Pub. Watchdogs v. S. Cal. Edison Co.

• Decision Date: 03 December 2019
• Docket Number: Case No.: 19-CV-1635 JLS (MSB)
• Parties: PUBLIC WATCHDOGS, a California 501(c)(3) corporation, Plaintiff, v. SOUTHERN CALIFORNIA EDISON COMPANY; SAN DIEGO GAS & ELECTRIC COMPANY; SEMPRA ENERGY; HOLTEC INTERNATIONAL; UNITED STATES NUCLEAR REGULATORY COMMISSION; and DOES 1 through 100, Defendants.
• Court: U.S. District Court — Southern District of California

PUBLIC WATCHDOGS, a California 501(c)(3) corporation, Plaintiff,
v.
SOUTHERN CALIFORNIA EDISON COMPANY;
SAN DIEGO GAS & ELECTRIC COMPANY;
SEMPRA ENERGY; HOLTEC INTERNATIONAL;
UNITED STATES NUCLEAR REGULATORY COMMISSION;
and DOES 1 through 100, Defendants.

Case No.: 19-CV-1635 JLS (MSB)

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA

December 3, 2019

ORDER (1) GRANTING DEFENDANTS' MOTIONS TO DISMISS, (2) DISMISSING PLAINTIFF'S FIRST AMENDED COMPLAINT WITH PREJUDICE, AND (3) DENYING PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION

(ECF Nos. 2, 5, 41, 42, 47)

Presently before the Court are Plaintiff Public Watchdogs' Amended Motion for Preliminary Injunction and Temporary Restraining Order ("Mot. for Prelim. Inj.," ECF No. 5) and the Motions to Dismiss filed by Defendants Holtec International, Inc. ("Holtec") ("Holtec MTD," ECF No. 41); Southern California Edison Company ("SCE"), San Diego Gas & Electric Company ("SDG&E"), and Sempra Energy ("Sempra") (together, the "Utility Defendants"; with Holtec, the "Private Defendants") ("Utility MTD," ECF No. 42); and the United States Nuclear Regulatory Commission ("NRC") ("NRC MTD," ECF

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No. 47). The Court heard oral argument on November 25, 2019. See ECF Nos. 58, 59. Having considered the Parties' arguments and the law, the Court GRANTS Defendants' Motions to Dismiss, DISMISSES WITH PREJUDICE Plaintiff's First Amended Complaint, and DENIES Plaintiff's Motion for Preliminary Injunction, as follows.

BACKGROUND¹

I. Plaintiff's Allegations

Plaintiff "is a 501(c)(3) non-profit corporation that advocates for public safety by ensuring that government agencies and special interests comply with all applicable laws, including public-safety and environmental protection laws, especially in the public-utilities industry." FAC ¶ 4. "Plaintiff has at least one member who lives within the zone of exposure to a catastrophic release of radioactive material from SONGS." Id.

SCE and SDG&E are public utilities doing business in California. Id. ¶¶ 5-6. Sempra is the parent company of SDG&E. Id. ¶ 7.

In August 1963, Congress enacted Public Law 88-82, which authorized the "construct[ion], operate[ion], maintain[enance], and use" of a nuclear power plant on the Camp Pendleton military base. Id. ¶ 18. The Utility Defendants operated three nuclear electric generating units in that area—which is located within a tsunami inundation zone and between two active fault lines, see id. ¶¶ 1, 48—at the San Onofre Nuclear Generating Station ("SONGS"). Id. ¶ 19. SCE owned 78.2% of SONGS, id. ¶ 5, while SDG&E owned approximately 20% of SONGS. Id. ¶ 6. The first nuclear generating unit at SONGS operated between 1968 and 1992, while the second and third units operated from 1983 and 1984, respectively, until June 12, 2013, when they were shut down. Id.

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Plaintiff alleges that, throughout this time, "SONGS has had numerous instances of poor safety and regulatory compliance." Id. ¶ 20; see also id. ¶¶ 21-28. These led to the announcement on June 7, 2013, that SONGS would be permanently shut down. Id. ¶ 29. The Utility Defendants permanently ceased operation of SONGS Units 2 and 3 on June 12, 2013. Id. ¶ 41. Plaintiff contends, however, that issues of mismanagement have continued to plague the decommissioning process, which has led to "a continuing liability and an ever-present existential threat." See id. ¶ 30.

For example, the NRC—which is "federal government agency that is mandated by Congress to license and regulate the Nation's civilian use of radioactive materials to protect public health and safety, promote the common defense and security, and protect the environment," id. ¶ 10—"has repeatedly failed to exercise any meaningful oversight of SONGS and has abdicated its role to regulate [the Private Defendants]." Id. ¶ 32. The NRC has declined to perform an independent seismic hazard assessment of SONGS, see id. ¶ 33, and has frequently allowed the Utility Defendants to violate NRC rules and regulations. See id. ¶¶ 34-36. The NRC also has granted several exemptions to the Utility Defendants from the emergency response regulations, see id. ¶¶ 37-38, and allowed the Utility Defendants to use the $4.7 billion decommissioning trust fund for purposes other than decommissioning activities. See id. ¶ 39. Finally, the NRC granted the Utility Defendants a license amendment on July 17, 2015 (the "July 2015 License Amendment"), which permitted them to decommission the SONGS facility. See id. ¶ 43. In granting the July 2015 License Amendment, however, the NRC "relied on the [Utility] Defendants' own analysis instead of objective criteria or independent analysis." Id.

