As perhaps the world’s most heavily regulated, scrutinized, politicized and publicly misunderstood global industry sector, the nuclear industry and its suppliers require sophisticated counsel with a keen sense of the legal, political and commercial challenges facing the industry, as well as its important place in the worldwide energy future. The K&L Gates nuclear industry group is an international, multidisciplinary team focused on virtually every facet of the nuclear industry and on the challenges presented by the use and disposal of radioactive materials and radiation-generating devices.
Our clients include operators of commercial nuclear energy facilities, nuclear fuel fabricators, ore processors, industrial and medical users, waste management and transportation contractors, developers and suppliers to the commercial nuclear power industry. In the United States, our attorneys have represented Nuclear Regulatory Commission (NRC) licensees and Department of Energy (DOE) contractors, as well as consultants, contractors and subcontractors in nearly every capacity. In the United Kingdom, we have advised government agencies and nuclear facility operators on a wide range of regulatory issues and have been involved in several important transactions in the U.K. nuclear industry.
Our industry team combines attorneys with a range of nuclear industry experience, including technical backgrounds, government agency roles, and in-house counsel of regulated companies. Still others bring truly unique experiences to bear in counseling our nuclear clients. For example, K&L Gates partner Dick Thornburgh, in his former capacity as governor of Pennsylvania, led the Commonwealth’s emergency response during the Three Mile Island accident in 1979. Roger P. Shaw, a certified health physicist, was the head of Radiation Protection at Three Mile Island after the accident and is now a full-time technical specialist at the firm. Slade Gorton joined the K&L Gates team after spending 18 years representing Washington state in the U.S. Senate, where he was involved in many matters associated with nuclear energy and ongoing DOE nuclear defense, energy, science, national laboratory and environmental programs.
Our nuclear industry group offers our clients services across the full spectrum of legal issues affecting businesses in nuclear industries:
Licensing Proceedings
Our attorneys have advised clients on licensing requirements and have been involved in licensing proceedings before the NRC and various Agreement States for a variety of facilities, including commercial nuclear electric facilities, nuclear fuel cycle facilities, low-level waste disposal facilities, and industrial and medical facilities. We also have counseled clients on DOE nuclear facility activity requirements that parallel NRC regulatory requirements. Our experience with licensing matters and nuclear authorization includes initial license approvals, transfers, renewals and modifications, financial assurance, decontamination and decommissioning, and license termination for restricted and unrestricted uses. Our licensing experience includes the following representative matters:
- Nuclear Fuels Manufacturing: Our attorneys have represented the current and former owners and operators of a uranium fuel fabrication facility, plutonium processing laboratory and radioactive waste shallow land burial site before the NRC and state agencies in matters concerning decontamination and decommissioning and license termination. These efforts included NRC proceedings to amend the Special Nuclear Materials license for the facility.
- Ore Processing: K&L Gates represented the operator of a former rare earth metals extraction and processing facility in matters concerning site decontamination and decommissioning under the NRC Site Decommissioning Management Plan and subsequent License Termination Rule, as well as amending the NRC Source Materials license to allow processing of licensed ore residues to recover additional metal values.
- RAM Purchasers: Our attorneys have advised clients on the NRC’s “general license” requirements that would be applied to the purchase and ownership of radioactive materials, and related actions that would trigger filing and notification to the NRC.
- Industrial Users: K&L Gates has advised several state-licensed thorium alloy producers on matters concerning license renewal and amendment to accommodate process and facility modifications, decontamination and decommissioning.
- Transporters of Nuclear Materials: Our attorneys have advised DOE contractors on NRC license and certification requirements for the transportation of highly radioactive materials and spent nuclear fuel, including domestic transportation and nuclear fuel shipping campaigns involving the return of foreign research reactor fuel to the United States.
- Medical Equipment Manufacturer: We represented a seller of a nuclear imaging equipment manufacturer in the transfer of multiple NRC licenses and state permits in connection with the sale of the business.
