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No. 99-447C (Judge Lettow) ______________________________________________________________________________ IN THE UNITED STATES COURT OF FEDERAL CLAIMS BOSTON EDISON COMPANY, Plaintiff, v. THE UNITED STATES, Defendant. ______________________________________________________________________________ PLAINTIFF BOSTON EDISON COMPANY'S BRIEF IN RESPONSE TO DEFENDANT'S MOTION TO DISMISS OR, IN THE ALTERNATIVE, FOR SUMMARY JUDGMENT UPON COUNTS I AND II AND FOR SUMMARY JUDGMENT UPON COUNT III OF PLAINTIFF'S AMENDED COMPLAINT AND CROSS-MOTION FOR SUMMARY JUDGMENT ON LIABILITY REGARDING COUNT I OF THE AMENDED COMPLAINT ______________________________________________________________________________ Richard J. Conway DICKSTEIN SHAPIRO MORIN & OSHINSKY LLP 2101 L Street, NW Washington, DC 20037 Tel: (202) 785-9700 Fax: (202) 887-0689 Attorney for Plaintiff Of Counsel: David M. Nadler Nicholas W. Mattia, Jr. Bradley D. Wine Jeffrey P. Becherer DICKSTEIN SHAPIRO MORIN & OSHINSKY LLP 2101 L Street, NW Washington, DC 20037 Neven Rabadjija, Esq. Associate General Counsel NSTAR Electric & Gas Corporation 800 Boylston Street, 17th Floor Boston, MA 02199-0228 July 9, 2004

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TABLE OF CONTENTS TABLE OF AUTHORITIES........................................................................................................iii INDEX TO APPENDIX .............................................................................................................vii INTRODUCTION ........................................................................................................................ 1 ISSUES PRESENTED ................................................................................................................... 3 STATEMENT OF THE CASE..................................................................................................... 4 A. B. A. B. I. Nature of the Case ......................................................................................... 4 Statement of Facts .......................................................................................... 4 Motion to Dismiss .......................................................................................... 4 Motion for Summary Judgment................................................................... 5

STANDARD OF REVIEW .......................................................................................................... 4

ARGUMENT................................................................................................................................. 5 BOSTON EDISON HAS STANDING TO SUE BECAUSE IT SUSTAINED DAMAGES RESULTING FROM THE GOVERNMENT'S BREACH OF THE STANDARD CONTRACT ON JANUARY 31, 1998.................................... 5 A. B. C. Boston Edison Meets The Requirements For Standing ............................ 5 DOE Breached The Standard Contract On January 31, 1998................. 10 The Government Is Collaterally Estopped From Arguing That The Breach Occurred On Any Date Other Than January 31, 1998 ............... 13 1. 2. 3. D. The D.C. Circuit Determined that the Breach Occurred on January 31, 1998................................................................................ 15 The Federal Circuit Determined that the Breach Occurred on January 31, 1998................................................................................ 16 The U.S. Court of Federal Claims Has Determined that the Breach Occurred on January 31, 1998 ........................................... 17

The DCS Process Does Not Create A Contractually Binding Obligation...................................................................................................... 21 1. 2. The Government's Interpretation of the DCS Process Would Render the Standard Contract Illusory......................................... 21 DOE Knew that Utilities, Including Boston Edison, Relied on January 31, 1998 as the Performance Date.................................... 23

II.

BOSTON EDISON HAS A COGNIZABLE TAKINGS CLAIM UNDER THE FIFTH AMENDMENT TO THE U.S. CONSTITUTION........................... 26 A. Boston Edison's Takings Claim Arises Out Of Legal And Property Rights That Existed Prior To The Standard Contract ............................. 27

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B. C. D.

Boston Edison's Real Property Rights Were Taken Without Just Compensation............................................................................................... 30 The Standard Contract Was Not Entered Into Voluntarily ................... 32 Boston Edison Has A Cognizable Takings Claim To Pursue Remedies That Are Not Available Under A Breach Of Contract Claim.............................................................................................................. 35 Boston Edison's Takings Claim May Be Brought Concurrently With Its Breach Of Contract Claim...................................................................... 37 Since Boston Edison Asserts A Taking Independent Of The Standard Contract, The Court's Decision In Commonwealth Edison Has No Application Here ........................................................................... 40

E. F.

III.

DOE INTERFERED WITH BOSTON EDISON'S ABILITY TO RECOGNIZE ITS RIGHTS UNDER THE STANDARD CONTRACT, THEREBY VIOLATING ITS DUTY OF GOOD FAITH AND FAIR DEALING ................ 41 CROSS-MOTION FOR SUMMARY JUDGMENT ON LIABILITY .................. 46

IV.

CONCLUSION........................................................................................................................... 50

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TABLE OF AUTHORITIES Page Cases: Ala. Power Co. v. Dep't of Energy, 307 F.3d 1300 (11th Cir. 2002)......................... 31-32, 34, 35 Allegre Villa v. United States, 60 Fed. Cl. 11 (2004).................................................................. 39 Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986) ................................................... 46 Avedon Corp. v. United States, 15 Cl. Ct. 771 (1988) ................................................................ 23 Benenson v. United States, 548 F.2d 939 (Ct. Cl. 1977) ............................................................ 31 Burnside-Ott Aviation Training Ctr. v. United States, 985 F.2d 1574 (Fed. Cir. 1993)......... 6-7 Buse Timber & Sales, Inc. v. United States, 45 Fed. Cl. 258 (1999) .......................................... 36 Castle v. United States, 48 Fed. Cl. 187 (2000), aff'd in part, rev'd in part, vacated, and remanded in part, 301 F.3d 1328 (Fed. Cir. 2002) ................................................... 35, 36, 39 Centex Corp. v. United States, 49 Fed. Cl. 691 (2001)............................................................... 42 Cienega Gardens v. United States, 331 F.3d 1319 (Fed Cir. 2003) ..................................... 38, 39 Coast Fed. Bank, FSB, v. United States, 323 F.3d 1035 (Fed. Cir. 2003) .................................. 23 Coast-to-Coast Fin., Corp., v. United States, 52 Fed. Cl. 352 (2002)......................................... 43 Commonwealth Edison Co. v. United States, 46 Fed. Cl. 29 (2000) ............................................ 4 Commonwealth Edison Co. v. United States, 56 Fed. Cl. 652 (2003) ................................. passim Connecticut Yankee Atomic Electric Co. v. United States, 42 Fed. Cl. 448 (1998) ............. 19, 49 Cooper v. Ford Motor Co., 748 F.2d 677 (Fed. Cir. 1984) ........................................................... 5 Cresswell v. United States, 173 F. Supp. 805 (Ct. Cl. 1959) ..................................................... 24 Dana v. E.S. Originals, Inc., 342 F.3d 1320 (Fed. Cir. 2003).................................................... 14 Del Monte Dunes at Monterey, Ltd. v. City of Monterey, 920 F.2d 1496 (9th Cir. 1990), aff'd, 526 U.S. 687 (1999)................................................................................................. 26, 27 Detroit Edison Co. v. United States, 56 Fed. Cl. 299 (2003)............................................... passim E. Enters. v. Apfel, 524 U.S. 498 (1998)...................................................................................... 27 Emerson Radio Corp. v. Orion Sales, Inc., 253 F.3d 159 (3d Cir. 2001) ................................... 43 Exxon Corp. v. United States, 45 Fed. Cl. 581 (1999), aff'd in part and rev'd in part on other grounds, 244 F.3d 1341 (Fed. Cir. 2001) .................................................................... 14 Florida Power & Light v. United States, 56 Fed Cl. 555 (2003)........................................... 19, 49 Heydt v. United States, 38 Fed. Cl. 286 (1997) .......................................................................... 36 High Star Toys, Inc. v. United States, 32 Fed. Cl. 176 (1994) ................................................... 46 Hughes Communications Galaxy, Inc. v. United States, 271 F.3d 1060 (Fed. Cir. 2002) .......... 9

