Converdyn v. Moniz , 185 F. Supp. 3d 148 ( 2016 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
____________________________________
)
CONVERDYN, )
)
Plaintiff, )
)
v. ) Civil Action No. 14-1012 (RBW)
)
ERNEST J. MONIZ )
in his official capacity as Secretary of the )
United States Department of Energy, et al., )
)
Defendants. )
)
MEMORANDUM OPINION
Plaintiff ConverDyn (“the plaintiff”) brings this suit against the United States Department
of Energy (“the Department”) and Ernest J. Moniz (“the Secretary”), in his official capacity as
Secretary of the Department, alleging that certain actions taken by the defendants violate the
United States Enrichment Corporation Privatization Act (“the Privatization Act”), 42 U.S.C. §
2297h–10 (2012), and are arbitrary and capricious under the Administrative Procedure Act
(“APA”), 5 U.S.C. §§ 553, 706(2)(a) (2012). See Complaint (“Compl.”) ¶¶ 118–38. Currently
pending before the Court is the defendants’ Motion for Judgment on the Pleadings (“Defs.’ Mot.
for J. on the Pleadings”). Upon careful consideration of the parties’ submissions and the entire
1
record in this case, the Court concludes that it must grant in part and deny in part the defendants’
motion. 1
I. FACTUAL AND LEGAL BACKGROUND
A. Statutory Framework
“In 1996, Congress enacted the Privatization Act, which includes various provisions
relating to the transfer of the [United States’] interest in the United States Enrichment
Corporation, a government corporation previously established by the Energy Policy Act of
1992.” ConverDyn v. Moniz, 68 F. Supp. 3d 34, 39 (D.D.C. 2014) (Walton, J.) (citation
omitted). The Privatization Act “states that [t]he [defendants] shall not provide enrichment
services or transfer or sell any uranium (including natural uranium concentrates, natural uranium
hexafluoride, or enriched uranium in any form) to any person except as consistent with this
section.” Id. (citing 42 U.S.C. § 2297h–10(a)). One such exception provides that “the
[defendants] may, from time to time, sell natural and low-enriched uranium (including low-
enriched uranium derived from highly enriched uranium) from the Department[’s] . . . stockpile.”
Id. (citing § 2297h–10(d)(1)). However, the Privatization Act prohibits the “sale or transfer of
natural or low-enriched uranium” unless:
(A) the President determines that the material is not necessary for
national security needs,
1
In addition to the documents previously referenced, the Court considered the following submissions in reaching its
decision: the defendants’ Memorandum of Points and Authorities in Support of Defendants’ Motion for Judgment
on the Pleadings (“Defs.’ Mem.”); the defendants’ Answer to Complaint; the plaintiffs’ Motion for Summary
Judgment (“Pl.’s Mot. for Summ. J.”); the defendants’ Memorandum in Support of Defendants’ Motion for
Summary Judgment and Opposition to Plaintiff’s Motion for Summary Judgment (“Defs.’ Cross-Mot. & Opp’n”);
the Court’s May 11, 2015 Order; the plaintiff’s Response to the Court’s May 11, 2015 Order (“Pl.’s June 2, 2015
Resp. to the Ct.’s May 11, 2015 Order”); the defendants’ June 10, 2015 Notice to the Court (“Defs.’ June 10, 2015
Notice to the Ct.”); the plaintiff’s Memorandum in Opposition to the Defendants’ Motion for Judgment on the
Pleadings (“Pl.’s Opp’n to Defs.’ Mot. for J. on the Pleadings”); the defendants’ Reply Memorandum in Support of
Motion for Judgment on the Pleadings (“Defs.’ Reply in Support of Mot. for J. on the Pleadings”); and the Court’s
July 9, 2015 Order.
2
(B) the Secretary determines that the sale of the material will not
have an adverse material impact on the domestic uranium mining,
conversion, or enrichment industry, taking into account the sales of
uranium under the Russian [High Enriched Uranium] Agreement
and the Suspension Agreement, and
(C) the price paid to the Secretary will not be less than the fair
market value of the material.
Id. at 39–40 (citing § 2297h–10(d)(2)). Determinations under § 2297h–10(d)(2) “remain valid
for two years only.” Id. at 40 (citations omitted).
B. The 2008 and 2013 Excess Uranium Inventory Management Plans
In 2008, the Department issued a “document entitled United States Department of Energy
Excess Uranium Inventory Management Plan dated December 16, 2008.” Id. 2 The 2008 Policy
“set[] forth the general framework within which the Department prudently [would] manage [and
sell] its excess uranium inventory.” Id. (citation omitted). The 2008 Policy stated that “as a
general matter, the introduction into the domestic market of uranium from Departmental
inventories in amounts that do not exceed ten percent of the total annual fuel requirements of all
licensed nuclear power plants should not have an adverse material impact on the domestic
uranium industry.” Id. (citation omitted). The 2008 Policy further stated that “[t]he Department
anticipate[d] that it [might] introduce into the domestic market, in any given year, less than that
amount, or, in some years for certain special purposes such as the provision of initial core loads
for new reactors, more than that amount.” Id. (citation omitted). This “Policy Statement” was
not “published in the Federal Register or subject to notice and comment.” Id.
