action in the future relating to the exemption well certainly that's going to seal the honor but there is a distinction to be tron between that's which is conceivable and that which is foreseeable and this is quoting say section three fifty one foreseeable as a probable result of the breach and certainly it's conceivable that the legislature might change its laws or something like that but that's a circumstance that far more akin to old stone than it is to  and had ultimately prevailed do you think the litigation costs would have been the regular course of a business so even though you say that for months changing its position was not forseeable that you nonetheless think that given that the position changed and there were substantial litigation costs litigation costs might would be recoverable i think that depending on the amount of them and what exactly they were for that they may well be recovered when there are certain cost  all these spent fuel cases incurred in order to pursue a license on that for the n r c or various paper scenes and that includes challenges the third parties may bring to the pursuit of a license for example you can contest the application for spent fuel we retain the obligation to pay the one time fee which is now in excess of one hundred forty million dollars so even though we saw the power plant we retained that obligation under section six point eleven and we retained as a reciprocal fuel to two to two obligations for the fee for fuel before ninety three i don't understand what you're saying well we say it we say in the agreement that that we agreed to pay  damages for relating to a one time fee for fuel burn before april seventh ninety three that's all we're saying we're not saying that we have every right pre closed we said we have now right for costs a crude as a closing to ground fuel for electricity generated before and before one thousand eighty three because that's what the one time fee is for so it's a very simple right so how's that different from what i said but what you're saying is it could be under the d o d s deal we've seen a contract a clue accrued as of the closing which was in one which is in two thousand two whether relating to periods prior to or following the closing those were sold excluding such claims as merely late to a one time fee with respect to fuel used to generate electricity prior to april seventh ninety three so we don't claim that we retain all frequency cos we claim only an hour second of that so that's what we say we have two thousand and eight the bedrock of the case is a reciprocal obligation of the parties we have a right to as as judge rising as you said earlier you know that you have the ability to have to sue for damages and you have the you have the obligation to think the clear language of the statute in this court's analysis and ruling in dominion is dictates the correct result of the government's argument on this aspect of the claim as well there's only two ways by which the government can get to the of the standard contract which doesn't provide for a partial assignment and least statement does say that there can be circumstances in which a partial assignment is not permissible but vital interests look at what's going on in this case in the state of vermont to get that fuel offsite and so the government's in a different position it's supposed to host a c and entergy would always have the ability to you know for that they have an interest having the obligations to perform under the contract rest with a single party don't because they have they certainly may prefer that they say they now prefer i don't concede that there's any advantage to the government again i think doesn't affect the way the government operating today would not affect the way they perform if they start to plan to come to the vermont yankee plant they will they will get the trucks ready and say we need a one time fee and they'll  a fee but that doesn't matter that's that risk is the same from the whoever owns that obligation and they'll perform so i'd like in the minyan the government said they would prefer to deal with one party but that's not what the language you can imagine  here if if this obligation to pay the one time fee weren't supported by an escrow account in vermont where insolvent and well there's no there's no requirement for an escrow account if entergy had never you know we reject your argument about the type of mitigation costs not having to be foreseeable let's assume that the type has to be foreseeable what in one nine hundred eighty three to there's no clean energy finder that existed in a similar there was no similar payment required for licensing the plants and nine hundred eighty three there was no payment like the clean energy find called the clean energy fin dry storage by the way we talked a little bit about that there was an exception but never stashed on the books for any dinosaurs that states were hostile some states to nuclear power and states would use all the tools at their disposal or maybe some tools not at their disposal to inhibit the development  operation nuclear power so in your our hypothetical hundred million dollars for school yes foreseeable now would that be recoverable i suggest potentially not because then the question becomes the reasonableness of the mitigation and that's a fact situation very very different from here where and in testimony taken by the records important emphasize clearer standard foreseeability is a question of fact exhaustive review by the trop we're here in this case with the three hundred million dollars with a one hundred million dollars payment into the schools fund be preempted potentially potentially and i don't know that this is this particular you know has it there's never been a ruling on that in a particular this clean energy fund the real one that happened in this case there's never been a ruling about whether that's that was unlawful absolutely that's what school was going on in pacific gas and that's what continued to go on state again approached in line and sometimes crossed the line so the foreseeability question which is i understand your honour's questions precise foreseeable but i want to be clear i'm not necessarily saying it's recoverable because then you have to