OPINION AND ORDER
At issuе is Defendant’s motion for reconsideration of this Court’s August 3, 2010,
The Government’s motion to reconsider is based on the more recent decision of the Federal Circuit in Southern Nuclear Operating Co. v. United States,
In supplemental briefing requested by the court, the Government has clarified that “the Unitеd States does not propose to use the unavoidable delays defense as a get-out-of-jail-free card” respecting liability, but rather as a means to “circumseribe[ ] the amount of expectation damages.” Def.’s Suppl. Br. at 4, 5. Specifically, the Government argues that costs incurred by Plaintiffs due to one particular source of delay — Nevada’s efforts to prevent licensing of a repository — are covered by the clause. “[Plaintiffs’ recovery should be reduced only by the amount that plaintiff would have expended had the United States accepted SNF on a schedule delayed only by the length of time attributable to Nevada’s dilatory conduct.” Id. at 6. More specifically, the Government asserts, “the unavoidable delays that DOE has encountered as a result of the [sic] Nevada’s conduct would have delayed the commencement of SNF acceptance by at least 31 months, or from January 30, 1998 through at least August 2000.” Id. at 7 (emphasis in original). Thus, it argues that Plaintiffs’ damages for SNF storage due to the Government’s delay in performance “did not commence until September 2000 — the earliest that performance could have begun given the Unavoidable Delays that DOE encountered.” Id.
For the reasons set forth below, Defendant’s motion for reconsideration is DENIED.
I. Background
The procedural history of this ease is discussed in greater detail in Entergy Nuclear FitzPatrick,
In 1983, Power Authority of the State of New York (“NYPA”), the original owner of the James A. FitzPatrick Nuclear Power Station and the Indian Point 3 Nuclear Power Station, entered into a Standard Contract with DOE for the removal of SNF from both plants. The plants were sold in November 2000 to Entergy Nuclear FitzPatrick, LLC
In 1994, DOE noted in the Federal Register its projection that the “earliest possible date for acceptance of waste for disposal at a repository is 2010.” 59 Fed.Reg. 27,007, 27,-008 (May 25, 1994). In 1995, DOE issued a Final Interpretation of Nuclear Waste Acceptance Issues concluding that it did not have an unconditional obligation under the NWPA or the Standard Contract to accept SNF by January 31,1998, in the absence of a repository or interim storage facility by that date. 60 Fed.Reg. 21,793, 21,794-95 (May 3, 1995).
A number of utilities, states, and state agencies subsequently filed a petition in the United States Court of Appeals for the District of Columbia Circuit for review of DOE’s Final Interpretation, pursuant to 42 U.S.C. § 10139. The D.C. Circuit concluded that “section 302(a)(5)(B) creates an obligation in DOE, reciprocal to the utilities’ obligation to pay, to start disposing of the SNF no later than January 31, 1998.” Ind. Mich. Power Co.,
The D.C. Circuit denied the utilities’ request for a writ requiring DOE to begin accepting nuclear waste as of the statutory deadline. Id. at 756. The appellate court, however, rejected DOE’s argument that it was not obligated to accept nuclear waste because its failure to do so was “unavoidable” within the meaning of the Unavoidable Delays clause. Id. at 757. Accordingly, the D.C. Circuit held that NWPA “imposes an unconditional obligation” tо begin accepting nuclear waste by January 31, 1998, and issued a writ of mandamus “precluding DOE from excusing its own delay on the grounds that it has not yet prepared a permanent repository or interim storage facility.” Id. at 761. The D.C. Circuit ordered DOE “to proceed with contractual remedies in a manner consistent with NWPA’s command that it undertake an unconditional obligation to begin disposal of the SNF by January 31, 1998.” Id. at 760. The court specifically precluded DOE “from concluding that its delay [was] unavoidable.” Id.
Despite the provisions of the NWPA and the Standard Contract, DOE did not begin accepting nuclear waste by January 31, 1998 (nor has it accepted any SNF tо date from any utility), even though it has continued to collect payments from the nuclear utilities for SNF disposal. More than sixty nuclear utilities eventually filed suits in the Court of Federal Claims for damages for partial breach of contract.
