February 3, 2011 SECY-11-0015

FOR: The Commissioners

FROM: John F. Cordes, J r

Solicitor

SUBJECT: ANNUAL REPO ON COURT LITIGATION (CALENDAR YEAR 2010)

PURPOSE:

To Inform the Commission of the Status of Litigation in the Courts.

DISCUSSION:

Enclosed is a report updating events in Nuclear Regulatory Commission (NRC) court litigation

since my last cumulative annual report dated January 29, 2010 (SECY-10-0012). This report

reflects the status of NRC cases in court as of January 31, 2011.

During the reporting period (Calendar Year 2010), the Commission or NRC officials were sued

seven (7) times in the courts of appeals1 and twice in federal district court.2 During this same

one-year period thirteen (13) cases were closed.3 The nine (9) new court cases in 2010 are in

In re: Aiken County, No. 10-1050 (D.C. Cir.); Blue Ridge Environmental Defense League v.

NRC, No. 10-1058; Centerfora Sustainable Coast v. NRC, No. 10-1057 (D.C. Cir.); Honeywell

International, Inc. v. NRC, No. 10-1022 (D.C. Cir.); Peterson v. NRC, No. 10-1097 (D.C. Cir.);

South Carolina v. DOE, No. 10-1069 (D.C. Cir.); Washington v.DOE, No. 10-1082 (D.C. Cir.).

2 Baig v. NRC, No. 10-842 (FLW) (D.N.J.); General Electric Co. v. U.S. Dept. of the Interior, et

aL, No. 10-404 MCA/RHS (D.N.M.)

3 Brodsky v. NRC, No. 08-1454 (2d Cir.); Burton v. NRC, No. 09-1901 (2d Cir.); Burton v.NRC,

No. 09-0005 (2d Cir.); Center for a Sustainable Coast v. NRC, Nos. 09-1263 & 10-1057 (D.C.

Cir.); McCracken v. Brookhaven Science Associates, LLC, No. 08-cv-2642 (E.D.N.Y.), aff'd, No.

09-2165 (2d Cir.); Miles v. Jaczko, No. 8:09-cv-00503 (D. Md.), appeal dismissed, No. 10-1283

(4 th Cir.); Moris (& Eastern Navajo Dine Against Uranium Mining) v. NRC, No. 07-9505 (10th

Cir.); New York v. NRC, Nos. 08-3903, 08-4833 & 08-5571 (2d Cir.); Salsman v. NRC, No. 08-

74043 ( 9 th Cir.); Westinghouse Elec. Co. v. United Statees, No. 4:03-CV-00861 (DDN)

(E.D.N.Y.).
The Commissioners -2-

line with what we have come to expect over the past decade. There were 8 new cases in 2009,

.13 in 2008, 11 in 2007, 8 in 2006, 11 in 2005, 13 in 2004, 14 in 2003, 8 in 2002, and 5 in 2001,

for an average of 10 new cases a year.

During this reporting period (2010) we also handled four (4) requests (so-called "Touh/'

requests) for NRC testimony, depositions or other evidence for use in private litigation - one is

complete and the other three are in progress. We also continued to handle a steady stream of

discovery demands in lawsuits for or against the United States but not involving the NRC as a

party. The chief burden in this area again this year came in cases brought in the U.S. Court of

Federal Claims seeking money damages against the government for not meeting the statutory

deadline (1998) for a high-level waste disposal facility. We also handled a complex discovery

request in an offshoot of the Tronox bankruptcy case, where the United States is attempting to

recover additional assets for a clean-up, as well as requests for documents and witnesses in

two pending tax lawsuits involving the nuclear industry.

CONTACT: John Cordes

(301) 415-1600

Enclosure:

Litigation Status Report

DISTRIBUTION:

Commissioners

OGC

OCAA

OPA

OCA

ASLBP

CFO

EDO

SECY
LITIGATION STATUS REPORT

(As of Jan. 31, 2011)

ACTIVE CASES 1

In re: Aiken County (& Consolidated Cases), Nos. 10-1050, 10-1069 & 10-1082 (D.C. Cir.)

