Opposition — Hartigan v. General Electric Co.

ATTORNEY GENERAL OF IL-

LINOIS, CHARLES P. ZALAR, STATE’S ATTORNEY OF

GRUNDY COUNTY, and PHILIP GUSTAFSON, DIREC-

TOR OF THE ILLINOIS DEPARTMENT OF NUCLEAR

SA°ETY,

Petitioners.

v.

GENERAL ELECTRIC COMPANY and

SOUTHERN CALIFORNIA EDISON COMPANY,

Respondents.

ON PETITION FOR WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

BRIEF OF RESPONDENTS IN OPPOSITION

TO PETITION FOR CERTIORARI

WILLIAM A. GORDON

(Counsel of Record )

JoHN M. CaRROLL

MICHELE OporizzZI

DanieL D. BECKEL

231 South LaSalle Street

Chicago, Illinois 60604

(312) 782-0600

Attorneys for Respondents

Of Counsel:

Mayer, Brown & Piatt

231 South LaSalle Street

mM 4 . 7 i — a? Au. nu

‘wy -, # fet

i

QUESTION PRESENTED

In December, 1980, Illinois enacted a statute (“the Spent

Fuel Statute”) which prohibited ihe importation of spent

nuclear fuel generated outside the state of Illinois if that fuel

was to be stored at an away-from-reactor facility located within

Illinois. General Electric Company (“General Electric”)*

operates such a storage facility at Morris, Illinois. Together

with Southern California Edison Company (“SCE”),** which

had a contract to store spent fuel at Morris, General Electric

brought suit against the state officials charged with enforcing

the Statute, seeking a declaratory judgment that it was uncon-

stitutional.

Both the District Court and the Seventh Circuit Court of

Appeals held the Spent Fuel Statute unconstitutional under the

Commerce Clause, relying on this Court's decision in City of

Philadelphia v. New Jersey, 437 U.S. 617 (1978), striking down

a virtually identical statute. The only question properly

presented to this Court is whether that determination was

erroneous. ***

* Pursuant to Sup. Ct. Rule 28, General Electric states that it has

no parent companies. A list of its subsidiaries ( except wholly-owned

subsidiaries) and affiliates is attached hereto as Exhibit A.

** Pursuant to Sup. Ct. Rule 28, SCE states that it has no parent

companies, subsidiaries (except wholly-owned subsidiaries) or affil-

iates.

*** The first question presented by the Petition relating to the

economic impact of the Statute was neither raised nor passed upon by

the courts below and thus is not properly before this Court.

TABLE OF CONTENTS

PAGE

Question Presented ae

Table of Authorities . iii

Ny NO ccctrnenerepsnsntmenenestemeeengremsemeeen l

Reasons for Denying the WIit..................c.ccccceseseeseeseereeeee 4

I. The Court of Appeals Correctly Concluded That

the Spent Fuel Statute Unconstitutionally Dis-

criminates Against Articles in Interstate Com-

merce Solely on the Basis of Their Origin ............ 6

A. This Case Is Controlled by the Decision in

City of Philadelphia v. New Jersey ................ 7

B. There Is No Reason to Disturb the Lower

Courts’ Finding That the Spent Fuel Stat-

ute Is Not a Quarantine Measure................. 10

C. The Court of Appeals Decision Is Con-

sistent with Decisions in Other Circuits........ 11

Il. The Preemption Issue Raised in the Petition Is

Not Properly Before This Court. 12

Ill. The Tenth Amendment Argument Is Frivolous

and Should Not Be Considered by This Court..... 17

Ee eee SEC ee 19

TABLE OF AUTHORITIES

Asbell v. Kansas, 209 U.S. 251 (1908)

City of Philadelphia v. New Jersey, 437 U.S. 617 ....

Clason v. Indiana, 306 U.S. 439 (1939) ........ccccc0

Graver Tank Mfg. Co. v. Linde Air Products Co.,

336 U.S. 271 (1949)

Great Atlantic & a Tea Co. v. Cottrell, 424

8 ee

Hardage v. Atkins, 582 F. 2d 1264 (10th Cir.

1978)

Hill v. California, 401 U.S. 797 (1971) ...ccccccccceseeee

Hodel v. Virginia Surface Mining & Reclamation

Ass'n, 452 U.S. 264 (1981)

Hughes v. Oklahoma, 441 U.S. 322 (1979).............

Lewis v. BT Investment Managers, Inc., 447 U. S.

27 (1980)

National League of Cities v. Usery, 426 U. S. 333

(1976)

Northern States Power Co. v. Minnesota, 447 F. 2d

1143 (8th Cir. 1971), aff'd, 405 U. S. 1035

I ee ee ene eee

Pacific Gas & Electric Co. v. State Energy Re-

sources Conservation & Development Commis-

sion, 659 F. 2d 903 (9th Cir. 1981), cert.

granted, 102 S. Ct. 2956 (1982) .......cccccceeseeseesees

Pike v. Bruce Church, Inc., 397 U.S. 137 (1970) ...

