ML21324A002

Response to Motion to Dismiss (5th Cir.)(Case No. 21-60743)

ML21324A002
Person / Time
Site:	Consolidated Interim Storage Facility
Issue date:	11/15/2021
From:	Abrams M, Baasch R, Paxton K, Stone J, Webster B State of TX, Commission on Environmental Quality, State of TX, Office of the Attorney General, State of TX, Office of the Governor
To:	Andrew Averbach NRC/OGC, US Federal Judiciary, Court of Appeals, 5th Circuit
References
00516093217, 21-60743
Download: ML21324A002 (14)

Text

Case: 21-60743 Document: 00516093217 Page: 1 Date Filed: 11/15/2021 No. 21-60743 In the United States Court of Appeals for the Fifth Circuit State of Texas; Greg Abbott, Governor of the State of Texas; Texas Commission on Environmental Quality; Fasken Land and Minerals, Limited; Permian Basin Land and Royalty Owners, Petitioners, v.

Nuclear Regulatory Commission; United States of America, Respondents.

On Petition for Review of Action by the Nuclear Regulatory Commission RESPONSE TO MOTION TO DISMISS Ken Paxton Judd E. Stone II Attorney General of Texas Solicitor General Brent Webster Michael R. Abrams First Assistant Attorney General Assistant Solicitor General Michael.Abrams@oag.texas.gov Office of the Attorney General P.O. Box 12548 (MC 059) Ryan S. Baasch Austin, Texas 78711-2548 Assistant Solicitor General Tel.: (512) 936-1700 Fax: (512) 474-2697 Counsel for Petitioners State of Texas, Governor Greg Abbott, and Texas Commission on Environmental Quality

Case: 21-60743 Document: 00516093217 Page: 2 Date Filed: 11/15/2021 Certificate of Interested Persons No. 21-60743 State of Texas; Greg Abbott, Governor of the State of Texas; Texas Commission on Environmental Quality; Fasken Land and Minerals, Limited; Permian Basin Land and Royalty Owners, Petitioners, v.

Nuclear Regulatory Commission; United States of America, Respondents.

Under the fourth sentence of Fifth Circuit Rule 28.2.1, petitioners, as govern-mental parties, need not furnish a certificate of interested persons.

/s/ Michael R. Abrams Michael R. Abrams Counsel of Record for Petitioners State of Texas, Governor Greg Abbott, and Texas Com-mission on Environmental Quality

Case: 21-60743 Document: 00516093217 Page: 3 Date Filed: 11/15/2021

Background

Two months ago, the Nuclear Regulatory Commission licensed Interim Storage Partners, LLC (ISP) to operate a so-called consolidated interim storage facility in Andrews County, Texas, which lies within the Permian Basin. The company plans to store tons of spent nuclear fuel and Greater-Than-Class-C radioactive waste above ground, in the middle of the worlds largest producing oilfield, where it will be a prime target for terrorist attacks. See Mot. to Dismiss Ex. 4.

The deadly radioactive waste that ISP plans to store in the Permian Basin poses a greater risk than the State of Texas is prepared to tolerate. Id. The State apprised the Commission of these concerns during the administrative proceedings on whether to issue the license, which included a notice-and-comment process. As the Governor explained in his comment letter to the Commission, spent nuclear fuel is so danger-ous that it belongs in a deep geologic repository, not on a concrete pad above ground in Andrews County. Id. (citing Nevada v. Dept of Energy, 457 F.3d 78, 81 (D.C. Cir.

2006), which notes that the consensus is that the waste should be stored in an un-derground repository to be located at Yucca Mountain, Nevada). The Texas Com-mission on Environmental Quality (TCEQ) also addressed a comment to the Com-mission to express doubts that the site will be an interim placement for radioactive waste, reasoning that because the U.S. Department of Energy has been unsuccess-ful in developing a permanent geologic repository, the TCEQ is concerned that a

[consolidated interim storage facility] in Texas will become the permanent solution for dispositioning the nations spent nuclear fuel. Mot. to Dismiss Ex. 3.