In 2005, at oral argument in a suit filed by Nebraska Public Power District, the Government noted its continued interest in raising a defense based on the Unavoidable Delays clause, but believed it was precluded from doing so by the writ of mandamus issued in
The Federal Circuit took up the issue on interlocutory appeal. In an en banc decision, the Federal Circuit reversed the trial court and held that the D.C. Circuit had jurisdiction to issue its writ of mandamus and that the writ must be given res judicata effect in this Court. Nebraska Public Power,
Given the Federal Circuit’s en banc decision in Nebraska Public Power, this Court granted Plaintiffs motion to strike Defendant’s unavoidable delays defense in Entergy Nuclear FitzPatrick, LLC v. United States,
II. Defendant’s Motion for Reconsideration
The instant motion before the Court stems from the Federal Circuit’s recent decision in Southern Nuclear. Def.’s Mot. for Reconsideration at 1. In Southern Nuclear, a Federal Circuit panel affirmed a decision by the Court of Federal Claims that held that the Government had waived its unavoidable delays defense by not having raised it at trial. Southern Nuclear,
In our en banc decision in Nebraska Public Power, we did not suggest that the District of Columbia Circuit’s decision in any way foreclosed arguing in favor of the defense in the Claims Court. Indeed, we considered the government’s argument and held that the District of Columbia Circuit had jurisdiction to enter the mandamus order and that its decision in Northern States was entitled to res judicata effect on the issue of liability but that it did not “direct the implementation of any remedy.”
Id. at 1306 (internal citation omitted).
As noted, Defendant argues that the Federal Circuit “unequivocally” held the writ of mandamus issued against DOE by the D.C. Circuit in Northern States I does not bar the Government from asserting the unavoidable delays defense in the Court of Federal Claims. Plaintiffs rejoin that there has been no change in controlling law since the Federal Circuit’s en bane decision in Nebraska Public Power. Specifically, Plaintiffs argue that the Government is relying on dicta in the Southern Nuclear decision and that the panel decision in Southern Nuclear cannot
III. Standard of Review
Pursuant to Rule 59(a)(1) of the Rules of the Court of Federal Claims (“RCFC”), a party may file a motion to reconsider a prior decision by the Court. RCFC 59(a)(1). The decision to grant the motion rests within the sound discretion of the Court. See Yuba Natural Res., Inc. v. United States,
IV. Discussion
Here, Defendant challenges not the validity of the D.C. Circuit’s mandamus order, but this Court’s interpretation of the scope of that order based on its analysis of Nebraska Public Power. Thus, it is not that there has been an intervening change in controlling law since this Court first granted Plaintiffs motion to strike Defendant’s unavoidable delays defense, but rather that, according to Defendant, the limited boundaries of both the mandamus order and the Federal Circuit’s affir-mance of its validity have now been more brightly limned by the panel’s decision in Southern Nuclear. “Southern Nuclear clarifies that the Government has never violated the D.C. Circuit’s mandamus order by asserting the unavoidable delays defense — nor has it run afoul of the Federal Circuit’s holding in NPPD.” Def.’s Mot. at 5.
The inquiry, then, is to determine the precise holding of Southern Nuclear and to examine whether it counsels a reading of the en banc decision in Nebraska Public Power that upends the basis for this Court’s striking of the unavoidable delays defense.
A. Southern Nuclear Implicitly Held that the Government Could Have Raised the Unavoidable Delays Defense, Despite the D.C. Circuit’s Mandamus
In Southern Nuclear, the Federal Circuit affirmed the trial court’s holding that the Government had waived any defense based on the Unavoidable Delays clause. The trial court had noted that the Government had not raised its interest in the unavoidable delays defense except in its post-trial brief. Southern Nuclear Operating Co. v. U.S.,
Plaintiffs here characterize the Federal Circuit panel decision in Southern Nuclear as “holding that the Government waived use of the Unavoidable Delays clause by failing to raise it until after the conclusion of discovery and trial.” Pis.’ Resp. at 8. Anything more, they argue, is at best dicta. Id. at 2. After specifically holding that the Government had waived its proposed defense, the Federal Circuit panel then stated, somewhat ambiguоusly, “We need not reach the question posed by the Nebraska Public Power concurrence as to whether the ‘unavoidable delays’ clause could provide a defense to expectancy damages.” Southern Nuclear,
This Court finds, however, that the actual holding of the Federal Circuit decision is more expansive than Plaintiffs contend. The panel held, “Because the government failed to raise the unavoidable delays clause here and because this failure was not compelled by the District of Columbia Circuit’s mandamus in Northern States, it has waived the defense.” Southern Nuclear,
The panel explained why it believed the defense could have been raised.