Sporhase v. Nebraska, 50 U.S. L. W. 5115 (U.S.

1982)

7

iv

Tacon v. Arizona, 410 U.S. 351 (1973) ......c.cccee0- 15

Train v. Colorado Pub. Int. Research Group, Inc.,

426 U.S. 1 (1976) 14

United States v. Ceccolini, 435 U.S. 268 (1978)... 11

Washington State Building & Construction Trades

Council v. Spellman, 684 F. 2d 627 (9th Cir.

1982) 12, 16

Statutes and Regulations

Atomic Energy Act, 42 U.S. C. § 2021(k) .............. 5

Clean Air Act Amendments of 1977, Pub. L. No.

95-95, 91 Stat. 685 3,4

10 C. F. R. Parts 71, 72 14, 15

Ill. Rev. Stat., ch. 111%, $§ 230.21-.24 (1981)........ 2

IN THE

Supreme Court of the United States

Octosper Term, 1982

TYRONE C. FAHNER, ATTORNEY GENERAL OF IL-

LINOIS, CHARLES P. ZALAR, STATE'S ATTORNEY OF

GRUNDY COUNTY, and PHILIP GUSTAFSON, DIREC-

TOR OF THE ILLINOIS DEPARTMENT OF NUCLEAR

SAFETY,

Petitioners.

GENERAL ELECTRIC COMPANY and

SOUTLERN CALIFORNIA EDISON COMPANY,

Respondents.

ON PETITION FOR WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

BRIEF OF RESPONDENTS IN OPPOSITION

TO PETITION FOR CERTIORARI

STATEMENT OF THE CASE

General Electric’s facility at Morris, Illinois, is the only

operating commercial facility in the United States licensed by

the United States Nuclear Regulatory Commission (“NRC”)

to accept and store spent nuclear fuel away from the site of the

power plant where it was discharged. While the Morris facility

provides an important service for those utilities that need to

store fuel off-site, it has sufficient capacity to store only 750 tons

of spent fuel, a small fraction of the 64,912 tons projected to be

2

discharged nationwide through the year 2000.' At the time the

complaint was filed, 316 tons of spent fuel were stored at

Morris, approximately 171 tons of which had been discharged

from reactors located outside the state of Illinois. Of these 171

tons, 95 came from SCE’s nuclear generating facility in San

Onofre, California. When the Spent Fuel Statute was enacted

into law, SCE had a contract to transport an additional 32 tons

to Morris for storage during 1981 and 1982.

On December 3, 1980, the Illinois General Assembly

enacted the Spent Fuel Statute, Ill. Rev. Stat. ch. 111%,

$§ 230.21-.24 (1981), into law over the Governor’s veto. As

enacted, the law provides:

“No person may dispose of, store, or accept any spent

nuclear fuel which was used in any power generating

facility located outside this State, or transport into this

State for disposal or storage any spent nuclear fuel which

was used in any power generating facility located outside

this State, unless the state of origin of such spent nuclear

fuel has a facility, which is not part of a power generating

facility, for the disposal or storage of spent nuclear fuel

substantially like that of this State and has entered into a

reciprocity agreement with this State.”

Because Morris is the only licensed and operating away-

from-reactor facility in the country, the reciprocity provisions of

the Statute are meaningless. The Spent Fuel Statute was

' The capacity of the Morris plant is pleaded in the complaint,

Wil. The projection of nationwide discharges is taken from the

United States Department of Energy’s June, 1982 publication, “Spent

Fuel Storage Requirements,” DOE/RL-82-1. Only 3 per cent of the

spent fuel discharged in the United States to date is presently stored at

Morris. Even if its full capacity is utilized by the year 2000, only 1%

per cent of the nation’s spent fuel will be stored there. Under these

circumstances, there is clearly no factual basis for the fears expressed

in the Petition that a failure to reverse the Court of Appeals’ decision

would make Illinois ( and specifically Morris) the “dumping ground”

for the nation’s nuclear wastes and cast upon Illinois the “entire

burden of nuclear waste disposal.” See Petition at 6, 8.

3

designed to and in fact did prohibit General Electric from

accepting spent nuclear fuel discharged anywhere outside the

state of Illinois for storage at its Morris facility.

General Electric and SCE brought this action on December

24, 1980, seeking a declaratory judgment that the Spent Fuel

Act was unconstitutional because, among other things, it placed

an impermissible burden on interstate commerce in violation of

the Commerce Clause and intruded into an area preempted by

pervasive federal regulation in violation of the Supremacy

Clause.? In defending the Statute against this attack, the State

argued in both the District Court and the Court of Appeals, as it

does here, that the Statute established a valid quarantine, and

therefore did not violate the Commerce Clause. On the

preemption issue, however, the State took a completely differ-

ent approach than it is now taking. Nowhere in any of the

numerous briefs or pleadings below did the State coniend that

the Statute was prompted by concern over the possibility that

the Morris facility might be abandoned and that the state might

be required to bear the cost of maintaining the site. Rather, the

State argued that the Statute was an attempt to regulate

radioactive emissions from spent fuel, which it contended was

permissible under the Clean Air Act Amendments of 1977, Pub.

