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States v. United States

United States District Court, D. South Carolina, Aiken Division

February 7, 2017

State of South Carolina, Plaintiff,
v.
United States; United States Department Of Energy; Dr. Ernest Moniz, in his official Capacity as Secretary of Energy; National Nuclear Security Administration; and Lt. General Frank G. Klotz, in his official Capacity as Administrator of the National Nuclear Security Administration and Undersecretary for Nuclear Security, Defendants.

          ORDER AND OPINION

         Before the court is a motion for reconsideration, filed by Plaintiff, the State of South Carolina (the “State”), pursuant to Fed.R.Civ.P. 54(b), 59(e), and 60(b), asking the court to reconsider its rulings in its October 31, 2016 order directing further briefing in regard to the motion to dismiss filed by Defendants United States, the United States Department of Energy (“DOE”), Dr. Ernest Moniz, the National Nuclear Security Administration (“NNSA”), and Lieutenant General Frank G. Klotz (collectively “Defendants”). (ECF No. 62.)[1] For the reasons that follow, the court DENIES the motion for reconsideration.

         I. RELEVANT FACTUAL AND PROCEDURAL BACKGROUND

         On February 9, 2016, the State filed a complaint against Defendants asserting three causes of action, based largely on the provisions of 50 U.S.C. § 2566. (See ECF No. 1.) The State alleges that Defendants are responsible for operations at the Savannah River Site (“SRS”), which serves as the construction site for the MOX Facility that is intended to fabricate mixed-oxide fuel from defense plutonium owned by the federal government in accordance with international agreements. (See id.); 50 U.S.C. § 2566. Section 2566(h) defines the production objective of the MOX Facility as producing mixed-oxide fuel from defense plutonium at an average rate determined by its production during a defined period but not less than one metric ton of mixed-oxide fuel per year. 50 U.S.C. § 2566(h)(2).

         Relevant here, subsections (c)(1) and (d)(1) provide for certain consequences in the event the MOX production objective is not achieved:

         (c) Contingent requirement for removal of plutonium and materials from Savannah River Site

         If the MOX production objective is not achieved as of January 1, 2014, the Secretary [of Energy] shall, consistent with the National Environmental Policy Act of 1969 and other applicable laws, remove from the State of South Carolina, for storage or disposal elsewhere--

         (1) not later than January 1, 2016, not less than 1 metric ton of defense plutonium or defense plutonium materials; and

         . . . .

         (d) Economic and impact assistance

         (1) If the MOX production objective is not achieved as of January 1, 2016, the Secretary shall, subject to the availability of appropriations, pay to the State of South Carolina each year beginning on or after that date through 2021 for economic and impact assistance an amount equal to $1, 000, 000 per day, not to exceed $100, 000, 000 per year, until the later of--

         (A) the date on which the MOX production objective is achieved in such year; or

         (B) the date on which the Secretary has removed from the State of South Carolina in such year at least 1 metric ton of defense plutonium or defense plutonium materials.

         50 U.S.C. § 2566(c)(1), (d)(1).

         In its complaint, the State alleges that its suit arises out of agency action by Defendants that fails to comply with applicable law regarding the MOX Facility. (ECF No. 1 at 1.) Relevant here, [2] the State asserted two causes of action:

         (1) In its second cause of action, the State alleges that Defendants failed to meet the MOX production objective by January 1, 2014, and failed to remove one metric ton of defense plutonium by January 1, 2016, or thereafter. (Id. at 27.) The State alleges that Defendants have unlawfully withheld a non-discretionary, mandatory duty and obligation to the State, and it seeks an order enjoining and requiring Defendants to remove from South Carolina one metric ton of defense plutonium pursuant to § 2566(c) and preventing Defendants from transferring additional defense plutonium to SRS. (Id. at 27-28, 31-32.)

         (2) In its third cause of action, the State alleges that Defendants failed to meet the MOX production objective, and failed to remove one metric ton of defense plutonium, by January 1, 2016, or thereafter. (Id. at 28.) The State alleges that Defendants have unlawfully withheld a non-discretionary, mandatory duty and obligation to the State, and it seeks an order enjoining and requiring Defendants to pay the State the economic and impact assistance amount and to remove an additional one metric ton of defense plutonium from South Carolina, pursuant to § 2566(d). (Id. at 31-32.)