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Page In re Freeman, 30 F.3d 1459 (Fed. Cir. 1994) ............................................................................ 14 Ind. Mich. Power Co. v. Dep't of Energy, 88 F.3d 1272 (D.C. Cir. 1996) .......................... passim Indiana Michigan Power Co. v. United States, 57 Fed. Cl. 88 (2003) ...................... 19, 20, 34,49 Integrated Logistics Support Sys. Int'l, Inc. v. United States, 42 Fed. Cl. 30 (1998) ................ 39 Jet Forwarding, Inc. v. United States, 437 F.2d 987 (Ct. Cl. 1971) ........................................... 24 Kaiser Aetna v. United States, 444 U.S. 164 (1979).................................................................... 31 Kimball Laundry Co. v. United States, 338 U.S. 1 (1949) .......................................................... 31 Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419 (1982)..................................... 31 Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) ................................................................. 6, 7 Madera Irrigation Dist. v. Hancock, 985 F.2d 1397 (9th Cir. 1993).......................................... 21 Maine Yankee Atomic Power Co. v. United States, 42 Fed. Cl. 582 (1998), aff'd, 225 F.3d 1336 (Fed. Cir. 2000).............................................................................. 19, 49 Maine Yankee Atomic Power Co. v. United States, 225 F.3d 1336 (Fed. Cir. 2000)............................................................................................................... passim Maxima Corp. v. United States, 847 F.2d 1549 (Fed. Cir. 1988) .............................................. 42 Medina Constr., Ltd. v. United States, 43 Fed. Cl. 537 (1999) .................................................. 37 N. States Power Co. v. United States Dep't of Energy, 128 F.3d 754 (D.C. Cir. 1997) ..... passim Northern States Power Co. v. United States, 224 F.3d 1361 (Fed. Cir. 2000).................................................................................................... 16, 17, 42, 48 Penn Cent. Transp. Co. v. City of New York, 438 U.S. 104 (1978) ............................................ 32 Pa. Coal Co. v. Mahon, 260 U.S. 393 (1922), abrogated .......................................................... 32 Perry & Wallis, Inc. v. United States, 427 F.2d 722 (Ct. Cl. 1970) ..................................... 24, 26 Peterson Mfg. Co. v. Cent. Purchasing, Inc., 740 F.2d 1541 (Fed. Cir. 1984), abrogated on other grounds by Beatrice Foods Co. v. New England Printing & Lithography Co., 899 F.2d 1171 (Fed. Cir. 1990) ............................................................................................... 5 Precision Pine & Timber, Inc. v. United States, 50 Fed. Cl. 35 (2001) ...................................... 43 Price v. Symsek, 988 F.2d 1187 (Fed. Cir. 1993) ....................................................................... 43 Prudential Ins. Co. of America v. United States, 801 F.2d 1295 (Fed. Cir. 1986)......... 36, 37, 39 Ridge Runner Forestry v. Veneman, 287 F.3d 1058 (Fed. Cir. 2002)........................................ 19 Roedler v. Dep't of Energy, 255 F.3d 1347 (Fed. Cir. 2001) .................................... 16, 17, 48, 49 San Carlos Irrigation & Drainage Dist. v. United States, 877 F.2d 957 (Fed. Cir. 1989)...................................................................................................................... 46 Scheuer v. Rhodes, 416 U.S. 232 (1974), abrogated on other grounds by Harlow v. Fitzgerald, 457 U.S. 800 (1982) ............................................................................................... 4 Seal-Flex, Inc. v. Athletic Track & Ct. Constr., 98 F.3d 1318, 1321 (Fed. Cir. 1996)............... 46 iv

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Page Sommers Oil Co. v. United States, 241 F.3d 1375 (Fed. Cir. 2001) ............................................ 5 Southern Nuclear Operating Co. v. United States, No. 98-614C (Fed. Cl. Filed Apr. 7, 2004) .......................................................................................... 19, 49 Specialty Transp., Inc. v. United States, 57 Fed. Cl. 1 (2003).................................................... 23 Sun Oil Co. v. United States, 572 F.2d 786 (Ct. Cl. 1978) ........................................................ 30 St. Regis Paper Co. v. United States, 368 U.S. 208 (1961) ......................................................... 42 Temple-Inland, Inc. v. United States, 59 Fed. Cl. 550 (2004) .................................................... 43 Tennessee Valley Authority v. United States, 60 Fed. Cl. 665 (2004)........................ 9, 19, 33, 49 Tennessee v. Herrington, 806 F.2d 642 (6th Cir. 1986) ............................................................. 12 Torncello v. United States, 681 F.2d 756 (Ct. Cl. 1982)............................................................. 21 Unisys Corp. v. United States, 48 Fed. Cl. 451 (2001)............................................................... 23 United States v. Diebold, Inc., 369 U.S. 654 (1962)...................................................................... 5 United States v. Pewee Coal Co., 341 U.S. 114 (1951)................................................................ 31 Westfed Holdings, Inc. v. United States, 52 Fed. Cl. 135 (2002) ............................................... 36 Whitney Benefits, Inc. v. United States, 752 F.2d 1554 (Fed. Cir. 1985).................................. 27 Winstar Corp. v. United States, 64 F.3d 1531 (Fed. Cir. 1995), aff'd, 518 U.S. 839 (1996)....................................................................................................... 12 Woll v. United States, 45 Fed. Cl. 475 (1999), aff'd, 251 F.3d 171 (Fed. Cir. 2000) (Table) ........................................................................................................ 21 Yankee Atomic Elec. Co. v. United States, 42 Fed. Cl. 223 (1998), aff'd sub nom. Maine Yankee Atomic Power Co. v. United States, 225 F.3d 1336 (Fed. Cir. 2000) ................................................................................ 16, 29, 48 Yankee Atomic Electric Co. v. United States, No. 98-126C (Fed. Cl. filed June 26, 2003) ......................................................................................... 19, 49 Yankee Atomic Electric Co. v. United States, No. 98-126C (Fed. Cl. filed June 28, 2004) ................................................................................................. 9 Yuba Goldfields, Inc. v. United States, 723 F.2d 884 (Fed. Cir. 1983) ................................ 27, 39 Statutes: 28 U.S.C. § 2516(a)...................................................................................................................... 36 42 U.S.C. § 10101 et seq........................................................................................................ passim 42 U.S.C. § 10222(a)(5) ............................................................................................................... 47 42 U.S.C. § 10222(a)(5)(B) .......................................................................................................... 19 42 U.S.C. § 10222(b)(2) ............................................................................................................... 33

