Faced with mounting energy demands and decarbonization
commitments, industry throughout the country is ramping up
investments in nuclear energy. Microsoft, for instance, announced
last month that it is financing the reopening of Three Mile Island,
a mothballed nuclear power plant near Harrisburg, Pennsylvania. At
the same time, and despite the relative safety of nuclear power,
the plaintiffs' bar has brought a number of toxic tort actions
over the past several years against existing nuclear fuel cycle
operators throughout the country.
These cases are governed by the Price-Anderson Act (PAA), enacted
50 years ago to spur private investment in nuclear
energy.1 Among other things, the PAA creates a federal
"public liability action" for injury arising from a
"nuclear incident." In cases arising from nuclear
incidents, the PAA "transforms" a state-law action into a
federal public liability action.2 Specifically, it
provides original federal-question jurisdiction.3 And it
has a "preemption provision" — 42 U.S.C. §
2014(hh).4 Accordingly, the PAA defines a "public
liability action" as a federal action arising under the PAA,
which borrows the substantive law of the forum state "unless
such law is inconsistent with the provisions of" the
PAA.5
Until October 30, 2024, the five federal courts of appeals that had
confronted the question had all held that states' standards of
care in tort suits conflict with the PAA, such that "federal
regulations must provide the sole measure of the defendants'
duty in a public liability cause of action."6
With the Eighth Circuit's decision in Mazzocchio v. Cotter
Corporation, --- F.4th ---, 2024 WL 4612546 (8th Cir. Oct. 30,
2024), the court ruled that federal regulatory standards do not
form the entire standard of care that governs tort cases brought
under the PAA related to alleged radioactive exposures. States'
tort-law standards of care can and do apply. In so holding,
Mazzocchio creates a stark circuit split. Whereas
compliance with federal permitting limits should still protect most
nuclear facilities from liability in a tort suit, facilities in the
Eighth Circuit could now be subject to liability even when in full
compliance with federally permitted radiation limits.
The question in these cases is one of federal preemption. As the
near-unanimous view holds, "the field of nuclear safety has
been occupied by federal regulation."7 To
incorporate a "state duty" into a public liability action
would, therefore, infringe upon pervasive federal safety
regulations in the field of nuclear safety."8 These
courts have also worried that a jury should not, in applying
open-ended state-law standards governing negligence, decide
"permissible levels of radiation exposure" or "the
adequacy of safety procedures at nuclear plants" where the
federal government has already brought ample scientific expertise
to bear through notice-and-comment rulemaking.9 Applying
a terse textualist approach to the PAA, the Eighth Circuit now
disagrees.
In Mazzocchio, the plaintiffs claim that a group of
defendants negligently disposed of and stored certain radioactive
wastes, exposing them to tortious levels of radiation.10
Although the plaintiffs pleaded, among other things, a PAA claim,
they did not plead that the defendants had violated federal permit
standards, particularly the federal nuclear dosage
limits.11 The defendants moved to dismiss on those
grounds, arguing that a PAA claim fails as a matter of law at the
motion-to-dismiss stage unless it pleads a violation of applicable
federal radiation standards.12 The district court
disagreed, concluding that, under certain (unarticulated)
circumstances, state law could provide the standard of care in a
PAA claim.13 Because the district court departed from
the otherwise unanimous authority to the contrary, the district
court agreed to certify the question for interlocutory appeal to
the Eight Circuit.
In a brief opinion, the Eighth Circuit affirmed. Fundamentally, the
Eighth Circuit reframes the question as one of statutory
interpretation. In short, according to the court of appeals,
because section 2210 contains no provision explicitly preempting
state standards of care, federal regulations need not provide the
exclusive standard of care in public liability
actions.
The Eighth Circuit's analysis rests on two main authorities:
the text of 42 U.S.C. § 2014(ii) and the Supreme Court's
ruling in Silkwood v. Kerr-McGee, 464 U.S. 238
(1984).
In its analysis, the Eighth Circuit panel focused on section
2014(ii), which provides that the "substantive rules for
decision in such [public liability] action shall be derived from
the law of the State in which the nuclear incident involved occurs,
unless such law is inconsistent with the provisions of such
section." The court interpreted this provision of the PAA to
mean that state law is preempted only where it conflicts with a
specific and explicit provision of that statute, specifically 42
U.S.C. §2210. In so holding, the Eighth Circuit appeared to
reject wholesale field preemption in the nuclear regulatory space
and failed to explicitly preserve the possibility of conflict
preemption where federal regulatory provisions conflict with state
law.