These consolidated lawsuits challenge a decision by the Department of Energy (DOE) to

abandon its effort to obtain an NRC license for a high-level waste facility at Yucca Mountain and

to withdraw its license application. The lead case was filed by Aiken County (SC). It has been

consolidated with Ferguson v. Obama, No. 10-1052 (D.C. Cir.), South Carolina v. DOE, No. 10-

1069 (D.C. Cir.), and Washington v.DOE, No. 10-1082 (D.C. Cir.).

Three of the consolidated suits (all but Ferguson) name NRC or NRC officials as respondents,

but petitioners' court of appeals briefs do not argue specific claims against NRC. In addition to

defending DOE's decisions on the merits, the government's brief argues that petitioners' suits

are premature because an NRC licensing board has already rejected DOE's attempted

withdrawal of its application and the Commission still is considering the board's ruling. The

Justice Department is representing the government at the court of appeals. NRC has joined

aspects of the Justice Department's prematurity defense, but has stood neutral on the merits

arguments.

After being held in abeyance for some time, the cases are now set for oral argument on March

22,2011.

CONTACT: John F. Cordes, OGC

301-415-1956

Baig v. NRC, No. 10-842 (FLW) (D.N.J.)

Plaintiff, a former NRC employee, claims that he suffered age discrimination and national-origin

discrimination in employment. Working with the United States Attorney's office, NRC has filed a

motion to dismiss or for summary judgment. The motion is awaiting decision.

CONTACT: John S. Farrington, OGC

301-415-2196

Blue Ridge Environmental Defense League v. NRC, No. 09-1112 & 10-1058 (D.C. Cir.)

These lawsuits challenge NRC's decision to reinstate previously-withdrawn construction permits

at TVA's Bellefonte site. Because a related adjudication was pending before NRC, the court of

appeals, on our motion, held the initial lawsuit in abeyance. We moved to dismiss the second

suit for lack of jurisdiction, but the court directed full briefing on the issue. The Commission

recently completed the adjudication - rejecting all contentions - and the lawsuits were

1 For statistical purposes, we count as "active" any case pending before a court, or still

subject to further judicial review, as of January 1, 2010. But narratives accompanying each

listed case include post-January 1 developments.

ENCLOSURE
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reactivated. Petitioner filed its opening brief in January, and our brief is due in March. Our brief

will raise both jurisdictional and merits arguments.

CONTACT: Grace H. Kim, OGC

301-415-3605

Brodsky v. NRC, No.09-Cv-10594 (S.D.N.Y.)

This federal district court lawsuit challenges exemptions from fire protection requirements that

the NRC Staff granted to Indian Point. Plaintiffs had originally challenged the exemptions on a

petition for review filed in the court of appeals (Second Circuit), but that court held that it lacked

jurisdiction. The complaint raises various procedural and NEPA-based challenges to the

exemptions. In collaboration with our office, the U.S. Attorney has sought dismissal, or

summary judgment, in the case. The case is awaiting decision.

CONTACT: Robert M. Rader, OGC

301-415-1955

El Paso Natural Gas Company, et al., v. United States of America, et al., No. 07-00905, RJL

(D. D.C.):

El Paso Natural Gas filed this lawsuit to compel the United States to clean up two sites

associated with the Tuba City Mill: the Tuba City Dump, and the Highway 160 site. The suit

asserts a number of theories of liability including the APA, CERCLA, RCRA, and UMTRCA.

The Navajo Nation has intervened as a plaintiff. The district court dismissed the APA and

UMTRCA claims against the Department of Energy, and issued a Rule 54 partial judgment

allowing El Paso to appeal on those issues to the D.C. Circuit. That court recently affirmed the

district court's dismissal order. The government has moved to dismiss a number of the

remaining claims, and is preparing a motion to dismiss still others. NRC is a named defendant

in the lawsuit, along with other federal agencies and the United States.

CONTACT: Charles E. Mullins, OGC

301-415-1618

General Electric Company v. U.S. Department of Interior, et al., Civ. No. 10-404 MCA/RHS

(D. N.M.)