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Page U.S. Constitution: Fifth Amendment........................................................................................................... 26, 31, 39 Rules: Fed. R. Civ. P. 56(c) ................................................................................................................ 5, 46 Rules of the U.S. Court of Federal Claims: Rule 7.2(c)................................................................................................................................ 1 Rule 12 ..................................................................................................................................... 1 Rule 12(b) ................................................................................................................................ 1 Rule 56 ................................................................................................................................... 46 Rule 56(b) ................................................................................................................................ 1 Regulations: Policy Relating to the Siting of Fuel Reprocessing Plants and Related Waste Management Facilities, 10 C.F.R. pt. 50, App. F ................................................................. 28 Other Authorities: Standard Contract for Disposal of Spent Nuclear Fuel and/or High-Level Radioactive Waste, 48 Fed. Reg. 16590 (Apr. 18, 1983........................................................................... 25 Financing Nuclear Waste Disposal: Joint Hearing on S. 637 and S. 1662 Before the Comm. on Energy and Natural Resources and the Subcomm. on Nuclear Regulation of the Comm. on Environment and Public Works, 97th Cong. 307 (1981) (Congressional Budget Office Staff Working Paper) ...................................................... 28 Restatement (Second) of Contracts (1981) § 201(2)(a)-(b) ....................................................................................................................... 24 § 204.................................................................................................................................. 19, 21 § 205........................................................................................................................................ 44 § 235(2)................................................................................................................................... 12 § 350.......................................................................................................................................... 9

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INDEX TO APPENDIX DOCUMENT Page

July 6, 2004 Affidavit of Geoffrey O. Lubbock....................................................................... 1 May 20, 2002 Deposition of Michael J. Lawrence.................................................................. 6 May 17, 1984 Confirmation Statement of Benard C. Rusche ............................................. 13 May 16, 2002 Deposition of Benard Rusche; ........................................................................ 20 March 21-22, 2002 Deposition of Robert L. Morgan ........................................................... 25 October 12, 1983 Remarks of Robert L. Morgan before the IAEA .................................... 34 June 1987 OCRWM Mission Plan Amendment................................................................... 40 December 1990 OCRWM Annual Capacity Report ............................................................ 42 February 9, 2004 Nuclear Energy Overview........................................................................ 44 February 12, 1998, letter from Thomas W. Bennet, Jr. to Joseph A. Pezello .................... 56 September 28, 1995 letter from Daniel A. Dreyfus to Dr. Andrew C. Kadak.................. 67 May 18, 1998 letter from Federico Pena to Eugene McGrath (and attached chart)........ 68 March 21-22 Deposition of Robert L. Morgan ..................................................................... 72 April 17, 2002 Deposition of David K. Zabransky .............................................................. 75 June 13, 2002 Deposition of Nancy Slater Thompson......................................................... 77 April 10, 2002 Deposition of Alan Brownstein .................................................................... 80 April 22, 2002 Deposition of Lake H. Barrett (pp. 1-4) ....................................................... 83 April 17, 2002 Deposition of David K. Zabransky .............................................................. 86 December 1991 Acceptance Priority Ranking...................................................................... 89 November 24, 1998 letter to H.V. Oheim from Beth A Tomasoni re: Boston Edison's Delivery Commitment Schedule .............................................................. 93 July 13, 1999 Boston Edison Company Purchase and Sale Agreement............................ 94 December 1991 Annual Capacity Report ............................................................................. 97 vii

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS ) ) ) Plaintiff, ) ) v. ) ) UNITED STATES OF AMERICA, ) ) Defendant. ) ) BOSTON EDISON COMPANY,

No. 99-447C (J. Lettow)

PLAINTIFF BOSTON EDISON COMPANY'S BRIEF IN RESPONSE TO DEFENDANT'S MOTION TO DISMISS OR, IN THE ALTERNATIVE, FOR SUMMARY JUDGMENT UPON COUNTS I AND II AND FOR SUMMARY JUDGMENT UPON COUNT III OF PLAINTIFF'S AMENDED COMPLAINT AND CROSS-MOTION FOR SUMMARY JUDGMENT ON LIABILITY REGARDING COUNT I OF THE AMENDED COMPLAINT INTRODUCTION Pursuant to Rules 7.2(c), 12(b), and 56(b) 1 of the Rules of the U.S. Court of Federal Claims ("RCFC"), and further pursuant to the Court's Order dated May 28, 2004, Plaintiff Boston Edison Company ("Boston Edison"), through its undersigned counsel, hereby submits its brief in response to the Motion to Dismiss or, in the Alternative, for Summary Judgment upon Counts I and II and for Summary Judgment upon Count III of Plaintiff's Amended Complaint ("Motion") filed by Defendant, the United States of America ("Government"), acting by and through the U.S. Department Although the Government has styled its Motion as a "Motion to Dismiss, or in the Alternative, for Summary Judgment" on Counts I and II of the Amended Complaint, the Government cites only to RCFC 56(b). Motion at 1. While the Government has briefly discussed the standard for dismissal for lack of jurisdiction, id. at 4-6, it has not expressly invoked RCFC 12. For purposes of this response, Boston Edison treats the Government's Motion as having been filed under RCFC 12(b) and 56(b).
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of Energy ("Government" or "DOE"). Boston Edison also cross-moves herein for summary judgment on liability for breach of contract pursuant to Count I of its Amended Complaint. As discussed below, both legal and factual issues preclude a judgment in favor of the Government on its Motion. Conversely, Boston Edison is entitled to summary judgment on its cross-motion as there are no legal or factual issues in dispute regarding the Government's liability for breach of the Standard Contract. The Government's arguments about the Delivery Commitment Schedule ("DCS") in response to Count I of the Amended Complaint have no merit and, as a result, have been soundly rejected on numerous occasions by the Federal Circuit, the D.C. Circuit, and the U.S. Court of Federal Claims. These courts have unanimously held that the Government was required by the Nuclear Waste Policy Act of 1982, 42 U.S.C. § 10101 et seq. ("NWPA"), to begin accepting spent nuclear fuel ("SNF") from the nuclear utilities by January 31, 1998 in exchange for the payment of prescribed fees by the utilities into a Nuclear Waste Fund, and that the Government breached that obligation. Boston Edison owned the Pilgrim Nuclear Power Station ("Pilgrim") on the date of the Government's breach ­ January 31, 1998 ­ and was injured as a direct and proximate result of that breach. Accordingly, Boston Edison has standing to bring this action. Boston Edison also has a viable claim for uncompensated taking pursuant to Count III of the Amended Complaint because Boston Edison's takings claim does not "arise from" its breach of contract claim. Finally, Boston Edison's good faith and fair dealing claim in Count II of the Amended Complaint is based on the Government's well-documented interference with Boston Edison's ability to recognize its rights under the Standard Contract. Additionally, material issues of fact exist that preclude