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Case: 21-60743 Document: 00516093217 Page: 4 Date Filed: 11/15/2021 The Commissions decision to issue the license to ISP is not just bad policy; it also is unlawful. The Commissions issuance of the license exceeds its statutory au-thority. Although the Commission has repeatedly referred to the construction and operation of a consolidated interim storage facility, it defies belief that the facility will be interim in any meaningful sense of the word. Instead, as the Governor and TCEQ warned the Commission, Texas is likely to become a permanent repository for spent nuclear waste. The Commission lacks the authority to issue a license for a permanent repository in Texas. See 42 U.S.C. §§ 10135-10137 (requiring congres-sional review of agency siting decision if State or Indian tribe where the site is located objects).

The State now seeks judicial review of the Commissions order issuing the li-cense to ISP.1 See Docket No. 72-1050: Interim Storage Partners, LLC; WCS Consol-idated Interim Storage Facility; Issuance of Materials License and Record of Decision, 86 Fed. Reg. 51,926 (Sept. 17, 2021) (issuing Materials License No. SNM-2515). The Commission contends, however, that this entire proceeding must be dismissed for 1

The Commission references (at 7-8) four petitions for review that were filed in the D.C. Circuit related to the Commission proceedings. But those petitions were filed before the Commissions final order of September 13, 2021, and the D.C. Circuit has sua sponte directed the parties to address whether a new petition for review, rather than an amended petition, is required [to] obtain review of the order granting a license. Order, Dont Waste Michigan v. NRC, D.C. Cir. No. 21-1048 (Nov. 10, 2021). A premature petition for review cannot win the race to the courthouse under 28 U.S.C. § 2112. See, e.g., Southland Mower Co. v. U.S. Consumer Prod. Safety Commn, 600 F.2d 12, 13-14 (5th Cir. 1979) (per curiam); Public Citizen v. NRC, 845 F.2d 1105, 1108-10 (D.C. Cir. 1988). Venue is thus appropriate in this Court. See 28 U.S.C. § 2112(a).

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Case: 21-60743 Document: 00516093217 Page: 5 Date Filed: 11/15/2021 lack of jurisdiction. The Commission concedes (at 9-10) that it received the States comment letters and addressed them in the Commissions final environmental im-pact statement. But the Commission insists that the Court lacks jurisdiction because the Commissions rules say so.

The Commission is wrong. The Commission cannot regulate the scope of this Courts jurisdiction, which is statutorily limited only by the Hobbs Acts require-ment that the petitioner be a party aggrieved by the final order. 28 U.S.C. § 2344.

The State is such a party: it is unquestionably aggrieved by the license at issue, and it meaningfully participated in the agency proceedings through the detailed comment letters it timely submitted for the Commissions consideration. That suffices to con-fer aggrieved party status. And even if the Commission is correct that the State was required to comply with the Commissions rules in order to invoke this Courts ju-risdiction, circuit precedent eliminates any such requirement if the agency action is attacked as exceeding the power of the Commission. Am. Trucking Assns, Inc. v.

ICC, 673 F.2d 82, 85 n.4 (5th Cir. 1982) (per curiam). That is the exact challenge, among several, that the State will make in its briefing on the merits.

The motion to dismiss should be denied, and the Court should allow briefing to resume on the merits of the States petition for review.

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Case: 21-60743 Document: 00516093217 Page: 6 Date Filed: 11/15/2021 Argument I. Petitioners Are Parties Aggrieved by ISPs License.

A. The State participated in the Commission proceedings.

The Hobbs Act provides that [a]ny party aggrieved by the final order may, within 60 days after its entry, file a petition to review the order in the court of appeals wherein venue lies. 28 U.S.C. § 2344. The Commission contends (at 11-12) that Texas is not a party aggrieved by the license because the State never sought to become a party under the NRCs rules of adjudicatory procedure. But the Com-mission misstates the party inquiry.