This case is an attempt by General Electric to obtain reimbursement for clean-up activities at the

mine(s) associated with the Church Rock Mill. The NRC regulates the tailings pile associated

with the Mill, but not the mine. GE filed the complaint (naming NRC as a defendant, among

other agencies) and then initiated settlement negotiations, which have produced a tentative

agreement. The NRC is not required to do anything in conjunction with the proposed

agreement, but GE may approach the NRC in an effort to get it to license a separate disposal

cell to hold mine spoil and other NARM.

CONTACT: Charles E. Mullins, OGC

301-415-1618
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Honeywell international, Inc. v. NRC, No. 10-1022 (D.C. Cir.)

This petition for review challenges an NRC decision not to grant a licensee, Honeywell, an

exemption in 2009 from decommissioning financial-assurance requirements. NRC had twice

previously (in 2007-2008) granted Honeywell an exemption - allowing self-financing in lieu of a

surety - on the ground that Honeywell's strong bond rating and corporate goodwill compensated

for its failure to have "tangible net worth" at least ten times the current decommissioning cost

estimate of its licensed fuel facility in Metropolis, Illinois. NRC said that Honeywell's declining

tangible net worth no longer justified the exemption.

The court of appeals (Rogers, Brown & Griffith, JJ) remanded the exemption-denial for further

proceedings. The court held that NRC had not adequately explained why Honeywell's bond

position and corporate goodwill did not continue to justify an exemption, notwithstanding a

decline in tangible net worth. The court said that the Commission had "left too much to

Inference" and had not indicated "how far the tangible net worth must decline and over what

period."

NRC has time to seek Supreme Court review, but is unlikely to do so, given that the court has

given the agency another chance to articulate its rationale on remand.

CONTACT: Robert M. Rader, OGC

301-415-1955

Kandel v. United States, No. 1:06-cv- 872 (Court of Federal Claims)

This is a class-action suit brought against the United States by federal retirees seeking

additional retirement benefits on account of alleged mishandling of annual leave at the time of

retirement. The complaint, originally captioned Solow v. United States, but now renamed,

includes the NRC and other federal agencies. The court denied the government's motion to

dismiss on statute of limitations grounds, and the parties have engaged in settlement

negotiations (so far unsuccessful) and are disputing various class-action issues.

CONTACT: Mark J. Maxin, OGC

301-415-1554

Nevada v. NRC, No, 09- 1133 (D.C. Cir.)

This petition for review challenges NRC's "Yucca Mountain Rule," 10 CFR Part 63, which

implements an EPA rule establishing standards for reviewing the Yucca Mountain high level

waste application. The case has been held in abeyance, at the joint request of all parties,

subject to periodic status reports.

CONTACT: Steven F. Crockett, OGC

301-415-2871
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New Jersey Environmental Federation v. NRC, No. 09- 2567 (3 rd Cir.)

This petition for review challenges NRC's decision, after an extensive adjudication, to grant

Oyster Creek's license renewal application. Petitioners maintain that NRC made many

procedural errors during the adjudication and that NRC unlawfully referred some issues to later

resolution by the NRC Staff. The court heard oral argument in early January, and the case is

awaiting decision.

CONTACT: Robert M. Rader, OGC

301-415-1955

Ohngo Gaudadeh Devia v. NRC, Nos. 05-1419, 05-1420, 06-1087 (D.C. Cir.)

These consolidated lawsuits challenge a series of Commission adjudicatory decisions resulting

in an authorization to the NRC staff to license the proposed Private Fuel Storage ISFSI in Utah.

OGD's brief argued that the NRC did not properly handle an "environmental justice" claim and

that the NRC license should be vacated as moot (because other federal agencies have taken

action making PFS's use of the NRC license problematic). Utah's brief argued that the NRC did

not properly consider the probability and consequences of an air crash into the PFS facility, that

the NRC did not take adequate account of the Department of Energy's changing plans for

shipping spent fuel to the proposed Yucca Mountain facility, and that the NRC wrongly failed to

examine, under NEPA, the consequences of a terrorist attack.