B. The Decision in Southern Nuclear Tracks the Concurrence in Nebraska Public Power
The panel’s implicit holding that the unavoidable delays defense could have been raised, and its commentary on Northern States I and Nebraska Public Power, certainly track the position of the concurrence in Nebraska Public Power. There, two judges of the en banc majority, Judges Timothy B. Dyk and Richard Linn, joined in a concurrence in order to address what they termed “the dissent’s overreading of the majority opinion.” Nebraska Public Power,
To better understand the concurrence, inasmuch as it was written to rebut the dissent, it is helpful thus to review the argument of the dissent. The dissenting judge, Judge Arthur J. Gajarsa, had complained that the majority had overreached in affirming the validity of the mandamus order. The order was “unquestionably directed to and aimed at the contract dispute,” which the dissent argued should more properly have been lodged under the Tucker Act as a damages action at the Court of Federal Claims аnd thus beyond the D.C. Circuit’s statutory jurisdiction, rather than directed solely at agency action under the NWPA. Id. at 1381. The dissent expressed that the majority’s effort to “parse[]” the jurisdictional issue by noting that the order “did not address any issue of contract breach, direct the implementation of any remedy, or construe any contract defense,” id. at 1376, was ineffectual. “Notwithstanding its cleverly worded interstitial attempt in limiting the interpretation of liability by the D.C. Circuit, the majority cannot avoid the obvious legal conclusion that this affects the damages imposed upon the United States.” Id. at 1381. The dissent characterized the majority decision as attempting “to maintain comity with the D.C. Circuit by distinguishing between liability qua breach and liability qua damages,” id. at 1383, but it questioned the functionality of that distinction precisely because the Unavoidable Delays clause “is directed to ‘liab[ility] for damages.’ ” Id.
In short, the dissent said that the D.C. Circuit improperly leveraged its authority to construe the statute to restrict the Government’s effort to raise a contractual defense, which should have been left to the Court of Federal Claims. The mandamus order was effectively imposing both liability for breach of contract — because DOE had not begun SNF acceptance by the statutorily set date of January 31, 1998 (which was also set out in the Standard Contract) — and for damages, because any distinction between the two was “not intellectually defensible.” Id. at 1383. “Specifically, the question of breach is every
The two concurring judges wrote to express their view that neither the D.C. Circuit nor the Federal Circuit majority went as far “as ordering the government to pay money damages (expectancy damages) for breach of the agreement.” Id. at 1377 (footnote omitted). “Although I read the majority as establishing governmеnt liability, it remains open for the government to argue that the Unavoidable Delays clause bars a damages award (as opposed to some other contractual remedy such as restitution).” Id. “[T]he D.C. Circuit has no jurisdiction to determine questions concerning damages remedies.” Id. Thus, the distinction between barring use of the Unavoidable Delays clause as a defense to liability for breach but not as a defense to liability for damages, which the dissent said inhered in the majority decision but which it found “intellectually indefensible,” was explicitly noted in the concurrence as “open for the government to argue.”
Thus, even before the panel decision in Southern Nuclear, the concurrence in Nebraska Public Power had already exprеssed the view that the D.C. Circuit’s mandamus nevertheless allows the Government to raise the Unavoidable Delays clause, at least as a defense to expectancy damages.