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summary judgment on Counts II and III of the Amended Complaint. Accordingly, Boston Edison respectfully requests that the Court deny the Government's Motion in its entirety. Boston Edison also respectfully requests that the Court grant its cross-motion for summary judgment on Count I of its Amended Complaint. There are no material facts in dispute regarding the Government's liability for breach of the Standard Contract. The Government has been found to have breached the Standard Contract by every court that has considered this issue. Boston Edison is entitled to judgment on Count I of the Amended Complaint as a matter of law. ISSUES PRESENTED 1. Whether Boston Edison has standing to bring an action for damages incurred as a direct and proximate result of the Government's breach of the Standard Contract on January 31, 1998. 2. Whether Boston Edison can pursue breach of contract and uncompensated takings claims concurrently, where Boston Edison's takings claims arise independently from the rights conveyed by the Standard Contract. 3. Whether Boston Edison can maintain a claim for breach of the Government's duty of good faith and fair dealing based on the Government's welldocumented interference with Boston Edison's ability to realize its rights under the Standard Contract. 4. Whether the Government is liable for breach of contract where there is no genuine issue of material fact regarding the Government's contractual obligation to begin removal of Boston Edison's SNF by January 31, 1998 and the Government's undisputed failure to meet that material obligation.

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STATEMENT OF THE CASE A. Nature of the Case

This case involves claims by Boston Edison under both contract and takings theories arising from the Government's failure to fulfill both statutory and contractual obligations owed to Boston Edison. The breach of these obligations occurred on January 31, 1998 when DOE failed to begin accepting and disposing of Boston Edison's SNF as required by the NWPA and the Standard Contract. B. Statement of Facts

Boston Edison respectfully refers the Court to its Response to Defendant's Proposed Findings of Uncontroverted Fact, its Proposed Findings of Uncontroverted Fact in Support of Its Cross-Motion for Summary Judgment on Liability, and the Appendix in support thereof.2 STANDARD OF REVIEW A. Motion to Dismiss

"When a federal court reviews the sufficiency of the complaint pursuant to a motion to dismiss, `its task is necessarily a limited one.'" Commonwealth Edison Co. v. United States, 46 Fed. Cl. 29, 35 (2000) (quoting Scheuer v. Rhodes, 416 U.S. 232, 236 (1974), abrogated on other grounds by Harlow v. Fitzgerald, 457 U.S. 800 (1982)). "`The issue is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support [its] claims.'" Id. Toward this end, the court must presume that the "factual allegations included in the complaint by a plaintiff are true." Id. Given this minimal standard, the court should not dismiss a complaint for failure to state a claim "unless it is `beyond doubt that the plaintiff can prove no set of facts which would
2

In this brief, Boston Edison refers to its Response to Defendant's Proposed Findings of Uncontroverted Fact as "RPFF"; to Defendant's Proposed Findings of Uncontroverted Fact as "DPFF"; and to its Proposed Findings of Uncontroverted Fact as "PFF." 4

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entitle [it] to relief.'" Sommers Oil Co. v. United States, 241 F.3d 1375, 1378 (Fed. Cir. 2001) (citation omitted). As discussed below, the Government's Motion fails to demonstrate that Boston Edison can prove no set of facts that would entitle it to relief. B. Motion for Summary Judgment

Under Rule 56(c) of the Federal Rules of Civil Procedure, summary judgment may be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." The evidence presented must be viewed in a light most favorable to the nonmovant and all reasonable inferences must be drawn in the nonmovant's favor. See, e.g., United States v. Diebold, Inc., 369 U.S. 654, 655 (1962); Petersen Mfg. Co. v. Cent. Purchasing, Inc., 740 F.2d 1541, 1546 (Fed. Cir. 1984), abrogated on other grounds by Beatrice Foods Co. v. New England Printing & Lithography Co., 899 F.2d 1171 (Fed. Cir. 1990). "The movant bears the burden of demonstrating the absence of all genuine issues of material fact." See, e.g., Cooper v. Ford Motor Co., 748 F.2d 677, 679 (Fed. Cir. 1984). ARGUMENT I. BOSTON EDISON HAS STANDING TO SUE BECAUSE IT SUSTAINED DAMAGES RESULTING FROM THE GOVERNMENT'S BREACH OF THE STANDARD CONTRACT ON JANUARY 31, 1998 A. Boston Edison Meets The Requirements For Standing

Boston Edison's Amended Complaint demonstrates that it has standing to bring this action for breach of contract pursuant to Count I of the Amended Complaint. To present a justiciable controversy, a plaintiff must plead: (1) actual or threatened injury; (2) a causal connection between the injury and the allegedly illegal action that can be redressed by a judicial action; and (3) a likelihood that the injury will be

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redressed by a favorable decision. See, e.g., Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992). Boston Edison has properly pled injury, nexus, and redressability to the Government's breach. Boston Edison was the sole owner and operator of Pilgrim and party to a Standard Contract with the Government on January 31, 1998. Am. Compl. ¶¶ 1-3, 31. Boston Edison sold Pilgrim to Entergy Nuclear Generating Company LLC ("Entergy") on July 13, 1999 and reserved in that transaction "all claims against DOE related to the Standard Contract up to the closing date of the sale." Id. ¶¶ 4, 55. Boston Edison has alleged that it was injured, in part, because it realized significantly less value in the sale of Pilgrim than it would have received had DOE properly fulfilled its obligations under the NWPA and the Standard Contract. Id. ¶¶ 58-71. Boston Edison has clearly met its burden of pleading standing. "At the pleading stage, general factual allegations of injury resulting from the defendant's conduct may suffice, for on a motion to dismiss we `presum[e] that general allegations embrace those specific facts that are necessary to support the claim.'" Lujan, 504 U.S. at 561 (citation omitted). Likewise, the Government's alternative request for summary judgment on Count I must be denied. The Government's Motion was filed shortly after the Court accepted Boston Edison's Amended Complaint and Boston Edison has not conducted any discovery on the Amended Complaint, including its amended damages analysis. It is well settled that "`summary judgment is inappropriate unless a tribunal permits the parties adequate time for discovery.' . . . Indeed, summary judgment should `be refused where the nonmoving party has not had the opportunity to discover information that is essential to [its] opposition.'" Burnside-Ott Aviation Training Ctr., Inc.