2
The Court refers to this document hereinafter as “the 2008 Policy.”
3
“In July 2013, the Department transmitted to Congress a second Excess Uranium
Inventory Management Plan . . . .” Id. at 41. 3 The 2013 Policy “replace[d] the 2008 [Policy]
and reflect[ed] updated and evolving information, programs, and mission needs, including
additions to and deletions from the inventory and changes to [the Department’s] uranium
management strategy.” Id. (last alteration in original) (citation omitted). The 2013 Policy
acknowledged the 2008 Policy’s “reference to a Departmental guideline that, as a general matter,
the introduction into the domestic market of uranium from Departmental inventories in amounts
that do not exceed 10 percent of the total annual fuel requirements of all nuclear power plants
should not have an adverse material impact on the domestic uranium mining, conversion, or
enrichment industry.” Id. (citation omitted). However, the 2013 Policy repudiated this
guideline, stating that “the Department . . . determined that it [could] meet its statutory and
policy objectives in regard to [Department] uranium sales or transfers without an established
guideline.” Id. (citation omitted). “Accordingly,” the 2013 Policy added that “the 10 percent
guideline [would] no longer be used.” Id. at 42 (citation omitted). As with the 2008 Policy, the
2013 Policy “was neither published in the Federal Register nor was it subject to notice and
comment.” Id.
C. The Current Litigation
Pursuant to § 2297h–10(d), in May 2014, the Department issued a “2014 Secretarial
Determination finding no adverse material impact on the domestic uranium mining, conversion,
and enrichment industry.” Id. at 44. 4 “The 2014 . . . Determination authorize[d] the transfer of
up to 2,055 [metric tons of uranium] per year of natural uranium equivalent contained in natural
3
The Court refers to this document hereinafter as “the 2013 Policy.”
4
The Court refers to the 2014 Secretarial Determination hereinafter as “the 2014 Determination.”
4
uranium and natural uranium from off-specification non-uranium hexafluoride transferred to
[Department] contractors for cleanup services at the Paducah or Portsmouth Gaseous Diffusions
Plants and up to 650 [metric tons of uranium] per year of natural uranium equivalent contained in
low-enriched uranium . . . transferred to [National Nuclear Security Administration] contractors
for down-blending highly-enriched uranium to [low-enriched uranium] for [National Nuclear
Security Administration] programs.” Id. (some alterations in original) (citation omitted).
The plaintiff, who, according to the Complaint, “is the sole domestic supplier of uranium
conversion services in the United States,” ¶ 2, “filed suit on June 13, 2014, alleging that the
Department [was] acting in excess of its statutory authority by transferring conversion services,
that the 2014 . . . Determination’s finding that the planned transfers [would] have no adverse
material impact [was] arbitrary and capricious, and that the Department [would] receive less than
fair market value for the planned transfers, in violation of the Privatization Act and the APA.”
ConverDyn, 68 F. Supp. 3d at 45 (citation omitted). The plaintiff also challenged the lawfulness
of the 2013 Policy, alleging that it was “arbitrary and capricious, and otherwise not accordance
with the law, in violation of the [APA].” Compl. ¶ 134. Then, “[o]n June 23, 2014, [the
plaintiff] filed [a] motion for a preliminary injunction seeking to enjoin all of the transfers
identified in the 2014 . . . Determination.” ConverDyn, 68 F. Supp. 3d at 45 (citation omitted).
“The Court held oral argument on [the plaintiff’s] motion [for a preliminary injunction]
on July 29, 2014 and later that day, issued an order denying the motion for failure to show
irreparable harm, with an indication that [an] opinion setting forth the Court’s reasoning in full
would be issued later.” Id. (citation omitted).
On September 11, 2014, the plaintiff filed a motion for summary judgment. Pl.’s Mot.
for Summ. J. In its motion, the plaintiff “move[d] for summary judgment to stop [the allegedly]
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unlawful transfers of uranium from the . . . Department[’s] . . . inventory into the commercial
markets.” Id. at 1. On the following day, September 12, 2014, the Court issued its
Memorandum Opinion (“Opinion”) setting forth the “reasons” that it “denied [the plaintiff’s]
motion [for a preliminary injunction].” ConverDyn, 68 F. Supp. 3d at 38. The Court held that,
[w]hile [the plaintiff’s] projected losses [would be] quite significant, if accurate, [the plaintiff] . .