C. Nebraska Public Power, However, Affirmed the Bar on Unavoidable Delays as a Defense to Liability for Damages
The Government’s motion in favor of reconsideration based on Southern Nuclear thus raises no new argumentation in favor of allowing its proposed unavoidable delays defense (and to a certain extent is seeking a second bite at the apple in re-litigating issues already decided). In ruling on Plaintiffs’ motion to strike the defense in the first place, this Court weighed these same arguments regarding the limitations of the Northern States I mandamus and the affirmance of its validity in Nebraska Public Power. The Government’s brief in opposition to the motion to strike had plainly noted the concurrence’s view that the Unavoidable Delays clause remained available as a defense to damages. Nevertheless, this Court noted that the majority decision acknowledged that the writ “could affect subsequent contract litigation that in turn could result in an award of damages,” id. at 1371 n. 7, and that “the D.C. Circuit’s remedial order would affect later litigation over contract-based rights.” Id. at 1376. This Court further recognized as significant the majority’s observation that “the order did not address any issue of contract breach, direct the implementation of any remedy, or construe any contract defense, except to the extent that the proposed interpretation of the contract would conflict with the statutory directive of section 302(a)(5).” Id. (emphasis added by this Court). Thus, the applicability of the mandamus to liability for damages was an issue squarely joined and evident in the interlocutory appeal of Nebraska Public Power at the Federal Circuit.
The “statutory directive of section 302(a)(5)” at the heart of the mandamus was the “unconditional” obligation to begin SNF acceptance by the January 1998 date. “Accordingly,” the D.C. Circuit wrote in Northern States I, “we order DOE to proceed with contractual rеmedies in a manner consistent with NWPA’s command that it undertake an unconditional obligation to begin disposal of the SNF by January 31, 1998.” Northern States I,
The majority decision in Nebraska Public Power was clearly sensitive to the limited reach of the D.C. Circuit’s mandamus. The Federal Circuit noted the D.C. Circuit’s point that thе nuclear utilities’ ability to enforce the Standard Contract would be “ ‘frustrated’ ” by a construction of the contract “ ‘inconsistent with’ ” the conclusion that DOE’s statutory obligation to begin performance in January 1998 was “ ‘without qualification or condition.’ ” Nebraska Public Power,
In this respect, both the dissent and the concurrence misread the majority opinion in Nebraska Public Power. The dissent discerned an attempted distinction in the majority opinion between “liability qua breach and liability qua damages,” but found it “ineffectual” such there would effectively be no boundary at all to the reach of the mandamus “precisely and explicitly to the issue of ‘remedies’ for a breach.” Id. at 1381. This court finds, however, that the majority in Nebraska Public Power did not in effect open the barn door to the D.C. Circuit’s wholesale jurisdiction over contractual remedies, but rather drew a specific and effective line, i.e., that the mandamus precludes the Government’s reliance on the Unavoidable Delays clause to excuse the failure of performance by January 31,1998. On that point at least, the dissent is in agreement. “Additionally, the D.C. Circuit’s writ of mandamus prohibits the DOE from construing the Unavoidable Delays clause to excuse its failure to dispose of SNF by January 31,1998.” Id. at 1382. The concurrence, on the other hand, also found in the majority opinion a distinction between liability and damages, but found it appropriate. “Although I read the majority as establishing government liability, it remains open for the government to argue that the Unavoidable Delays clause bars a damages award....” Id. at 1377.
This view by the concurrence does not comport with the exception the majority plainly drew: “The [mandamus] order did not address any issue of contract breach, direct the implementation of any remedy, or construe any contract defense, except to the extent that the proposed interpretation of the contract would conflict with” the unconditional performance start date of January 31, 1998. Id. at 1376. In acknowledging the aforementioned exception, “except to the extent that ...,” and affirming the mandamus, the Federal Circuit majority in Nebraska Public Power — plainly, in this Court’s reading — foreclosed the Government’s use of the Unavoidable Delays clause not merely as a defense to liability but as a defense to damages for failing to meet its unconditional obligation.
The majority decision in Nebraska Public Power made no distinction between the start of liability, which was incurred when DOE failed to meet its unconditional obligation to begin SNF acceptance by January 1998, and a later date of liability for damages due to
As the court in Portland General Elec. Co. has observed,
Here it is undisputed that breach occurred on January 31, 1998____We are unable to hypothesize a scenario that there is breach on that date, but no damages accrue because performance is excused. The two concepts are mutually exclusive; if damages do not accrue, it is because performance is excused, i.e., there is no breach.
Portland General Elec. Co.,
Based on the foregoing, this Court adheres to its earlier conclusion, contrary to the concurrence in Nebraska Public Power and to the implicit holding in Southern Nuclear, that “[allowing the Government to use the [Unavoidable Delays] clause to negаte a damages award would be permitting what the D.C. Circuit has already prevented,” Entergy Nuclear FitzPatrick,
D. Southern Nuclear Cannot Override Nebraslca Public Power
In view of this court’s analysis of the majority decision in Nebraska Public Power, the panel decision in Southern Nuclear can only be reconciled with the en banc decision by reading the panel decision extremely narrowly.
