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Court affirms $159.6 million damage award to 3 utilities.

The U.S. Court of Appeals for the Federal Circuit, Washington, D.C., has affirmed a $159.6 million damages award to three nuclear utilities in a long-running battle with the federal government over the disposal of spent nuclear fuel.

The lawsuits by Yankee Atomic Electric Co., Maine Yankee Atomic Power Co., and Connecticut Yankee Atomic Power Co. are reported to be among approximately 50 lawsuits charging the federal government with breach of contract for its failure to accept and dispose of radioactive waste from the nation's nuclear utilities.

The three Yankees originally sought damages to compensate for the cost of storing spent nuclear fuel and high-level radioactive waste beyond the time that the government promised by contract to begin storing that waste in a permanent and secure repository.

The awards cover the period through 2002 for Yankee Atomic and Connecticut Yankee and through 2003 for Maine Yankee.

An earlier decision by the appeals court held that the nuclear utilities could only sue for retrospective not prospective damages and that successive suits would have to be filed periodically to recover incurred costs until the federal government opens a waste repository.

The government has failed to open a repository, and has abandoned plans for a facility at Yucca Mountain in Nevada.

Chief Judge Randall Rader, joined by judges Alan Lourie and Kimberly Moore, wrote the opinion affirming the damages awards.

The Hogan Lovells law firm in Washington, D.C., represented the nuclear utilities in the case, Yankee Atomic v. United States, Nos. 2011-5020 et seq. (Fed. Cir. May 18, 2012).

In a statement, Catherine (Cate) Stetson, co-director of Hogan Lovells' Appellate practice, said that the court "sided fully with our clients' position and awarded them the full amount of damages they were owed."

"The decision is a significant milestone in this longfought case, for the Yankee utilities and for other nuclear utilities across the country with similar damages issues," Stetson said.

The trial court had awarded the New England nuclear utilities approximately $143 million in damages for the government's breach but denied the utilities another $17 million they had sought, ruling that the damages had not been awarded in an earlier iteration of the case and that the "mandate rule" precluded the court from adding them now.

The government appealed, arguing that most of the $143 million damage award should be thrown out because the utilities used a speculative damages

The utilities cross-appealed, arguing that the damages model was valid and that the mandate rule did not apply.

Chief Judge Rader wrote that the government "did not identify any record evidence to support a finding that the trial court committed clear error in adopting (the damages) model."

Rader also wrote that the mandate rule did not foreclose Yankee Atomic from collecting the $17 million in damages it sought on cross-appeal, and the court ordered those damages added to the utilities' award without a remand.

Washington, D.C., attorney Jerry Stouck of Greenberg Traurig, who filed the first Yankee case in February 1998, reported the federal government has paid an estimated $2 billion in settlements and damages to utilities involving the storage issue

Stouck and his team handled the trials and first of three appeals in the three Yankee lawsuits.

Stouck worked on the briefs in the latest appeal. Maine Yankee spokesman Eric Howes said the companies have another suit pending aimed at recovering more recent costs.

The utility reports it is spending approximately $8 million annually to store the wastes in Wiscasset, Maine.

That cost has been paid for by the ratepayers of the 10 power companies that were partners in Maine Yankee, the company noted.

Source: Hogan Lovells
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Publication:Nuclear Waste News
Date:Jun 12, 2012
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