The panel further analogized to Silkwood, a U.S. Supreme
Court case from 1984 which held that the PAA did not preempt
state-authorized punitive damages. In particular, the panel focused
on the Supreme Court's dicta surmising that, although
"there is tension between the conclusion that safety
regulation is the exclusive concern of the federal law and the
conclusion that a State may nevertheless award damages based on its
own law of liability[,] ... Congress intended to stand by both
concepts and to tolerate whatever tension there was between
them."14 According to the Eighth Circuit, this
language broadly explains "how exclusive federal regulatory
power and state tort law can operate together."15
The Eighth Circuit panel concluded that this statement supports the
conclusion that "state law standards of negligence and strict
liability would continue to play a role in compensating those
injured in a nuclear accident, notwithstanding the federal
government's occupation of the field of nuclear
safety."16
It bears noting that four years after Silkwood, Congress
reacted by amending the PAA to preclude state-authorized punitive
damages and to create a "public liability action." Since
then, other courts have narrowed Silkwood's
application in subsequent PAA cases. For instance, as the Eleventh
Circuit observed, Silkwood was brought not as a public
liability action (i.e., a PAA action, subsequently created in the
1988 amendments), but "as a diversity tort action governed by
Oklahoma law."17 The Eighth Circuit's
Mazzocchio opinion acknowledges that the 1988 PAA
amendments post-date Silkwood and argues that "the
Court's understanding of the role that state tort law plays in
a public liability action" stands.18 But as
discussed by the Eleventh Circuit in Roberts, a PAA
"public liability action" was a creation of the 1988
amendments that post-date Silkwood. Thus, counter to the
language in the Eighth Circuit decision, the Supreme Court's
understanding of "the role that state tort law plays" as
articulated in Silkwood could not have spoken (at least
not directly) to public liability actions like the one at issue in
Mazzocchio.
Despite the opinion's brevity, the consequences of the Eighth
Circuit's decision in Mazzocchio are profound. In the
Eighth Circuit, companies that handle nuclear fuel or waste can no
longer rest easy when a federal regulator assures them of their
compliance with federal regulations. Now, such companies may be
exposed to substantial liability based on no more than a lay
jury's view of appropriate regulatory safeguards. With all
signs pointing to certiorari, time will tell which view
prevails for the entire nuclear industry in the United
States.
We will continue to follow and report on other developments.
Footnotes
1 42 U.S.C. §§ 2210, et seq.; see Pac. Gas. and Elec. Co. v. State Energy Res. Cons. & Dev. Comm'n, 461 U.S. 190, 221 (1983).
2 El Paso Nat. Gas Co. v. Neztsosie, 526 U.S. 473, 477, 484 & n.6 (1999).
3 42 U.S.C. § 2210(n)(2).
4 Neztsosie, 526 U.S. at 484.
5 42 U.S.C. § 2014(ii).
6 See, e.g., O'Conner v. Commonwealth Edison Co., 13 F.3d 1090, 1105 (7th Cir. 1994).
7 O'Conner, 13 F.3d at 1105.
8 In re TMI Litig. Cases Consol. II, 940 F.2d 832, 859 (3d Cir. 1991); accord Nieman v. NLO, Inc., 108 F.3d 1546, 1551-53 (6th Cir. 1997); Roberts v. Fla. Power & Light Co., 146 F.3d 1305, 1308 (11th Cir. 1998).
9 In re Hanford Nuclear Reservation Litig., 534 F.3d 986, 1003 (9th Cir. 2008).
10 2024 WL 4612546, at *1.
11 Id.
12 Id. at *1-3.
13 Id. at *1; Mazzocchio v. Cotter Corp., 2023 WL 5831960, at *1 (E.D. Mo. Sept. 8, 2023).
14 Silkwood, 464 U.S. at 256.
15 Mazzocchio, 2024 WL 4612546, at *3.
16 Id. at 5.
17 Roberts, 146 F.3d at 1308 n.5.
18 Mazzocchio, 2024 WL 4612546, at *5.
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