- Hospitals: We have represented several hospitals in the transfer and amendment of NRC licenses and state permits in connection with mergers and acquisitions of other hospitals and nuclear medicine practices.
Regulatory And Environmental Compliance And Enforcement
K&L Gates has over 100 experienced lawyers in the United States, European Union and Asia dedicated to developing creative and cost-effective solutions to the environmental and regulatory challenges confronting our clients. Our attorneys have advised NRC and Agreement State licensees on regulatory requirements associated with nuclear facility operations, radioactive material handling and disposal, facility safety, occupational radiation exposure monitoring and reporting, and facility decontamination and decommissioning. We have participated in DOE contractor self-assessments and audits in the areas of nuclear safety, radioactive and mixed waste management, environmental restoration, radiation protection and risk management.
In addition, we have advised clients on the cleanup of radioactive contamination at a number of Superfund sites and other unlicensed sites. In the United Kingdom, we have advised a radioisotope producer on EU and British government regulations concerning radioactive releases and site decontamination.
The following are selected representative matters:
- Off-Site Contamination: On behalf of the former owner of two nuclear fuel processing facilities, we defended claims asserted by a local wastewater treatment plant alleging that radiological materials previously discharged to sewers (in accordance with NRC limits) were concentrated in the treatment plant’s sludge. The sludge was thereafter incinerated and placed in an ash lagoon. K&L Gates counseled the client through negotiations with the wastewater treatment plant operator, proceedings before the NRC resulting in a no further action determination, and subsequent negotiations with the state environmental agency, ultimately leading to final closure of the ash lagoon.
- Agreement State Compliance: We have advised a thorium alloy manufacturer with respect to a range of Agreement State radioactive materials licensing issues, including occupational exposure monitoring and reporting, survey and release of materials and equipment, area posting and monitoring, site decommissioning, financial assurance, license renewal and radioactive waste management.
- DOE Facilities: Our attorneys have advised several DOE contractors on compliance with DOE Orders and regulations related to nuclear operations, waste management and cleanup, and nuclear safety and security. We have participated in contractor self-assessments and audits in compliance with DOE nuclear safety rules (Price-Anderson Act compliance), radioactive and mixed waste management, environmental restoration, radiation protection and risk management. Facilities assessed include gaseous diffusion plants (Portsmouth, Ohio, and Paducah, Ky.), national laboratories (Oak Ridge National Laboratory, Tenn., Sandia National Laboratories, N.M. and the Idaho National Laboratory), environmental restoration/waste management sites (Hanford, Wash., and the K-25 site in Tennessee) and defense program sites (Y-12 National Security Complex, Tenn.).
- Mixed Waste: We also have advised contractors on nuclear waste management and cleanup at sites having both defense and commercial nuclear waste, such as the West Valley site in New York. We have extensive experience in the management of mixed waste – that is, waste that has both hazardous and radioactive constituents – and have counseled contractors at large DOE sites.
- Pharmaceutical Research: Our nuclear industry group lawyers have counseled a laboratory owner on the state and federal regulatory requirements for decontaminating and decommissioning its laboratory facility and managing the resulting radioactive waste.
- Superfund: We served as chair and common counsel for a PRP group for a metal smelting facility, a portion of which was contaminated with radioactive materials. K&L Gates led negotiations with the EPA and Pennsylvania Department of Environmental Protection regarding the investigations, characterizations, remedial selection, design and implementation.
- State Superfund/FUSRAP: We represented the owner of an industrial facility that contained radioactive contamination from a former site owner’s operations conducted for the U.S. government. We worked closely with the New York Attorney General’s office and NYSDEC to insure that the federal government would remove the radioactive contamination from the property under the FUSRAP program.
- Low-Level RAM Contamination: While representing a client in California in unrelated matters, the client discovered radioactive material contamination in boxes of its documents stored in a warehouse. We guided the client through various state regulatory issues (California OSHA, Cal Prop. 50), and ultimately NRC transportation regulations when the client shipped the boxes to a low-level waste facility.
