Envirocare of Utah, Inc. v. Nuclear Regulatory Commission

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 8, 1999 Decided October 22, 1999

No. 98-1426

Envirocare of Utah, Inc.,

Petitioner

v.

Nuclear Regulatory Commission and

United States of America,

Respondents

Quivira Mining Company and

International Uranium (USA) Corporation,

Intervenors

Consolidated with

No. 98-1592

On Petitions for Review of an Order of the

Nuclear Regulatory Commission

Richard L. Cys argued the cause for petitioner. With him

on the briefs was Lynda L. Brothers.

E. Leo Slaggie, Deputy Solicitor, U.S. Nuclear Regulatory

Commission, argued the cause for respondents. With him on

the brief were Lois J. Schiffer, Assistant Attorney General,

U.S. Department of Justice, Robert H. Oakley, Attorney,

Karen D. Cyr, General Counsel, U.S. Nuclear Regulatory

Commission, and John F. Cordes, Jr., Solicitor. Grace H.

Kim, Attorney, entered an appearance.

Anthony J. Thompson, Frederick S. Phillips, David C.

Lashway, Mark J. Wetterhahn, and Robert M. Rader were on

the brief for intervenors.

Before: Edwards, Chief Judge, Sentelle and Randolph,

Circuit Judges.

Opinion for the Court filed by Circuit Judge Randolph.

Randolph, Circuit Judge: Federal agencies may, and

sometimes do, permit persons to intervene in administrative

proceedings even though these persons would not have stand-

ing to challenge the agency's final action in federal court.

Agencies, of course, are not constrained by Article III of the

Constitution; nor are they governed by judicially-created

standing doctrines restricting access to the federal courts.

The criteria for establishing "administrative standing" there-

fore may permissibly be less demanding than the criteria for

"judicial standing." See, e.g., Pittsburgh & W.Va. Ry. v.

United States, 281 U.S. 479, 486 (1930); Alexander Sprunt &

Son, Inc. v. United States, 281 U.S. 249, 255 (1930); Henry J.

Friendly, Federal Jurisdiction: A General View 118 (1973).1

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1 As Judge Friendly observed:

The need for a "case or controversy" to seek judicial review but

not to intervene in an administrative hearing; the differences

between statutes and agency rules controlling intervention and

statutes controlling judicial review; and the differing charac-

ters of administrative and judicial proceedings--all of these

negate any general rule linking a person's standing to seek

judicial review to the fact that he has been allowed to intervene

before the agency.

Is the converse true? May an agency refuse to grant a

hearing to persons who would satisfy the criteria for judicial

standing and refuse to allow them to intervene in administra-

tive proceedings? This is the ultimate question posed in

these consolidated petitions for judicial review of two orders

of the Nuclear Regulatory Commission refusing to grant

Envirocare of Utah, Inc.'s requests for a hearing and for

intervention in licensing proceedings.

I

Envirocare was the first commercial facility in the nation

the Commission licensed to dispose of certain radioactive

byproduct material from offsite sources.2 The Commission

had licensed other companies to dispose of such radioactive

waste, but only if the waste was produced onsite. In the late

1990s, the Commission granted the applications of two such

companies for amended licenses to allow them to dispose of

radioactive waste received from other sites. International

Uranium (USA) Corporation's facility in Utah became li-

censed to receive and dispose of approximately 25,000 dry

tons of waste still remaining from the Manhattan Project and

currently stored in New York State. Quivira Mining Compa-

ny's facility in New Mexico, some 500 miles from Envirocare's

operation, also became licensed to dispose of specified

amounts of such material from offsite sources.

In both licensing proceedings before the Atomic Safety and

Licensing Board, Envirocare requested a hearing and sought

leave to intervene to oppose the amendment. Envirocare's

basic complaint was "that the license amendment permits [the

company] to become a general commercial facility like Envi-

rocare, but that the NRC did not require [the company] to

meet the same regulatory standards the agency imposed upon

Envirocare when Envirocare sought its license to become a

__________

Id. (citing 3 Kenneth Culp Davis, Administrative Law Treatise

s 22.08, at 241 (1958)).

2 The material consists of waste resulting from "the extraction or

concentration of uranium or thorium from any ore processed pri-

marily for its source material content." 42 U.S.C. s 2014(e)(2).

commercial disposal facility for" radioactive waste. Quivira

Mining Co., 48 N.R.C. 1, 4 (1998). The Licensing Board

rejected Envirocare's requests for a hearing and for leave to

intervene in both cases, and in separate opinions several

months apart, the Commission affirmed.