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v. United States, 985 F.2d 1574, 1582 (Fed. Cir. 1993) (citations omitted). Moreover, as the Supreme Court noted in Lujan, When the suit is one challenging the legality of government action or inaction, the nature and extent of facts that must be averred (at the summary judgment stage) or proved (at the trial stage) in order to establish standing depends considerably upon whether the plaintiff is himself an object of the action (or foregone action) at issue. If he is, there is ordinarily little question that the action or inaction has caused him injury, and that a judgment preventing or requiring the action will redress it. 504 U.S. at 561-62 (emphasis added). Boston Edison, as a party to the Standard Contract, was the object of the Government's breach and standing must be assessed accordingly. The attached affidavit of Geoffrey O. Lubbock, Vice President of Financial Strategic Planning and Policy for NSTAR Electric & Gas Corporation ("NSTAR") and Boston Edison (an operating affiliate of NSTAR) ("Lubbock Affidavit"), describes some of the damages suffered by Boston Edison as a direct and proximate result of the Government's breach.3 See Appendix ("App."), attached hereto, at 4; PFF No.15. As the Lubbock Affidavit states, Pilgrim was designed and constructed in a manner that required SNF to be shipped off-site to be reprocessed for future use. RPFF No. 1. When reprocessing was prohibited by the Government in the late 1970s, and with the subsequent passage of the NWPA, it was clear to all concerned that the operation and indeed the viability of Pilgrim relied heavily upon the Government's statutory and contractual obligation to remove and dispose of Boston Edison's SNF. Id.

3

The Lubbock Affidavit is offered in response to the Government's Motion with respect to Count I of the Amended Complaint. The Lubbock Affidavit should not be construed as articulating the entirety of Boston Edison's damages analysis. Boston Edison expressly reserves its right to more fully develop its damages analysis through the use of documents, demonstrative exhibits, testimony (including the testimony of expert witnesses), and other means, as appropriate. 7

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Consequently, the Government's breach of its obligations had a significant detrimental impact on the fair market value of Pilgrim. App. at 4. The manifestations of these damages include, but are not limited to, the economic impacts described in the Lubbock Affidavit and summarized below. One measure of the impact of the Government's breach on the fair market value of Boston Edison's property was the dramatic decrease in the number of prospective bidders that actually participated in the auction of Pilgrim. App. at 3. The limited number of bidders for Pilgrim was "directly related to the increased risk and cost associated with the uncertain future for permanent disposition of SNF." Id. The Government's breach also directly resulted in a significant reduction in the per kWh purchase price of Boston Edison's nuclear assets. Id. The two bidders that submitted bids during the auction process were concerned about Pilgrim's ability to produce future revenues beyond the end of its initial license life. Id; PFF No. 16. Faced with the Government's failure to begin acceptance of SNF as required, a potential buyer did not know if it could have the facility re-licensed. App. at 3. In the alternative, the buyer was faced with the prospect of having to expend considerable funds to construct dry cask storage at Pilgrim. Id. These factors had a dramatic impact on the fair market value of Pilgrim prior to the sale. Id. Moreover, the fair market value of Pilgrim was significantly decreased as a result of the future costs that encumbered the property as a direct result of the Government's breach. App. at 3-4. These costs included indefinite future payments to DOE of the one mil per kWh fee assessed by DOE, as well as increased costs associated with decommissioning Pilgrim. Id. Ultimately, as a direct result of the Government's breach of the Standard Contract, Boston Edison was required to transfer a larger

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decommissioning trust fund than it otherwise would have been required to transfer had the Government not breached its contractual obligations. Id. at 4. Boston Edison suffered these (and other) damages as a direct and proximate result of the Government's breach of the Standard Contract on January 31, 1998. 4 In short, Boston Edison sustained damages on January 31, 1998. Those damages were not forestalled to a later date after assignment of the Standard Contract in July 1999, as the Government now claims. By January 1998 the economic viability of Boston Edison's nuclear assets was significantly injured as a direct consequence of the Government's decision not to have an operational repository in place in order to permit permanent disposal of SNF by January 31, 1998. By 1998, the Government was unable to state when ­ if ever ­permanent disposal would actually begin. As of January 1998,

In its Motion, the Government argues that Count I of the Amended Complaint must be construed as asserting a claim for partial breach of contract, and therefore, pre-breach damages are not recoverable. Motion at 18-19. Boston Edison respectfully disagrees. To the contrary, as the court has recently found in Yankee Atomic Electric Co. v. United States, No. 98-126C (Fed. Cl. filed June 28, 2004) (Merow, J.), damages incurred prior to January 31, 1998 may be recoverable to the extent that such damages were foreseeable and necessary to avoid further losses. Judge Merow held: "Consider the ramifications of defendant`s position. Should plaintiffs have waited until December 31, 1998 and then decided what to do with their nuclear waste? The court thinks not, and accordingly, will not preclude evidence and argument in this regard." Id. slip op. at 10. Accordingly, the court held that Yankee Atomic would be permitted to present at trial evidence of pre-breach damages incurred as a result of DOE`s breach. Id. (citing Tennessee Valley Auth. v. United States, 60 Fed. Cl. 665, 674 (2004), and Restatement (Second) of Contract § 350 cmt. B (1981). In Tennessee Valley Authority, the court, observing that DOE had notified all Standard Contract holders that it would not collect any SNF prior to 2010, concluded that the Standard Contract holder "was justified, indeed obligated, to take steps to minimize its losses in light of DOE's imminent nonperformance." 60 Fed. Cl. at 674. Reasonably foreseeable damages that "`place the injured party in as good a position as he or she would have been had the breaching party fully performed'" are recoverable irrespective of whether the breach is viewed as partial or total. Yankee Atomic, slip op. at 10-11 (quoting Hughes Communications Galaxy, Inc. v. United States, 271 F.3d 1060, 1066 (Fed. Cir. 2002)). Boston Edison respectfully requests that the Court take a similar view in the present case.
4

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Boston Edison was also deprived of its valuable rights to buy, sell, and trade SNF disposal allotments, as the Government had earlier encouraged. RPFF No. 9. B. DOE Breached The Standard Contract On January 31, 1998

The Government's Motion attempts to resurrect its tired and thoroughly discredited contention that the breach of the Standard Contract did not occur on January 31, 1998, but rather, at a later date. Motion at 10. The Government argues that the later date is the proper indicator of the Government's breach because it established when Boston Edison was first scheduled to deliver its SNF to DOE pursuant to Boston Edison's initial Delivery Commitment Schedule ("DCS"). Motion at 15. According to the Government, Boston Edison has no standing to bring this action because DOE's alleged first acceptance obligation of Boston Edison's SNF under its DCS occurred after Boston Edison sold Pilgrim to Entergy on July 13, 1999. Motion at 10. The Government's position, however, flies in the face of the express language of the NWPA and the Standard Contract, and has been rejected by every court that has considered the issue ­ including two decisions by the U.S. Court of Appeals for the District of Columbia Circuit, two decisions of the U.S. Court of Appeals for the Federal Circuit, and at least three decisions of this Court. As discussed below, these decisions hold that the Government's breach occurred when it failed to have an operational repository in place for permanent SNF disposal by January 31, 1998 as required by the NWPA and the Standard Contract. The Government's breach was not limited to failing to dispose of particular or discrete units of SNF. As such, and as discussed in Section I.C infra, the Government is collaterally estopped from arguing that the breach of the Standard Contract occurred on any date other than January 31, 1998.

