Opposition Brief — USEC, Inc. v. Eurodif S.A. (Nos. 07-1078, 07-1059)

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Nos. 07-1059, 07-1078 FILED

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Supreme Court of the Cite’ States us.

UNITED STATES OF AMERICA; USEC INC.; and

UNITED STATES ENRICHMENT CORPORATION,

Petitioners,

Vv.

EURODIF S.A.; COMPAGNIE GENERALE

DES MATIERES NUCLEAIRES; COGEMA, INC.; and

THE AD HOC UTILITIES GROUP,

Respondents.

a

ON PETITION FOR WRIT OF CERTIORARI

To THE UNITED STATES COURT OF APPEALS

For THE FEDERAL CIRCUIT

.

BRIEF IN OPPOSITION

+

Nancy A. Fischer

Counsel of Record

Stephan E. Becker

David J. Cynamon

Joshua D. Fitzhugh

PILLSBURY WINTHROP SHAW PITTMAN LLP

2300 N Street, NW

Washington, DC 20037

(202) 663-8000

Counsel for Respondent

the Ad Hoc Utilities Group Dated: March 21, 2008

PHE LEX GROUP" ¢ 1750 K Street N.W. @ Suite 475 ¢ Washington, DC 20006

(202) 955-0001 @ (800) 815-3791 @ Fax (202) 955-0022 ewww. thelexgroupde.com

QUESTION PRESENTED

Whether the court of appeals was correct in

holding that under the plain language of the

antidumping statute, 19 U.S.C. § 1673, contracts for

the sale of uranium enrichment services are not

sales of merchandise, and therefore that sales of

enrichment services under those contracts are not

subject to the statute.

li

RULE 29.6 STATEMENT

Pursuant to Supreme Court Rule 29.6, the

members of the Ad Hoc Utilities Group (hereinafter

“AHUG”) joining in this Brief in Opposition list their

respective parent companies and nonwholly owned

subsidiaries as follows:

3

or

The parent company of respondent

Dominion Energy Kewaunee, Inc. is

Dominion Resources, Inc. Dominion

Energy Kewaunee, Inc. has _ no

nonwholly owned subsidiaries.

The parent company of respondent

Dominion Nuclear Connecticut, Inc. is

Dominion Resources, Inc. Dominion

Nuclear Connecticut, Inc. has no

nonwholly owned subsidiaries.

The parent company of respondent

Duke Energy Carolinas, LLC is Duke

Energy Corporation. Duke Energy

Carolinas, LLC has no _ nonwholly

owned subsidiaries.

The parent company of respondent

Entergy Services, Inc. is Entergy

Corporation. Entergy Services, Inc. has

no nonwholly owned subsidiaries.

Respondent Exelon Corporation has no

parent and three nonwholly owned

subsidiaries: Sithe Energies, Inc.,

Comed, and PECO.

10.

iii

The parent company of respondent

Florida Power & Light Company is FPL

Group, Inc. Florida Power & Light

Company has no nonwholly owned

subsidiaries. .

Respondent Nebraska Public Power

District has no parent or nonwholly

owned subsidiaries. It is a political

subdivision of the State of Nebraska.

The parent company of respondent PPL

Susquehanna, LLC is PPL Corporation.

PPL Susquehanna, LLC has four

nonwholly owned subsidiaries: PPL

Electric Utilities Corporation, PPL

Energy Supply LLC, PPL Montana

LLC, and PPL Transition Bond

Company LLC.

The parent company of respondent

Progress Energy Carolinas, _Inc.,

formerly known as Carolina Power &

Light Company, is Progress Energy,

Inc. Progress Energy Carolinas, Inc.

has no nonwholly owned subsidiaries.

The parent company of respondent

Progress Energy Florida, Inc., formerly

known as Florida Power Corporation, is

Progress Energy, Inc. Progress Energy

Florida, Inc. has no nonwholly owned

subsidiaries.

11.

12.

13.

14.

iv

The parent company of respondent

Southern California Edison Company is

Edison International. Southern

California Edison Company has three

nonwholly owned subsidiaries: Edison

Mission Energy (issuing equity or debt

securities through Edison Mission

Energy Funding Corp., Midwest

Generation LLC, Midwest Finance

Corp., and Edison Mission Holdings

Co.), Edison Capital (through its

financing subsidiary Edison Funding

Co.), and SCE Funding LLC.

The parent company of respondent

Southern Nuclear Operating Company,

Inc. is the Southern Company.

Southern Nuclear Operating Company,

Inc. has no nonwholly owned

subsidiaries.

The parent company of respondent

Union Electric Company, d/b/a

AmerenUE, is Ameren Corporation.

Union Electric Company has _ three

nonwholly owned subsidiaries: Central

Illinois Public Service Company d/b/a

AmerenCIPS, Central [Illinois Light

Company d/b/a AmerenCILCO, and

Illinois Power Company d/b/a

AmerenIP.

The parent company of respondent

Virginia Electric & Power Company is

Dominion Resources, Inc. Virginia

15.

Electric & Power Company has no

nonwholly owned subsidiaries.

The parent company of respondent Wolf

Creek Nuclear Operating Corporation is

Westar Energy, Inc. Wolf Creek

Nuclear Operating Corporation has one

nonwholly owned subsidiary, Great

Plains Energy, Inc.

TABLE OF CONTENTS

Page

QUESTION PRESENTED 00.0... .-.cc-csccscssscsssseceseesesseee j

RULE 29.6 STATEMENT .................2.cccccceeceeccesseeeees ii

TABLE OF CONTENTS ....................cccccseeccseeceeeeceeeeees vi

TABLE OF AUTHORITIES ...............0..0....00..ceecceee viii

STATEMENT OF THE CASE....................ccccceeceeee eee 1

A. The Enrichment Of Uranium Is

An Intermediate Manufacturing

Process In The Production Of

Nuclear Fuel Assemblies....................... 3

B. The Antidumping Law .......................... 7

C. The Proceedings Below .....................45 10

a ccdhusiinneutocononenses 15

A. This Case Involves Oniy A

Routine Application Of The

Chevron Standard Of

Neen. iia setieedteemdensbenes 15

B. The Facts Of This Case Are

Narrow And Unique ............................ 21

C. The Petitioners’

Characterizations Of “Foreign

Policy” And “National

Security” Interests Are

Factually Incorrect And

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TABLE OF AUTHORITIES

Page(s)