do the calculus of whether it's reasonable mitigation so in the hundred million dollar example i can foresee that could change the calculus and because the because of the amount all of the other factors being determined and reviewed by the transport here in the relationship with the state the desire to continue operating the plant what it does to the two points i wanted to emphasize and for state of the state and in essence can require a blackmail payment for the approval you don't have to challenge it and you can recover and i'm not saying that you know i know i'm not an apologist but i'm not being clear what i'm saying is the state can blackmail and maybe or maybe not that's per ok if it's not and if the amount is enough that it causes the reasonable mitigation step to be to take them to court and get it overturned for preemption then that's the step that that the utility would have to say so when i gather you're saying is that recognising i submit as high standards the government tries to cast it as an issue foreseeability but for the reasons i've tried to explain it was foreseeable that states would do some states would do anything and everything including crossing the wires and foreseeable if they would require payments a new clean energy fund when you've agreed that there wasn't anything like that and once again i apologize for not being a clear it was foreseeable that they would take whatever steps they had available to them including potentially some steps that were not available to them to try to get storage  to plant because because of safety concerns well potentially it is that i think when i get into the question whether it's printed again i would be clear i'm not saying it is or is not present it may well have been preempted but that's not because he said that it was goal that the state would have safety concerns it was foreseeable that those concerns would lead to a preemption of the state legislation right i'm sorry to the extent that the it was foreseeable the state would do things because of safety concerns it was also quite foreseeable that any action taken because of safety concerns would be preemptive right might be subject to a preemption challenge that was going on and like i said so the notion and i think not just what i'm trying to make but it's not just a challenge that they would be pretty well we don't we don't know that we litigated in this record proceedings in vermont there have been multiple live hearings testimony by senators there has to be a preemptive purpose and a preemptive the government cites relies upon you can do say that because it is arguably preempted it's not foreseeable i would i'd like to brief if i have any time well for what what did you want to well i didn't have a chance to respond  power decision that determined that the nuclear waste fund was not an appropriate place to go and so the notion that you might be able to set off any of these with respect to damages was still not as clear as it is today but to go back to to your honor not knowing how whether said also it would play out or what would happen if there was ever going to be a reduction of that see again and i recognize and understand your honour's not well by my example here but i would i would  on which we had a cross  but public policy is an issue to be determined or mission be analyzing considering whether an assignment is valid and just because the end of an p a where the contract says that the obligations may be assignable it doesn't say that they can be assigned in all circumstances so therefore the court needs to look in the court the trial court should have looked at these public policy questions at these questions about the risk to the united states so it's not a question of public policy being irrelevant to the contrary the restatement makes clear that the public policy implications judge by concerning one hundred million dollars for schools or something like that i think one of the one of the points that the didn't get addressed there that needs to be addressed is that there is a serious intervening causation problem and i recognize that an old st court i think properly indicated that the questions of causation and foreseeability in this context are not necessarily distinct but in the event that the state of vermont said well we'd like you to pay a hundred million dollars for schools or a skyscraper or something like that then you have a situation in which this is truly an intervening causation as counsel for government sends one page seven forty nine of the of our joint appendix the clean energy development payments had quote nothing to do with dry storage nothing to do with dry storage well if they have nothing to do with dry storage how in the world they're possibly conceivable to the only that if if entergy need a dry storage that that entergy would be on the hook for payments to the clean energy development fund it is a question of intervening causation and for that reason it's not a question of mitigation or the reasonable sum of the mitigation it's a question of whether or not these are causes intervening cause of the chain up that deal we should have foreseen at the time of contract and there's no proof in the record suggesting that anyone in any way shape or form daily was on notice that should have known and did know that this was a possibility and as the court indicated there is judge next question and fast as i flesh and there was no example of the utility of the state reaching out to try to extort or extract or whatever you want to call it blackmail utility into having to make payments of any kind is a condition to continue to operate ordered storekeeper or anything like that finally and this is just set forth cabin in its claim perhaps because it knew that this might be an issue in this particular lawsuit and they tried to suggest oh we're not challenging the clean energy development payments but when it didn't get the injunction that it originally wanted from the district court it went back to the district court and said and i put it in bold and alex we think that the entirety of x seventy four is preempted and the court's ruling in vermont going to energy was that the entirety of acceptance will thank you no thank you i did not hear anything from either party