. nonetheless failed to meet this Circuit’s stringent standard for establishing irreparable harm.”
ConverDyn, 68 F. Supp. 3d at 47.
Despite denying the plaintiff’s motion for a preliminary injunction on the basis that the
plaintiff failed to show irreparable harm, the Court nonetheless “discuss[ed] the remaining three
factors in order to provide the parties with a complete understanding of its balance of the four
preliminary injunction factors.” Id. at 50 (citation omitted). The Court stated that it agreed with
the plaintiff “that it [was] likely to prevail on its claim that the 2014 . . . Determination’s finding
that the planned transfers [would] have no adverse material impact [was] arbitrary and capricious
in violation of the APA.” Id. However, “[w]ith respect to [the plaintiff’s] other claims, . . . the
Court [was] unpersuaded that [the plaintiff was] likely to succeed.” Id. at 51. The Court also
concluded that the balance of the equities and the public interest preliminary injunction factors
did not weigh in favor of issuing a preliminary injunction. Id. at 52–54.
On September 25, 2014, the defendants filed a cross-motion for summary judgment and
opposition to the plaintiff’s motion for summary judgment. Defs.’ Cross-Mot. & Opp’n.
“On May 1, 2015, the Secretary . . . issued a determination . . . covering continued
transfers of uranium for cleanup services at the Portsmouth Gaseous Diffusion Plant and for
down-blending of highly-enriched uranium to low-enriched uranium.” Excess Uranium
Management: Secretarial Determination of No Adverse Impact on the Domestic Uranium
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Mining, Conversion, and Enrichment Industries, 80 Fed. Reg. 26,366, 26,366 (May 7, 2015)
(hereinafter “2015 Determination”). The 2015 Determination “covers transfers of up to the
equivalent of 2,500 metric tons of natural uranium (“MTU”) per year in 2015 and up to the
equivalent of 2,100 MTU in each year thereafter.” Id. The 2015 Determination expressly states
that it “replaces the previous determination issued in May 2014, which covered transfers for
these two programs of up to the equivalent of 2,705 MTU per year.” Id. (emphasis added); see
also id. (emphasis added) (stating that “this determination . . . supersede[s] the 2014
Determination”). Additionally, the 2015 Determination provides that “no further transfers
pursuant to the 2014 Determination will take place.” Id.On May 11, 2015, in light of the 2015 Determination’s issuance, the Court entered an
order directing the plaintiff to “[show cause] . . . why the claims set forth in this action should
not be dismissed as moot.” May 11, 2015 Order at 2. The plaintiff responded to the Court’s
May 11, 2015 order on June 2, 2015, contending that its challenge to the defendants’ 2014
Determination was not moot. See Pl.’s June 2, 2015 Resp. to the Ct.’s May 11, 2015 Order. The
defendants “disagree[d] and [,therefore, represented that they] intend[ed] to file a Motion for
Judgment on the Pleadings by June 30, 2015, arguing for dismissal of [the] plaintiff’s claims
challenging the May 15, 2014 Determination that [allegedly were] rendered moot by the
adoption of the . . . 2015 Determination.” Defs.’ June 10, 2015 Notice to the Ct. at 1–2.
Consistent with this response, the defendants filed their motion for judgment on the pleadings on
June 30, 2015. Defs.’ Mot. for J. on the Pleadings.
On July 9, 2015, the Court issued an order in which it, among other things, declined to
address the merits of the plaintiff’s September 11, 2014 motion for summary judgment. See July
9, 2015 Order at 2–3. In declining to address the motion, the Court reasoned that “before it
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[could] address the merits of this case, it [had to] resolve the threshold issues of the . . . [C]ourt’s
subject matter jurisdiction and mootness.” Id. at 2 (ellipsis in original) (citation omitted).
Therefore, the Court denied, without prejudice, both parties’ cross-motions for summary
judgment and ordered the plaintiff to respond to the defendants’ motion for judgment on the
pleadings. Id. at 3.
On July 23, 2015, the plaintiff filed its memorandum in opposition to the defendants’
motion for judgment on the pleadings. Pl.’s Opp’n to Defs.’ Mot. for J. on the Pleadings. The
defendants then filed their reply on August 8, 2016, Defs.’ Reply in Support of Mot. for J. on the
Pleadings, and the defendants’ motion for judgment on the pleadings is now ripe for resolution.
II. STANDARD OF REVIEW
Federal Rule of Civil Procedure 12(c) permits “a party [to] move for judgment on the
pleadings” so long as the motion is made “[a]fter the pleadings are closed—but early enough not
to delay trial.” “The standard for a motion for judgment under Rule 12(c) is essentially the same
standard as a motion to dismiss under Rule 12(b)(6).” Rollins v. Wackenhut Servs., 802 F. Supp.
