Pacific Gas & Electric Co. v. United States
2012 U.S. App. LEXIS 3384
| Fed. Cir. | 2012Background
- This is a spent nuclear fuel damages case where the Federal Circuit previously held the 1991 ACR incorrect and that the 1987 ACR should govern causation analysis for the Standard Contract.
- On remand, the trial court recalculated damages focusing on direct, reasonably foreseeable costs caused by the government's partial breach and allowed reconsideration of mitigation issues, including off-site storage and SAFSTOR costs.
- The Government acknowledged PG&E was entitled to approximately $82 million of about $92 million on remand, with specific awards for Humboldt Bay SAFSTOR, Humboldt Bay ISFSI, Diablo Canyon ISFSI, Diablo Canyon temporary racks, and Diablo Canyon storage options study as contemplated by the 1987 ACR.
- On remand, the trial court awarded PG&E $4,044,000 for Humboldt Bay SAFSTOR costs in 1999, $9,534,000 for GTCC-related ISFSI costs, and $889,517 for off-site storage option costs, while denying stack-removal costs and internal/external legal costs on statute/mandate grounds, totaling $89,004,415.
- The Government appealed asserting the mandate barred the PFS and 1999 Humboldt Bay SAFSTOR exchanges-based damages; the appellate court has jurisdiction under 28 U.S.C. § 1295(a)(3).
- The Federal Circuit affirms the district court, holding the remand mandate permitted reconsideration of PFS off-site storage and 1999 Humboldt Bay SAFSTOR mitigation damages and that the damages awarded were supported by the record.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Scope of mandate on remand | PG&E contends the remand allowed reconsideration of PFS and 1999 SAFSTOR damages. | U.S. argues the mandate limited reconsideration to specific issues or barred certain damages. | Yes; mandate permitted reconsideration within its scope. |
| Off-site PFS storage damages under mandate | PG&E argues PFS off-site storage mitigation damages were within the remand scope. | Government contends those damages were beyond the mandate. | Within the mandate; damages affirmed. |
| 1999 Humboldt Bay SAFSTOR damages via exchanges model | PG&E showed exchanges model would have mitigated 1999 SAFSTOR costs and should be rewarded. | Government contested the model as speculative and not properly proven. | Damages supported; offset for exchange costs proper; award affirmed. |
| Mitigation, foreseeability, and pre-breach costs | PG&E established foreseeability and reasonable mitigation efforts before 1998, entitling recovery of mitigation costs. | No contrary argument provided beyond general defenses to costs. | Mitigation costs recoverable; foreseeability and reasonable mitigation satisfied. |
Key Cases Cited
- Yankee Atomic Electric Co. v. United States, 536 F.3d 1268 (Fed.Cir.2008) (guides evaluation of causation and non-breach world events in damages)
- Indiana Michigan Power Co. v. United States, 422 F.3d 1369 (Fed.Cir.2005) (mitigation, foreseeability, and pre-breach damages framework)
- Dairyland Power Cooperative v. United States, 645 F.3d 1363 (Fed.Cir.2011) (exchanges model and mitigation damages in utility context)
- Laitram Corp. v. NEC Corp., 115 F.3d 947 (Fed.Cir.1997) (mandate scope and remand discretion principles)
- State Industries, Inc. v. Mor-Flo Industries, Inc., 948 F.2d 1573 (Fed.Cir.1991) (credibility and weighing of conflicting evidence principle)
- Engel Indus., Inc. v. Lockformer Co., 166 F.3d 1379 (Fed.Cir.1999) (mandate interpretation and remand discretion considerations)