Allied-General Nuclear Services v. United States

12 Cl. Ct. 372, 1987 U.S. Claims LEXIS 92
United States Court of Claims·Decided May 22, 1987·No. No. 146-83C·Published·Cited by 5 cases

Opinion

OPINION

YANNELLO, Judge.

This case was brought pursuant to the Tucker Act, 28 U.S.C. § 1491(a)(1), seeking compensation of $500 million for a taking by the United States. The matter is before the court on plaintiff’s and defendant’s motions for summary judgment.*

I. Factual Background

This court recognizes that each case in which a taking is alleged is unique. In most cases the uniqueness lies in the facts, and the development of those facts is important to the resolution of such case. Usually this factual development requires trial and the resolution of the case depends on factual findings. The situation in the instant case, however, is somewhat different.

Firstly, most of the basic facts in this case are stipulated and undisputed. (Even the facts about which there is any significant controversy have been stipulated for the purposes of the pending dispositive motions.)

Secondly, there are questions of law present in this case, and raised by the pending motions, which may well be dispos-itive of the entire matter. In any event, as the parties have recognized, even if the case were not resolved on the basis of these motions, a trial would be appropriate only after resolution of these legal issues since the scope of trial may be affected thereby. Accordingly, this court now undertakes a review of the pending disposi-tive motions.

The complex facts material to the pending motions have been most ably stated in the parties’ briefs and are essentially agreed to. (In addition, these facts are recited in Westinghouse Electric Corp. v. United States, 598 F.2d 759 (8d Cir.1979), in which plaintiff in the instant case joined as a party plaintiff.)

No purpose would be served by reiterating these facts in detail here; a detailed Statement of Facts is set forth in the Appendix hereto.

The facts central to resolution of this case can be summarized briefly as follows, addressing first the general factual background and second, the facts concerning the “bargaining chip” issue raised extensively by the parties.

Prior to 1954, private corporations were unable to possess, produce, or use nuclear materials. In the years after 1954, the private commercial use of nuclear materials was encouraged, particularly in the generation of electrical power. As part of the [374] cycle of nuclear-generated power, a waste product emerged known as “spent fuel.” This spent fuel could be recycled or reprocessed so as to separate radioactive waste as well as plutonium. (Plutonium, unlike the enriched uranium used in the generation of electrical power, also has an application in nuclear weaponry.)

Changes in statutory provisions, such as the Atomic Energy Act (AEA) of 1954, 42 U.S.C. §§ 2011-2282, and the Private Ownership of Special Nuclear Materials Act (POSNMA) of 1964, 42 U.S.C. §§ 2012 et seq., reflected these changes and contained the provisions pursuant to which private commercial enterprises could use nuclear fuel. The AEA, for example, provided for the granting of licenses to construct plants for the reprocessing of fuel and, after construction, to operate such plants. The AEA also provided that the issuance of such licenses should take into account whether the issuance “would be inimical to the common defense and security or the health and safety of the public”. 42 U.S.C. § 2236.

For the purposes of the pending motions, and based on the facts set forth in detail in the Appendix, it is concluded that, prior to 1977, the government encouraged and exhorted private commercial enterprises to enter the field of nuclear generation of power and of reprocessing of spent nuclear fuel.

Plaintiff obtained a license to construct a reprocessing facility at Barnwell, South Carolina, and began construction in 1971. During the next several years, a number of events occurred, all of which led to the situation giving rise to this suit. In 1974, the government began preparation of a generic environmental statement referred to as GESMO. At about the same time, the government began proceedings on plaintiff’s application for an operating license for its Barnwell plant.

Also at about this time, India conducted its first atomic test, using plutonium recovered from a spent-fuel reprocessing plant. In 1976 and 1977, the French and West German nuclear industries were negotiating to sell reprocessing technology to Brazil and Pakistan.

The international concerns about proliferation of nuclear technology, materials, testing, and weaponry had been the subject of non-proliferation treaties in 1968 and 1978. (See Appendix, footnote 12.) In 1976, President Ford discussed the risks of plutonium recycling and declared that the country “should pursue reprocessing and recycling in the future only if they are found to be consistent with our international objectives”. (See Appendix, footnote 7.)

In April 1977, President Carter noted with alarm the serious proliferation risks of plutonium recycling and announced the sponsorship of an International Nuclear Fuel Cycle Evaluation (INFCE) program. The government’s immediate response was to defer indefinitely the commercial reprocessing and recycling of plutonium from spent fuel used in the generation of power.

The agency immediately announced a postponement of the GESMO hearings and a reassessment of the applications for licenses relating to recycling. The agency requested comments and received comments on behalf of the President, re-emphasizing his earlier statements. In December 1977, the agency announced the termination of all GESMO proceedings as well as most proceedings relating to license applications for plutonium recycling. The agency would reexamine the matter after the conclusion of investigations into alternative fuel cycles, which was expected in about two years. (This directive was memorialized in 1978.)

Parties interested in such license proceedings, including plaintiff, filed suit to protest the cessation of proceedings. The agency action was upheld, however, and the court, in Westinghouse, 598 F.2d 759, stated that the agency-imposed “moratorium” was appropriate when sound regulatory reasons existed for doing so, as where the moratorium was designed to enable the agency to make rules and regulations which would be applied in the context of processing licensing applications. The court found that the agency did not abuse its discretion or act arbitrarily or capri[375] ciously “when it rested its decision in part on a desire not to obstruct the goal of securing international non-proliferation.” Westinghouse, 598 F.2d at 776.

The court provided that the agency may not completely terminate the license application proceedings, simply by declaring an open-ended moratorium, without passing on the merits of the applications and that the agency must grant licenses unless it makes a finding of inimicality to the common defense and security or to the public health and safety. Westinghouse, 598 F.2d at 774.

The court concluded that:

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