Va. Uranium, Inc. v. Warren

• Decision Date: 17 February 2017
• Docket Number: No. 16-1005,16-1005
• Citation: 848 F.3d 590
• Parties: VIRGINIA URANIUM, INC. ; Coles Hill, LLC ; Bowen Minerals, LLC ; Virginia Energy Resources, Inc., Plaintiffs–Appellants, v. John WARREN, in his official capacity as Director of the Virginia Department of Mines, Minerals and Energy; Bradley C. Lambert, in his official capacity as Deputy Director of the Virginia Department of Mines, Minerals and Energy; James P. Skorupa, in his official capacity as Director of the Virginia Department of Mines, Minerals and Energy's Division of Mineral Mining, Defendants–Appellees, and Terry McAuliffe, in his official capacity as Governor of Virginia; Maurice Jones, in his official capacity as Virginia Secretary of Commerce and Trade; Molly J. Ward, in her official capacity as Virginia Secretary of Natural Resources; David K. Paylor, in his official capacity as Director of the Virginia Department of Environmental Quality ; Robert J. Weld, in his official capacity as Regional Director of the Department of Environmental Quality's Blue Ridge Regional Office; Michael Dowd, in his official capacity as Director of the Virginia Department of Environmental Quality's Air Division; Melanie D. Davenport, in her official capacity as Director of the Virginia Department of Environmental Quality's Water Permitting Division; Justin Williams, in his official capacity as Director of the Virginia Department of Environmental Quality's Division of Land Protection and Revitalization, Defendants. The Nuclear Energy Institute, Amicus Curiae, Roanoke River Basin Association; Dan River Basin Association, Amici Supporting Appellees.
• Court: U.S. Court of Appeals — Fourth Circuit

848 F.3d 590

VIRGINIA URANIUM, INC. ; Coles Hill, LLC ; Bowen Minerals, LLC ; Virginia Energy Resources, Inc., Plaintiffs–Appellants,

v. John WARREN, in his official capacity as Director of the Virginia Department of Mines, Minerals and Energy; Bradley C. Lambert, in his official capacity as Deputy Director of the Virginia Department of Mines, Minerals and Energy; James P. Skorupa, in his official capacity as Director of the Virginia Department of Mines, Minerals and Energy's Division of Mineral Mining, Defendants–Appellees,andTerry McAuliffe, in his official capacity as Governor of Virginia; Maurice Jones, in his official capacity as Virginia Secretary of Commerce and Trade; Molly J. Ward, in her official capacity as Virginia Secretary of Natural Resources; David K. Paylor, in his official capacity as Director of the Virginia Department of Environmental Quality ; Robert J. Weld, in his official capacity as Regional Director of the Department of Environmental Quality's Blue Ridge Regional Office; Michael Dowd, in his official capacity as Director of the Virginia Department of Environmental Quality's Air Division; Melanie D. Davenport, in her official capacity as Director of the Virginia Department of Environmental Quality's Water Permitting Division; Justin Williams, in his official capacity as Director of the Virginia Department of Environmental Quality's Division of Land Protection and Revitalization, Defendants.The Nuclear Energy Institute, Amicus Curiae,Roanoke River Basin Association; Dan River Basin Association, Amici Supporting Appellees.

No. 16-1005

United States Court of Appeals, Fourth Circuit.

Argued: October 28, 2016

Decided: February 17, 2017

ARGUED: Charles J. Cooper, COOPER & KIRK, PLLC, Washington, D.C., for Appellants. Stuart Alan Raphael, OFFICE OF THE ATTORNEY GENERAL OF VIRGINIA, Richmond, Virginia, for Appellees. ON BRIEF: Michael W. Kirk, John D. Ohlendorf, COOPER & KIRK, PLLC, Washington, D.C., for Appellants. Mark R. Herring, Attorney General of Virginia, Rhodes B. Ritenour, Deputy Attorney General, Jonathan Duncan Pitchford, Assistant Attorney General, Matthew R. McGuire, Assistant Attorney General, Trevor S. Cox, Deputy Solicitor General, OFFICE OF THE ATTORNEY GENERAL OF VIRGINIA, Richmond, Virginia, for Appellees. William C. Cleveland, Caleb A. Jaffe, SOUTHERN ENVIRONMENTAL LAW CENTER, Charlottesville, Virginia, for Amici Roanoke River Basin Association and Dan River Basin Association. Peter C. Meier, PAUL HASTINGS LLP, San Francisco, California; Ellen C. Ginsberg, Jonathan M. Rund, Anne W. Cottingham, NUCLEAR ENERGY INSTITUTE, Washington, D.C., for Amicus Nuclear Energy Institute.

Before TRAXLER, DIAZ, and HARRIS, Circuit Judges.

Affirmed by published opinion. Judge Diaz wrote the majority opinion, in which Judge Harris joined. Judge Traxler wrote a dissenting opinion.

DIAZ, Circuit Judge:

Virginia Uranium, Inc., Coles Hill, LLC, Bowen Minerals, LLC, and Virginia Energy Resources, Inc. (collectively "Virginia Uranium") appeal the district court's dismissal of their complaint for failure to state a claim upon which relief can be granted. Because we agree with the district court that federal law does not preempt state regulation of conventional uranium mining, we affirm.

I.

A.

The federal Atomic Energy Act ("AEA" or "Act") regulates several aspects of nuclear power generation in the United States, including "source material" such as uranium. 42 U.S.C. §§ 2011, 2014(z). The Nuclear Regulatory Commission ("NRC") enforces the provisions of the Act. Id. §§ 2201, 5801, 5841.