         On April 25, 2016, Defendants filed a motion to dismiss, asserting, among other things, that they were protected by, and had not waived, sovereign immunity with respect to the third cause of action under § 2566(d). (ECF No. 17 at 30-34.) They understood the State to premise jurisdiction and a waiver of sovereign immunity on the Administrative Procedures Act (“APA”), 5 U.S.C. § 701, et seq., but argued that the third cause of action was barred by 5 U.S.C. § 702 or § 704. (Id.)

         On October 31, 2016, the court entered the order that is the subject of the instant motion for reconsideration. (See ECF No. 56.) The court began its analysis by noting that the State primarily seeks to enforce what it avers are two statutory rights. (Id. at 9.) First, under the third cause of action, the State seeks an order requiring Defendants to make the § 2566(d)(1) economic and impact assistance payments, which the court referred to as the “monetary claim.” (Id.) Second, under the second cause of action, the State seeks an order requiring Defendants to remove one metric ton of plutonium from South Carolina pursuant to § 2566(c), which the court referred to as the “removal claim.”[3] (Id.)

         The court next determined that the State could not proceed on either claim unless there had been a waiver of sovereign immunity. (See Id. at 6 (citing Hawaii v. Gordon, 373 U.S. 57, 57 (1963) (per curiam)).) The court concluded that sovereign immunity for the claims had been waived, if at all, only under the APA. (See Id. at 7-8 (citing Suburban Mortg. Assocs., Inc. v. U.S. Dep't of Hous. & Urban Dev., 480 F.3d 1116, 1121-22 (Fed. Cir. 2007)).) Interpreting the APA and relevant case law, the court explained that “[a] waiver of sovereign immunity authorizing jurisdiction in a district court is available when a party satisfies the requirements of both § 702 and § 704 of the APA.” (Id. at 7 (citing Bowen v. Massachusetts, 487 U.S. 879, 891-93 (1988); Consol. Edison of N.Y. v. U.S. Dep't of Energy, 247 F.3d 1378, 1382 (Fed. Cir. 2001)).) Relevant here, § 704 provides that “final agency action for which there is no other adequate remedy in a court [is] subject to judicial review.” 5 U.S.C. § 704. Thus, courts interpreting the APA have held that for the APA's waiver of sovereign immunity to apply, a plaintiff must meet § 702's requirement by seeking relief other than money damages and § 704's requirement by showing that there is no other adequate remedy for the agency action in another court. (ECF No. 56 at 8 (citing Doe v. United States, 372 F.3d 1308, 1312 (Fed. Cir. 2004)).) The court pointed out that, pursuant to the Tucker Act, 28 U.S.C. §§ 1346, 1491. the Court of Federal Claims (“CFC”) might be another court in which an adequate remedy was available for purposes of § 704. (Id.) The Tucker Act waives sovereign immunity protection and authorizes monetary claims “founded either upon the Constitution, or any Act of Congress, or any regulation of an executive department, or upon any express or implied contract with the United States, or for liquidated damages in cases not sounding in tort.” 28 U.S.C. §§ 1346, 1491(a)(1). For claims greater than $10, 000, the Tucker Act assigns exclusive jurisdiction to the CFC. See Jan's Helicopter Serv. v. F.A.A., 525 F.3d 1299, 1304 (Fed. Cir. 2008); Tootle v. Sec. of the Navy, 446 F.3d 167 (D.C. Cir. 2006).