L. No. 95-95, 91 Stat 685.

Both the District Court and Court of Appeals rejected

these arguments. In his opinion for the Seventh Circuit, Judge

Posner first affirmed the District Court’s holding that the

Statute was not an attempt to quarantine spent fuel and thus

2 A few hours after this complaint was filed in federal court, the

State filed what purported to be an enforcement action against SCE in

state court, later joining General Electric as a defendant. General

Electric and SCE removed that action, which was consolidated with

the federal case. On appeal, the Seventh Circuit held that the removal

had been improper and ordered the case remanded to state court.

General Electric and SCE have not sought review in this Court of that

determination.

4

could not escape the consequences under the Commerce Clause

of its facial discrimination against goods originating outside the

state. Then, although recognizing that it “may seem super-

fluous” to consider the preemption issue, Judge Posner went on

to reject the State’s arguments on that point as well.?

REASONS FOR DENYING THE WRIT

The Illinois Spent Fuel Act is indistinguishable from the

New Jersey statute this Court held unconstitutional under the

Commerce Clause in City of Philadelphia v. New Jersey, 437

U.S. 617 (1978). The State attempts to distinguish this case by

characterizing the Statute as a quarantine measure designed to

prevent the transportation of dangerous materials. Both lower

courts, however, rejected this argument, noting that the Statute

by its terms permits transportation of spent fuel within or

through Illinois so long as out-of-state fuel does not come to rest

within Illinois at an away-from-reactor site. There is no basis

for disturbing this factual determination.

Because the lower courts were clearly correct on the

Commerce Clause issue, there is no need for this Court to

consider the preemption issue. However, even if the Court were

required to review that issue, it cannot do so on the grounds

suggested by the State in its Petition, which were not raised in

the courts below.

The Petition argues that there is a “direct” conflict between

the Seventh Circuit’s decision in this case and the Ninth

3In his opinion, Judge Posner noted that the Statute, which

prohibits storage of certain types of fuels rather than setting emission

levels for those fuels, clearly was not designed to control radioactive

air pollution. Thus, the Clean Air Act was irrelevant and the Spent

Fuel Statute fell squarely within the Atomic Energy Act's preemption

of state regulation of radiological hazards. See Northern States Power

Co. v. Minnesota, 447 F. 2d 1143 (8th Cir. 1971), aff'd, 405 U. S.

1035 ( 1972).

5

Circuit’s decision in Pacific Gas & Electric Co. v. State Energy

Resources Conservation & Development Commission, 659 F. 2d

903 (1981), on which this Court has granted certiorari, 102 S.

Ct. 2956 (1982). The “conflict,” however, is purely an after-

the-fact invention by the Petitioner. In Pacific Gas & Electric,

the Ninth Circuit was dealing with a state moratorium on

nuclear power plants that was claimed to be based solely on

economic considerations; because the court found that this

provision had been “enacted for purposes other than protection

against radiation hazards,” it held that it was not preempted by

federal regulation.* By contrast, until it reached this Court, the

State had always characterized Illinois’ Spent Fuel Statute as a

radioactive pollution control measure. The Seventh Circuit’s

decision that the State’s attempt to regulate spent fuel as a

radiological hazard was preempted is entirely consistent with

the Ninth Circuit’s ruling.

The State’s “discovery” of an economic motivation behind

the Spent Fuel Act comes too late to be considered by this

Court. The courts below were not given an opportunity to

consider the argument, and there is no factual basis in the

record for the State’s assertion that the importation of spent

nuclear fuel into Illinois for storage at the Morris plant poses a

threat to the Illinois treasury.

Furthermore, under the State’s own reasoning, if it prevails

on the Commerce Clause argument, it must lose on the

preemption issue, and if it prevails on the preemption issue, the

Statute must be unconstitutional under the Commerce Clause.

For, if the statute is a quarantine measure aimed at radioactive

emissions, it is preempted, and if it is merely an economic

regulation, it does not fall within the quarantine exception and

thus is void under the Commerce Clause.

4 Section 274( k) of the Atomic Energy “oct provides that the Act

shall not be construed to affect the states authority “to regulate

ivities for fy eaten tom

ards.” 42 U. S. C. § 2021(k) (emphasis supplied ).

6

Finally, the State argues that if the Atomic Energy Act

preempts the Spent Fuel Statute, then the Act is an uncon-

stitutional invasion of the State’s right under the Tenth Amend-

ment to control its own treasury. This argument also was not

raised below and therefore cannot be considered here. In any

event, any Tenth Amendment argument is clearly foreclosed by

this Court’s decision in Hodel v. Virginia Surface Mining &

Reclamation Ass'n, 452 U. S. 264 (1981). Accordingly, the

petition for certiorari should be denied.