2d 111, 116 (D.D.C. 2011) (citing, inter alia, Schuchart v. La Taberna Del Alabardero, Inc., 365
F.3d 33, 35 (D.C. Cir. 2004)). Accordingly, when considering a Rule 12(c) motion, “the court
must accept the nonmovant’s allegations as true and should view the facts in the light most
favorable to the nonmovant.” Bowman v. District of Columbia, 562 F. Supp. 2d 30, 32 (D.D.C.
2008). Therefore, “[t]he court should grant a motion for judgment on the pleadings [only] if the
movant ‘is entitled to judgment as a matter of law.’” Id. (quoting Burns Int’l Sec. Servs. v. Int’l
Union, 47 F.3d 14, 16 (2d Cir. 1995)).
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III. LEGAL ANALYSIS
A. The Parties’ Arguments
1. The Defendants’ Arguments
The defendants assert that their “issuance of [the] 2015 Determination moot[ed] [the]
plaintiff’s challenge to the 2014 Determination.” Defs.’ Mem. at 1. The defendants therefore
conclude that “the Court should grant [their] Motion for Judgment on the Pleadings and dismiss
Counts I and II of [the] plaintiff’s Complaint as moot.” Id. Further, the defendants argue that
the Court should dismiss Count III because, in the defendants’ assessment, “the Court lacks
subject matter jurisdiction to consider [Count III] outside a live challenge to a concrete agency
action such as a Secretarial Determination.” Id.The defendants argue that Counts I and II of the Complaint are moot and should be
dismissed because “[t]he 2015 Determination unambiguously states that ‘the 2014 Determination
is replaced by the [2015] [D]etermination . . . and no further transfers pursuant to the 2014
Determination will take place.’” Id. at 6 (quoting 2015 Determination, 80 Fed. Reg. at 26,366).
The defendants acknowledge that “‘voluntary cessation of a challenged practice’ does not
necessarily render the challenge moot.” Id. at 7 (quoting Friends of the Earth, Inc. v. Laidlaw
Envtl. Servs. (TOC), Inc., 528 U.S. 167, 169–70 (2000)). However, the defendants assert that
this exception to mootness is inapplicable because “‘subsequent events made it absolutely clear
that the allegedly wrongful behavior could not reasonably be expected to recur.’” Id. at 7–8
(quoting Laidlaw, 528 U.S. at 189). From the defendants’ standpoint, “there is no reasonable
expectation that the agency action constituting the alleged violation . . . will recur” “[b]ecause
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the basis for a Secretarial Determination related to the transfer of excess uranium is necessarily
particular to conditions in the uranium markets at the time of the Determination.” Id. at 8.
Furthermore, the defendants assert that “there is no reason for this Court to think that [the
defendants] will arbitrarily issue a new determination” because “prior to issuing the 2015 . . .
Determination, [the Department] engaged in a time consuming and expensive process [in order
to formulate the Determination].” Id. Additionally, the defendants contend that “there is less
concern about the recurrence of objectionable behavior” where “the defendant is a government
agency.” Id. at 9 (citations omitted).
From the defendants’ perspective, the “capable of repetition, yet evading review”
exception to mootness is likewise inapplicable. Id. at 11 (citing S. Pac. Terminal Co. v.
Interstate Commerce Comm’n, 219 U.S. 498, 515 (1911)). The defendants note that “[t]o invoke
this exception, [the] plaintiff must demonstrate that ‘(1) the challenged action [is] in its duration
too short to be fully litigated prior to cessation or expiration, and (2) there [is] a reasonable
expectation that the same complaining party [will] be subject to the same action again.’” Id.(alterations in original) (quoting Spencer v. Kemna, 523 U.S. 1, 17 (1998)). Although the
defendants do not address the first prong of this test, the defendants assert that the “same action”
requirement is not satisfied because “Determinations on uranium transfer are . . . highly fact-
specific” and, accordingly, “there can be no reasonable expectation that [the] plaintiff will again
be subject to the same action in the future.” Id. at 13 (citation omitted).
Moreover, the defendants note that, under Count I of the Complaint, the “plaintiff
contends that [the Department] does not have legal authority to transfer uranium hexafluoride
(UF6) . . . and . . . that a practice of valuing the uranium it transfers at roughly the spot market
price does not comply with the statutory requirement that [the Department] obtain fair market
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value for uranium transferred pursuant to a Secretarial Determination.” Id. (citations omitted).