With respect to the proceedings to amend Quivira's license,

the Commission ruled that Envirocare did not come within

the following "standing" provision in the Atomic Energy Act:

when the Commission institutes a proceeding for the granting

or amending of a license, "the Commission shall grant a

hearing upon the request of any person whose interest may

be affected by the proceeding, and shall admit any such

person as a party to such proceeding." 42 U.S.C.

s 2239(a)(1)(A). In determining whether Envirocare pos-

sessed the requisite "interest" under this provision, the Com-

mission looked to "current judicial concepts of standing."

Quivira Mining Co., 48 N.R.C. at 6. Envirocare alleged

economic injury, claiming that the less stringent application of

regulations to Quivira placed Envirocare at a competitive

disadvantage. This allegation was sufficient, the Commission

held, to meet the injury-in-fact requirements of constitutional

standing. On the question of prudential standing, however,

the Commission determined that "Envirocare's purely com-

petitive interests, unrelated to any radiological harm to itself,

do not bring it within the zone of interests of the AEA for the

purpose of policing the license requirements of a competitor."

Id. at 16.

With respect to International Uranium's license, the Com-

mission agreed with the Licensing Board that the case was

"on all fours" with Quivira. International Uranium Corp.,

48 N.R.C. 259, 261 (1998). As in that case, Envirocare's

injury from International Uranium's competition was not

within the Atomic Energy Act's zone of interests. In addi-

tion, the Commission made explicit its view that judicial

standing doctrines were not controlling in the administrative

context and that its duty was to interpret the "interest[s]"

Congress intended to recognize in s 2239(a)(1)(A): "Our un-

derstanding of the AEA requires us to insist that a competi-

tor's pecuniary aim of imposing additional regulatory restric-

tions or burdens on fellow market participants does not fall

within those 'interests' that trigger a right to hearing and

intervention under [s 2239(a)(1)(A)]." International Urani-

um Corp., 48 N.R.C. at 264.

II

Envirocare spends all of its time arguing that in light of

decisions of the Supreme Court and of this court, its status as

a competitor satisfies the "zone of interests" test for standing,

as the test was formulated in Association of Data Processing

Service Organizations v. Camp, 397 U.S. 150 (1970), and as it

was refined in National Credit Union Administration v.

First National Bank & Trust Co., 522 U.S. 479 (1998). We

shall assume that Envirocare is correct. It does not follow

that the Commission erred in refusing the company's motions

for a hearing and for leave to intervene, at least in regard to

International Uranium's license amendment. The Commis-

sion rightly pointed out, in International Uranium and in

Quivira, that it is not an Article III court and thus is not

bound to follow the law of standing derived from the "case or

controversy" requirement. See Lujan v. Defenders of Wild-

life, 504 U.S. 555, 561 (1992). Judicially-devised prudential

standing requirements, of which the "zone of interests" test is

one, are also inapplicable to an administrative agency acting

within the jurisdiction Congress assigned to it. The doctrine

of prudential standing, like that derived from the Constitu-

tion, rests on considerations "about the proper--and properly

limited--role of the courts in a democratic society." Warth v.

Seldin, 422 U.S. 490, 498 (1975).

Whether the Commission erred in excluding Envirocare

from participating in International Uranium's licensing pro-

ceeding therefore turns not on judicial decisions dealing with

standing to sue, but on familiar principles of administrative

law regarding an agency's interpretation of the statutes it

alone administers. See Chevron U.S.A. Inc. v. Natural Re-

sources Defense Council, Inc., 467 U.S. 837, 842 (1984). The

governing provision--42 U.S.C. s 2239(a)(1)(A)--requires the

Commission to hold a hearing "on the request of any person

whose interest may be affected by the proceeding" and to

allow such a person to intervene.3 The term "interest" is not

defined in the Act and it is scarcely self-defining. It could

mean merely an academic or organizational interest in a

problem or subject, as in Sierra Club v. Morton, 405 U.S. 727,

738-40 (1972). Or an interest in avoiding economic harm or

in gaining an economic benefit from agency action directed at

others. See Association of Data Processing Serv. Orgs., 397

U.S. at 154. Or an "interest" in "aesthetic, conservational

and recreational values." Id. Or all of these. But whatever

the judicial mind thinks of today as an "interest" affected by a

proceeding is not necessarily what Congress meant when it

enacted this provision in 1954. At the time, judicial notions of

standing were considerably more restrictive than they are

now. The Supreme Court had put it this way: a private

party could challenge federal government action in federal

court only if the party had a legally protected interest, that is,

"one of property, one arising out of contract, one protected

against tortious invasion or one founded on a statute which

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3 Although it appears that the Administrative Procedure Act

applies to the Nuclear Regulatory Commission, see 42 U.S.C.

s 2231, Envirocare has not invoked the APA's administrative stand-

ing provision, which reads: "So far as the orderly conduct of public

business permits, an interested person may appear before an agen-

cy or its responsible employees for the presentation, adjustment, or

determination of an issue, request or controversy in a proceeding."

