Southern Nuclear Operating Co. v. United States
2011 U.S. App. LEXIS 4966
| Fed. Cir. | 2011Background
- Congress enacted NWPA and requiring Energy to begin accepting SNF by January 31, 1998 under Standard Contracts.
- Energy failed to begin acceptance due to repository/interim storage constraints, triggering alleged breaches by Energy.
- Claims Court held liability in 2004 and later trial determined damages for on-site storage costs, including ISFSIs, casks, and reracking.
- Damages depended on hypothetical non-breach world SNF acceptance rates; trial used varying ACR rate scenarios and did not fix a single contract rate.
- Claims Court found waiver of Energy's ‘unavoidable delays’ defense; court awarded damages for Hatch, Farley, Vogtle with adjustments discussed on remand.
- This court affirms waiver ruling and damages for Farley, vacates Hatch and Vogtle damages and remands for further proceedings consistent with Pacific Gas/Yankee/Carolina Power guidance.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Proper rate to define but-for world damages | SNC argues 1987 ACR rates control but-for world; 1991 rates too high; 1987 rates require remand for proof of saved costs. | Energy contends 1991 rates apply or remand needed to apply 1987 rates with discovery of saved costs. | Remand needed to apply 1987 rates and assess saved costs; burden on movant for specifics. |
| Remand on Hatch and Vogtle damages | Damages at Hatch and Vogtle stand regardless of rate; no need to revisit trial. | Pacific Gas/Yankee/Carolina Power require record reopening to compare breach vs. non-breach costs at 1987 rates. | Remand appropriate to reconsider Hatch and Vogtle damages under intervening authorities. |
| Waiver of unavoidable delays defense | Defense was waived by Government for not raising it at trial, per Nebraska decisions. | Northern States mandamus limits raised defense; but waiver is disputed. | Waiver of the unavoidable delays defense is affirmed. |
| Bathtub racks erroneous award at Hatch | Bathtub racks costs would have been incurred absent breach; offset inappropriate. | Cost offset for non-breach world not properly calculated; some costs double-counted. | Damages including $3,186,000 for Hatch bathtub racks vacated; remand to correct. |
Key Cases Cited
- Pacific Gas & Electric Co. v. United States, 536 F.3d 1282 (Fed. Cir. 2008) (establishes contract rate binding in the hypothetical world)
- Yankee Atomic Electric Co. v. United States, 536 F.3d 1268 (Fed. Cir. 2008) (remand when no contractual rate selected; causation analysis for but-for world)
- Carolina Power & Light Co. v. United States, 573 F.3d 1271 (Fed. Cir. 2009) (remand required when rate choice not tested; equivalence of rates uncertain)
- Nebraska Public Power District v. United States, 590 F.3d 1357 (Fed. Cir. 2010 (en banc)) (mandamus-related jurisdiction; waiver discussion on unavoidable delays defense)
- Indiana Mich. Power Co. v. Department of Energy, 88 F.3d 1272 (D.C. Cir. 1996) (unavoidable delays interpretation under NWPA; district court decisions)
- Mech-Con Corp. v. West, 61 F.3d 883 (Fed. Cir. 1995) (burden-shifting for proven saved costs in overhead damages context)
- Am. Capital Corp. v. Fed. Deposit Ins. Corp., 472 F.3d 859 (Fed. Cir. 2006) (burden allocation for offsets in reliance damages context)
- Caroline Hunt Trust Estate v. United States, 470 F.3d 1044 (Fed. Cir. 2006) (offsets for saved costs in restitution damages context)