Uranium is the predominant source of fuel for nuclear power plants and fissile material for nuclear warheads. Uranium ore can be recovered from a deposit either through in situ leaching or by conventional mining such as an open-pit or underground mine.¹

Once removed from the ground, uranium ore is milled into a refined product called "yellowcake." Yellowcake can be used to make nuclear fuel, but the remaining unused material—known as "tailings"—is radioactive and must be stored securely.

B.

In the early 1980s, a uranium deposit was discovered in Pittsylvania County, Virginia on land owned by Coles Hill, LLC and Bowen Minerals, LLC. Containing 119 million pounds of uranium ore, the Coles Hill deposit was then (and remains) the largest known uranium deposit in the United States.

The Virginia General Assembly reacted to this discovery by calling for the state Coal and Energy Commission to "evaluate the environmental effects ... and any possible detriments to the health, safety, and welfare of Virginia citizens which may result from uranium exploration, mining or milling." 1981 Va. Acts 1404. Before the Commission completed its report, however, the General Assembly imposed a moratorium (or "ban") on uranium mining "until a program for permitting uranium mining is established by statute." Va. Code Ann. § 45.1-283.

The Commission ultimately reported to the Governor and General Assembly in 1985 that the state could lift "the moratorium on uranium development" if it followed "essential specific recommendations ... of the task force" and enacted laws to tightly regulate the industry. J.A. 534–38. The recommendations included limiting public exposure to radiation, issuing mill and tailings licenses in cooperation with the NRC, and regulating hazardous waste. The benefits of uranium mining in Virginia, the Commission found, "outweighed the costs 26 to 1." J.A. 543. Despite the Commission's recommendation, the General Assembly did not move to lift the moratorium.

In January 2013, Virginia State Senators John Watkins and Richard Saslaw sponsored a bill to create a licensing scheme for the issuance of uranium mining permits. The bill was never voted on, and was later withdrawn. To date, no such program has been established, and the ban remains in effect.

Stymied in its efforts to mine the Coles Hill deposit, Virginia Uranium brought suit in the United States District Court for the Western District of Virginia, asking the court to declare the ban preempted by federal law and issue an injunction compelling the Commonwealth to grant uranium mining permits.

The Defendant Commonwealth of Virginia officials (collectively the "Commonwealth") moved to dismiss the Plaintiffs' complaint, and Virginia Uranium moved for summary judgment. The district court granted the Commonwealth's motion and dismissed the complaint. The court found that federal law (specifically the Atomic Energy Act) "does not ... regulate nonfederal uranium deposits or their conventional mining." Virginia Uranium, Inc. v. McAuliffe , 147 F.Supp.3d 462, 471 (W.D. Va. 2015). Finding that the Act does not commit conventional uranium mining to the NRC's authority, the district court distinguished the instant case from Supreme Court precedent requiring states to have a non-safety rationale to regulate activities within the NRC's purview. The district court further held that Virginia's ban "does not obstruct the realization of Congress' purposes and objectives behind the [Act]" because Congress "evinced no purpose or objective that nonfederal uranium deposits be conventionally mined." Id. at 477.

This appeal followed.

II.

We review de novo the district court's conclusion that the Atomic Energy Act does not preempt Virginia's ban on uranium mining. Epps v. JP Morgan Chase Bank, N.A. , 675 F.3d 315, 320 (4th Cir. 2012). State laws may be preempted by federal law under the Supremacy Clause, which provides that "[t]his Constitution, and the Laws of the United States which shall be made in Pursuance thereof ... shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary notwithstanding." U.S. Const. art. VI, cl. 2.

"[T]he first and fundamental question in any pre-emption analysis is whether Congress intended to displace state law...." Wardair Canada, Inc. v. Fla. Dep't of Revenue , 477 U.S. 1, 6, 106 S.Ct. 2369, 91 L.Ed.2d 1 (1986). Congressional intent to "supercede state law ... may be found from a scheme of federal regulation so pervasive as to make reasonable the inference that Congress left no room to supplement it," otherwise known as "field" preemption. Pacific Gas & Elec. Co. v. State Energy Resources Conservation & Dev. Comm'n , 461 U.S. 190, 203–04, 103 S.Ct. 1713, 75 L.Ed.2d 752 (1983) (internal quotation marks omitted). State law may also be preempted as in "conflict" with federal law when it "stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress." Id. at 204, 103 S.Ct. 1713 (citing Hines v. Davidowitz , 312 U.S. 52, 67, 61 S.Ct. 399, 85 L.Ed. 581 (1941) ).

Virginia Uranium offers three reasons why the Atomic Energy Act preempts Virginia's ban on uranium mining. First, it urges that conventional uranium mining is an "activity" under Section 2021(k) of the Act and that the Commonwealth therefore may not regulate it out of concern for radiological safety. Second, it contends that even if uranium mining is not a regulated "activity" under the Act, uranium-ore milling and tailings storage are regulated activities, and because the Virginia legislature intended to and does regulate those activities, the ban is therefore preempted. Finally, Virginia Uranium says that the ban is preempted because it's an obstacle to the full implementation of the Act's objectives. We address these arguments in turn.

A.

We begin with Virginia Uranium's claim that conventional uranium mining is an "activity" under Section 2021(k) of the Atomic Energy Act, which in turn means that states can't regulate such mining for the purpose of protecting against radiation hazards. Section 2021 of the Act, entitled "Cooperation with States," outlines "the respective responsibilities ... of the States and the [Nuclear Regulatory] Commission with respect to the regulation of byproduct, source, and special nuclear materials." 42 U.S.C. § 2021(a). Subsection (k) reserves to the states...