5 U.S.C. s 555(b).

Commentators have noted that the role of s 555(b) is unclear and

very few courts have attempted to delineate its scope. See 3

Kenneth Culp Davis & Richard J. Pierce, Jr., Administrative Law

Treatise s 16.10, at 63-65 (3d ed. 1994). One scholar, relying on

the prefatory language of the provision, argues that s 555(b) does

not create "an absolute, or even a conditional, right to be a party."

David L. Shapiro, Some Thoughts on Intervention Before Courts,

Agencies, and Arbitrators, 81 Harv. L. Rev. 721, 766 (1968). We

express no view on whether s 555(b) would bring about a result

different than the one reached by the Commission in its Interna-

tional Uranium opinion interpreting s 2239(a)(1)(A). See infra

note 7.

confers a privilege." Tennessee Elec. Power Co. v. TVA, 306

U.S. 118, 137-38 (1939); see also Stephen G. Breyer &

Richard B. Stewart, Administrative Law and Regulatory

Policy: Problems, Text, and Cases 1195-96 (2d ed. 1985).

Thus, traders in one market were not "parties in interest"

entitled to sue for an injunction against a railroad's extending

its track to a competitive market. L. Singer & Sons v. Union

Pac. R.R., 311 U.S. 295 (1940). On the other hand, some

Supreme Court opinions pointed in the opposite direction,

recognizing judicial standing for competitors who would suf-

fer economic injury from agency action. An example is FCC

v. Sanders Brothers Radio Station, 309 U.S. 470 (1940).

Another is The Chicago Junction Case, 264 U.S. 258 (1924).

How agencies were then treating standing questions is un-

clear. According to one report, they were limiting the right

to a hearing "to those directly subject to administrative

controls, exactions or sanctions," Breyer & Stewart, supra,

at 1186. Even after Sanders Brothers, the FCC did not

recognize "economic injury" as "sufficient to secure a hearing

or to intervene in a hearing on a competitor's license applica-

tion." Ronald A. Cass & Colin S. Diver, Administrative Law:

Cases and Materials 714 (1987) (citing Voice of Cullman, 14

F.C.C. 770 (1950)). It was not until the late 1950s that some

decisions of this court began expanding the category of

persons entitled to participate in agency proceedings on the

theory that anyone who had standing to seek judicial review

should have administrative standing. See, e.g., National Wel-

fare Rights Org. v. Finch, 429 F.2d 725, 732-33 (D.C. Cir.

1970); Office of Communication of United Church of Christ

v. FCC, 359 F.2d 994, 1000-06 (D.C. Cir. 1966); Virginia

Petroleum Jobbers Ass'n v. FPC, 265 F.2d 364 (D.C. Cir.

1959).4 (We will have more to say about these cases in a

moment.)

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4 We are not sure that Martin-Trigona v. Federal Reserve Bd.,

509 F.2d 363 (D.C. Cir. 1975), is such a case. While the court

stated that the tests for judicial standing and administrative stand-

ing would be treated as identical "[f]or purposes of this case," id. at

366, this appears to have been a decisional device. The court's

holding was that petitioner had alleged no injury in fact and

Because we cannot be confident of what kinds of interests

the 1954 Congress meant to recognize in s 2239(a)(1)(A)--

because, in other words, the statute is ambiguous--the Com-

mission's interpretation of this provision must be sustained if

it is reasonable. See Chevron, 467 U.S. at 843. We think it

is. For one thing, excluding competitors who allege only

economic injury from the class of persons entitled to inter-

vene in licensing proceedings is consistent with the Atomic

Energy Act. The Act meant to increase private competition

in the industry, not limit it. Before its passage in 1954, the

federal government completely controlled nuclear energy.

Through the Act, Congress sought to foster a private nuclear

industry for peaceful purposes. In order to ensure that

private industry would not undermine nuclear safety, the Act

created an agency--what is today the Nuclear Regulatory

Commission--to regulate the private sector. See generally

Pacific Gas & Elec. v. Energy Resources Comm'n, 461 U.S.