To be an aggrieved party, one must have participated in the agency proceeding under review. Wales Transp., Inc. v. I.C.C., 728 F.2d 774, 776 n.1 (5th Cir. 1984)

(emphasis added). The State did participate: the Commission invited comments on its draft environmental impact statement, the Governor and TCEQ submitted com-ments, and the Commission engaged with those comments in its final environmental impact statement. See 85 Fed. Reg. 27,447 (requesting comments); Mot. to Dismiss Ex. 3 & Ex. 4 (submitting the States comments); Mot. to Dismiss at 10 (acknowl-edging that the Commission addressed the States comments in Appendix D to the Commissions final Environmental Impact Statement); see also Transp. Div. of the Intl Assn of Sheet Metal, Air, Rail & Transp. Workers v. Fed. R.R. Admin., 988 F.3d 1170, 1177-78 (9th Cir. 2021) (finding that States were parties aggrieved when state agencies submitted comments to federal agency). Indeed, although not relevant for the jurisdictional inquiry, this submission of comments fully complied with the 5

Case: 21-60743 Document: 00516093217 Page: 7 Date Filed: 11/15/2021 Commissions own rules for objections regarding environmental impact statements.

See 10 C.F.R. §§ 51.73, 51.91, 51.117.

Submitting a comment in a rulemaking suffices to confer party status under the Hobbs Act. See Reytblatt v. NRC, 105 F.3d 715, 720 (D.C. Cir. 1997) (Petitioners clearly [enjoy party status] because each participated in the Commissions informal rulemaking by filing comments . . . . (emphasis added)); see also Am. Trucking Assns, Inc. v. FMCSA, 724 F.3d 243, 246 (D.C. Cir. 2013); NASUCA v. FCC, 457 F.3d 1238, 1250 (11th Cir. 2006). The same is true for commenting on a petition in agency proceedings that resulted in a declaratory ruling. See ACA Intl v. FCC, 885 F.3d 687, 711-12 (D.C. Cir. 2018).

And the same must be true here for this administrative adjudication for at least two reasons. First, the Hobbs Act makes no distinction between adjudicative and rulemaking proceedings in its requirement of party status. Gage v. AEC, 479 F.2d 1214, 1218 (D.C. Cir. 1973). Second, the requirement that a party participate in agency proceedings ensures that the agency is aware of the objections to its eventual decision so that it can develop and compile a robust administrative record for appel-late review. See, e.g., ACA Intl, 885 F.3d at 711-12 (emphasizing the centrality of having presented a view to the agency to qualify as an aggrieved party); Gage, 479 F.2d at 1219-21 (describing the difficulty of appellate review absent such a developed record). Because the State (along with many other commenters) participated in the Commissions administrative proceedings, the State ensured that this Court can comprehensively evaluate the merits of the parties contentions.

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Case: 21-60743 Document: 00516093217 Page: 8 Date Filed: 11/15/2021 The Commission argues (at 17-18) that the State cannot be a party because the State did not seek a hearing in accordance with the Commissions rules, on top of submitting comments from the Governor and TCEQ. But party status under the Hobbs Act cannot depend on getting a hearing, given the Supreme Courts hold-ingin a case involving this very agencythat Congress intended to provide for initial court of appeals review of all final orders in licensing proceedings whether or not a hearing before the Commission occurred or could have occurred. Fla. Power

& Light Co. v. Lorion, 470 U.S. 729, 737 (1985). Nor does the Commissions argu-ment about the effect of its own rules conform with the principle that it is for courts, rather than agencies, to determine who is an aggrieved party under the Hobbs Act.

See, e.g., Massachusetts v. NRC, 878 F.2d 1516, 1520 (1st Cir. 1989); Clark & Reid Co.

v. United States, 804 F.2d 3, 5 (1st Cir. 1986).

The Commission also cites Gage, 479 F.2d at 1217, for the proposition that peti-tioners who were never parties to the underlying Atomic Energy Act proceedings cannot obtain judicial review under the Hobbs Act. But Gage actually undermines the Commissions position. There, the petitioners challenged a rulemaking decision of the Atomic Energy Commission in which they had neither filed comments nor taken any other action while the matter was before the agency. Id. at 1217. The peti-tioners argued that their failure to comment was not fatal to their challenge because the Hobbs Acts party aggrieved requirement applies only in appeals from adju-dicative proceedings and not rulemakings. Id. at 1218. The D.C. Circuit disagreed, holding that the Hobbs Acts limitations also apply to notice-and-comment rulemak-ing. Id. The Gage petitioners did not submit comments, so they were jurisdictionally 7

Case: 21-60743 Document: 00516093217 Page: 9 Date Filed: 11/15/2021 barred. But here Texas did submit comments, so jurisdiction obtains under Gages reasoning. And it makes no difference that here we are dealing with an adjudication instead of a rulemaking. Id. (The clear words of the statutes involved make no dis-tinction between orders which promulgate rules and orders in adjudicative proceed-ings.).