L

THE COURT OF APPEALS CORRECTLY CONCLUDED

THAT THE SPENT FUEL STATUTE UNCON-

STITUTIONALLY DISCRIMINATES AGAINST ARTI-

CLES IN INTERSTATE COMMERCE SOLELY ON THE

BASIS OF THEIR ORIGIN.

The Spent Fuel Statute on its face precludes the storage in .

Illinois of spent nuclear fuel only if that fuel was used in power

plants located outside of the State. Similarly, the Statute

prohibits the transportation into [Illinois for storage of such

nuclear fuel only if that fuel was used in power plants located

outside of the State. No restrictions whatsoever are imposed

upon spent fuel discharged from plants located within Illinois.

5 As noted above, General Electric’s facility at Morris, Illinois is

the only operating commercial facility in the United States licensed by

the NRC to accept spent fuel for away-from-reactor storage. There-

fore, even though the statute purports to allow the importation of

spent fuel from other states if they grant reciprocal storage privileges,

in practice, the Statute imposes a complete ban on the importation for

storage purposes of spent fuel discharged outside the State of Illinois.

However, even if some states could extend reciprocal storage privi-

leges to Illinois, the statute would still be invalid. In Great Atlantic &

Pacific Tea Co. v. Cottrell, 424 U. S. 366 (1976). this Court made it

clear that one state may not blackmail others into signing reciprocity

agreements by refusing to accept their goods if they do not. See also

Sporhase v. Nebraska, 50 US.L.W. 5115, 5119-5120 (U. S. 1982).

7

In holding this Statute unconstitutional, the courts below

correctly found that it imposed an impermissible burden on

interstate commerce in violation of the Commerce Clause of the

United States Constitution.

A.

This Case Is Controlled By The Decision In City Of Phila-

deiphia v. New Jersey.

Where a state statute regulates domestic and interstate

activities evenhandedly and imposes only an incidental burden

on interstate commerce, it will be upheld “unless the burden .. .

is clearly excessive in relation to the putative local benefits.”

Pike v. Bruce Church, Inc., 397 U. S. 137, 142 (1970).

However, where the statute on its ‘ace discriminates against

articles of commerce based solely on their out-of-state origin,

this Court has applied the strictest scrutiny, approaching a

“virtually per se rule of invalidity.” City of Philadelphia v. New

Jersey, 437 U. S. 617, 624 (1978); Lewis v. BT Investment

Managers, Inc., 447 U.S. 27, 36, (1980); Hughes v. Oklahoma,

441 U. S. 322 (1979).

The case at bar clearly falls within the latter category and,

indeed, is virtually on all fours with City of Philadelphia v. New

Jersey. In that case, the Court struck down a 1974 New Jersey

statute that prohibited the importation for disposal purposes of

most types of “solid or liquid waste which originated or was

collected outside the territorial limits of the State.” 437 U. S. at

618. The New Jersey Supreme Court had upheld the statute

against a Commerce Clause challenge on the ground that the

importation of wastes that by definition could not be put to

effective use was not “commerce” within the meaning of the

Commerce Clause.

On appeal, this Court reversed. It rejected the New Jersey

court’s restrictive definition of “commerce,” stating that “{a)ll

objects of interstate trade merit Commerce Clause protection;

none is excluded by definition at the outset. . . . Just as Congress

has power to regulate the interstate movement of these wastes,

States are not free from constitutional scrutiny when they

restrict that movement.” Jd. at 622-23.

After making the threshold determination that Commerce

Clause principles applied to this material, the Court described

the “crucial inquiry” as whether the statute

“ ... is basically a protectionist measure, or whether it can

fairly be viewed as a law directed to legitimate local

concerns, with effects upon interstate commerce that are

only incidental.”

Id. at 624. In resolving the issue, the Court stated that it was

irrelevant whether the legislative motivation had been econom-

ic protectionism or a desire to protect the public health:

“But whatever New Jersey’s ultimate purpose, it may not

be accomplished by discriminating against articles of com-

merce coming from outside the State unless there is some

reason, apart from their origin, to treat them differently.”

Id. at 626-27.

The Court noted that there was no basis for distinguishing

out-of-state from domestic waste. Both types of waste present-

ed identical health and pollution hazards. Under those circum-

stances, New Jersey was free to ban ail/ wastes, to regulate ail

wastes, or to allow the unregulated disposal of a// wastes, but it

could not allow domestic wastes to be buried in its commercial

landfills while prohibiting landfill operators from accepting out-

of-state wastes.

