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Hanna Recap of the Entergy/Vermont Yankee Oral Arguments in the Second Circuit Court of Appeals

January 14, 2013

A Recap of the Entergy/Vermont Yankee Oral Arguments in the Second Circuit Court of Appeals

by Cheryl Hanna
Professor of Law
Vermont Law School

It isn't often that you get to watch two of the best constitutional lawyers in the country argue a case of such importance. Today's case in the Second Circuit Court of Appeals was excellent, and no matter whether you're for or against Vermont Yankee, you had to admire the skills of both David Frederick, who argued on behalf of Vermont, and Kathleen Sullivan, Entergy's lawyer.  Two legal superstars.  Two outstanding arguments.  (Attorney General Bill Sorrell deserves credit for hiring Frederick.  It may just turn out to be one of the best decisions he ever made.)

Predicting how the three-judge panel will decide, however, is not quite as easy as praising the lawyers.  The judges were well prepared and asked insightful questions during the 30-minute argument, but, in the end, gave very little indication which arguments would prevail in this admittedly complex case. 

Perhaps the best way to sum up the argument is that it was a battle between the past and the future.  Frederick began with Pacific Gas and Electric, the 1983 case in which the United States Supreme Court held that the state of California was not preempted from regulating the economic aspects of a nuclear power facility.  It was this precedent, coupled with federal law, that allowed Vermont to pass Act 160, what he termed a "process statute."  Judge Garvan Murtha, Frederick argued, violated the holding of Pacific Gas because he cherry-picked the legislative record instead of looking to the language of the statute itself for the legislative intent. He quoted Chief Justice John Roberts about judges examining the legislative record: It is like being at a party.  You look out and find your friends.

Frederick also made two additional arguments that were noteworthy.  First, he made the point that Vermont had no affirmative duty whatsoever to relicense Vermont Yankee and that the company hadn't raised any due process arguments during litigation.  This suggested to the court that Vermont could have decided any process by which to relicense Vermont Yankee, or no process at all. 

Even more compelling (at least the chief judge) was the point that Vermont could be stuck with the bill of decommissioning the plant if Vermont Yankee declared bankruptcy and skipped town.  That alone, Frederick argued, was enough of an economic interest to justify the state's actions. 

The main strength, and weakness, of Frederick's argument was his reliance on Pacific Gas. The Pacific Gas case is old, Sullivan argued, and was decided when nuclear power plants sold their power directly to consumers.  "PG&E came from a different era," claimed Sullivan. Vermont Yankee is a "merchant plant" that sells to the grid. If Vermont doesn't want power from us, then don't buy it. There was also the subtle implication that today's Supreme Court would be far more skeptical of what happened in Vermont when it was attempting to shutter a federally regulated power plant than was the Court that decided Pacific Gas. To that end, she quoted Justice Sonia Sotomayor, who, while on the Second Circuit, indicated that states can't claim one reason for regulation to mask another preempted one.

Sullivan pointed repeatedly to the record, which shows Vermont's party was only full of safety-minded friends, calling it a "cherry orchard" of statements that should lead any reasonable person to the conclusion that the state was motivated if primarily, but exclusively, over radiological safety.

And what about the concern over Vermonters footing the bill if Vermont Yankee skipped town?  One answer: The Nuclear Regulatory Commission, which already has significant oversight here.  That too is about events that haven't yet happened.

Sullivan then made the extremely important point that the court could rule "as applied" just on the narrow issues without having to make a broad ruling. She gave the court a modest way out, and one that might ultimately persuade the court when faced with a decision that could otherwise have wide-reaching implications.  

The state should be happy that the bench at least took seriously their argument that Judge Murtha should not have ruled as he did.  Whether the gravitas and intellect of Frederick is enough to convince them in the face of overwhelming evidence that the legislature was primarily motivated by safety is harder to call. The state still bears the burden, and the facts and (in my opinion) the law still favor Entergy.  If the state loses, it won't be because it was out-lawyered.  It will be because, in the end, a federal court was reluctant to shutter a federally licensed nuclear power plant on the basis of this particular legislative history. That has as much as do with judicial conservatism as it does with nuclear power.

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