The Commission also argues (at 12-13) that Texas is not a party under the Com-missions rules because, in adjudications, those rules require formal intervention in order to obtain party status. But other circuits have recognized that whether an entity is a party aggrieved is not dependent upon the agencys labeling of an entity as a party. See, e.g., Clark & Reid Co., 804 F.2d at 6 (refusing to equate the reg-ulatory definition of a party in an [agency] proceeding with the participatory party status required for judicial review under the Hobbs Act). Such a recognition faith-fully applies the principle that Congress, and not an administrative agency, has the authority to strip federal courts of the power of judicial review. See Kucana v. Holder, 558 U.S. 233, 251-52 (2010); Barrios Garcia v. DHS, 14 F.4th 462, 474 (6th Cir.

2021); Make the Road New York v. Wolf, 962 F.3d 612, 623-24 (D.C. Cir. 2020). [I]t is axiomatic that agencies can neither grant nor curtail federal court jurisdiction

. . . . Carlyle Towers Condo. Assn v. FDIC, 170 F.3d 301, 310 (2d Cir. 1999).

So, for instance, in Massachusetts v. United States, 522 F.3d 115 (1st Cir. 2008),

the court adopted a functional test to determine whether one is a party aggrieved for Hobbs Act purposes. Id. at 131. That test asks whether the would-be petitioner directly and actually participated in the administrative proceedings. Id. The court 8

Case: 21-60743 Document: 00516093217 Page: 10 Date Filed: 11/15/2021 refused to equate the regulatory definition of a party in an [agency] proceeding with the participatory party status required for judicial review. Id.

The same reasoning should control here. The State participated in the agency proceedings. The Commission recognized the States participation. And the Com-mission does not dispute, nor could it, that the State has Article III standing to chal-lenge the license. See Natl Treasury Emps. Union v. Merit Sys. Prot. Bd., 743 F.2d 895, 910 (D.C. Cir. 1984) (explaining that the courts that have considered the scope of § 2344s aggrieved party language have engaged in traditional standing doctrine analysis). The Court therefore should reject the Commissions attempt to add its own jurisdictional prerequisites on top of the Hobbs Acts party aggrieved re-quirement.

B. The Hobbs Act does not contain a mandatory exhaustion require-ment.

The Commission also argues (at 13) that the States claims are barred as a matter of non-jurisdictional, mandatory exhaustion, citing Fleming v. USDA, 987 F.3d 1093, 1098-99 (D.C. Cir. 2021). In Fleming, the court explained that a nonjurisdic-tional, mandatory exhaustion requirement functions as an affirmative defense that must be enforced if raised. Id. at 1099. But Flemings discussion of a challenge to a USDA decision under the Horse Protection Act is inapposite. Id. at 1095.

As the court explained in Fleming, the statute governing judicial review of the USDAs adjudications expressly requires exhaustion of all administrative appeal procedures established by the [agency]. See id. (citing 7 U.S.C. § 6912(e)). Thus, the provision imposes a mandatory exhaustion rule, such that a court cannot excuse 9

Case: 21-60743 Document: 00516093217 Page: 11 Date Filed: 11/15/2021 a partys failure to exhaust, no matter the reason. Id. at 1098. And that meant that the petitioners failure to comply with the agencys specific administrative appeal procedures barred the petitioners from bringing a petition for review. Id.

The Commission has not identified any similar statutory language in the Atomic Energy Act or the Hobbs Act. The inclusion of an express exhaustion provision in another statute indicates that Congress could have included a similar provision that would have required Texas to intervene as a party in the Commission proceedings under the Commissions rules. The fact that Congress did not do so is just one more reason the Commissions arguments fail. The States petition for review is not sub-ject to dismissal under a mandatory exhaustion rule because no such rule applies here.

In addition, the Commission appears to concede (at 13 n.9) that, to the extent exhaustion is relevant in this proceeding, the courts have concluded that it is relevant on an issue-by-issue basis only. See Vermont Dept of Pub. Serv. v. United States, 684 F.3d 149, 156 (D.C. Cir. 2012) (concluding at the merits stage that petitioners waived one specific objection by failing to raise it before the NRC). This is then, at most, a response on the merits that the NRC can raise once it has seen the scope of Texass arguments. It is not a proper basis to dismiss Texass petition altogether.