Public Policy
The public policy team in our Washington, D.C. office has been actively engaged in nuclear issues for over 20 years. We have represented prominent companies, research laboratories, universities and local communities in public policy issues affecting all aspects of the nuclear fuel cycle. Our work has included advocating client issues before the U.S. Congress, the DOE, the NRC, and the Office of Management and Budget.
Examples of our public policy work include:
- Appropriations: We have represented local communities and major contractors to secure additional federal appropriations to support nuclear production and remediation activities at large DOE sites, such as Hanford, Oak Ridge and Savannah River. At the Hanford site alone, we have helped successfully lobby Congress over the past 10 years to approve over $1 billion in appropriations above the President’s request, for nuclear remediation, research and health and safety programs.
- Nuclear Waste Legislation: We helped lobby for the inclusion of provisions to the 1987 amendments to the Nuclear Waste Policy Act and supported legislative language on nuclear waste issues contained in annual appropriations acts. We have worked on nuclear waste legislation affecting FUSRAP, 11e.2 byproduct material, and the construction of the waste treatment plant.
- Price-Anderson Act: We were active in lobbying for the 1988 and 2005 reauthorizations of the Price-Anderson Act. Our efforts included successfully fending off several hostile amendments that would have undercut hallmark features of Price-Anderson.
- Tax and Tariff Legislation: We have successfully lobbied Congress for amendments to maintain favorable tax benefits and tariff treatment for equipment and large components used in nuclear power plants. These efforts have been worth potentially millions of dollars to our clients.
Litigation
K&L Gates fields a global litigation practice with experience in a wide range of disputes affecting clients in the nuclear industry. We have represented NRC licensees on issues ranging from radiation exposure claims to antitrust to employment to environmental litigation. Our litigation practice is complemented by the firm’s cutting edge e-DAT group which, with the support of its proprietary software tools, has the capabilities to manage millions of pages of paper and electronic documents in discovery and all other aspects of the litigation process.
The following are a few representative examples of our litigation experience:
- Sherman Act and Lanham Act: K&L Gates is currently defending a major vendor of products and services to the nuclear power industry against claims of attempted monopolization under the Sherman Act, and false advertising and product disparagement under the Lanham Act.
- Nuclear Fuel Transportation: K&L Gates successfully represented an electric utility in a challenge brought by the state of New Jersey to proposed barge transportation of partially spent nuclear fuel to a Pennsylvania utility. The claims were brought under the Atomic Energy Act, the National Environmental Policy Act, and the Coastal Zone Management Act. New Jersey v. Long Island Power Authority, 30 F. 3d 403 (3d Cir. 1993).
- Employee Discrimination: Our attorneys successfully defended a client in an employment discrimination action brought by a group of workers at a nuclear power plant in Florida. The workers claimed to be members of a religious group that prohibited them from being identified by social security numbers, in an apparent attempt to avoid having their occupational radiation exposure histories tracked as they traveled from plant to plant for outage work.
- CERCLA Liability for Radioactive Waste Disposal: Our lawyers represented a client that sent radioactive waste to the Maxey Flats low-level radioactive waste disposal site in Kentucky in a successful “arranger” claim against the DOE.
- Superfund: K&L Gates represented a former operator of a tungsten ore processing facility contaminated with uranium, thorium and other metals associated with tungsten ore processing. We represented the client in a contribution action, while at the same time advising the client on remedial design and remedial action issues under CERCLA 106 orders.
K&L Gates successfully defended a diversified chemical company in relation to a cost recovery action brought by the United States for costs incurred for the cleanup of radioactive contamination. The contamination had arisen from uranium ore processing for the Manhattan Engineering District in the 1940s, and our client had purchased the allegedly decontaminated site subsequent to Manhattan Project activities.
Radiation Exposure Claims
K&L Gates is one of the few firms with substantial experience in handling the extremely complex scientific and legal issues associated with ionizing radiation and radiation injury claims. In addition to attorneys well versed in the legal, scientific and medical aspects of radiation injury litigation, we have on staff a certified health physicist whose full-time work as a technical specialist is devoted to providing technical and scientific support for the defense of our clients in radiation injury litigation.