The defendants assert that the plaintiff cannot “continue to pursue a challenge to [these]
[Department] practices underlying the uranium transfers [allegedly] covered by the 2014
Determination even after the Determination itself has been replaced.” Id. The defendants
acknowledge that, even where a plaintiff’s specific claim has been mooted, the plaintiff “may
nevertheless seek declaratory relief forbidding an agency from imposing a disputed policy in the
future, so long as the plaintiff has standing to bring such a forward-looking challenge and the
request for declaratory relief is ripe.” Id. at 14 (citing City of Houston v. Dep’t of Housing &
Urban Dev., 24 F.3d 1421, 1429 (D.C. Cir. 1994)). Yet, the defendants assert that, “in the
absence of a specific agency action exercising and carrying out these two practices that has
caused [the] plaintiff concrete and particularized injury, [the] plaintiff lacks standing.” Id.(citation omitted). This is because, in the defendants’ assessment, the Department’s “legal
conclusions about its authority to transfer UF6 and a practice of seeking roughly spot market
prices for transferred uranium cannot possibly cause plaintiff any harm in the abstract.” Id.Rather, “[i]t is only in the context of an agency action, such as a Secretarial Determination
covering those uranium transfers, that these practices could arguably be said to result in any
harm to plaintiff.” Id. Also, the defendants note that the ripeness doctrine requires courts to
evaluate “‘both the fitness of the issues for judicial decision and the hardship to the parties from
withholding court consideration.’” Id. at 15 (quoting Abbott Labs v. Gardner, 387 U.S. 136, 149
(1967)). In the defendants’ opinion, the issues are not fit for judicial resolution because “the
determination of whether [the Department’s] valuation methods result in it receiving fair market
value cannot be intelligently evaluated in the abstract, outside of final agency action.” Id.(citation omitted).
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The defendants urge the Court to dismiss Count III on various grounds. First, the
defendants assert that the plaintiff lacks standing to challenge the 2013 Policy “[f]or the same
reasons that the plaintiff lacks standing to bring a . . . challenge to the two agency policies
[discussed in the preceding paragraph].” Id. at 17. Second, the plaintiff characterizes the 2013
Policy as a “general statement of policy,” id. at 18, and notes that such policies are “not subject
to pre-implementation judicial review” under the APA, id. (citing Nat’l Mining Ass’n v.
McCarthy, 758 F.3d 243, 251 (D.C. Cir. 2014)). According to the defendants, in the absence of
a “concrete action[] – such as a Secretarial Determination on uranium transfers,” there is no
policy to implement and, therefore, the plaintiff “cannot maintain a challenge to the [2013
Policy] in isolation.” Id. Third, the defendants assert that, “[f]or essentially the same reasons,
[the] plaintiff’s challenge to the 2013 [Policy] in the absence of [an allegedly] non-moot
Determination where it is applied or relied upon[] is not ripe for judicial review.” Id. at 19.
Finally, the defendants assert that “[e]ven assuming that [the] plaintiff’s challenge to the 2013
[Policy] is unaffected by the mooting of the 2014 Determination, that claim has no merit and the
Court can resolve this claim by granting [the] defendants’ Motion for Summary Judgment on this
issue.” Id.
2. The Plaintiff’s Counterarguments
Regarding Counts I and II of the Complaint, the plaintiff argues that the defendants’
“decision to supersede the 2014 Determination—[allegedly] made in the face of [the plaintiff’s]
lawsuit and the Court’s adverse ruling—is not enough to moot the lawsuit.” Pl.’s Opp’n to
Defs.’ Mot. for J. on the Pleadings at 6. As to the voluntary cessation doctrine, the plaintiff
asserts that “it is by no means absolutely clear that [the defendants] would not return to the
higher transfer levels authorized by the 2014 Determination if they found it convenient to do so
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in the future.” Id. at 7. To bolster its assertion, the plaintiff accuses the defendants of “already
us[ing] the uranium transfer program as an extra-budgetary slush-fund to circumvent the
Congressional appropriations process,” citing documents outside of the pleadings to substantiate
this argument. Id. Furthermore, the plaintiff asserts that the defendants have “offer[ed] no
evidence . . . to support their claim[] that the [allegedly] flawed analysis and methodology
applied in the 2014 Determination cannot be revived.” Id. at 8. Additionally, the plaintiff
expresses skepticism about the defendants’ assertion that it is unreasonable to believe that it
would issue a new Determination just to avoid judicial review, stating that “that is precisely what
[the defendants] did in this case.” Id. at 9. Moreover, the plaintiff asserts that the defendants
must show that “interim relief or events [] completely and irrevocably eradicated the effects of
the alleged violation,” id. at 11 (citing Larsen v. U.S. Navy, 525 F.3d 1, 4 (2008)), and argues
that the defendants have not made this showing because “the adverse impacts [of the allegedly
unlawful prior transfers] linger in the market and contribute to the still-depressed market for [the
plaintiff’s] conversion services,” Pl.’s Opp’n to Defs.’ Mot. for J. on the Pleadings at 11. Lastly,
the plaintiff states that it is “not claiming that [the defendants] will enact a new Secretarial
Determination at some indeterminate point that relies on the exact same facts as the 2014
Determination,” id. at 12, but rather, that the defendants are “continuing to rely on the same
flawed policies and practices when making the 2015 Determination,” id.The plaintiff also contends that the “capable of repetition yet evading review” mootness
exception “dooms [the defendants’] motion.” Id. Although the plaintiff acknowledges that “a
plaintiff may be less likely to show that it will be subject to the same action” where “the only
action challenged is . . . very fact-specific,” id. at 13, the plaintiff asserts that “[i]t is well-
established that if a plaintiff challenges both a specific agency action and the policy that
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underlies that action, the challenge to the policy is not necessarily mooted merely because the
challenge to the particular agency action is moot,” id. (citing City of Houston, 24 F.3d at 1428).