CASES

Barseback Kraft AB v. United States,

Be Py Mais I QUID sntccccsccccccesascsseccconsescocecnes 6

Centerior Service Co. v. United States,

No. 95-103C,

1997 U.S. Claims LEXIS 323

TR ES NO oe 5

Chevron U.S.A. v. Natural Resources Defense

Council,

By nn, ST I cireiernsinenincscnunninennadid passim

Eurodif S.A. v. United States,

411 F.3d 1355 (Fed. Cir. 2005).............. passim

Eurodif S.A. v. United States,

423 F.3d 1275 (Fed. Cir. 2005).......... 13, 15,17

Eurodif S.A. v. United States,

431 F. Supp. 2d 1351

ls Se I ci crccnsncisessccesscescncacsasecnens 14

Eurodif S.A. v. United States,

506 F.3d 1051 (Fed. Cir. 2007) ...................... 15

Florida Power & Light Co. v. United States,

307 F.3d 1364 (Fed. Cir. 2002)...... 6, 12, 13, 18

National Cable & Telecommunications Assoc.

v. Brand X Internet Services,

545 U.S. 967 (2005) ................ceeee cee ceeeeees passim

NSK Ltd. v. United States,

115 F.3d 965 (Fed. Cir. 1997) .................. 12, 16

Taiwan Semiconductor Manufacturing Co. v.

United States,

143 F. Supp. 2d 958

(Ct. Int’] Trade 2001).................0........4. 9, 20, 22

USEC Inc. v. United States,

259 F. Supp. 2d 1310

(Ct. Int] Trade 2003) ................00.... 5,6, 11,21

USEC Inc. v. United States,

281 F. Supp. 2d 1334

CER, BR TID BID once ccncnccccccccesccccoccceseccccess 12

PENDING CASES

Ad Hoc Utilities Group v. United States,

No. 06-00229

(Ct. Int’] Trade appeal docketed

a icaie i acmtntantinnonnndi 26

Nukem v. United States,

No. 06-00298

(Ct. Int'l Trade appeal docketed

CASES ee ne Ra 26

Ad Hoc Utilities Group v. United States,

No. 06-00300

(Ct. Int’] Trade appeal docketed

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STATUTES AND CODES

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INTERNATIONAL AGREEMENT

Agreement Between the Government of the

United States of America and_ the

Government of the Russian Federation

Concerning the Disposition of Highly

Enriched Uranium Extracted from Nuclear

Weapons, U.S.-Russ., Feb. 18, 1993, State

Dep't No. 93-59, 1993 WL 152921.......... 24, 25, 26, 27

ADMINISTRATIVE PROCEEDINGS

Certain Pasta from Italy,

63 Fed. Reg. 53,641

(Dep’t of Commerce Oct. 6, 1998)

(prelim. results of new _ shipper

antidumping duty admin. review)................. 22

Certain Forged Stainless Steel Flanges from

India,

58 Fed. Reg. 68,853

(Dep’t of Commerce Dec. 29, 1993)

(notice of final determination of sales

at less than fair value) ...................:cccccseeeeee ees 22

DOE Uranium Enrichment Program,

51 Fed. Reg. 11,811

(Dep’t of Energy Apr. 7, 1986)

(request for expression of interest for

ES RTE SE Ree 6

Dynamic Random Access Memory

Semiconductors of One Megabit and Above

(“DRAMs”) From Taiwan,

64 Fed. Reg. 56,308

(Dep’t of Commerce Oct. 19, 1999)

(notice of final determination of sales

at less than fair value) .................cccecccceeeees 9, 22

Final Results of Low Enriched Uranium from

France Remand Redetermination (Mar. 3, 2006)

(final results of redetermination) .....................0..006:. 14

Final Results of Low Enriched Uranium from

France Remand Redetermination (June 19,

2006) (final results of redetermination)...................14

Low Enriched Uranium From France,

66 Fed. Reg. 65,877

(Dep’t of Commerce Dec. 21, 2001)

(notice of final determination of sales

at less than fair value)................... 7,10, 11,19

Low Enriched Uranium from France

Remand Redetermination (June 23, 2003)

(final results of redetermination) ............................11

Low Enriched Uranium from the United

_ Kingdom, Germany and the Netherlands,

66 Fed. Reg. 65,886

(Dep’t of Commerce Dec. 21, 2001)

(notice of final determinations of sales

at not less than fair value)........................000.06- 6

Stainless Steel Wire Rod from Sweden,

63 Fed. Reg. 40,449

(Dep’t of Commerce July 29, 1998)

(notice of final determination of sales

at less than fair value) ....................0.ccceeceeveees 22

Uranium from Russia, USITC Pub. 3872,

Inv. No. 731-TA-539-C (Second Review)

RETIREE EA SREY AE aE a a ae Oe 26

MISCELLANEOUS

Communication from the United States to the

Council on Trade in Services,

SICESIW D4 Cae. 16, BODO) .....cceccesecsccccccceses. 18

DOE Press Release, DOE Announces Policy for

Managing Excess Uranium Inventory (Mar. 10,

TTI ihniesiisinsiitcniahiouniaineipseiiedindiiciatiadhidtnin Maiaaabaateddiaedatennts 27

Ux Consulting, Ux Current and Historical Price

ID sclsiencninendesccasnvitinlendaiapeiiniaietininabiniiuidepelaanduiesiniotl 4

_ Respondent the Ad Hoc Utilities Group

(“AHUG”) is comprised of fifteen domestic utilities

that represent the majority of commercial nuclear

power generation in the United States.. AHUG

respectfully submits this brief in opposition to the

petitions for certiorari submitted by the United

States (“Government”) and USEC Inc. and the

United States Enrichment Corporation (collectively,

“USEC”).?

STATEMENT OF THE CASE

This case involves an administrative

proceeding under the provisions of the Tariff Act of

1930. Those provisions authorize the Government to

impose offsetting customs duties (“antidumping

duties”) when the Department of Commerce

(“Commerce”) finds, among other conditions, that

imports of foreign merchandise are being sold at a

lower price in the United States than they are sold

in the home country market of the foreign producer

or exporter.

1 The members of the Ad Hoc Utilities Group are

Dominion Energy Kewaunee, Inc.; Dominion Nuclear

Connecticut, Inc.; Duke Energy Cuarolinas, LIC; Entergy

Services, Inc.; Exelon Corporation; Florida Power & Light

Company; Nebraska Public Power District; PPL Susquehanna,

LLC; Progress Energy Carolinas, Inc.; Progress Energy Florida,

Inc.; Southern California Edison Company; Southern Nuclear

Operating Company; Union Electric Company (d/b/a

AmerenUE); Virgima Electric & Power Company; and Wolf

Creek Nuclear Operating Corporation.

: The Governments and USEC’s petitions are

respectively referenced hereinafter as “Gov't Pet.” (Gov't App.)

and “USEC Pet.” (USEC App.).