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Moreover, as discussed below, the DCS process is administrative and does not create a binding contractual obligation for purposes of determining liability or standing. The Government's interpretation of the DCS process would render the Standard Contract illusory, as it would give the Government an unlimited right to walk away from its obligations without liability. Finally, the Government is bound by the January 31, 1998 deadline because it knew that the utilities, including Boston Edison, relied upon that date, not the DCS process, to trigger the Government's SNF disposal obligations. The Government's assertion that Boston Edison lacks standing because Boston Edison sold Pilgrim and assigned its Standard Contract to Entergy before any right to SNF acceptance accrued is premised on the wrongheaded notion that the DCS triggers DOE's obligations. To this end, the Government maintains that the January 31, 1998 deadline was not binding on the Government with respect to Boston Edison, but rather, "was a statutory deadline by which DOE was required to begin its program of accepting SNF from the contract holders as a collective whole." Motion at 10 (emphasis in original). The Government's argument, however, ignores the plain language of the NWPA and the Standard Contract, both of which expressly obligate DOE to begin disposal of Boston Edison's SNF by a date certain ­ "no later than January 31, 1998." Standard Contract, 10 C.F.R. § 961.11, Art. II. The Government's obligation to the utilities, including Boston Edison, was "`without qualification or condition,'" N. States Power Co. v. United States Dep't of Energy, 128 F.3d 754, 757 (D.C. Cir. 1997) (quoting Ind. Mich. Power Co. v. Dep't of Energy, 88 F.3d 1272, 1273 (D.C. Cir. 1996)), and, thus, essential to Boston Edison's obligation to pay the fees into the Nuclear Waste Fund. See Indiana Michigan, 88 F.3d 1276-77. Boston Edison timely paid in excess of $89 million in

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fees to DOE in express reliance on DOE's obligation to take custody of the SNF by January 31, 1998. Am. Compl. ¶ 31. It is undisputed that DOE failed to meet its obligation to begin disposal on January 31, 1998. DPFF No. 37. Courts have long held that the "[f]ailure to perform a contractual duty when it is due is a breach of the contract." Winstar Corp. v. United States, 64 F.3d 1531, 1545 (Fed. Cir. 1995) (citing Restatement of Contracts § 235(2)), aff'd, 518 U.S. 839 (1996). Indeed, notwithstanding its present position, the Government has previously acknowledged that January 31, 1998 is the operative date for the Government's breach. In Defendant's Second Motion to Renew Its Motion to Consolidate (filed July 29, 2003), at 15, the Government stated: "The holders of the remaining approximately 53 Standard Contracts have yet to file suit, although we understand from industry reports that most, if not all, of these contract holders are expected to file complaints by January 31, 2004 (six years from the January 31, 1998 acceptance date in the Standard Contract and the Nuclear Waste Policy Act)." From a legislative perspective, Congress found the January 31, 1998 acceptance date "so important when it promulgated the [NWPA] that it took the unusual action of specifying that all the contracts must contain this explicit requirement." Maine Yankee Atomic Power Co. v. United States, 225 F.3d 1336, 1342 (Fed. Cir. 2000). Indeed, Congress demonstrated a strong "intent that DOE's various obligations be performed in a timely manner." Indiana Michigan, 88 F.3d at 1277 (quoting Tennessee v. Herrington, 806 F.2d 642, 648 (6th Cir. 1986)) ("`[T]he overall structure of the [NWPA] does reveal a consistent concern for timely implementation of the disposal provisions.'"). "DOE has no authority to adopt a contract that violates the directives of Congress, just as it cannot implement interpretations of the contract that

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contravene this court's prior ruling." Northern States, 128 F.3d at 760. Given this, the only reasonable interpretation of the Standard Contract and the NWPA is that the January 31, 1998 deadline was an express, material, and unconditional obligation of the Government. The Government's construction of the DCS process renders that obligation meaningless and contravenes the express intent of Congress. Further, as discussed below, the Government's DCS argument has been soundly and repeatedly rejected by several courts, each of which has held that January 31, 1998 was the operative date of the Government's breach of the Standard Contract. As Boston Edison was a Standard Contract holder when the breach occurred, and retained its claim against DOE when Pilgrim was subsequently sold to Entergy, Boston Edison has standing to bring this action for the damages it incurred up to the closing date of the sale. C. The Government Is Collaterally Estopped From Arguing That The Breach Occurred On Any Date Other Than January 31, 1998

The Government's DCS argument not only ignores the express intention of Congress, as reflected in the plain language of the NWPA and the Standard Contract, it also requires the Court to ignore several cases that have consistently held that the Government's breach occurred on January 31, 1998. These cases have rejected the Government's argument that the breach occurred later, including the notion that the DCS determines when the Government's breach occurred. The Court is bound by these prior decisions and, in particular, by the decisions of the Federal Circuit that set the date of the Government's breach at January 31, 1998. Accordingly, Boston Edison respectfully requests that the Court take judicial notice of these prior decisions and

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prohibit the Government from arguing that the operative date of the breach of Boston Edison's Standard Contract is anything other than January 31, 1998.5 Under the doctrine of collateral estoppel, "`once a court has decided an issue of fact or law necessary to its judgment, that decision is conclusive in a subsequent suit based on a different cause of action involving a party to the prior litigation.'" Exxon Corp. v. United States, 45 Fed. Cl. 581, 610 (1999), aff'd in part and rev'd in part on other grounds, 244 F.3d 1341 (Fed. Cir. 2001). A party asking a court to apply collateral estoppel must establish that: "(1) the issue at stake is identical to the one involved in the prior proceeding; (2) the issue was actually litigated in the prior proceeding; (3) the determination of the issue in the prior litigation must have been `a critical and necessary part' of the judgment in the first action; and (4) the party against whom collateral estoppel is asserted must have had a full and fair opportunity to litigate the issue in the prior proceeding." Dana v. E.S. Originals, Inc., 342 F.3d 1320, 1323 (Fed. Cir. 2003) (citation omitted); see also In re Freeman, 30 F.3d 1459, 1465 (Fed. Cir. 1994). As detailed below, the legal issue presented by the Government's Motion ­ whether the Government's breach of the Standard Contract occurred on January 31, 1998 or at some later date ­ is identical to the issue litigated and resolved in numerous prior proceedings. Moreover, the date of the Government's breach is "a critical and necessary part" of these prior decisions as it goes to the heart of the Government's liability. Finally, there is no question that the Government has had a full and fair opportunity to litigate the issue of when the breach occurred and did, in fact, litigate this issue. Thus, collateral estoppel is appropriate in this matter.