Our experience in this area includes the following:
- We currently serve as national counsel to a consortium of approximately 85 percent of the U.S. commercial nuclear industry on claims avoidance and defense of radiation injury claims.
- We represent the owner and operator of two nuclear facilities located in western Pennsylvania in a case involving claims of over 400 plaintiffs alleging personal injury and property damage resulting from radioactive releases from these facilities. After a trial where the client was represented by insurer-appointed counsel and which resulted in a verdict for the first eight plaintiffs in excess of $36 million, K&L Gates was asked to assume the defense of these claims. Our attorneys are also pursuing insurance coverage for all potential liabilities from the client’s nuclear insurers as well as indemnification from other parties.
- We represented a former government contractor in successfully defeating a putative international class action brought on behalf of all U.S. and NATO military personnel claiming that they developed cancer due to ionizing radiation exposure from military radar equipment during the Cold War.
- Our attorneys have also represented several commercial nuclear licensees in the defense of claims of alleged radiation-related cancer by individual employees.
Insurance Coverage
Our nuclear industry group has extensive experience counseling clients on insurance coverage issues for nuclear-related liabilities, and helping them secure coverage for radiation-related property damage claims, on‑site and off‑site remediation, and bodily injury claims.
Our experience includes a comprehensive understanding of the issues arising under the particularized insurance policies covering nuclear‑related liabilities issued by American Nuclear Insurers (ANI), formerly known as the Nuclear Energy Liability Insurance Association (NELIA), and Mutual Atomic Energy Liability Underwriters (MAELU). These policies include the Facility Form Policy, the Facility Worker Form Policy, the Supplier’s and Transporter’s Policy, and the Secondary Financial Protection Policy.
We have successfully represented suppliers and manufacturers as well as owners and operators of nuclear facilities in securing insurance coverage for various types of claims under the ANI, NELIA and MEALU policies. Our two most notable examples follow:
- We represented a supplier to the commercial nuclear power industry in securing nuclear liability insurance coverage in connection with the Maxey Flats disposal site. See Aetna Casualty & Surety Co., et al. v. Commonwealth of Kentucky, et al., 179 S.W.3d 830 (Ky. 2005) aff’g Aetna Cas. & Sur. Co. v. Nuclear Engineering Co., 2002 WL 363373 (Ky. App. Mar. 8, 2002). This decision represents the first appellate guidance regarding the coverage afforded under nuclear energy liability policies for claims alleging radiation‑related property damage.
- We represented a manufacturer of steam generators and other commercial nuclear power components in securing an independent insurer-funded defense and access to the broadest limits available under nuclear liability Facility Form Policies, for underlying claims alleging injuries resulting from exposure to radioactive emissions from nuclear fuel processing plants in Apollo and Parks Township, Pennsylvania. See The Babcock & Wilcox Company, et al. v. American Nuclear Insurers, et al., No. 1916 WDA 2001, 2002 WL 31749119 (Pa. Super. Ct. Nov. 25, 2005), appeal denied, 829 A.2d 350 (Pa. 2003). This decision represents the first appellate guidance regarding the coverage afforded under nuclear liability policies for claims alleging radiation‑related bodily injury.
Construction And Engineering
K&L Gates’ construction and engineering practice assists our clients with the bidding and procurement of work, project finance, bonding and insurance requirements, negotiation and drafting of contracts, administration of contracts, compliance with government regulations and myriad other issues.
Our attorneys are accustomed to handling extremely large-scale, complex construction projects of the types undertaken in the nuclear industry. We have negotiated major turnkey, prime and EPC contracts for owners and contractors of power generation plants. We have performed confidential internal investigations and preliminary case assessments for domestic and international multi-billion dollar projects. We have conducted forensic investigations concerning a wide variety of designs and construction defects and damage claims occurring in connection with construction projects. We also have extensive experience in prosecuting construction-related insurance coverage claims on behalf of owners, contractors, subcontractors and engineers under builders risk, professional indemnity, commercial general liability, ocean marine cargo and consequential loss (delay in start-up and efficacy) policies.