To buttress this assertion, the plaintiff maintains that its “challenge is not just to the ultimate
conclusion in the 2014 Determination that transferring 2,705 MTU per year would not have an
adverse material impact . . . , but also to the manner in which [the defendants] reached that
result.” Id. at 14. Elaborating, the plaintiff states that it challenges the defendants’ “practices of
balancing the potential harms from the transfers against the benefits of the programs funded by
the transfers and comparing the harms from the transfers to other harms affecting the market.”
Id. 5
Regarding Count I of the Complaint, the plaintiff asserts that § 2297h–10(d) “bars [the
defendants] from transferring material other than natural and low enriched uranium regardless of
whether it will have an adverse material impact, and bars [the defendants] from receiving less
5
Additionally, the plaintiff notes that the defendants argued in their motion for judgment on the pleadings “that this
case is moot because the Court [allegedly] lacks broad equitable powers to provide any remedy for harms caused by
issuance of the . . . 2014 Determination.” Pl.’s Opp’n to Defs.’ Mot. for J. on the Pleadings at 17. The plaintiff
disputes this argument on the ground that it “is not just seeking to stop or mitigate the ongoing harmful effects of the
prior . . . transfers,” id., but rather, “to prevent further reliance by [the defendants] on [their allegedly] flawed
underlying methodology and to avoid revival of the invalid 2014 Determination,” id. Moreover, the plaintiff
contends that, pursuant to its equitable powers, the Court could “enjoin a quantity of uranium transfers going
forward to counteract the effects of the quantity transferred unlawfully.” Id. at 18. According to the plaintiff, the
defendants “transferred approximately 2,700 MTU under the auspices of the 2014 Determination,” id., and
“[e]njoining the next 2,700 MTU . . . will help to remedy this continuing harm by putting the parties in the position
they would have been in had [the defendant] not made [these] transfers,” id.
The Court declines to address this issue because it is outside of the scope of the defendants’ motion for
judgment on the pleadings. For one thing, the defendants did not make this argument in response to the Complaint’s
allegedly insufficient allegations, but rather, to a position that the plaintiff took in its June 2, 2015 response to the
Court’s May 11, 2015 order. See Pl.’s June 2, 2015 Resp. to the Ct.’s May 11, 2015 Order at 6–7; May 11, 2015
Order. Moreover, this issue is fact-intensive and, therefore, is more appropriately addressed on summary judgment.
Cf. McFadden v. Wash. Metro. Area Transit Auth., 949 F. Supp. 2d 214, 222 (D.D.C. 2013) (noting that
“question[s] of fact . . . [are] more appropriately addressed on summary judgment”). Thus, while enjoining uranium
transfers under a purportedly valid Determination to compensate for transfers made under a repealed Determination
would be unusual, cf. Theodore Roosevelt Conservation P’ship v. Salazar, 661 F.3d 66, 79 (D.C. Cir. 2011) (“We
are not going to invalidate a valid [agency decision] to remedy the alleged non-enforcement of an [agency decision]
which has no current force or effect.”), it is premature to address this issue at this time.
14
than the fair market value of the material regardless of whether it will have an adverse material
impact.” Id. at 22 (citations omitted). In the plaintiff’s view, “Count I of [the] Complaint makes
clear that it is challenging [the aforementioned alleged] [v]iolations of the . . . Privatization Act
and [APA], not just a violation of the Secretarial Determination requirement.” Id.
As for Count III of the Complaint, the plaintiff asserts that its “claim that [the
defendants’] improperly abolished the 10% [l]imit without following requisite notice and
comment procedures and did so arbitrarily and capriciously has nothing to [do] with the
Secretarial Determination process.” Id. at 24. “As a result,” the plaintiff continues, “issuance of
the 2015 Determination, or any other new Determination, does not moot the claims.” Id.
Further, the plaintiff states that the defendants are “currently making excess uranium transfers
above the 10% [l]imit and will continue to do so.” Id. at 25. “The ongoing nature of these
transfers,” the plaintiff concludes, “fatally undermine[s] [the defendants’] claim that there is no
final agency action.” Id.