The reasoning of this Court in City of Philadelphia is

squarely applicable to the case at bar. Interstate movement of

spent nuclear fuel, like interstate movement of solid or liquid

wastes, is “commerce” within the meaning of the Commerce

Clause. Thus, it may be regulated by Congress and may nor be

9

unduly restricted by the states. Assuming arguendo that a state

has the power to regulate spent nuclear fuel at all,® it must do so

evenhandedly. Because spent fuel discharged in California or

Wisconsin is identical in every respect to spent fuel discharged

in Illinois, any statute that prohibits the storage or trans-

portation of out-of-state, but not domestic, spent fuel, must be

unconstitutional. This is true even if the State’s only goal is to

protect the public from possible hazards associated with the

storage of spent fuel. As the Court held in City of Philadelphia

v. New Jersey, even legitimate, non-discriminatory goals cannot

be achieved by facially discriminatory means. Any other result

would violate the concept of free interstate trade embodied in

the Commerce Clause:

“Today, cities in Pennsylvania and New York find it

expedient or necessary to send their waste into New Jersey

for disposal, and New Jersey claims the right to close its

borders to such traffic. Tomorrow, cities in New Jersey

may find it expedient or necessary to send their waste into

Pennsylvania or New York for disposal, and those States

might then claim the right to close their borders. The

Commerce Clause will protect New Jersey in the future,

just as it protects her neighbors now, from efforts by one

State to isolate itself in the stream of interstate commerce

from a problem shared by all.” Jd. at 629.

The same reasoning applies here. As the State itself

recognizes, the disposal of spent nuclear fuel is a nationwide

problem. The Commerce Clause cannot be interpreted to

permit one state to isolate itself from that problem by declaring

its storage facilities off-limits to all other states.

® As the Seventh Circuit held, Congress has exercised its power to

regulate spent nuclear fuel to such an extent that it has preempted the

entire field. Thus, even if it did not discriminate against interstate

commerce, the Spent Fuel Statute would be unconstitutional because

it violates the Supremacy Clause.

10

B.

There Is No Reason To Disturb The Lower Courts’ Finding

That The Spent Fuel Statute Is Not A Quarantine Measure.

The State does not dispute the fact that the Spent Fuel

Statute should be held unconstitutional if Commerce Clause

principles apply. Rather, it bases its entire position on the

argument that those principles do not apply because .ue Spent

Fuel Statute is a quarantine measure and, as such, falls within

the “quarantine exception” set forth in Asbell v. Kansas,

209 U. S. 251 (1908), and Clason v. Indiana, 306 U. S. 439

(1939). Even assuming that such an exception continues to

exist, it is not applicable to the Spent Fuel Statute, which both

lower courts have held is simply not a quarantine measure.

In City of Philadelphia v. New Jersey, this Court dis-

tinguished the quarantine cases on the ground that they in-

volved articles whose “very movement risked contagion and

other evils.” By contrast, in the case before it there had been no

claim that

“the very movement of waste into or through New Jersey

endangers health, or that waste must be disposed of as

soon and as close to its point of generation as possible.

The harms caused by waste are said to arise after its

disposal in landfill sites, and at that point, New Jersey

concedes, there is no basis to distinguish out-of-state

waste.” 437 U. S. at 625.

The State has attempted to take advantage of the dis-

tinction made in City of Philadelphia by arguing that the very

movement of spent fuel presents health hazards. But both

courts below rejected this argument, on the ground that the

Spent Fuel Statute is clearly aimed at preventing storage, not

transportation of out-of-state spent fuel. Supp. App. at 8-9;

App. at |4a. Despite the fact that all spent fuel necessarily

presents the same hazards, if any, during transportation, the

Spent Fuel Statute:

(i) does not prohibit the transportation within uve State of

Illinois of spent nuclear fuel discharged in Illinois;

(ii) does not prohibit the transportation through Illinois of

spent fuel discharged elsewhere unless it is to be

stored at an away-from-reactor facility in Illinois; and

(iii) does not prohibit and, indeed, specifically allows, the

importation for storage purposes of spent nuclear fuel

from any states that give Illinois reciprocal storage

privil

Thus, as the Seventh Circuit held, the Statute, unlike a legiti-

mate “quarantine” measure, reflects a hostility to the interstate

nature of the spent fuel and not to the purported hazards of the

fuel itself.

The lower courts’ view of the Statute should be treated by

this Court as a finding of fact which should not be disturbed

absent a “very obvious and exceptional showing of error.”

Graver Tank & Mfg. Co. v. Linde Air Products Co., 336 U.S.

271, 275 (1949); United States v. Ceccolini, 435 U.S. 268

(1978). No such showing has been made here.

c.

The Court of Appeals Decision Is Consistent With Decisions

In Other Circuits.

Not only was the Seventh Circuit’s decision in this case

consistent with, and indeed mandated by, City of Philadelphia,

it is also consistent with decisions in other similar cases in the

Tenth and Ninth Circuits.