Although the Utility Defendants previously had stored spent nuclear fuel ("SNF") at SONGS in wet storage pools, see id. ¶ 45, the Utility Defendants' decommissioning plan allows for the burial of SNF in an onsite containment system called an Independent Spent Fuel Storage Installation ("ISFSI"). Id. ¶ 48. The ISFSI is located in a tsunami inundation zone located between two seismic fault lines and only 108 feet from the Pacific Ocean. See id. ¶ 48. Consequently, the ISFSI "is only about 18 feet above the Pacific Ocean's median

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high tide," and "[t]he bottom of the structure is a mere three feet above the underground water table." Id. ¶ 49. Accordingly, "[c]limate-change experts predict that the bottom of each silo located in the ISFSI will be inundated with salt water as early as 2035." Id. ¶ 51.

Designed by Holtec, id. ¶ 52, and guaranteed only for ten years, id. ¶ 55, the ISFSI calls for the burial of 73 canisters filled with 3.6 million pounds of SNF, see id. ¶¶ 49, 54, approximately 20 feet underground. See id. ¶ 48. Like the ISFSI itself, the canisters were designed and manufactured by Holtec, id. ¶ 54, who warrants them only for 25 years. See id. ¶ 55. In contrast to the thick-walled dry casks used by many international nuclear decommissioning projects, see id. ¶ 57, Holtec's "thin-wall" canisters have "only a 5/8-inch thick stainless[-]steel wall with an aluminum egg-crate structure designed to hold up to 37 spent fuel assemblies." Id. ¶ 56. Holtec made design changes to its canisters without the authorization of the NRC, which rendered four canisters already loaded into the ISFSI at SONGS potentially defective. See id. ¶¶ 60-62. The NRC declined to impose a civil fine for the failure to seek pre-authorization of the change in the design of the Holtec canisters. See id. ¶ 62. Independent risk assessments of the decommissioning plan and the Holtec canisters, if performed, have not been made publicly available. See id. ¶¶ 50, 52, 58.

Despite the lack of independent analyses and NRC oversight, the Utility Defendants began burying the canisters at the SONGS ISFSI on January 31, 2018. See id. ¶ 53. Workers discovered a defective Holtec canister on March 5, 2018, see id. ¶ 63, and the Utility Defendants admitted that four potentially defective canisters had already been filled and buried at a Community Engagement Panel Meeting on March 22, 2018. See id. ¶ 64. Because "Defendants have consistently used [fewer] personnel than necessary to ensure that the Holtec canisters are safely and effectively loaded into the ISFSI," id. ¶ 66, they have "negligently gouged and then buried twenty-nine (29) fully loaded canisters at SONGS." Id. ¶ 67. "[T]his gouging may lead to deeper, through-the-wall cracks," which may "be exacerbated, inter alia, by the presence of salt air, fog, rain, and salt water—the precise weather conditions that the canisters will be exposed to at the current location just

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steps from the Pacific Ocean." Id. Further, "many (if not all) of the canisters were negligently scratched during transportation to the ISFSI." Id. ¶ 68.

On July 22, 2018, the Utility Defendants "nearly dropped a 49-ton canister full of deadly radioactive nuclear waste more than 18 feed into the ISFSI when it was caught on a quarter inch thick steel guide ring." Id. ¶ 69. They failed to report the incident to the NRC. See id. ¶¶ 70-71. On August 3, 2018, the Utility Defendants "once again lost control of a 49-ton canister full of deadly radioactive nuclear waste while it was being lowered into a below-ground storage silo," id. ¶ 72, which resulted in a work stoppage. See id. ¶ 74. The Utility Defendants informally informed the NRC on August 6, 2018, see id. ¶ 76, and a whistleblower reported the event at a Community Engagement Panel Meeting on August 9, 2018. See id. ¶ 73. As a result of the August 3, 2018 incident, "[o]n March 25, 2019, the NRC issued a 'Notice of Violation' and 'NRC Special Inspection Report' to Edison for two safety violations." Id. ¶ 91. The first violation concerned "a failure to make certain that safety equipment was operating," while the second was for "failure to report the safety incident to the NRC." Id. "[T]he NRC issued an Inspection Charter for SONGS, which found five violations that were ultimately penalized [by] the imposition of a . . . fee of $116,000 on [SCE]." Id. ¶ 79; see also id. ¶ 91.

"On August 24, 2018, the NRC issued an Inspection Report to the [Utility] Defendants," in which "the NRC determined that [SCE] had committed a Severity IV violation of the NRC's safety requirements between June 2017 and June 2018." Id. ¶ 85. "The violation related to the design control of field changes made to the safety equipment the [Utility] Defendants used to loan SNF into storage canisters." Id.

"On November 29, 2018, the NRC issued an Inspection Report to Holtec," in which the NRC "informed Holtec that it was being considered for 'Escalated Enforcement Action' for two apparent violations" related to the change in the design of the spent fuel storage casks. See id. ¶ 87. Plaintiff believes that the first violation relates to Holtec's "failure to establish adequate design control measures," which resulted in the defect that may have rendered the first four canisters deployed at SONGS unsafe. See id. ¶ 88.

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