The antidumping proceeding at issue involved

imports of low enriched uranium (“LEU”) from

Eurodif S.A. (“Eurodif”) of France. Commerce

evaluated purchases by American electric utility

companies of a foreign manufacturing service — the

enrichment of the utilities’ uranium for ultimate use

in commercial nuclear reactors — and deemed them

to be purchases of merchandise, LEU. On appeal,

the Court of Appeals for the Federal Circuit

concluded that the contracts at issue were for the

sale of services, not LEU, and that the antidumping

statute unambiguously did not apply to sales of

services.

Neither the Government nor USEC raise any

issues worthy of Supreme Court review. Specifically,

the decision of the Federal Circuit challenged by the

Petitioners involves a routine application of the

standard of deference established by Chevron U.S.A.,

Inc. v. Natural Resources Defense Council, Inc., 487

U.S. 837 (1984). The Federal Circuit has not decided

an important question of law not previously settled

by this Court’s decisions on the review of agency

decisions, or with which relevant decisions of the

Court are in conflict. Moreover, the dispute arises in

the context of the highly complex and unique

marketplace for nuclear fuel manufacturing services.

The fact specific nature of the issues in this case

raise no issues of general application and none

worthy of certiorari review by this Court.

Accordingly, the instant petitions should be denied.

A. The Enrichment Of Uranium Is An

Intermediate Manufacturing Process In

The Production Of Nuclear Fuel

Assemblies

Utilities use fuel rod assemblies containing

enriched uranium in nuclear reactors as part of a

process in which water is heated to produce steam,

which in turn passes through turbines to generate

electricity.

Typically, utilities arrange for the production

of their own nuclear fuel rod assemblies through

multiple contracts for manufacturing services. The

utility generally begins the nuclear fuel production

process by purchasing a quantity of milled uranium

ore. It then contracts with a conversion service

provider to chemically transform the ore into

gaseous uranium hexafluoride (UF,), commonly

referred to as uranium “feedstock.” Next, the utility

separately contracts with an enrichment service

provider to enrich the UF, in the fissionable isotope

U* to a level specified by the utility. As a final step,

the utility contracts with a fabrication service

provider to chemically transform the enriched

uranium hexafluoride into an oxide (UQ,), press the

oxide into pellets, encapsulate the pellets in tubes,

and bundle the tubes into fuel assemblies for

insertion in the utility’s nuclear reactors. The utility

retains ownership of the uranium in all of its

chemical forms throughout these stages of nuclear

fuel production.*

All mined uranium originally contains 0.711

percent of fissionable isotope U**. Enrichment is the

process by which the heavier isotopes of uranium are

separated from the lighter isotopes to increase the

percentage of U** in a portion of the uranium.

Enrichment results in a quantity of enriched

uranium and a waste stream of depleted uranium,

known as “tails.” This process involves a trade-off

between the amount of uranium feedstock used and

the amount of energy expended (the energy is

referred to as Separative Work Units, or “SWU”).

The same quantity of LEU enriched to the same U*”*

isotope level (or “assay”) can be produced by using

either less uranium feedstock and more SWU (to

separate more U** from the “tails” portion of the

uranium), or more uranium feedstock and less SWU.

When purchasing enrichment services, utilities

deliver uranium feedstock to the enricher, specify

the required level of enrichment, and pay for the

service of enriching that uranium to the desired

3 See Low Enriched Urantum From France, 66 Fed. Reg.

65,877, 65,879 (Dep't of Commerce Dec. 21, 2001) (notice of

final determination of sales at less than fair value) (hereinafter

Low Enriched Uranium from France Final AD Determination)

(Gov't App. 230a-231a).

level, based on the amount of SWU expended by the

enricher.‘

Because the amount of uranium feedstock

provided and the level of enrichment required varies

from transaction to transaction, two utilities

purchasing the same amount of SWU may have very

different quantities of LEU delivered to them after

the enrichment processing service is completed.

Similarly, deliveries by enrichers of the same

quantity of LEU to two utilities may reflect the use

of different quantities of uranium feedstock and

enrichment services.” ,

Under enrichment services contracts the

utilities retain ownership of the uranium feedstock

they provide to the enrichers. Thus, the enrichers do

‘ During the antidumping proceeding at issue, the

enrichment process represented approximately 65 percent of

the value of LEU. USEC Ine. v. United States, 259 F. Supp. 2d

1310, 1325 (Ct. Int'l Trade 2003) (‘USEC I’) (Gov't App. 205a).

The price of milled uranium ore has since increased by

approximately 800 percent (from under $8 per pound in 2000 to

$73 in 2008) and now represents a greater portion of the LEU’s

value. Ux Consulting, Ux Current and Historical Price

Indicators, available at http://www.uxc.com/review/uxc_g_price.

html.

5 Alternatively, a utility sometimes purchases completed

LEU through a contract for “enriched uranium product”

(“EUP”), which it subsequently arranges to be fabricated into

nuclear fuel assemblies. Under an EUP contract, the utility

pays the seller a price that reflects all elements of the LEU's

value, including the milled uranium, the conversion services,

and the enrichment services. USEC I, 259 F. Supp. 2d at 1314-

15 (Gov't App. 182a-185a). The application of the

antidumping law to EUP transactions is not at issue in this

proceeding.

not report that feedstock as an asset on their books,

and have no legal obligation to pay property, sales,

or income taxes on it. The enrichers do not know the

cost of the uranium feedstock that the utilities

provide, and such values can vary considerably,

because utilities purchase uranium concentrates

under long-term contracts from a variety of sources

in different countries at different prices. USEC I,

259 F. Supp. 2d at 1314-15 (Gov’t App. 182a-185a).

The courts have consistently viewed enrichment

services contracts as contracts for services, in a

variety of legal contexts.®

This method of contracting separately for

enrichment services. was originally established by

the U.S. Government. The existing 104 operating

nuclear plants in the United States were ordered in

the 1960s and 1970s. At the time the utilities

entered into contracts for the construction of their

nuclear reactors, they were required to sign

contracts for uranium enrichment services with the

U.S. Government. USEC I, 259 F. Supp. 2d at 1316

(Gov’t App. 186a). During that period there was no

6 See, e.g., Florida Power & Light Co. v. United States,

307 F.3d 1364 (Fed. Cir. 2002) (applying the Contract Disputes

Act); Centertor Service Co. v. United States, No. 95-103C, 1997

U.S. Claims LEXIS 323, at *19 (Dec. 17, 1997) (applying the

Uniform Commercial Code); Barseback Kraft AB v. United

States, 36 Fed. Cl. 691, 705 (1996) (applying the Uniform

Commercial Code); see also DOE Uranium Enrichment

Program, 51 Fed. Reg. 11,811, 11,812 (Dep't of Energy Apr. 7,

1986) (request for expression of interest for participation)

(describing enrichment as “an arrangement whereby uranium

supplied by a customer is ennmched in uranium-235 content by

DOE and then returned to that customer” and stating that such

“[sJervices are provided under contracts which are gencrally

signed with publicly or privately owned utilities.”).

alternative source of enrichment services. Later, the

U.S. Government lifted its own monopoly and

allowed foreign entities to provide enrichment

services to utilities, and eventually privatized its

own enrichment operation, which became USEC. 42

U.S.C. § 2297h-10. Two years after it was privatized

in 1998, USEC initiated antidumping proceedings

against imports of LEU from its two main

competitors, who have facilities in four European

countries. The appeal at issue arises from the

proceeding against Eurodif.’