In Hardage v. Atkins, 582 F. 2d 1264 ( 10th Cir. 1978), the

court relied on City of Philadelphia in striking down an

Oklahoma statute which, like the Spent Fuel Statute, prohibited

the importation of waste material unless the state of origin had

entered into a reciprocity agreement with the State of Okla-

12

homa. Similarly, in Washington State Building & Construction

Trades Council v. Spellman, 684 F.2d 627 (1982), the Ninth

Circuit held that the Commerce Clause was violated by a

Washington statute banning the importation for purposes of

storage of low-level radioactive wastes. In its opinion the court

rejected a quarantine argument similar to that made here,

holding that while a state may “close its borders to protect

citizens against health hazards such as epidemics,” it may not

use its citizens’ health as an excuse to isolate itself from the

“nationwide problem of waste disposal.” Jd. at 631.

Il.

THE PREEMPTION ISSUE RAISED IN THE PETITION

IS NOT PROPERLY BEFORE THE COURT.

Because the Court of Appeals was correct in holding the

Spent Fuel Statute unconstitutional under the Commerce

Clause, there is no reason for this Court to consider the first

argument raised in the Petition, i.e., that the Court of Appeals

erred in holding the Spent Fuel Statute preempted by the

pervasive federal regulation of nuclear power. However, even

apart from the Commerce Clause issue, the argument advanced

by the State against the lower court’s holding on the preemp-

tion issue does not provide a basis for granting the Petition.

The State’s preemption argument rests on this Court’s

grant of certiorari in the case of Pacific Gas & Electric Company

v. State Energy Resources Conservation & Development Com-

mission, 659 F.2d 03 (9th Cir. 1981). There, the Ninth

Circuit upheld against a Supremacy Clause challenge a Califor-

nia moratorium on the certification of new nuclear plants until

there is a federally approved method of nuclear waste disposal.

The court held that the Atomic Energy Act, while preempting

state regulation of radiological hazards, was not intended to

impair a state’s ability to regulate its public utilities or to

address legitimate economic concerns. It then delved into the

13

extensive legislative history behind the California moratorium,

determining that it was an economic rather than a safety

measure. The court found that the legislature had been

concerned that the lack of any nationwide disposal strategy

created “uncertainties in the nuclear fuel cycle [which] make

nuclear power an uneconomical and uncertain source of

energy.” 659 F. 2d at 925. California's decision to prohibit its

utilities from constructing new nuclear plants until these uncer-

tainties were resolved was held to be within the state’s power to

regulate in its economic interest.

Here, by contrast, until the instant Petition was filed,

Illinois’ Spent Fuel Statute had always been defended purely as

a safety measure. In its opinion, the Seventh Circuit, like the

Ninth Circuit in Pacific Gas & Electric, relied on the holding in

Northern States Power Co. v. Minnesota, 447 F.2d 1143 (8th

Cir. 1971), aff'd, 405 U.S. 1035 (1972), that pervasive federal

regulation of the nuclear power industry preempts state regu-

lation of radiological hazards. The Seventh Circuit went on to

state that

“(t]he analysis of the structure and legislative history of

the Act in Northern States compels the conclusion that the

Act equally preempts state regulation of the storage, and

shipment for storage, interstate and intrastate alike, of

spent nuclear fuel.” App. at |6a.

It then rejected the State’s argument that the Spent Fuel Statute

was a permissible state regulation of radioactive air pollution

under the Clear Air Act Amendments of 1977.

In its Petition, the State does not dispute the holding of

both the Seventh and Ninth Circuits that state safety regu-

lations aimed at radiological hazards are preempted.’ Rather, it

7 Numerous cases have held that federal regulation of radio-

logical hazards pursuant to the Atomic Energy Act is so pervasive that

it preempts any state regulation in this area. See, e. g., Northern

States Power Co., v. Minnesota, 447 F. 2d 1143 ( 8th Cir. 1971), aff'd,

( Footnote continued on following page)

14

argues that the Seventh Circuit should have viewed the Illinois

Statute, like the Ninth Circuit viewed the California :norato-

rium in Pacific Gas & Electric, as having been motivated by

strictly economic concerns. The State contends that the ban on

the storage of out-of-state spent fuel was designed solely to

ensure that the capacity of the Morris facility would not be

exhausted in the very near future. It hypothesizes that once the

storage pools are full, General Electric will no longer have an

economic incentive to maintain the facility and “will likely

abandon it,” leaving the state to bear the cost of caring for the

facility. Petition at 7. The State chastises the Court of Appeals

for “ignor[ing]” the true purpose of the Statute and argues that

its erroneous interpretation puts the Seventh Circuit in conflict

with the Ninth. There are a number of reasons why this

argument must be rejected.