         The court determined that “‘to resolve the sovereign immunity and jurisdiction questions, the court must consider the State's claims individually.'” (ECF No. 56 at 10 (brackets omitted) (quoting Transohio Sav. Bank v. Dir., Office of Thrift Supervision, 967 F.2d 598, 609 (D.C. Cir. 1992)) (citing Sharp v. Weinberger, 798 F.2d 1521, (D.C. Cir. 1986) (Scalia, J.)).) The court concluded that it lacked subject matter jurisdiction over the monetary claim because the APA does not waive sovereign immunity with respect to that claim. (See ECF No. 56 at 10-17.) First, the court noted that, when examining the interplay between the Tucker Act and the APA, it is preferable to start by determining whether the CFC provides an adequate remedy for purposes of § 704. (See Id. at 10-11 (collecting cases).) Interpreting the Supreme Court's seminal decision on the issue in Bowen and case law that followed, [4] the court explained that it does not look exclusively to the form of the complaint to determine whether it states a cognizable Tucker Act claim. (ECF No. 56 at 11-12 (citing Suburban, 480 F.3d at 1123-24, 1126; Consol. Edison, 247 F.3d at 1385; Nat'l Ctr. for Mfg. Scis. v. United States, 114 F.3d 196, 199 (Fed. Cir. 1997)).) Rather, the court asks primarily whether the complaint seeks essentially a monetary reward and considers the complexity and constancy of the relationship between the plaintiff and the federal government. (Id. at 12-13 (citing Suburban, 480 F.3d at 1126-27; Consol. Edison, 247 F.3d at 1383).) Assessing the nature of the relief the State seeks and the relationship between the State and the federal government implicated by § 2566(d) (id. at 13-17), the court determined that the CFC could provide an adequate remedy for the State's monetary claim for purposes of § 704 (id. at 17). Accordingly, the court concluded that the APA does not waive Defendants' sovereign immunity with respect to the monetary claim. (Id.)

         Applying the same analysis to the State's removal claim, the court concluded that, because the CFC provided no adequate remedy for that claim and because the claim was one for other than money damages, the APA waived sovereign immunity with respect to that claim, and the court had jurisdiction over it. (See Id. at 17-19.) The court also rejected Defendants' argument that the State lacked standing to bring the claim. (See Id. at 19-24.) Consequently, the court determined that it had jurisdiction to decide the State's removal claim but that it lacked jurisdiction to hear the monetary claim, as the CFC could provide an adequate remedy. (See Id. at 24.)

         Rather than ruling on Defendants' motion to dismiss, the court determined that it should seek additional input from the parties before proceeding further. (See Id. at 24-31.) The court explained that, because it had jurisdiction over the removal claim, but not the monetary claim, several options were presented. First, under 28 U.S.C. § 1631, the court could transfer the monetary claim to the CFC and retain jurisdiction over the removal claim. (See Id. at 24-25 (citing Harbuck v. United States, 378 F.3d 1324, 1328 (Fed. Cir. 2004); United States v. Cnty. of Cook, 170 F.3d 1084, 1089 (Fed. Cir. 1999)).) However, such a maneuver might result in the CFC's immediately dismissing the claim pursuant to 28 U.S.C. § 1500. (See Id. at 25-26 (citing United States v. Tohono O'Odham Nation, 563 U.S. 307, 311, 317 (2011); Keene Corp. v. United States, 508 U.S. 200, 212 (1993); Harbuck, 378 F.3d at 1324, 1328; Cnty. of Cook, 170 F.3d at 1091; Loveladies Harbor, Inc. v. United States, 27 F.3d 1545, 1548 (Fed. Cir. 1994) (en banc); UNR Indus. v. United States, 962 F.2d 1013, 1018, 1021 (Fed. Cir. 1992) (en banc)).) Second, the court could dismiss the monetary claim without prejudice to the State's ability to file the claim in an original action in the CFC after disposition of its removal claim in this court. (See Id. at 26.) However, if the court dismisses the monetary claim, there is risk that it might become time-barred while litigation on the removal claim remains pending in this court. (See Id. at 26-27.) Moreover, the court explained that it was concerned that the State's pursuing its monetary claim in the CFC at the same time the removal claim remained pending in this court might oblige either this court or the CFC to stay proceedings until a disposition in the other court had been reached. (See Id. at 27-29.) The court noted that neither party had addressed any of these issues in their briefs, and that the court's order was the first instance in which they had been raised. (See Id. at 30.) Accordingly, the court declined to dispose of the motion to dismiss and, instead, directed the parties to file briefs addressing whether the court should transfer the monetary claim to the CFC and whether the court should dismiss the monetary claim without prejudice. (Id. at 30-31.)