B. The Antidumping Law

The antidumping _ statute authorizes

Commerce to impose antidumping duties if it

“determines that a class or kind of merchandise is

being, or is likely to be, sold in the United States at

less than fair value [and such sales cause material

7 USEC simultaneously initiated countervailing duty

proceedings against the same imports of LEU, which were the

subject of separate court appeals. (Countervailing duty

proceedings involve investigations of whether foreign

governments are providing subsidies that benefit exports.) In

the countervailing duty proceeding involving Eurodif's exports

from France, the Federal Circuit also held that an enrichment

contract was a purchase of a service and not of a good. Eurodif

S.A. v. United States, 411 F.3d 1355, 1364-65 (Fed. Cir. 2005)

(“Eurodif 1") (Gov't App. 24a-27a). The Government and USEC

did not seek certiorari review of that decision, and the

countervailing duty order consequently was revoked. The

antidumping investigation of the other European enricher,

Urenco, resulted in a determination of no dumping. Low

Enriched Uranium from the United Kingdom, Germany and the

Netherlands, 66 Fed. Reg. 65,886, 65,888 (Dep’t of Commerce

Dec. 21, 2001) (notice of final determinations of sales at not less

than fair value).

8

injury or threat thereof].” 19 U.S.C. § 1673 (2000)

(emphasis added). In general, merchandise is

deemed sold at less than fair value if its price in the

United States is less than its price in the exporter’s

home country market.

The purpose of the antidumping law is to

allow special customs duties to be imposed to offset

price discrimination by particular sellers in the

country subject to an antidumping investigation,

based on an examination of actual sales. The law

provides detailed rules on how transactions are to be

analyzed and compared, including how adjustments

are made to account for differences in the

circumstances of sales -— e.g., differences in

transportation costs, whether a transaction reflects a

quantity discount, whether sales are made at the

wholesale or retail level, etc. 19 U.S.C. §§ 1677a -

1677b (2000). Accordingly, the law requires a

specific examination of each sale of merchandise to

support a determination that sales are being made

at less than fair value, and separate antidumping

duty rates are calculated for each foreign producer

and exporter that participates in the proceeding. 19

U.S.C. § 1677f-1 (2000). Generalized assumptions

about transactions are not permitted.

Transactions in contract manufacturing

services such as uranium enrichment are not

unusual, and Commerce previously developed

policies for applying the antidumping statute to

contract manufacturing. In recognition that the

antidumping statute applies only to sales of

merchandise and not to sales of services, Commerce

issued a regulation distinguishing between sales of

merchandise, which are relevant in an antidumping

analysis, and sales of manufacturing services

associated with such merchandise, which are not.

The regulation provides in pertinent part that

“(Commerce] will not consider a toller or

subcontractor to be a manufacturer or producer

where the toller or subcontractor does not acquire

ownership, and does not control the relevant sale, of

the subject merchandise or foreign like product.” 19

C.F.R. § 351.401(h) (2007). Except for uranium

enrichment services, Commerce has relied upon

Section 351.401(h) to establish a consistent practice

— confirmed by the courts —- of finding that

contracting for manufacturing services does not

constitute a relevant sale of the resulting

merchandise. See, e.g., Taiwan Semiconductor

Manufacturing Co., Ltd. v. United States, 143 F.

Supp. 2d 958, 966 (Ct. Intl Trade 2001)

(“Commerce’s use of ‘relevant sale’ ... furthers

congressional intent for Commerce to determine

whether subject merchandise is being, or is likely to

be, sold in the United States at less than its fair

value.”).? On that basis, Commerce previously has

held that sales of contract manufacturing services

cannot be the basis of a determination of sales of

merchandise at less than fair value.

8 “Toll producers” are entities that produce merchandise

for other parties through contract manufacturing service

arrangements.

® See also Dynamic Random Access Memory

Semiconductors of One Megabit and Above (“DRAMs”) From

Taiwan, 64 Fed. Reg. 56,308, 56,318 (Dep't of Commerce Oct.

19, 1999) (notice of final determination of sales at less than fair

value) (treating sales of Taiwanese contract manufacturing

service provider as services, not sales of merchandise).

10

C. The Proceedings Below

At the request of USEC, in December 2000

Commerce initiated antidumping and countervailing

duty investigations of imports of LEU from France,

Germany, the United Kingdom and the Netherlands.

It published its final determination in the

antidumping proceeding involving France on

December 21, 2001. Low Enriched Uranium from

France Final AD Determination, 66 Fed. Reg. at

65,877 (Govt App. 220a-262a). Commerce’s

determination that Eurodif had made sales at less

than fair value was based primarily on sales of

enrichment services.

The question whether enrichment contracts

should be considered sales of services or of goods was

thoroughly briefed during the administrative

proceedings. In its initial determination, Commerce

stated that “[w]hile we recognize that the provision

of uranium feedstock may not be a payment-in-kind

in the formal sense under these contracts, we

maintain that the arrangement between buyer and

seller in a SWU contract nonetheless is dedicated to

the delivery of LEU, and critical to the trade in

LEU.” Id. at 65,884-65,885 (Gov't App. 254a-255a).

Moreover, it was uncontested that the utilities did

not sell the LEU produced from their feedstock.

Nonetheless, Commerce concluded that “[i]t does not

matter whether the producer/exporter [Eurodif] sold

subject merchandise as subject merchandise, or

whether the producer/exporter sold some input or

manufacturing process that produced = subject

merchandise, as long as the result of the

producer/exporter’s activities is subject merchandise

11

entering the commerce of the United States.” Id. at

65,885 (Gov’t App. 232a, 254a-255a).