Mergers, Acquisitions And Other Transactions
K&L Gates’ corporate and transactional practice is one of the most substantial in the profession. We have completed over 100 mergers and acquisitions in each of the last three years, and hundreds of public debt and equity offerings over the last decade, including complex transactions involving licensed facilities and operations with licensed radioactive materials in the United States and United Kingdom.
In connection with transactions involving nuclear-related assets and operations, we have assisted in understanding and evaluating potential and historical nuclear exposures (environmental, bodily injury and property damage) in the context of the liability and financial protection schemes of the Price-Anderson Act, including protections that may be available under historic nuclear liability insurance policies, under NRC and DOE indemnities and under indemnities extended by third parties.
In the United States, our transactional experience includes the following:
- K&L Gates has served as environmental counsel to a major electric utility in the exchange and auction sale of multiple electrical generating facilities, including nuclear generating facilities in Ohio and Pennsylvania.
- We have represented the seller of a nuclear imaging equipment manufacturer in the transfer of multiple state and NRC permits and approvals for radioactive materials and equipment used in the business.
- One of our attorneys led the environmental/regulatory due diligence for a radioactive waste processing facility in Canada and several radioisotope production facilities in the United States, Canada and Europe.
- We have represented parties in the sale of commercial facilities and hospitals requiring transfer of multiple Agreement State and NRC licenses.
-
One of our attorneys was involved in the $1 billion sale of two state-owned nuclear power plants to a private party as well as power purchase agreements for the future output of the plants. Issues included due diligence and assignment of hundreds of supply and service contracts, the renegotiation and transfer of dozens of joint operating and maintenance agreements and the transfer of 1,600 public employees to the private sector with all compensation and pensions intact.
-
K&L Gates represented a nuclear engineering contractor in its Chapter 11 reorganization. Our attorneys successfully assisted our client in the court-approved sale of its spent nuclear fuel transportation and storage business and in negotiations with its nuclear power generation customers regarding disposition of their design and construction contracts.
Our attorneys in the United Kingdom have also been involved in several notable transactions involving nuclear facilities. For example:
- We worked on the formation of British Energy and on the transfer of certain nuclear power generating stations from the British government to the company. We also represented the company’s subsequent IPO on the London Stock Exchange. These projects involved a thorough review of all the company’s operations with specific reference to the commercial agreements in place for the sale of the electricity generated by the plants, the antitrust issues raised by certain of these arrangements, the environmental risks faced by the company going forward, and a thorough review of the regulatory framework facing the company.
- K&L Gates is advising the British government’s Department of Trade and Industry on the development of a new synchrotron facility in Oxfordshire, a joint venture between the government and the Wellcome Trust. We also act on behalf of a special purpose company in charge of the facility. Our legal work has included advising on the joint venture agreement, procurement strategy, construction and operation contracts and related taxation issues, and providing general corporate advice in setting up the special purpose company.
- Our London lawyers also represented a Nasdaq-listed software and services supplier in a managed services IT supply contract with a division of British Energy, for use at several MAGNOX nuclear facilities. This representation involved weeks of negotiation and required familiarization with the highly developed risk management and safety systems required by British Energy and complex issues related to apportionment of risk, limitation of liability and related insurance questions.
- Our London attorneys recently represented the sellers in the disposal of a licensed nuclear submarine base, as well as undertaking the due diligence for the acquisition by a French company of a U.K. nuclear services promoter.
Project Development And Finance
K&L Gates’ project development and finance lawyers are adept in developing and financing the types of large-scale, complex projects common in the nuclear industry. We serve clients in the private and public sectors of the energy, electric power, industrial, infrastructure, transportation, telecom, health and education, and waste management industries all over the world. We have successfully represented the sponsors or developers of these projects, as well as lenders, investors, vendors, landowners and government contractors, operators and equipment suppliers. In the last five years, our attorneys have advised on projects in over 15 countries on five continents with an aggregate value of over $5 billion.