190 (1983). One of the Commission's statutory duties is

authorizing the transfer and receipt of radioactive byproduct

material. See 42 U.S.C. s 2111. The statute describes the

Commission's responsibility in this area as follows: "The

Commission shall insure that the management of any byprod-

uct material ... is carried out in such a manner as the

Commission deems appropriate to protect the public health

and safety and the environment from radiological and non-

radiological hazards associated with the processing and with

the possession and transfer of such material...." 42 U.S.C.

s 2114(a)(1).

Nothing in this provision, or in the rest of the Act, indicates

that the license requirement was intended to protect market

participants from new entrants. Envirocare points to the

Act's policy statement which mentions "strengthen[ing] free

competition in private enterprise." Petitioner's Initial Brief

at 25 (citing 42 U.S.C. s 2011). This statement refers to the

Act's goal of creating a private nuclear energy industry.

Allowing new competitors to enter the market strengthens

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therefore did not have standing of any sort. Id. at 367; see also id.

at 366 n.10.

competition. Permitting current license holders to initiate

hearings for the purpose of imposing burdens on potential

competitors does the opposite. See Lars Noah, Sham Peti-

tioning as a Threat to the Integrity of the Regulatory Pro-

cess, 74 N.C. L. Rev. 1 (1995).

In rendering its interpretation of s 2239(a)(1)(A), the Com-

mission also properly took account of regulatory burdens on

the agency. It wrote: "Competitors, though, whose only

'interest' is lost business opportunities, could readily burden

our adjudicatory process with open-ended allegations de-

signed not to advance public health and safety but as a

dilatory tactic to interfere with and impose costs upon a

competitor. Such an abuse of our hearing process would

significantly divert limited agency resources, which ought to

be squarely--genuinely--focused upon health and safety con-

cerns." International Uranium, 48 N.R.C. at 265. The

Commission's concerns are not limited to byproduct disposal

licenses. Those are only one of the many types of licenses

the Commission grants. Within the Commission's authority

are licenses for the distribution of special nuclear material,

see 42 U.S.C. s 2073, for the transfer and distribution of

nuclear source material, see id. ss 2092, 2093, for commercial

uses of nuclear material, see id. s 2133, and for medical

therapy that uses nuclear material, see id. s 2134(a).

For these reasons, the view the Commission expressed in

its International Uranium opinion--that competitors assert-

ing economic injury do not demonstrate the type of interest

necessary under s 2239(a)(1)(A)--is a permissible construc-

tion of the statute.5 And it appears to be a construction the

Commission has adhered to for some time. See Virginia

Elec. & Power Co., 4 N.R.C. 98, 105-06 (1976). The Commis-

sion stated that it has long been its practice to deny requests

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5 The Commission's interpretation does not leave competitors

without any opportunity to make their views known in another's

licensing proceeding. As the Commission pointed out, any person

is allowed to participate in the written petition process, see 10

C.F.R. s 2.206, and competitors can participate in ongoing adjudica-

tions as amici. See International Uranium, 48 N.R.C. at 265-66.

for a hearing under s 2239(a)(1)(A) when the petitioner al-

leged only economic injury. See International Uranium, 48

N.R.C. at 265. Envirocare has cited nothing to the contrary.

In any event, even if the Commission's refusal to follow the

developing law of judicial standing had been a departure from

its usual practice, it gave adequate reasons for changing

course.

We mentioned earlier several decisions of this court indicat-

ing that agencies should allow administrative standing to

those who can meet judicial standing requirements: National

Welfare Rights Organization v. Finch, 429 F.2d 725, 732

(D.C. Cir. 1970); Office of Communication of United Church

of Christ v. FCC, 359 F.2d 994, 1000-06 (D.C. Cir. 1966);

Virginia Petroleum Jobbers Association v. FPC, 265 F.2d 364

(D.C. Cir. 1959).6 None of these cases interpreted the admin-

istrative standing provision of the Atomic Energy Act. All

were decided before Chevron and for that reason alone cannot

control our decision today. Furthermore, despite some broad

language in Office of Communication about administrative

standing, the agency there equated standing to appear before

it with standing to obtain judicial review and so the court had

no occasion to examine whether the two concepts might be

distinct. See 359 F.2d at 1000 n.8. In National Welfare

Rights no statute gave individuals standing to intervene in

agency proceedings to cut off federal grants-in-aid to states

under the Social Security Act. Regardless of the agency's

view that only states could participate in the administrative

proceedings, which is what the statute said, the court ordered

the agency to follow principles of judicial standing in order to

"perfect[ ] the right to review." 429 F.2d at 737. This mode

of decisionmaking is contrary to the Supreme Court's later

decision in Vermont Yankee prohibiting the judiciary from

imposing procedures on an agency when a statute does not

require them. See Vermont Yankee Nuclear Power Corp. v.