First, the courts below can hardly be faulted for not

adopting the State’s current view of the Statute’s purpose, since

it is an entirely new argument raised for the first time in this

Court. As both of the opinions below demonstrate, the State in

its arguments to the lower courts concentrated exclusively on

the hazards associated with radiation allegedly emitted by the

spent fuel. Thus, its sole argument on the preemption issue in

the Court of Appeals was as follows:

“The State has alleged, and for purposes of this appeal it

must be taken as true, that the transportation of spent

nuclear fuel into Illinois would generate possibly dan-

( Footnote continued from preceding page)

405 U. S. 1035 (1972); Train v. Colorado Pub. Int. Research Group,

Inc., 426 U. S. 1, 15-17 (1976). The transportation, storage, and

disposal of spent fuel are comprehensively regulated by the NRC and

thus fall within the category of activities the states are prohibited from

regulating. The design, siting, licensing and operation of away-from-

reactor facilities are all regulated under 10 C. F. R. Part 72; the

packaging and transportation of special nuclear material including

spent fuel is governed by 10 C. F. R. Part 71.

15

gerous amounts of radioactive air pollution. The Spent

Fuel Act, by prohibiting the introduction of this pollution

source, is thus a state regulation of radioactive air pollution

authorized by the Clean Air Amendments.” State’s Open-

ing Brief at 57; see also Reply Brief at 27.

It is well settled that this Court will not review issues that

the Petitioner failed to raise below. See Tacon v. Arizona, 410

U. S. 351 (1973) (dismissing writ as improvidently granted

where the issues on which the grant was based had not been

raised below or passed upon by the court below); Hill v.

California, 401 U. S. 797, 805 (1971). That rule necessarily

precludes consideration of the State’s newly presented argu-

ment in this case.

One of the major reasons for refusing to review issues not

raised below is the lack of a proper *erord on the new issue. In

this case there is simply no basis in record for the essential

factual predicates of the new argunicnt. Furthermore, the

suggestion that General Electric is likely to abandon Morris

once it reaches capacity because it will become uneconomical to

maintain simply has no basis in fact. All fuel stored at Morris is

stored there on a temporary basis and most of the utilities that

own the fuel compensate General Electric for the privilege of

keeping it there. In addition, as a General Electric representa-

tive testified in legislative hearings, “[f]uel storage facilities are

very expensive and benefit greatly from the economies of

scale.” (Statement of Dr. Bertram Wolfe before the House

Committee on Environment Energy and Natural Resources,

June 7, 1979). That is, in a larger storage facility, the fixed

costs can be more effectively spread among the users. ‘Thus,

General Electric’s economic position will be enhanced, not

harmed, by the utilization of Morris’ full capacity. It should

also be noted that the NRC’s regulations require licensees to

make elaborate provisions for decommissioning away-from-

reactor facilities. 10 C. F. R. §§ 72.18, 72.31(a)( 10), 72.38,-

72.76.

16

There is also no basis in the legislative history for ascribing

to the Illinois legislature any fear that the facility would be

abandoned, or any hope that a limitation on its capacity would

forestall abandonment. Indeed, there is not even a mention of

the possibility that the Morris facility was in danger of

abandonment in any of the debates that have been transcribed.

There is, however, ample legislative history, which the State

quoted in the Court of Appeals, demonstrating the legislature’s

concern with the alleged radiation hazards associated with

spent fuel.®

Second, the Seventh Circuit’s view of the law simply does

not conflict with the view expressed by the Ninth Circuit in

Pacific Gas & Electric. Because it treated the Statute as an

attempt to regulate radiological hazards, the Seventh Circuit

found it unnecessary even to reach the issue of a state’s power

to regulate for economic purposes, which was the keystone of

the court’s analysis in Pacific Gas & Electric. The lack of any

real conflict between the two Circuits is also confirmed by the

Ninth Circuit’s subsequent opinion in Washington State Buil-

ding & Construction Trades Council v. Spellman, supra, 684 F-

2d at 630, where the court held that Washingten’s attempt to

prohibit the importation for storage purposes of low-level

radioactive wastes was preempted by the Atomic Energy Act.

Third, and finally, the interrelation between the State's

Commerce Clause and preemption arguments is such that the

Statute must be considered invalid on one theory or the other.

If the Statute is based on economic motives, as the State argues

in Part I of its Petition, then it cannot be considered a

quarantine measure designed to protect the citizens of [liinois

® For example, one senator, in a remark quoted by the State,

urged an override of the Governor’s veto on the ground that “the

citizens of this State [should not] be subjected to the risk of radiation

that’s been generated in other states. .. .”

17

from radiation hazards. But without the quarantine exception,

even the State concedes that the Statute must be held uncon-

stitutional under the Commerce Clause.®

If, on the otier hand, the State’s argument in Part II of the

Petition is correct and the Spent Fuel Statute is a quarantine

measure designed to protect the citizens of Illinois against

radiation hazards, then it cannot fall within the category of

“economic” measures carved out by the court in Pacific Gas &

Electric. Rather, it must be considered a “safety” regulation,

which both the Seventh and Ninth Circuits agree is preempted

by the pervasive federal regulation of radiological hazards.

Il.

THE TENTH AMENDMENT ARGUMENT IS FRIVO-

LOUS AND SHOULD NOT BE CONSIDERED BY THIS

COURT.