The Court of International Trade (“CIT”)

disagreed. It examined the enrichment contracts

and concluded they were sales of services, not LEU.

The CIT went on to hold that it could not reconcile

Commerce’s conclusions with a number of prior cases

in which Commerce itself had determined that

transactions in manufacturing services were not

sales of subject merchandise. Specifically, the CIT

noted that Commerce had previously recognized that

“where the price paid for subject merchandise does

not include the entire value of such merchandise, but

instead only that portion of the value added by the

services performed, there is no cognizable sale under

the antidumping duty law.” USEC I, 259 F. Supp.

2d at 1325 (Gov't App. 205a-206a). The CIT

remanded the case to Commerce for reconsideration.

Id. at 1331 (Gov’t App. 219a).

In its remand determination, Commerce

reaffirmed its prior conclusions, asserting that “the

enrichers make the only relevant sales that can be

used for purposes of establishing U.S. price and

normal value.” Low Enriched Uranium from France

Remand Redetermination (June 23, 2003) at 52

(USEC App. 211la). On appeal, the CIT again

rejected Commerce’s approach, stating that:

Commerce’s duty is to investigate

“sales” at less than fair value. The

agency’s assertion that the enrichers’

transactions with the utilities are the

only transactions that could be such

12

sales, without more, does not establish

that there is an evidentiary or legal

basis to conclude’ that those

transactions constitute sales for

purposes of our antidumping statutes.

USEC Inc. v. United States, 281 F. Supp. 2d 1334,

1340 (Ct. Intl Trade 2003) (Gov’t App. 45a-46a).

The parties thereafter obtained an order from the

CIT permitting an interlocutory appeal, pursuant to

28 U.S.C. § 1292(d)(1), on the issues relating to

Commerce’s proposed treatment of contracts for

manufacturing services as contracts for the sale of

merchandise.

The Federal Circuit affirmed the CIT’s

conclusion that enrichment services transactions are

not sales of goods. Eurodif I, 411 F.3d 1355 (Gov’t

App. 8a-28a). It agreed that the enrichment

contracts “do not evidence any intention by the

parties to vest the enrichers with ownership rights

in the delivered unenriched uranium or the finished

LEU.” Id. at 1362 (Gov’t App. 20a). The Federal

Circuit concluded that enrichment transactions

therefore were not “sales” of merchandise under the

antidumping law, because “the ‘transfer of

ownership’ required for a sale under [NSK Ltd. v.

United States, 115 F.3d 965 (Fed. Cir. 1997)] is not

present here.” Jd. (Gov't App. 20a). The court also

observed that in a recent case arising under the

Contracts Disputes Act, Florida Power & Light Co.

v. United States, 307 F.3d 1364 (Fed. Cir. 2002), it

had agreed with the Government’s position that

uranium enrichment contracts were sales of services.

The Federal Circuit found the reasoning in that

13

decision persuasive regarding the nature of the

contracts, although it noted that “Florida Power is

not binding precedent for this case.” Eurodif I, 411

F.3d at 1663-64 (Gov't App. 21a, 23a-24a).’°

The Government and USEC sought rehearing

and rehearing en banc, and brought to the attention

of the Federal Circuit this Court’s decision in

National Cable & Telecommunications Assoc. uv.

Brand X Internet Services, 545 U.S. 967 (2005). In

Brand X, this Court held that “[a) court’s prior

judicial construction of a statute trumps an agency

construction otherwise entitled to Chevron deference

only if the prior court decision holds that its

construction follows from the unambiguous terms of

the statute and thus leaves no room for agency

discretion.” Jd. at 982.

The Federal Circuit denied rehearing en banc,

and granted rehearing for the limited purpose of

addressing the application of Brand X. in its

rehearing decision, the Federal Circuit emphasized

that it had not relied on Florida Power as binding

precedent. To confirm its decision complied with

Brand X, the Federal Circuit clarified that “the

antidumping duty statute unambiguously applies to

the sale of goods and not services.” Eurodif S.A. v.

United States, 423 F.3d 1275, 1278 (Fed. Cir. 2005)

(“Eurodif II”) (Gov’t App. 33a). The Federal Circuit

further noted its original decision’s holding that the

10 The Government itself argued to the Federal Circuit

that Florida Power was relevant and supported Commerce's

determination because in Florida Power the Federal Circuit

had stated that its decision on the nature of the enrichment

contracts was a difficult one. Gov't Pet. at 15.

14

provision of services clearly was not covered by the

antidumping law, and affirmed its conclusion that

“Commerce’s characterization of the SWU contracts

at issue in this case would contradict ... the statute’s

unambiguous meaning because it is clear that those

contracts are contracts for services and not goods.”:

Id. (Gov’t App. 33a).

On remand, Commerce removed _ the

enrichment transactions from its calculations, but

initially resisted excluding LEU imported pursuant

to enrichment services transactions from the

antidumping order. Final Results of Low Enriched

Uranium from France Remand Redetermination

(Mar. 3, 2006) at 4-5 (USEC App. 323a-325a). On

appeal, the CIT held that because such LEU is never

sold, Commerce was required to exclude such

imports from the scope of the antidumping order.

Eurodif S.A. v. United States, 431 F. Supp. 2d 1351,

1354-57 (Ct. Intl Trade 2006) (USEC App. 327a-

339a). In the subsequent remand determination,

Commerce modified the scope of the antidumping

order accordingly, and issued a form by which

Eurodif and the utilities could certify that specific

imports met the conditions for exclusion. Final

Results of Low Enriched Uranium from France

Remand Redetermination (June 19, 2006) at 1

(USEC App. 341a).

After the CIT affirmed the remand results,

the Government and USEC appeated to the Federal

Circuit the limited question of whether Commerce

should be required to exclude imports under

enrichment contracts immediately or only after

Commerce conducted further factual analysis. The

i

15

Federal Circuit dismissed the appeal as unripe.

Eurodif S.A.-v. United States, 506 F.3d 1051 (Fed.

Cir. 2007) (Gov't App. 2a). The Petitioners then

sought review in this Court of the Federal Circuit’s

decision in the interlocutory appeal issued in 2005.

ARGUMENT

A. This Case Involves Only A Routine

Application Of The Chevron Standard Of

Deference

The Federal Circuit held that the

antidumping statute unambiguously applies to the

sale of goods and not to sales of services. Eurodif I],

423 F.3d at 1278 (Gov't App. 33a). That holding

satisfies the threshold test of Chevron and Brand X.

Having found no ambiguity, the Federal Circuit

applied the plain meaning of the statute and no

deference was due Commerce. Even if the Federal

Circuit had erred — and it did not — this case does not

raise any issue of administrative law not previously

addressed by this Court.