         On November 28, 2016, the State filed the instant motion for reconsideration, seeking review of the court's rulings in its October 31, 2016 order. (ECF No. 62.)

         II. LEGAL STANDARD

         Any order “that adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties . . . may be revised at any time before the entry of a judgment adjudicating all the claims and all the parties' rights and liabilities.” Fed.R.Civ.P. 54(b). Thus, under Rule 54(b), the “district court retains the power to reconsider and modify its interlocutory judgments . . . at any time prior to final judgment when such is warranted.” Am. Canoe Ass'n v. Murphy Farms, Inc., 326 F.3d 505, 514-15 (4th Cir. 2003); see also Moses H. Cone Mem. Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 12 (1983) (noting that “every order short of a final decree is subject to reopening at the discretion of the district judge”). The Fourth Circuit has offered little guidance on the standard for evaluating a Rule 54(b) motion, but has held that motions under Rule 54(b) are “not subject to the strict standards applicable to motions for reconsideration of a final judgment.” Am. Canoe Ass'n, 326 F.3d at 514; see also Fayetteville Investors v. Commercial Builders, Inc., 936 F.2d 1462, 1472 (4th Cir. 1991) (finding it “unnecessary to thoroughly express [Fourth Circuit's] views on the interplay of Rules 60, 59, and Rule 54”). In this regard, district courts in the Fourth Circuit, in analyzing the merits of a Rule 54 motion, look to the standards of motions under Rule 59 for guidance. See Ashmore v. Williams, No. 8:15-cv-03633, 2017 WL 24255, at *2 (D.S.C. Jan. 3, 2017) (collecting cases). Therefore, reconsideration under Rule 54(b) is appropriate on the following grounds: (1) to account for an intervening change in controlling law; (2) to account for newly discovered evidence; or (3) to correct a clear error of law or prevent manifest injustice. See Beyond Sys., Inc. v. Kraft Foods, Inc., No. PJM-08-409, 2010 WL 3059344, at *2 (D. Md. Aug. 4, 2010) (citing Am. Canoe Ass'n, 326 F.3d at 514).[5] However, a motion to reconsider an interlocutory order should not be used to rehash arguments the court has already considered merely because the movant is displeased with the outcome. See Ashmore, 2017 WL 24255, at *3; Sanders v. Wal-Mart Stores E., No. 1:14-cv-03509-JMC, 2016 WL 6068021, at *3 (D.S.C. Oct. 17, 2016) (citing U.S. Home Corp. v. Settlers Crossing, LLC, No. DKC 08-1863, 2012 WL 5193835, at *3 (D. Md. Oct. 8, 2012)). Nor should such a motion be used to raise new arguments or evidence that could have been raised previously. See Nationwide Mut. Fire Ins. Co. v. Superior Solution, LLC, No. 2:16-cv-423-PMD, 2016 WL 6648705, at *2 (D.S.C. Nov. 10, 2016); Regan v. City of Charleston, 40 F.Supp.3d 698, 701 (D.S.C. 2014).

         However, in assessing a motion to reconsider an interlocutory order under Rule 54(b), these standards are not applied with the same strictness as they would be if the order were a final judgment and reconsideration were sought under Rule 59(e). Am. Canoe Ass'n, 326 F.3d at 514-15. The standards are applied even less stringently when the issue for which reconsideration is sought implicates the court's subject matter jurisdiction. See Id. at 515-16; see also Bishop v. Smith, 760 F.3d 1070 (10th Cir. 2014); 18B Charles Alan Wright et al. Federal Practice and Procedure § 4478.5 (2d ed. 2002).[6] “The ultimate responsibility of the federal courts, at all levels, is to reach the correct judgment under law.” Am. Canoe Ass'n, 326 F.3d at 515. Nonetheless, even when subject matter jurisdiction is at issue, a Rule 54(b) motion for reconsideration is assessed under the same standards. See Id. (“[T]hat obligation may be tempered at times by concerns of finality and judicial economy.”); 18B Wright, supra, § 4478.5 (“Although a federal court is always responsible for assuring itself that it is acting within the limits of subject-matter jurisdiction statutes and Article III, this duty need not extend to perpetual reconsideration.”).

         III. ...


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