B. Discussion
1. The Doctrine of Mootness and Its Exceptions
“Article III, § 2[] of the Constitution limits the jurisdiction of federal courts to ‘Cases’
and ‘Controversies,’ which restricts the authority of federal courts to resolving the legal rights of
litigants in actual controversies.” Genesis Healthcare Corp. v. Symczyk, __ U.S. __, __, 133 S.
Ct. 1523, 1528 (2013) (citations omitted). Therefore, “[i]n order to invoke federal-court
jurisdiction, a plaintiff must demonstrate that he possesses a legally cognizable interest, or
personal stake, in the outcome of the action.” Id. (citation omitted). “This requirement [of
standing] ensures that the Federal Judiciary confines itself to its constitutionally limited role of
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adjudicating actual and concrete disputes, the resolutions of which have direct consequences on
the parties involved.” Id.“A corollary to this case-or-controversy requirement is that an actual controversy must be
extant at all stages of review, not merely at the time the complaint is filed.” Id. “If an
intervening circumstance deprives the plaintiff of a personal stake in the outcome of the lawsuit,
at any point during litigation, the action can no longer proceed and must be dismissed as moot.”
Id. (citation omitted). Thus, “[a] case is moot if the judgment . . . will neither presently affect the
parties’ rights nor have a more-than-speculative chance of affecting them in the future.” Noble
v. Sombrotto, 525 F.3d 1230, 1241 (D.C. Cir. 2008) (citation omitted); see also Del Monte Fresh
Produce Co. v. United States, 570 F.3d 316, 321 (D.C. Cir. 2009) (citation omitted) (“A case is
moot when the challenged conduct ceases such that there is no reasonable expectation that the
wrong will be repeated in circumstances where it becomes impossible for the court to grant any
effectual relief whatever to the prevailing party.”).
In certain cases, however, “the fact that the specific conduct that gave rise to the case has
ceased does not mean that the challenge to the legality of that conduct is moot.” Del Monte, 570
F.3d at 321 (citation omitted). “A claim for declaratory relief will not be moot if the claim ‘fits
the exception for cases that are capable of repetition, yet evading review, or falls within the
voluntary cessation doctrine.’” Jackson v. U.S. Parole Comm’n, 806 F. Supp. 2d 201, 205
(D.D.C. 2011) (quoting City of Houston, 24 F.3d at 1429). Under the voluntary cessation
doctrine, it “is well settled that a defendant’s voluntary cessation of a challenged practice does
not deprive a federal court of its power to determine the legality of the practice except when the
defendant meets its heavy burden of persuading the court that the challenged conduct cannot
reasonably be expected to start up again.” Worth v. Jackson, 451 F.3d 854, 860 (citing, inter
16
alia, Friends of the Earth, 528 U.S. at 189). By comparison, “[u]nder the capable of repetition
yet evading review exception to mootness, the plaintiff must demonstrate that (1) the challenged
action is in its duration too short to be fully litigated prior to its cessation or expiration, and (2)
there [is] a reasonable expectation that the same complaining party would be subjected to the
same action again.” Del Monte, 570 F.3d at 322 (alteration in original).
a. Count II
Count II of the plaintiff’s Complaint is moot. Count II exclusively challenges the 2014
Determination, alleging that it violates the Privatization Act’s requirement that the Department
determine that the “uranium transfers will not have an adverse material impact on the domestic
uranium mining, conversion, or enrichment industry.” Compl. ¶ 127; see also id. ¶¶ 128–29
(exclusively challenging the lawfulness of the 2014 Determination). Yet, the 2015
Determination unequivocally states that “the 2014 Determination is replaced by the
determination described below, and no further transfers pursuant to the 2014 Determination will
take place.” 2015 Determination, 80 Fed. Reg. at 26,366. Likewise, the 2015 Determination
states that it “supersede[s] the 2014 Determination.” Id. Therefore, the conduct that the plaintiff
challenges under Count II (i.e., the 2014 Determination) has ceased, and any ruling on Count II
would not affect the plaintiff’s rights. Accordingly, Count II of the plaintiff’s Complaint is
moot, unless one of the theories that defeats mootness applies.
On the record here, the Court is convinced that Count II is not saved by either the
voluntary cessation or the capable of repetition, yet evading review exceptions to mootness.