5

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1.

The D.C. Circuit Determined that the Breach Occurred on January 31, 1998

The D.C. Circuit conclusively ruled that the Government breached the Standard Contract on January 31, 1998. Seeking a writ of mandamus, a consortium of utility plaintiffs in Indiana Michigan, and later in Northern States, argued that the January 31, 1998 deadline was a binding obligation on the Government. In both cases, the court agreed: We held in Indiana Michigan that the NWPA imposes an unconditional obligation, memorialized in the Standard Contract, to begin disposing of the materials by January 31, 1998. We rejected the Department's attempt to water-down its obligations, finding that DOE's interpretation would "destroy[] the quid pro quo created by Congress" and would mean that the payment of fees into the Nuclear Waste Fund "was for nothing." 88 F.3d at 1276. To effectuate DOE's duty, as we recognized in Indiana Michigan, petitioners must be able to enforce the terms of the contract in a meaningful way. Petitioners' ability to enforce the contract would be frustrated if DOE were allowed to operate under a construction of the contract inconsistent with our prior conclusion that the NWPA imposes an obligation on DOE "without qualification or condition." Northern States, 128 F.3d at 759; see also Indiana Michigan, 88 F.3d at 1276 ("Under the plain language of the statute, the utilities anticipated paying fees `in return for [which] the Secretary' had a commensurate duty. She was to begin disposing of the high-level radioactive waste or SNF by a day certain."). The D.C. Circuit concluded that "section 302(a)(5)(B) [of the NWPA] creates an obligation in DOE, reciprocal to the utilities' obligation to pay, to start disposing of the SNF no later than January 31, 1998." Indiana Michigan, 88 F.3d at 1277 (emphasis added). The Northern States court concluded that utilities could sue the Government in the U.S. Court of Federal Claims if SNF disposal did not commence by January 31, 1998. 128 F.3d at 760.

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2.

The Federal Circuit Determined that the Breach Occurred on January 31, 1998

The Federal Circuit endorsed the D.C. Circuit's interpretation of the Standard Contract and the Government's breach in three key decisions. In Maine Yankee, the Federal Circuit held that DOE's failure to begin SNF disposal by January 31, 1998 constituted a breach of contract. 225 F.3d at 1343. The Maine Yankee decision notes that the NWPA "effectively made entry into such contracts mandatory" for all nuclear utilities. Id. at 1337. Citing the D.C. Circuit's holdings in Indiana Michigan and Northern States, the Federal Circuit affirmed the decision of the lower court that "the Department was obligated `without qualification or condition' to begin disposing of the nuclear waste by January 31, 1998" and that failure to begin disposal by that date constituted a breach. Id. at 1338-40 (also citing Yankee Atomic Elec. Co. v. United States, 42 Fed. Cl. 223, 235 (1998), aff'd sub nom. Maine Yankee Atomic Power Co. v. United States, 225 F.3d 1336 (Fed. Cir. 2000)). Indeed, the Federal Circuit extended its decision beyond the three utility plaintiffs before it and held that "[t]he breach involved all the utilities that had signed the contract ­ the entire nuclear electric industry." Id. at 1342 (emphasis added). In Northern States Power Co. v. United States, 224 F.3d 1361 (Fed. Cir. 2000), and Roedler v. Department of Energy, 255 F.3d 1347 (Fed. Cir. 2001), the Federal Circuit reaffirmed its decision in Maine Yankee. In Northern States, the Federal Circuit held: On the merits, our opinion in Maine Yankee fully explains why we have concluded that the utilities may maintain their damage suit, and we need not repeat that discussion here. In brief, we hold that the unavoidable delays provision deals with delays arising after performance of the contract has begun, and does not bar a suit seeking damages for the government's failure to begin performance at all by the statutory and contractual deadline of January 31, 1998. 224 F.3d at 1367. It is again important to note that the Federal Circuit did not limit its decision regarding the Government's breach to the particular plaintiff in that case, but

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rather applied its rationale to the utility industry as a whole. See id. Similarly, in Roedler, the Federal Circuit held: In Indiana Michigan Power Co. v. Department of Energy . . . and Northern States Power Co. v. Department of Energy . . . the District of Columbia Circuit held that the government's failure to meet this deadline was a breach of contract. This ruling led to further litigation in which the utility companies seek damages in the Court of Federal Claims. Appellate rulings in various threshold issues appear at Maine Yankee Atomic Power Co. v. United States. . . . and Northern States Power Co. v. United States . . . . 255 F.3d at 1350 (citations omitted).6 The Federal Circuit has spoken clearly and decisively on the issue of when the Government breached the Standard Contract and determined that the breach occurred on January 31, 1998. Moreover, the Federal Circuit held that the breach involved all of the utilities that signed the Standard Contract. As Boston Edison was a signatory and Standard Contract holder when the Government breached on January 31, 1998, the Federal Circuit decisions are equally applicable to Boston Edison and bind the Government in this case. 3. The U.S. Court of Federal Claims Has Determined that the Breach Occurred on January 31, 1998

Several decisions of the U.S. Court of Federal Claims also support Boston Edison's standing to bring this action. In Commonwealth Edison Co. v. United States, 56 Fed. Cl. 652 (2003) (Hewitt, J.), the court soundly rejected a virtually identical DCS argument by the Government. In Commonwealth Edison, the Government moved for partial summary judgment on the issue of the rate of acceptance of SNF. The Government argued that the DCS (and final delivery schedules) established the rate of Roedler differs from Maine Yankee and Northern States in that the plaintiffs in Roedler were rate payers, rather than utilities. Based on this distinction, the Federal Circuit affirmed the lower court's decision that the rate payers did not have a right of action against the Government. Roedler, 255 F.3d at 1353.
6

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acceptance and that January 31, 1998 was not the operative date for determining the Government's liability. Like the Government's present Motion, in Commonwealth Edison, the Government argued that DOE was not contractually obligated to accept SNF other than in the amounts at all times stated in the approved DCSs. Commonwealth Edison Company countered by arguing that the DCS did not create a binding contractual obligation akin to the January 31, 1998 deadline. See Plaintiff's Corrected Memorandum in Opposition to Defendant's Motion for Partial Summary Judgment Regarding the Rate of Spent Nuclear Fuel Acceptance, No. 98-621C (filed Apr. 22, 2003) at 22-28, Commonwealth Edison, 56 Fed. Cl. 652. Commonwealth Edison cited the Government's own "Instructions to Standard Contract Holders to Complete the DCS" ("Instructions") to show that the DCSs were administrative matters and not material terms of the Standard Contract. Id. at 24. Commonwealth Edison also pointed to the depositions of Government witnesses who testified that the DCSs were only for planning purposes and not binding on DOE or the utilities. Id. at 24-26; see also RPFF No. 25. The court rejected the Government's interpretation and held that the DCS was never intended to create contractual obligations between the Government and Standard Contract holders: [T]he DCSs merely "identify all SNF and/or HLW the Purchaser wishes to deliver to DOE . . . ." This mechanism does not create a contractually binding obligation for either party. The ACRs are, according to the Standard Contract terms, for "planning purposes" only. The court finds that there is no evidence that the exchange of DCSs was intended to create a contract between the parties. Commonwealth Edison, 56 Fed. Cl. at 663 (citations omitted). The court found that the Government's failure to give any weight to the January 31, 1998 deadline would render the Standard Contract unenforceable as an illusory contract. Id. at 664, 665 18