II. The Commission Acted Outside the Scope of Its Authority.

Even if Texas were not a party aggrieved (it is), the Commission acknowl-edges (at 14), as it must, that the Fifth Circuit has carved out instances [where] a person may appeal an agency action even if not a party to the original agency pro-10

Case: 21-60743 Document: 00516093217 Page: 12 Date Filed: 11/15/2021 ceeding: (1) if the agency action is attacked as exceeding the power of the Com-mission; or (2) if a person, not a party to the agency proceeding, challenges the constitutionality of the statute conferring authority on the agency. Am. Trucking, 673 F.2d at 85 n.4 (citations omitted). The Commission fails to identify any Fifth Circuit decision cabining American Trucking. And here, the State will argue that by licensing a de facto permanent facility for spent nuclear fuel, the agency has exceeded its power. So it is indisputable that at least some portions of Texass challenge to the license in this case are not jurisdictionally barred and must be permitted to proceed to the merits. 2 For that reason alone, at a minimum, the Court should carry the motion to dis-miss with the case to allow the State to develop its attack on the Commissions au-thority to issue the license. This Court has carried motions to dismiss for lack of jurisdiction in other cases. See, e.g., Order, Amawi v. Paxton, No. 21-50360 (July 26, 2021). It should do so here, too, if the motion to dismiss is not denied outright.

2 The Commission (at 14-15) recognizes that American Trucking is good law but suggests that it was wrongly decided and that it may apply only to orders from the Interstate Commerce Commission. Both points are mistaken: the jurisdictional ex-ception for challenges that claim an agency has exceeded its power are rooted in longstanding Supreme Court case law explaining that these challenges are presump-tively justiciable because [o]therwise the [challenger] is left to the absolutely un-controlled and arbitrary action of a public and administrative officer, whose action is unauthorized by any law. Am. Sch. of Magnetic Healing v. McAnnulty, 187 U.S. 94, 110 (1902); see also Dart v. United States, 848 F.2d 217, 224 (D.C. Cir. 1988); Aid Assn for Lutherans v. USPS, 321 F.3d 1166, 1173 (D.C. Cir. 2003).

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Case: 21-60743 Document: 00516093217 Page: 13 Date Filed: 11/15/2021 Conclusion The Court should deny the motion to dismiss.

Ken Paxton Judd E. Stone II Attorney General of Texas Solicitor General Brent Webster /s/ Michael R. Abrams First Assistant Attorney General Michael R. Abrams Assistant Solicitor General Office of the Attorney General State Bar No. 24087072 P.O. Box 12548 (MC 059) Michael.Abrams@oag.texas.gov Austin, Texas 78711-2548 Tel.: (512) 936-1700 Ryan S. Baasch Fax: (512) 474-2697 Assistant Solicitor General Counsel for Petitioners State of Texas, Governor Greg Abbott, and Texas Commission on Environmen-tal Quality 12

Case: 21-60743 Document: 00516093217 Page: 14 Date Filed: 11/15/2021 Certificate of Service On November 15, 2021, this response was served via CM/ECF on all registered counsel and transmitted to the Clerk of the Court. Counsel further certifies that:

(1) any required privacy redactions have been made in compliance with Fifth Circuit Rule 25.2.13; (2) the electronic submission is an exact copy of the paper document in compliance with Fifth Circuit Rule 25.2.1; and (3) the document has been scanned with the most recent version of Symantec Endpoint Protection and is free of viruses.

/s/ Michael R. Abrams Michael R. Abrams Certificate of Compliance This document complies with: (1) the type-volume limitation of Federal Rule of Appellate Procedure 27(d)(2)(A) because it contains 2,804 words, excluding ex-empted text; and (2) the typeface requirements of Rule 32(a)(5) and the type-style requirements of Rule 32(a)(6) because it has been prepared in a proportionally spaced typeface (14-point Equity) using Microsoft Word (the same program used to calculate the word count).

/s/ Michael R. Abrams Michael R. Abrams 13