Natural Resources Defense Council, Inc. v. United States Nuclear Regulatory Commission, and the United States of America, (Two Cases)

680 F.2d 810, 220 U.S. App. D.C. 261, 17 ERC 1778
Court of Appeals for the D.C. Circuit·Decided June 11, 1982·No. 80-1863, 80-1864·Published·Cited by 110 cases

Opinion

HARRY T. EDWARDS, Circuit Judge:

The petitions for review in this case arise out of an adjudicatory proceeding before the Nuclear Regulatory Commission (“NRC” or “Commission”) concerning proposed amendments to the license of Nuclear Fuel Services, Inc., a facility in Erwin, Tennessee (“NFS-Erwin”) that produces a special nuclear fuel used by the Navy. Petitioner Natural Resources Defense Council, Inc. (“NRDC”) requested a full adjudicatory hearing on the license amendments, as provided for in the NRC regulations at that time. In response, the Commission promulgated, without notice and comment, an immediately effective rule authorizing the use of alternative hearing procedures for matters involving “military and foreign affairs functions.” The Commission simultaneously issued an order granting NRDC’s hearing request but providing, under the new “military functions” rule, only a “legislative” type of hearing with limited procedural rights.

NRDC has petitioned for review of both the Commission’s adoption of the “military functions” rule and its simultaneous application of the rule to the NFS-Erwin proceeding. NRDC contends that: (1) the “military functions” rule is invalid because it was initially promulgated without notice and comment; (2) the rule cannot be applied to the ongoing NFS-Erwin proceeding because it would substantially prejudice NRDC by eliminating its rights to, inter alia, cross-examination and discovery; and (3) the rule cannot properly be applied to *812 the NFS-Erwin proceeding because that proceeding does not involve “military or foreign affairs functions.” As explained in greater detail below, we conclude that none of these issues is properly before the court at this time. The first issue is now moot because the NRC has repromulgated the “military functions” rule in accordance with the notice and comment requirements of section 553 of the Administrative Procedure Act (“APA”), 5 U.S.C. § 553 (1976). The remaining two issues concern interlocutory actions by the Commission that are not yet subject to judicial review. Consequently, we dismiss the petitions so that the Commission may conclude the NFS-Erwin proceedings and reach a final decision on the proposed license amendments.

I. HISTORY OF THE PROCEEDINGS

Operating under a license issued by the NRC, the NFS-Erwin facility produces a special, highly enriched uranium fuel that is used in the nuclear reactors that power Navy nuclear vessels. Historically, NFS-Erwin has had difficulty meeting certain requirements in its license and in the NRC regulations for maintaining control over and accounting for special nuclear material. See 10 C.F.R. § 70.51-.59 (1981). On more than one occasion the Commission has required the facility to shut down in order that a reinventory of its special nuclear materials might be conducted. This case has its genesis in a 1979 shutdown and reinventory of NFS-Erwin stemming from the inability of officials at the facility to account for amounts of nuclear material in excess of the limits specified in its license. After conducting an inquiry into the problems at NFS-Erwin, the Commission issued an order on January 21, 1980, J.A. 24, 109-11, authorizing the facility to resume operations under revised physical security measures and material control and accounting requirements. The order also amended the NFS-Erwin license by relaxing its reinven-tory and shutdown requirements, thereby increasing the permissible amounts of “unaccounted for” nuclear material in the facility.

On February 6, 1980, petitioner NRDC requested a hearing on the proposed license amendments, as provided for in the Atomic Energy Act of 1954 1 and in the NRC regulations. J.A. 29-64. At that time, the Commission regulations provided for full hearing procedures that included discovery and cross-examination. See 10 C.F.R. § 2.740-.744 (1981). On June 26, 1980, however, the Commission promulgated, without notice and comment, an immediately effective rule allowing the agency to use alternative hearing procedures for matters involving “military and foreign affairs functions.” J.A. 178-89; 45 Fed.Reg. 45,-253 (July 3, 1980). 2 Essentially, the new rule incorporated the language of the “military and foreign affairs” exception to the formal adjudication requirements in the APA. 5 U.S.C. § 554(a)(4) (1976). 3 The Commission then issued an Order and a Notice of Hearing that granted NRDC’s hearing request but provided only a limited, “legislative” type hearing pursuant to the new “military functions” rule. J.A. 174-77, 190-93.

*813 NRDC filed two petitions for review in this court. The petition in No. 80-1864 challenged the adoption and application by NRC of the “military functions” rule on the grounds that (1) it was unlawfully promulgated without the notice and comment procedures required by the APA, 5 U.S.C. § 553 (1976), and (2) it could not lawfully be applied to the ongoing NFS-Erwin proceeding because it would substantially prejudice NRDC by eliminating its rights to, inter alia, cross-examination and discovery. The petition in No. 80-1863 challenged the NRC order invoking the “military functions” rule to limit the procedures available to NRDC in the NFS-Erwin proceeding on the ground that the proceeding did not involve “military or foreign affairs functions” within the meaning of both section 554 of the APA and the NRC rule. 4 On September 29, 1980, a motions panel of this court granted NRDC’s motion in No. 80-1864 for a stay of both the “military functions rule” and the order granting NRDC a limited hearing under that rule. 5

On September 30,1981, the NRC initiated informal rulemaking proceedings to reconsider the “military functions” rule and its application to the NFS-Erwin proceeding. The Commission proposed a “military functions” rule that was essentially the same as the one it had previously issued. It asked for comments on whether the rule should be adopted in that form and on whether it should apply to ongoing proceedings in which a hearing already had been requested. 46 Fed.Reg. 47,799 (Sept. 30,1981). On January 26, 1982, the Commission adopted the “military functions” rule as proposed, with a section specifically making it applicable to ongoing proceedings. Supp.J.A. 91-106; 47 Fed.Reg. 4490 (Feb. 1, 1982) (to be codified at 10 C.F.R. § 2700a). 6

This court postponed consideration of the case while the NRC conducted its rulemak-ing. 7 Now that the Commission has completed that rulemaking, the NRDC petitions for review are once again before the court.

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Natural Resources Defense Council, Inc. v. United States Nuclear Regulatory Commission, and the United States of America, (Two Cases), 680 F.2d 810, 220 U.S. App. D.C. 261, 17 ERC 1778 (D.C. Cir. 1982).

680 F.2d 810 (Natural Resources Defense Council, Inc. v. United States Nuclear Regulatory Commission, and the United States of America, (Two Cases)) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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