We filed an answering brief arguing that NRC had reasonably resolved all safety and

environmental issues. But no merits decision will issue for quite some time, if ever. The court

of appeals (Gadand, Tatel, Rogers, JJ) removed the case from the oral argument calendar and

issued a decision finding the NRC case "prudentially" unripe. The court reasoned that the NRC

license was currently unusable due to- Department of the Interior rulings prohibiting use of the

proposed site. The court thus held the lawsuits against NRC in abeyance, pending PFS's effort

to overturn the Department of the Interiors adverse rulings. The court directed the parties to file

periodic status reports.

Several status reports have been filed. The most recent indicates that a federal district court in

Utah has remanded various Interior Department rulings back to the Department for

reconsideration. The Department has not yet resolved the case on remand, and our lawsuit

remains in abeyance.

CONTACT: Grace H. Kim, OGC

301-415-1607

Peterson v. NRC, No. 10-1097 (D.C. Cir.)

Petitioner, an advocate for a spent fuel disposal plan that he has developed as an alternative to

Yucca Mountain, attempted to intervene in the Yucca Mountain adjudicatory proceeding. The

Licensing Board and the Commission rejected his intervention petition for lack of standing and

for lack of an admissible contention. Petitioner challenged the decision in court, but his brief did

not explain why NRC should have allowed his entry into the adjudication but instead argued

various questions of national policy. The court of appeals declined to dismiss the case on our
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motion, but after full briefing the court (Ginsburg, Griffith & Kavanaugh, JJ) denied the petition

for review summarily. In a short, per cuniam order the court pointed out that petitioner had not

offered any reason why NRC's decision was unlawful. Petitioner may still seek rehearing at the

court of appeals or review in the Supreme Court.

CONTACT: Sean D. Croston

301-415-2585

San Luis Obispo Mothers for Peace v. NRC, 08-75058 ( 9 th Cir.)

Petitioner in this lawsuit, a citizens group, challenges the Commission's decision, after a

hearing, to uphold the NRC Staff's environmental assessment of the consequences of a terrorist

attack on an ISFSI at Diablo Canyon. Petitioner maintained that, to adequately address the

terrorism issue, the Commission ought to have provided access to non-public security

information and conducted a closed-door hearing. The Commission hearing in this

case was pursuant to a court directive in earlier litigation, San Luis Obispo Mothers for Peace v.

NRC, 449 F.3d 1016 (9th Cir. 2006), cert denied, 127 S.Ct. 1124 (2007),

All briefs have been filed, and the case was orally argued in November. It awaits decision.

CONTACT: Charles E. Mullins, OGC

301-415-1618

Shieldalloy v. NRC, No. 09- 1268 (D.C. Cir.)

This petition for review challenges NRC's decision to make New Jersey an agreement state to

the extent that the agreement covers a contaminated site that petitioner owns. Petitioner claims

that New Jersey's regulatory program, as it relates to petitioner's site, is incompatible with

NRC's, rendering NRC's entry into an agreement with New Jersey unlawful. The court of

appeals (Williams, Sentelle & Rogers, JJ) held that NRC had not adequately explained why it

rejected Shieldalloy's request that the agency retain NRC jurisdiction over the Shieldalloy site.

The court therefore remanded the case to NRC without resolving various other arguments

Shieldalloy had raised.

The time for Supreme Court review expires in February, but no certiorari petition will be filed.

The NRC instead has established a procedure for reconsidering the Shieldalloy matter on

remand.

CONTACT: Grace H. Kim, OGC

301-415-3605

United States v. Science Applications International Corp., No. 04-CV-1543 (RWR) (D.D.C.),

reversed, No. 09-5385 (D.C. Cir.)

The government sued SAIC under the False Claims Act for damages and other relief arising out

of SAIC's contract to provide unbiased advice to the NRC. The NRC hired SAIC to support the

agency's rulemaking effort to develop standards applicable to the release of radioactive

materials into the environment. SAIC at the same time was a hired consultant for entities with
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an interest in the outcome of the NRC rulemaking. After a jury trial where the United States was

represented by Department of Justice and NRC lawyers, the government won a $6.5 million

verdict and judgment. The district court rejected SAIC's motion to set aside the verdict.