Faced with the Federal Circuit’s clear holding,

the Petitioners attempt to divert attention from the

actual substance of the Federal Circuit's ruling and

the applicable precedents. Both Petitioners argue

that the meaning of “sold” is ambiguous, and cite to

cases arising under different and _ irrelevant

regulatory regimes in support of an argument that

Commerce should be given broad discretion in

interpreting that word. Gov’t Pet. at 18; USEC Pet.

at 21. Neither mentions that, as discussed below,

the Federal Circuit previously and correctly applied

16

Chevron in interpreting precisely that same word,

nor that the Federal Circuit relied on that prior

decision in making its holding in this case.

Specifically, in NSK Ltd. v. United States, 115

F.3d 965 (Fed. Cir. 1997), Commerce treated as

“sales” free samples given by a foreign manufacturer

to some of its U.S. customers, thereby placing

squarely at issue the meaning of the word “sold” in

section 1673. In NSK the Government argued, as it

does here, that not deferring to Commerce’s

interpretation would create a loophole in the

antidumping law. Id. at 972. As part of a detailed

analysis, the Federal Circuit held that “Congress

intended to give the term its ordinary meaning ....”

Id. at 974. It also stated that “contrary to the

Government’s suggestion, we do not believe that the

term ‘sale’ should be given any special meaning

under the antidumping laws.” Jd. The Federal

Circuit concluded “(t]he terms of the statutory

provisions are clear on their faces and we see no

reason to depart from the ordinary meaning of the

term ‘sold’ or ‘sale’. We thus need not reach the

second prong of the Chevron analysis.” Id. at 975.

In the instant case, the Federal Circuit

expressly relied on NSK for its principal holding, as

follows:

[Tlhe SWU contracts in this case do

not evidence any intention by the

parties to vest the enrichers with

ownership rights in the delivered

unenriched uranium or the finished

LEU. As a result, the “transfer of

17

ownership” required for a sale under

NSK is not present here.

Eurodif I, 411 F.3d at 1362 (Gov't App. 20a).

Because the holding in NSK was based on a finding

that the statute was unambiguous, the requirements

of Brand X were satistied. Accordingly, there was no

requirement for the Federal Circuit to defer to

Commerce’s interpretation of “sold” under the second

prong of Chevron.

In its decision on rehearing, the Federal

Circuit further reinforced its holding by stating as

follows:

We now clarify by stating expressly

that the antidumping duty statute

unambiguously applies to the sale of

goods and not services. In our opinion,

we stated that “under the statutory

scheme adopted by Congress, the sale

of goods (or ‘merchandise’) is covered

by the antidumping duty statute” but

tnat the “provision of services,

however, is not ....”. Eurodif I, 411

F.3d at 1361. While we did not use

the term “unambiguous”, we clearly

foreclosed any argument that § 1673 is

ambiguous on the precise question of

whether the antidumping duty statute

encompasses contracts for services. It

undoubtedly does not.

Eurodif I], 423 F. 3d at 1278 (Gov’t App. 33a).

18

USEC’s complaint that the Federal Circuit

improperly relied on Florida Power contrary to

Brand X is misplaced, because the Federal Circuit

expressly stated that “Florida Power is not binding

precedent for this case.” Eurodif I, 411 F.3d at 1363

(Gov't App. 21a). Recognizing that Florida Power

did not arise under the antidumping statute, the

Federal Circuit found Florida Power instructive on

the nature of the contracts because it involved

contracts for uranium enrichment services, and

because in Florida Power the Government itself had

argued successfully that the contracts were for

services. Id. at 1363-64 (Gov’t App. 21a-24a). Brand

X is not implicated by the Federal Circuit’s reference

to Florida Power.

Crucially, both the Government and USEC

now acknowledge that the antidumping statute

applies only to the sale of goods. Gov't Pet. at 3;

USEC Pet. at 5.7’ Im an effort to evade that

limitation, however, they rely on an individual

contract provision taken out of context to allege that

1 USEC argues that a completely separate statute

applying to a different subject — international trade

negotiations — should be interpreted to override the plain

meaning of “services” and limit it to activities not involving

manufacturing. USEC Pet. at 28. However, the statute cited

by USEC, 19 U.S.C. § 2114b(5), 1s not part of the antidumping

statute. Moreover, the U.S. Government itself has included

“services incidental to manufacturing” (such as_ the

manufacture of nuclear fuel on a fee or contract basis) within

the scope of the negotiations on energy services in the World

Trade Organization’s General Agreement on Trade in Services.

See Communication from the United States to the Council on

Trade in Services, S/CSS/W/24 (Dec. 18, 2000) avatlable at

http: / /docsonline.u to.org/ DDFDocuments/t/S/CSS/W24.doc

19

the provision of uranium feedstock for enrichment is

a type of barter or payment-in-kind transaction.

Gov't Pet. at 22-23; USEC Pet. at 26.’* Contrary to

the Government’s assertion that the utilities do not

own the LEU until it is delivered to them, Gov’t Pet.

at 21, the contracts make clear that the utilities are

deemed to receive back their own uranium, and that

uranium is never owned by the enricher. Eurodif I,

411 F.3d at 1362 (Gov’t App. 20a) (“In reviewing the

contracts in this case, it is clear that ownership of

either the unenriched uranium or the LEU is not

meant to the vested in the enricher during the

relevant time periods that the uranium is being

enriched.”). Indeed, both the CIT and the Federal

Circuit rejected Commerce’s strained view of the

contracts, finding that they are clearly purchases of

enrichment and not LEU. For that reason, the

Petitioners now ask this Court to analyze the

Petitioners’ hypotheses about the nature of specific

contract provisions, and to construe whether it is

12 The characterization of enrichment services contracts

as barter transactions was contradicted not only by the plain

terms of the contracts, but also by the fact that the enrichers

never know the value of the uranium feedstock provided by the

utilities. For that reason, Commerce was forced to invent a

price for the LEU in its determination. It stated that “[ijn

assigning a specific monetary value to the natural uranium

component, we estimated the market value,” and “[flor SWU

contracts, when comparing [prices of LEU], we valued natural

uranium using exactly the same value for both sides of the

equation.” Low Enriched Uranium from France Final AD

Determination, 66 Fed. Reg. at 65,885 (Gov't App. 257a). Thus,

in making its dumping calculations, Commerce relied on

fictional values for the uranium contained in the LEU, apphed

an equation that cancelled out the uranium values entirely,

and based its price comparisons on the sales of enrichment

services.

20

significant that uranium feedstock is a fungible

input. These are not issues of broad legal or factual

application. They are specific to the nuclear fuel

industry, and not appropriate for review by this

Court.