Natural Resources Defense Council, Inc., 435 U.S. 519, 543-

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6 At least one member of this court questioned these decisions

even before Chevron. See Koniag, Inc., Village of Uyak v. Andrus,

580 F.2d 601, 613 & n.5 (D.C. Cir. 1978) (Bazelon, J., concurring).

49 (1978). As to Virginia Petroleum Jobbers, the court there

equated standing to intervene in agency proceedings with

standing to seek judicial review on the basis that "the right to

appeal from an order presupposes participation in the pro-

ceedings which led to it," 265 F.2d at 368, a proposition that

has since been vigorously disputed. See Louis L. Jaffe,

Judicial Control of Administrative Action 524-25 (1965);

Louis L. Jaffe, Judicial Review of Procedural Decisions and

the Philco Cases: Plus Ca Change?, 50 Geo. L.J. 661, 669

(1960). In any event, as we have said, all of these cases were

pre-Chevron. Judged by current law, none gave sufficient

weight to the agency's interpretation of the statute governing

intervention in its administrative proceedings.7

This brings us to the Commission's order in Quivira. The

Commission in that case appeared to reject Envirocare's

petition entirely on the basis of its reading of judicial standing

doctrine. The opinion did not purport to rest on the interpre-

tation of s 2239(a)(1)(A) it expressed a few months later in

the International Uranium case. The Commission did, how-

ever, give notice that although it "customarily follows judicial

concepts of standing, we are not bound to do so given that we

are not an Article III court." Quivira, 48 N.R.C. at 6 n.2.

Whether in Quivira the Commission correctly analyzed the

Supreme Court's National Credit Union decision regarding

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7 Our post-Chevron opinion in Nichols v. Board of Trustees of the

Asbestos Workers Local 24 Pension Plan, 835 F.2d 881, 896 (D.C.

Cir. 1987), did state: "Because a party entitled to judicial review of

agency action clearly qualifies as an 'interested person' who normal-

ly may intervene in administrative proceedings, we hold that [peti-

tioner] possessed such status under [s 555(b) of the APA] when he

requested permission to participate in the proceedings under re-

view." Whether the meaning of "interested person" in s 555(b)

was contested is unclear (see id. at 897-98), nor are we certain what

the court meant by the qualifier "normally" in the quoted sentence.

At any rate, when it comes to statutes administered by several

different agencies--statutes, that is, like the APA and unlike the

standing provision of the Atomic Energy Act--courts do not defer

to any one agency's particular interpretation. See Tax Analysts v.

IRS, 117 F.3d 607, 613 (D.C. Cir. 1997).

the "zone-of-interest" test or our opinion in Hazardous Waste

Treatment Council v. EPA, 861 F.2d 277 (D.C. Cir. 1988), or

any of the other judicial opinions it discussed, is an issue we

do not decide. If we did decide the question and if we

concluded that the Commission's analysis was incorrect, we

would set aside its order and remand the case. On remand,

the Commission could--and undoubtedly would--simply cite

our holding in the International Uranium case and again

deny Envirocare's request for a hearing and for leave to

intervene. When "there is not the slightest uncertainty as to

the outcome of a proceeding" on remand, courts can affirm an

agency decision on grounds other than those provided in the

agency decision. NLRB v. Wyman-Gordon, 394 U.S. 759,

766 n.6 (1969); see also Pharma, Inc. v. Shalala, 62 F.3d

1484, 1489 (D.C. Cir. 1995). As Judge Friendly explained,

reversal and remand is "necessary only when the reviewing

court concludes that there is a significant chance that but for

the error the agency might have reached a different result.

In the absence of such a possibility, affirmance entails neither

an improper judicial invasion of the administrative province

nor a dispensation of the agency from its normal responsibili-

ty." Henry J. Friendly, Chenery Revisited: Reflections on

Reversal and Remand of Administrative Orders, 1969 Duke

L.J. 199, 211. With respect to the Quivira case, concerns

about judicial intrusion and agency abdication are especially

unwarranted. It is the Commission's reasoning, in Interna-

tional Uranium, that we accept as the ground upon which to

dispose of the petition for review in Quivira.

The petitions for judicial review are denied.