The court of appeals (Tatel, Sentelle & Griffith) reversed the district court judgment because of

defects in the jury instructions on calculating damages and on when corporate employees' "collective knowledge" could be imputed to the corporation. The court did, however, reject

SAIC's position that only express contract conditions are actionable under the False Claims Act,

and upheld the government's position that implied conditions (here, providing unbiased advice)

are actionable as well.

Time remains to seek Supreme Court review, but the Solicitor General is unlikely to file a

petition for certiorari, given that the government can still win a complete victory after a second

trial in the district court.

CONTACT: Robin A. Baum, OGC

301-415-2202

CLOSED CASES

Brodsky v. NRC, No. 08-1454 ag (2d Cir.)

Petitioners in this case, a New York assemblyman and citizen groups, challenged exemptions

from fire protection requirements that the NRC Staff granted to Indian Point. Petitioners argued

that the exemption should have triggered an NRC hearing and was in any event unreasonable

and unlawful. The court of appeals (Walker& Wallace, JJ), ruled that it lacked jurisdiction to

review exemptions, because they are not among the items specifically listed for hearing under

the Atomic Energy Act, Section 189. We sought rehearing but the petition was denied. We did

not seek Supreme Court review.

In the meantime, petitioners have re-filed their challenge to the Indian Point exemptions, this

time seeking relief in federal district court (described above).

CONTACT: Robert M. Rader, OGC

301-415-1955

Burton v. NRC, No. 09- 1901 (2d Cir.)

This petition for review challenged NRC's rejection of various contentions on Millstone's power

uprate. Petitioner filed an opening brief, but not in proper format and lacking a proper appendix.

After the court gave petitioner an opportunity to fix the defects, and petitioner did not do so, the

court dismissed the case. Petitioner then filed a motion to reinstate her lawsuit. We opposed

the motion, and the court ultimately denied it.

CONTACT: Robert M. Rader, OGC

301-415-1955
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Burton v. NRC, No. 09-0005 (2d Cir.)

Petitioner in this case challenged a Commission decision in the Indian Point license renewal

proceeding. The challenged decision rejected petitioner's contention and waiver petition

attacking NRC's rules specifying permissible doses from operating reactors. After full briefing,

the court set the case for oral argument, but petitioner did not show up on the prescribed date.

Shortly thereafter, the court (Sack, parker & Wesley, JJ) issued a short judgment-order denying

the petition for review and upholding NRC's waiver and contention-admissibility decisions.

Petitioner sought no further review.

CONTACT: James E. Adler, OGC

301-415-1656

Center for a Sustainable Coast v. NRC, No. 09-1263 & 10-1057 (D.C. Cir.)

These petitions for review challenged NRC's issuance of an early site permit (ESP) at the

Vogtle site, and several of the adjudicatory decisions underlying the ESP. Petitioner's chief

concern appeared to be protecting local waterways from contamination. Because the

adjudicatoryprocess at NRC was still ongoing at the time petitioners first filed suit (an

administrative appeal, now decided, was still pending), we filed a motion to dismiss the first

lawsuit as premature. Petitioners then filed a second lawsuit once NRC proceedings were

complete. Ultimately, though, upon receiving assurance from the ESP applicant that it no longer

intended to use river barges to bring heavy construction equipment and supplies to the site,

petitioner withdrew both lawsuits.

CONTACT: Sean D. Croston, OGC

301-415-2585

McCracken v. Brookhaven Science Associates, LLC, No. 08-cv-2642 (E.D.N.Y.), aff'd, No.

09-2165 (2d Cir. )

Plaintiff seeks millions of dollars in damages from the government, including the NRC, and from

private and national laboratories for alleged radiation injuries. The United States Attorney's

office in Brooklyn (NY) is representing the government and has sought dismissal on

jurisdictional grounds. Plaintiff filed, but then voluntarily dismissed, a similar suit in

Pennsylvania (McCracken v. Brookhaven Science Associates, LLC, No. 08-cv-2934 (E.D. Pa.)).

The district court (Gleeson, J) dismissed the suit as untimely and frivolous. Plaintiff appealed to

the Second Circuit, but the appeals court rejected all of his arguments.