The Federal Circuit has adopted the rule that prior decisions of the Federal Circuit are binding precedent on subsequent panels unless overruled by the Federal Circuit en banc, or by other controlling authority such as an intervening statutory change or a decision by the United States Supreme Court. See, e.g., Lumbermens Mutual Casualty Co. v. United States,
In sum, however, this Court’s analysis convinces it that the Federal Circuit in Nebraska Public Power ratified the effect of the mandamus barring use of the Unavoidable Delays clause as a defense to damages.
This court also finds convincing the arguments of Plaintiffs that the “delays” addressed in Article IX of the Standard Contract are those “that routinely may arise during the performance of the contract. For them to arise, however, the parties must have begun performance.... ” Maine Yankee Atomic Power Co. v. United States,
For the reasons stated above, Defendant’s Motion for Reconsideration is DENIED.
V. Certification for Interlocutory Appeal
The question whether the Government may raise the Unavoidable Delays clause as a defense to damages, as opposed to liability, is a wrinkle in what, prior to the Southern Nuclear opinion, had been generally seen as resolved by the Federal Circuit in Nebraska Public Power. The en banc decision in Nebraska Public Power itself stemmed from the interlocutory appeal of a trial court deсision that had held void the mandamus issued by the D.C. Circuit in Northern States I. For many of the same reasons that the trial court decision in Nebraska Public Power Dist. v. United States was certified for interlocutory appeal,
Because this opinion involves a controlling question of law with respect to which there is a substantial ground for difference of opinion, and an immediate appeal from this order would materially advance the ultimate termination of the litigation, the court certifies the
This case is hereby stayed pending further order of the court. If no application for consideration of this decision is made to the Federal Circuit within the requisite time period, the court will remove the stay and issue an order for a Joint Status Report on how the parties propose to proceed.
Notes
. For a detailed history of the NWPA, the Standard Contract, and SNF cases in the federal courts, see Maine Yankee Atomic Power Co. v. United States, 225 F.3d 1336, 1337-40 (Fed.Cir.2000); Indiana Michigan Power Co. v. U.S. Dep’t of Energy,
. The “unavoidable delays” clause is set forth in the Standard Contract at "Article IX — Delays, 1. A. Unavoidable Delays by Purchaser or DOE”:
Neither the Government nor the Purchaser shall be liable under this contract for damages caused by failure to perform its obligation hereunder, if such failure arises out of causes beyond the control and without the fault or negligence of the party failing to perform. In the event circumstances beyond the reasonable control of the Purchaser or DOE — such as acts of God, or of the public enemy, acts of Government in either its sovereign or contractual capacity, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes and unusually severe weather — cause delay in scheduled delivery, acceptance or transport of SNF and/or HLW, the party experiencing the delay will notify the other party as soon as possible after such delay is ascertained and the parties will readjust their schedules, as appropriate, to accommodate such delay.
10 C.F.R. § 961.1, Art. IX.A.
. Thus, where the panel wrote that it “need not reach the question whether” the clause "could” provide a defense, it meant not that the defense could not be raised but that, because the defense had been waived, the panel was not confronted with determining whether such a defense would be effective.
. It bears noting that the two judges in concurrence in Nebraska Public Power comprised two of the three judges of the Southern Nuclear panel. The third member of the panel, Judge Alvin A. Schall, who joined to make its decision unanimous, was also a member of the majority in Nebraska Public Power, although he did not join in the concurrence there.
. Thus, even the issue of contract breach, in addition to the prohibition against utilizing the defense of the Unavoidable Delays clause, is encompassed in the "except to the extent that" language in the ultimate clause of this sentence.
. The court in Portland General Elec. Co. found the Southern Nuclear decision "not to the contrary,” because of the panel’s statement that it "need not reach the question” of the availability of the Unavoidable Delays defense. Portland General Elec. Co.,
. See Portland General Elec. Co.,
. See, e.g., Arra Energy Co. v. United States,