In Part I-B of its Petition, the State argues that if the

Atomic Energy Act was intended to preempt measures like the

Spent Fuel Statute, then it interferes with each state’s right to

control its treasury in violation of the Tenth Amendment. Like

the State’s preemption argument, this argument is also predi-

cated on the erroneous assumption that the Spent Fuel Statute

is an economic measure. Furthermore, like the preemption

argument, the Tenth Amendment claim was not raised or

passed on in the courts below, and therefore should not be

considered oy this Court.

® This is particularly true if the goal was simply to limit the

amount of fuel being added to the Morris facility, since that goal

could easily have been accomplished by limiting the number of tons to

be added without regard to where that tonnage was generated.

Where a state chooses the most, rather than the least discriminatory

means of accomplishing its goal, it clearly trangresses the limitations

imposed by the Commerce Clause. Hughes v. Oklahoma, 441 U.S

322, 337 (1979).

In any event, the Tenth Amendment claim is frivolous in

light of this Court’s decision in Hodel v. Virginia Surface

Mining & Reclamation Ass'n, 452 U.S. 264 (1981). At issue in

Hodel was the constitutionality of a federal statute regulating

strip-mining which explicitly preempted state regulation unless

it met certain conditions. It was argued that the statute was

unconstitutional because, among other things, it invaded pow-

ers reserved to the states under the Tenth Amendment. This

Court rejected that argument, holding that its decision in

National League of Cities v. Usery, 426 U. S. 833 (1976), on

which the State relies in this case, could not be extended to

cases where federal statutes interfere with, or even totally

preempt, the exercise of traditional state functions such as land-

use planning. The Court, in effect, limited National League of

Cities to its facts, holding that the Tenth Amendment prohibits

only direct federal regulation of state activities and does not

“shield [ ] the States from pre-emptive federal regulation of

private activities affecting interstate commerce.” 452 U. S. at

291 (emphasis in original ).

Hodel disposes of the State’s contention here that the Tenth

Amendment prohibits Congress from preempting state regu-

lation of nuclear wastes if that regulation has an indirect impact

on state treasuries. Unlike the federal statute at issue in

National League of Cities, the Atomic Energy Act does not

order the states to make particular expenditures, nor does it

purport to regulate states in their governmental capacities;

rather, like the strip-mining statute in Hodel, the Atomic Energy

Act regulates only private conduct—in this case the private use

of nuclear energy. The fact that this regulation of private

conduct may indirectly require some state spending clearly does

not render the federal regulation unconstitutional under the

Tenth Amendment.

19

CONCLUSION

For the foregoing reasons, the Petition for a Writ of

Certiorari should be denied.

Respectfully submitted,

WILLIAM A. GORDON

( Counsel of Record )

JouHN M. CaRROLL

MICHELE Oporizz!

Dante. D. BECKEL

231 South LaSalle Street

(312) 782-0600

Attorneys for Respondents

Of Counsel:

Mayer, BROWN & PLatTT

231 South LaSalle Street

(312) 782-0600

EXHIBIT A

The following are the subsidiaries (except wholly owned

subsidiaries) and affiliates of Genera! Electric Company.*

Evansville Cable TV, Inc.

Utah Development Company

Waipipi Iron Sands Limited

Central Queensiand Coal Associates

General Electric-Goninan Engineering Services Ltd.

General Electric-Rickard Ltd.

F. R. Tulk & Co. Pty. Ltd.

Inducon do Brasil, Capacitores S.A.

Sade-Sul Americana de Engenharia S.A.

Canadian Appliance Manufacturing Co., Ltd.

Electromat S. A. Fabrica de Materiales Electricos

Condisa Limitada Ingenieros Contratistas, S.A.

Sud Americana de Electrificacion, S.A.

Storno S.A. ( France)

SNEF Electro-mechanique (SEM)

Storno Electronic GmbH

Westdeutsche Quarzschmelze GmbH

SADELMI-COGEPI Compagnia Generale Progetta-

zioni e Installazioni S.p.A.

* General Electric Credit Corporation and General Electric Over-

seas Capital Corporation are wholly-owned subsidiaries of General

publicly held.

General Electric de Mexico, S.A.

Specialty Materials International B.V.

Philippine Electrical Manufacturing Company

Sadelmi Shaker Tamimi Construction Company

Charomel Investment ( Pty.) Ltd.

EICSA ( Proprietary) Ltd.

Magnet Wires ( Proprietary) Ltd.

Reid & Mitchell ( Pty.), Ltd.

SADE S.A.

General Electrik Turk Anonim

N. C. Joseph Limited

Sud Americana de Electrificacion, S.A.

Compagnia Generale Elettromeccanica S.p.A.

Iran Electrical and Mechanical Service Company

Middle East Engineering Limited— UAE

General Electric Philippines Meter and

Instruments Co., Inc.

Genera! Electric CAE International, Incorporated

General Electric Mortgage Corporation

Lonestar Florida Pennsuco, Inc.