CONTACT: Maxwell C. Smith, OGC

301-415-1246

Miles v. Jaczko, No. 8:09-cv-00503 (D. Md.), appeal dismissed, No. 10-1283 (4 th Cir.).

This is an employment discrimination suit where we collaborated with the United States

Attorney's office on the defense. It was originally filed in the District of Columbia, but was later

transferred to the District of Maryland. The government filed a motion to dismiss and for
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summary judgment. The court granted the government's motion. Plaintiff took an appeal, but

the court of appeals ultimately dismissed it for lack of prosecution.

CONTACT: Sara McAndrew, OGC

301-415-1562

Morris (& Eastern Navajo Dine Against Uranium Mining) v. NRC, No. 07-9505 (10th Cir.)

Petitioners in this case challenged a series of Commission adjudicatory rulings culminating in

the approval of an in situ uranium mining license for Hydro Resources, Inc. Hydro Resources

sought the license to mine uranium in Crownpoint and Church Rock, New Mexico. Petitioners

argued that granting the license was unreasonable and unlawful under the AEA and NEPA.

Petitioners focused on dose calculation and financial assurance issues.

A split panel of the Tenth Circuit (Ebel, Frizzell & Lucero, JJ, with Judge Lucero dissenting in

part) found that NRC's interpretation of its regulations as not including radioactive residue from

past mining in calculating potential doses from the new project was reasonable. The court also

upheld NRC's financial-assurance and NEPA determinations.

Petitioner sought Supreme Court review, but the Court denied certiorari.

CONTACT: Charles E. Mullins, OGC

301-415-1618

New York v. NRC, Nos. 08-3903-ag, 08-4833-ag, 08-5571-ag (consolidated) (2d Cir.)

These consolidated lawsuits challenged an NRC denial of rulemaking petitions seeking changes

in NRC's generic environmental findings for license renewal. The three states that brought

suit - New York, Connecticut and Massachusetts - believed that NRC had not taken sufficient

account under NEPA of "new and significant" information on the risk of fires in spent fuel pools,

including terrorist-caused fires.

In a published, but per cunam opinion, the court of appeals (Jacobs, Kearse & Gardephe, JJ)

ruled for NRC. The court deferred to NRC's technical judgment that petitioners' "new

information" did not show an increase in fire risk in spent fuel pools, even when the threat of

terrorism is taken into account. Thus, the court did not step into the conflict between the Third

and Ninth Circuits on the question whether NEPA requires studying the consequences of

potential terrorist attacks.

Petitioners sought not further review at the court of appeals or at the Supreme Court.

CONTACT: James E. Adler, OGC

301-415-1656

Saisman v. NRC, No. 08-74043 (9 th Cir.)

Petitioner, an individual citizen with great interest in the hazards of uranium, filed an

unsuccessful rulemaking petition with NRC arguing that uranium's hazards (non-radiological)
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are worse than NRC had thought and warrant changes in 10 C.F.R. Part 20. He challenged

NRC's rulemaking denial in court.

Our brief maintained that Mr. SaIsman is an interested citizen but has not alleged that he

himself is suffering personal harm from the current Part 20. Therefore, we argued, petitioner

lacks standing to sue. In a short, per curiam order (Canby, Thomas, and W. Fletcher, JJ), the

court agreed and dismissed petitioner's suit. Subsequently, the court denied petitioner's

request for rehearing

CONTACT: Maxwell C. Smith, OGC

301-415-1246

Westinghouse Electric Co. v. United States, No. 4:03-CV-00861 (DDN) (E. D. Mo.)

This was a lawsuit for government contribution under CERCLA for cleanup of the Hematite site

in Missouri. We are working with the Justice Department in defending the suit. The United

States successfully intervened in a companion suit, Missouri v. Westinghouse Electric Co.,

involving the State of Missouri's effort to halt the State of Missouri's effort to "settle" with

Westinghouse in a way that would compromise the federal government's interests. The

government also filed a counterclaim and cross-claims against various parties seeking

contribution should the government be held financially liable under CERCLA.

After extensive settlement negotiations, in which NRC was closely involved, an agreement

favorable to the government was reached, and the lawsuit was dismissed.

CONTACT: Charles E. Mullins, OGC

301-415-1618