The Petitioners seek to avoid the fundamental

point that because enrichment contracts involve only

the purchase of a manufacturing service and not the

enriched uranium as a whole, there can be no “sale

of merchandise” within the meaning of the

antidumping _ statute. As discussed above,

Commerce has consistently viewed transactions in

manufacturing services as not involving a sale of

goods subject to the antidumping statute.’* In this

case, Commerce is attempting to create a unique

exception to its own regulations, and _ the

antidumping statute itself, to treat enrichment

services as sales of LEU. However, Commerce may

not create new restrictions on transactions in

manufacturing services without statutory

authorization from Congress.‘ For the Federal

ig For example, in Jaiwan Semiconductor, 143 F. Supp.

2d at 966, the CIT affirmed Commerce's determination that the

sale of manufacturing services is not a sale of the goods being

manufactured. Commerce’s regulation on _ contract

manufacturing, as applicd in that case and others, derives from

the statutory requirement that a finding of dumping be based

on sales of merchandise - the same requirement the Petitioners

now seek to evade.

a4 The Government acknowledges that an effort is

currently being made to enact special legislation targeting

enrichment services transactions. Gov't Pet. at 26 n.4. That

effort reflects a recognition that the antidumping statute does

not reach manufacturing services such as uranium enrichment.

21

Circuit to reject Commerce’s attempt to do so in this

case is entirely consistent with the standard of

review provided by this Court under Chevron and

Brand X.

B. The Facts Of This Case Are Narrow And

Unique

As discussed above, the manner in which

nuclear reactor assemblies are made and purchased

is unique, in that the imports of LEU are not sold

but rather are consumed by the utilities that

arranged for their production. The Petitioners’

argument that this unique situation creates a

“loophole” in the antidumping statute is wholly

unfounded, for two reasons.

First, there has never been an allegation that

the utilities restructured their contracts to evade the

antidumping law. The method of contracting

separately for enrichment services was originally

mandated by the U.S. Government in the 1960s,

almost 40 years before the antidumping proceeding

was initiated. The CIT specifically addressed this

issue, finding that “[t]he contract here is not simply

a restructured purchase contract.” USEC I, 258 F.

Supp. 2d at 1322 n.12 (Gov’t App. 198a).

Second, the examples’ given by the

Government and amicus curiae Committee to

Support U.S. Trade Laws (“Committee”) of products

that could be contract-manufactured abroad for sale

in the United States — such as steel, lumber, pasta,

"=

22

textiles, and semiconductors” —- are all readily

captured under the existing statute and regulations,

which are left undisturbed by the decision of the

Federal Circuit in this case. Indeed, in the Taiwan

Semiconductor case discussed above, sales of the

imported semiconductors by the U.S. importer (as

opposed to sales of manufacturing services by the

Taiwanese service provider to the U.S. importer)

were included in the scope of the proceeding.

Moreover, Commerce has previously applied its

doctrine that sales of manufacturing services are not

sales of merchandise in cases involving steel and

pasta, as well as in another case involving

semiconductors."© The ultimate sales of those

products in the United States were in each case

within the scope of the antidumping statute, because

the merchandise was actually sold.’

16 Gov't Pet. at 25: Committee Br. at 7-10.

se Certain Forged Stainless Steel Flanges from India, 58

Fed. Reg. 68,853 (Dep’t of Commerce Dec. 29, 1993) (notice of

final determination of sales at less than fair value); Stainless

Steel Wire Rod from Sweden, 63 Fed. Reg. 40,449 (Dep't of

Commerce July 29, 1998) (notice of final determination of sales

at less than fair value); Certain Pasta from Italy, 63 Fed. Reg.

53,641 (Dep't of Commerce Oct. 6, 1998) (prelim. results of new

shipper antidumping duty admin. review), aff'd, Certain Pasta

from ltaly, 64 Fed. Reg. 853 (Dep’t of Commerce Jan. 6, 1999)

(final results of new shipper antidumping duty admin. review);

DRAMS from Taiwan, 64 Fed. Reg. 56,308.

7 The antidumping statute also contains provisions to

ensure that sales of imported products can be captured when

the merchandise is incorporated into other products before it 1s

sold in the Umted States. 19 U.S.C. 1677a(c).

23

Under the existing law — unaffected by the

Federal Circuit’s decision — if a broker were to sell

imported LEU for which it had _ contracted

production, that sale would be subject to the

antidumping statute. But that is not the situation at

issue here, and neither the Petitioners nor the

Committee has identified another industry in which

U.S. companies arrange for foreign contract

production of merchandise that they consume

themselves. That is not the situation for foreign-

made steel products, lumber, pasta, textiles or

semiconductors, all of which are sold after

importation into the United States.

In sum, while the Petitioners argue that the

Eurodif decisions must be overturned to prevent a

loophole in the antidumping law, no such loophole

exists. In every other case identified by the

Petitioners, the imported goods are subject to the

antidumping law because those goods are eventually

sold. The Petitioners simply seek to twist a statute

of general applicability out of shape in order to

achieve a specific result tailored to the facts of one

particular — and unique — industry. Such a results-

driven application of the law is not a legitimate basis

for legal interpretation, and certainly not sufficient

justification for the granting of certiorari.

Cc. The Petitioners’ Characterizations Of

“Foreign Policy” And “National Security”

Interests Are Factually Incorrect And

Inapposite

The Petitioners argue that there are several

non-legal policy reasons why the Court should grant

24

certiorari, primarily claiming that the Federal

Circuit’s decision threatens national security, U-S.

energy policy, and the financial well-being of a

publicly held company, USEC. Gov’t Pet. at 25-32;

USEC Pet. at 32-37. Those policy arguments are all

based on the projected effect of this case on a

different case: an antidumping proceeding involving

imports of uranium from Russia.

An import restriction imposed under the

antidumping statute in the Russian uranium

proceeding prohibits utilities from purchasing

enrichment services directly from the Russian

enricher. Meanwhile, USEC serves as the US.

“executive agent” of Russian enrichment services

provided under the Agreement Between the

Government of the United States of America and the

Government of the Russian Federation Concerning

the Disposition of Highly Enriched Uranium

Extracted from Nuclear Weapons, U.S.-Russ., Feb.

18, 1993, State Dep’t No. 93-59, 1993 WL 152921

(hereinafter “HEU Agreement”). The HEU

Agreement is a government-to-government

arrangement under which Russia has committed to

sell the enrichment services associated with LEU

that has been “downblended” from weapons-grade

uranium. USEC has been given the exclusive right

to resell the enrichment services supplied by Russia

under the HEU Agreement as the U.S. “executive

25

agent” (i.e, broker) for the HEU Agreement.”