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("Defendant's interpretation that it is obligated only to `begin' and not to `continue' acceptance of SNF and/or HLW, would render much of the contract illusory because it would `leave [DOE's] future action subject to [its] own future will' thereby leaving the parties with a promise that had little meaning"); see also Ridge Runner Forestry v. Veneman, 287 F.3d 1058, 1061-62 (Fed. Cir. 2002); Indiana Michigan, 88 F.3d at 1277 (the Government's interpretation of the DCS would render the statutory phrase, "not later than January 31, 1998," superfluous). The court subsequently adopted the rationale of Commonwealth Edison in Yankee Atomic Electric Co. v. United States, Order No. 98-126C (Fed. Cl. filed June 26, 2003) (Merow, S.J.), and Southern Nuclear Operating Co. v. United States , No. 98-614C (Fed. Cl. filed Apr. 7, 2004) (Merow, S.J.); see also Restatement of Contracts § 204, Reporters Note: Case citations July 2003 ­ November 2003 (citing Commonwealth Edison, 56 Fed. Cl. at 662, for the proposition that a court can supply reasonable terms ­ i.e., delivery schedule ­ when a contract is sufficiently defined but otherwise missing a term).7 The U.S. Court of Federal Claims also has held that the Government breached the Standard Contract on January 31, 1998 in Maine Yankee Atomic Power Co. v. United States, 42 Fed. Cl. 582 (1998), aff'd, 225 F.3d 1336 (Fed. Cir. 2000), Detroit Edison Co. v. United States, 56 Fed. Cl. 299 (2003), Indiana Michigan Power Co. v. United States, 57 Fed. Cl. 88 (2003), Florida Power & Light Co. v. United States, 56 Fed. Cl. 555 (2003), and Connecticut Yankee Atomic Electric Co. v. United States, 42 Fed. Cl. 448 (1998).

In Tennessee Valley Authority, the court granted (in part) plaintiff's motion for summary judgment on liability, citing Maine Yankee for the proposition that the NWPA "required that [the Standard Contract] shall provide that [DOE] will dispose of the waste [or spent fuel] `beginning not later than January 31, 1998." 60 Fed. Cl. at 667 (quoting Maine Yankee, 225 F.3d at 1337 (quoting 42 U.S.C. § 10222(a)(5)(B))) (internal quotation marks omitted). The court further held that "[t]he Standard Contract did not establish a specific rate or schedule for the collection of SNF." Id.
7

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In its Motion, the Government takes issue with this Court's decisions in Commonwealth Edison and Indiana Michigan rejecting the Government's DCS arguments. Motion at 19-26. The Government criticizes these rulings by arguing that they "do not consider the practicalities of the acceptance of SNF necessitated by the Standard Contract." Id. at 19. The Government contends that the DCS process supplies most of the material terms of the Standard Contract, and that the Court's decision to interpret the DCS process as "administrative" and to supply its own rate of acceptance was improper. Id. at 19-22. The Government concludes that "[a] rejection of the Government's schedule arguments would effectively render the Standard Contract too indefinite to enforce." Id. at 25. The Government's rebuttal, however, ignores the court's conclusions in Commonwealth Edison and Indiana Michigan that the Government's DCS theory is inconsistent with the explicit requirements of the Standard Contract and the NWPA that "(1) the Department of Energy must remove all nuclear materials (Standard Contract Art. III); (2) the consideration for removal is `the payment of fees established by [42 U.S.C. § 10222(a)(5)(B)];' and (3) the process must begin `not later than January 31, 1998.'" Indiana Michigan, 57 Fed. Cl. at 95; see also Commonwealth Edison, 56 Fed. Cl. at 664. As the court found in Commonwealth Edison (and as discussed supra Section I.C.3), the DCS process described in the Standard Contract is just that ­ a process ­ not a contractual rate of acceptance that is binding on the parties. See 56 Fed. Cl. at 662. Indeed, the Government's own witnesses testified that they considered the DCS to be non-binding. See RPFF No. 25. Thus, the decision by the court to read into the Standard Contract a reasonable rate of acceptance is consistent with cannons of contract

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interpretation and necessary to effectuate the plain meaning of the Standard Contract. See, e.g., Restatement of Contracts § 204. D. The DCS Process Does Not Create A Contractually Binding Obligation

The Court should deny the Government's Motion because the DCS process does not establish a contractually binding obligation for purposes of determining whether Boston Edison has standing. The Government's interpretation of the DCS process is patently unreasonable and would render the Government's obligations under the Standard Contract unenforceable and illusory. The Government also should be estopped from arguing that the DCS process is operative for determining liability or standing because the Government knew that the utilities, including Boston Edison, relied on January 31, 1998 as the commencement date for the Government's SNF disposal obligations. 1. The Government's Interpretation of the DCS Process Would Render the Standard Contract Illusory

A contract that allows one party to "walk away from all obligations" without consequences is illusory. Woll v. United States, 45 Fed. Cl. 475, 478 (1999), aff'd, 251 F.3d 171 (Fed. Cir. 2000). As such, "the government cannot reserve to itself an unlimited right to escape its contractual obligations `without rendering its promises illusory and the contract void.'" Madera Irrigation Dist. v. Hancock, 985 F.2d 1397, 1405 (9th Cir. 1993) (quoting Torncello v. United States, 681 F.2d 756, 760 (Ct. Cl. 1982)). Thus, when faced with conflicting interpretations, courts must construe contracts so as to avoid rendering them "illusory." Torncello, 681 F.2d at 764, 769. The DCSs simply do not provide "specific acceptance obligations from individual Standard Contract holders" as the Government's Motion states. Motion at 2.

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In its Instructions, the Government clearly states that the DCSs do not establish an acceptance rate. The Preface to the Instructions emphasizes that the DCSs were for planning purposes only: The DCS provides the Purchasers with the opportunity to inform DOE of their plans for utilizing their allocations of projected Federal waste management system (FWMS) acceptance capacity. This information will assist DOE in meeting its contractual waste acceptance responsibilities and in developing the FWMS. (Emphasis added.) The Instructions also stated that the Government and purchasers could "reevaluate" the submissions if DOE did not remove SNF at the rate provided in the non-binding Annual Capacity Report ("ACR"). Id. The Instructi