Our attorneys have acted as primary legal counsel for a mid-Atlantic wholesale electric generation company for project development efforts involving investments of more than $3 billion in the mid-Atlantic states alone – many of them keyed to “fast-track” development schedules. Several of these projects have involved innovative redevelopment of “brownfield” sites, including state and federal processes to obtain required clearance with respect to possible contamination issues.
Our experience encompasses the full life cycle of major infrastructure and energy projects: structuring of initial bid and RFP documents; formation of project companies and joint ventures; site selection and permitting; project finance; construction agreements; fuel supply agreements; power supply agreements; operations and ongoing environmental compliance; litigation arising during project development; and a host of related issues such as labor, employment, tax, transactions and intellectual property.
Intellectual Property
K&L Gates has over 150 lawyers, including almost 70 registered patent lawyers with engineering or advanced science degrees, who devote their practice to obtaining protection for intellectual property assets in the form of patents, trademarks and copyrights. We prepare and prosecute hundreds of patent applications per year in the United States, the United Kingdom and internationally through a network of foreign associates. Our lawyers also counsel clients on intellectual property matters in connection with licensing, technology transfer, infringement and validity opinions and the intellectual property aspects of mergers and acquisitions.
Notably, one of our intellectual property partners was formerly chief IP counsel for Westinghouse Electric Corporation, where he headed an IP practice that obtained over 300 patents for the company’s nuclear business, including patents related to reactor design, inspection systems, decontamination, containment and fuel assemblies. A number of these patents resulted from research projects with the DOE for nuclear technology development, and from Westinghouse’s role as the operating contractor for DOE facilities at Savannah River, Idaho Falls and Hanford.
Our IP attorneys have handled the full range of intellectual property issues facing any government contractor. The proper treatment and allocation of patent rights, rights in technical data, and rights in software is a fundamental issue that can arise in many government contracts. The urgency of this issue has been heightened by recent statutory and regulatory developments such as the Federal Acquisition Streamlining Act, the Clinger-Cohen Act, other statutes implicating intellectual property interests, and regulatory provisions implementing all of these laws.
Government Contracts
K&L Gates has represented government contractors involved in national defense and nuclear operations for over 30 years – and our attorneys literally wrote the book on government contract law in the United States, with the publication of a leading textbook on the subject. We have assisted clients in the award, defense and protest of government contracts totaling hundreds of millions of dollars.
Our government contracts experience encompasses proposals and contract counseling, protests, contract and subcontract claims and litigation, termination claims, intellectual property, audits, investigations, fraud litigation and voluntary disclosures, debarment and suspension and compliance and education. In addition, we assist contractors with government competition requirements, small business subcontracting goals, cooperative research and development agreements, and affirmative action planning and other employment requirements.
K&L Gates also has been a leader in procurement reform efforts. For example, K&L Gates, serving as counsel to the Commercial Product Acquisition Team, took an early lead in industry efforts to modify federal procurement statutes to eliminate many of the unnecessary costs and risks associated with doing business with the government when selling commercial items and services. Since the enactment of the Federal Acquisition Streamlining Act of 1994, we have successfully counseled numerous companies on how to take advantage of the Act’s many positive changes in procurement regulations to make their government business more profitable.
We are familiar with the European Procurement Directive and the competitive dialogue process that will be used for the letting of government contracts in the United Kingdom and Europe. Our nuclear industry group has represented government contractors in interpreting and applying contract clauses (including those implementing the Defense Production Act and the Price-Anderson Act) requiring the government to indemnify and defend contractors against nuclear-related claims and litigation. We regularly serve as advisors to DOE and Department of Defense contractors on the formulation of winning procurement proposals, and in developing detailed corrective action plans in instances where improved performance was called for by the federal agency involved.