According to the Petitioners, using the antidumping

statute to prevent the utilities from contracting

directly with the F.ussian enricher preserves “market

conditions” that encourage Russia to comply with its

obligations under the HEU Agreement.

The Petitioners’ policy argument presumes,

without providing any evidentiary support, that

there is a significant risk that Russia will abandon

its treaty obligations under the HEU Agreement.

They also allege that Russia is capable of selling

substantial additional amounts of commercial

enrichment services to the United States, but that

18 Although the Petitioners appear to suggest otherwise,

USEC is not the only company capable of serving as the broker

of Russian enrichment services provided under the HEU

Agreement. In 1999 USEC announced it was considering

withdrawing from that role. When other companies -- including

members of AHUG -— proposed to take over or supplement

USEC’'s role as the executive agent, USEC opposed those

proposals and reclaimed the position for itself. Accordingly, its

role as the executive agent 1s voluntary.

26

specific issue is contested and currently is sub judice

in the CIT.”

Regardless, the U.S. utilities continue to fully

support the HEU Agreement, which could not exist

absent the utilities’ purchases of the Russian

enrichment services provided to them through

USEC. Nonetheless, when the HEU Agreement

expires in 2013, there will be a significant shortfall

in the available supply of enrichment services, and

utilities must have access to sufficient supplies to

ensure the continued reliable operation of domestic

nuclear plants. No full replacement for the

enrichment services currently obtained under the

HEU Agreement has been identified.

The Government also claims that it relies on

USEC “to supply enriched uranium for a variety of

military purposes,” and that USEC “is the sole

19 Ad Hoc Utilities Group v. United States, No. 06-00229

(Ct. Int'l Trade appeal docketed July 6, 2006) (appealing

Commerce determination); Ad Hoc Utilities Group v. United

States, No. 06-00300 (Ct. Int'l Trade appeal docketed Sept. 6,

2006) (appealing International Trade Commission

determination); Nukem v. United States, No. 06-00298 (Ct. Int’!

Trade appeal docketed Sept. 6, 2006) (appealing International

Trade Commission determination). In the proceedings

involving Russia — which are not part of the record of this case

and not before the Court — there is evidence that Russia's

enrichment capacity is already substantially occupied and that

in any event, US. utilities are already largely committed under

long term purchase contracts that extend beyond the expiration

of the HEU Agreement. Uranium from Russia, USITC Pub.

3872, Inv. No. 731-TA-539-C (Second Review) (Aug 2006) at

42, 44 (Comm. Lane, dissenting) and II-18, avatlable at http://

www.usitc. gov/ trade_ remedy/731_ad_701_cvd / investigations

/index_opinions/index.htm#2006.

a

27

supplier of the LEU used to fuel the government-

owned nuclear reactors that produce tritium,” which

is used in nuclear weapons. The Government

further asserts that USEC supplies enriched

uranium for the space program and for submarines

and aircraft carriers. Gov’t Pet. at 30. However,

although the Government is silent on the issue,

USEC acknowledges that it does not own the

enrichment facility at Paducah. USEC Pet. at 6.

Rather, USEC leases the facility from the

Government, which operated it for many years (until

USEC was privatized in 1998) and is able to do so

again.

Moreover, the Department of Energy (“DOE”)

itself has indicated that it has a major surplus of

weapons-grade uranium. On March 12, 2008, DOE

issued a press release addressing “the management

of [its] excess uranium inventory.” DOE stated that

it “has a significant inventory of . . . uranium that is

excess to U.S. defense needs.” DOE also explained

that, because the costs of maintaining the inventory

are high, it plans to dispose of excess uranitim

through commercial or other transfers, while still

“maintain[ing] sufficient uranium inventories at all

times to meet the current and reasonably foreseeable

needs.””°

It therefore appears unlikely that the

financial performance of USEC could have any

relationship to U.S. national security. Even if it did,

the Petitioners’ suggestion that the antidumping

20 DOE Press Release, DOE Announces Policy for

Managing Excess Uranium Inventory, (Mar. 10, 2008),

avatulable at http://www.energy.gov/news/6069 htm.

28

statute should be manipulated to assist USEC — a

private company — in raising capital in the

commercial markets is certainly not a_ valid

justification for certiorari. It is within the power of

the U.S. Congress to enact legislation granting

USEC a financial subsidy, but that is not a subject

within the scope or intent of the antidumping

statute.

With regard to energy policy, the Petitioners’

assertion that allowing utilities to purchase Russian

enrichment services without going through USEC

would increase dependence on foreign energy sources

is questionable. USEC itself has for many years

chosen to commit most of its own output of

enrichment services to contracts with foreign

utilities, while delivering Russian services to U.S.

utilities as a broker. The real threat to U.S. energy

policy arises from the increasing costs now faced by

utilities resulting from limited supplies of the

components and services needed to produce nuclear

fuel, and the potential impact of those limited

supplies on current plans for construction of the

additional nuclear reactors needed w = supply

America’s steeply growing energy needs. In any

event, these are the type of policy disputes that this

Court is ill-equipped to resolve.

In addition, it should be noted that USEC

soon will not be the only source of enrichment

services in the United States. The construction of

another U.S. enrichment facility by Louisiana

Energy Services (“LES”) is underway, and it is

expected to be operational in 2009. Reflecting the

high demand for and limited supply of worldwide

29

enrichment services capacity, the entire enrichment

output of the LES facility for its first ten years of

operation is already committed under contracts with

utilities. Other new enrichment facilities are in the

planning stages. Utilities will continue to purchase

significant amounts of enrichment services from U.S.

sources, including USEC, under long term contracts.

Perhaps most important, the antidumping

statute is an instrument of trade policy with general

application to all industries, and not a tool for the

implementation of national security or energy

policies. There is simply nothing in the Tariff Act of

1930 indicating that Congress intended it to be

interpreted in a special manner for purchases of

uranium enrichment services. The policy concerns

raised by Petitioners are not within the purview of

the antidumping law, and do not provide a valid

basis for seeking certiorari to this Court.

30

CONCLUSION

For the foregoing reasons, the petition for a

writ of certiorari should be denied.

Respectfully submitted,

Nancy A. Fischer

Counsel of Record

Stephan E. Becker

David J. Cynamon

Joshua D. Fitzhugh

PILLSBURY WINTHROP SHAW

PITTMAN LLP

2300 N Street, NW

Washington, DC 20037

(202) 663-8000

Counsel for the Ad Hoc Utilities Group

March 21, 2008