Regarding the voluntary cessation exception, it would be unreasonable to think that the
defendants would reissue the 2014 Determination. The Court agrees with the defendants’
assessment that “the basis for a Secretarial Determination related to the transfer of excess
17
uranium is necessarily particular to conditions in the uranium markets at the time of the
Determination,” Defs.’ Mem. at 8, and the plaintiff appears to concede that it is “not claiming
that [the defendants] will enact a new Secretarial Determination at some indeterminate point that
relies on the exact same facts as the 2014 Determination,” Pl.’s Opp’n to Defs.’ Mot. for J. on
the Pleadings at 12. Moreover, where, as here, “the defendant is a government actor—and not a
private litigant—there is less concern about the recurrence of objectionable behavior.” Citizens
for Responsibility & Ethics in Wash. v. SEC, 858 F. Supp. 2d 51, 61 (D.D.C. 2012) (collecting
cases). Admittedly, the defendants issued the 2015 Determination in the wake of the Court’s
September 12, 2014 Opinion, which held that the plaintiff was “likely to prevail on its claim that
the 2014 Secretarial Determination’s finding that the . . . transfers [would] have no adverse
material impact [was] arbitrary and capricious in violation of the APA.” ConverDyn v. Moniz,
68 F. Supp. 3d at 50. And, the defendants acknowledge that “this Court’s criticism of [the
Department’s] reasoning in support of the 2014 Determination . . . was one factor informing [the
Department’s] analysis for the new Secretarial Determination that attempts to address the Court’s
concerns.” Defs.’ Mem. at 10. Nonetheless, as a result of the Department’s reevaluation, “[t]he
[2015] Determination covers transfers of up to the equivalent of 2,500 metric tons of natural
uranium (“MTU”) per year in 2015 and up to the equivalent of 2,100 MTU in each year
thereafter,” 80 Fed. Reg. at 26,366, which is a reduction from “the previous determination issued
in May 2014, which covered transfers . . . up to the equivalent of 2,705 MTU per year,” id. On
this record, the defendants have carried their “heavy burden of persuading the [C]ourt that the
[2014 Determination] cannot reasonably be expected to [be reissued].” Worth, 451 F.3d at 860
(citing, inter alia, Friends of the Earth, 528 U.S. at 189).
18
For similar reasons, the “capable of repetition, yet evading review” exception to
mootness is inapplicable to Count II. Under the first prong of this exception, the defendants do
not dispute that the 2014 Determination “cannot be fully litigated prior to cessation or
expiration,” Del Monte, 570 F.3d at 322 (citation omitted), evidently because “Determinations
under [§ 2297h-10(d)(2)] remain valid for two years only,” ConverDyn, 68 F. Supp. 3d at 40
(citations omitted). Nevertheless, under the second prong, the Court agrees with the defendants’
contention that there is no reasonable expectation that the plaintiff will again be subject to the
2014 Determination. Defs.’ Mem. at 11 (citing Spencer, 523 U.S. at 17). As the plaintiff seems
to acknowledge, Pl.’s Opp’n to Defs.’ Mot. for J. on the Pleadings at 13, the defendants’
Determinations are “highly fact-specific,” Fund for Animals, 460 F.3d at 22. Therefore, because
the 2014 Determination “is highly dependent upon a series of facts unlikely to be duplicated in
the future,” id. at 23 (citation omitted), Count II “cannot be saved from mootness on the ground
that it raises issues or wrongs capable of repetition yet evading review,” id. at 22. 6
The plaintiff responds that it is challenging “both a specific agency action [i.e., the 2014
Determination] and the policy that underlies that action, [and that] the challenge to the policy is
not necessarily mooted merely because the challenge to the particular [Determination] is moot.”
City of Houston, 24 F.3d at 1428 (citations omitted). The plaintiff describes the alleged policy
as the defendants’ “practices of balancing the potential harms from the transfers against the
benefits of the programs funded by the transfers and comparing the harms from the transfers to
6
See also Spencer, 523 U.S. at 17 (alterations in original) (emphasis added) (citations omitted) (stating that the
“capable-of-repetition doctrine applies only . . . where . . . there [is] a reasonable expectation that the same
complaining party [will] be subject to the same action again”); Defs.’ Mot. for J. on the Pleadings at 12 (citing
cases); see generally 2015 Determination, 80 Fed. Reg. at 26,266 (embodying a fact-intensive analysis); compare 42
U.S.C. § 2297h–10(d)(2) (providing that the Department shall not sell or transfer “natural or low-enriched uranium”
unless certain conditions are satisfied), with ConverDyn, 68 F. Supp. 3d at 40 (citations omitted) (noting that
“Determinations under [§ 2297h–10(d)(2)] remain valid for two years only”).
19
other harms affecting the market.” Pl.’s Opp’n to Defs.’ Mot. for J. on the Pleadings at 14. But
the Complaint is bereft of any allegations regarding such a policy. See generally Compl.
Nevertheless, the plaintiff notes that “[t]he Court recognized this aspect of [the plaintiff’s]
challenge in its preliminary injunction decision.” Pl.’s Opp’n to Defs.’ Mot. for J. on the
Pleadings at 14 (citation omitted). While this representation is certainly correct, the policy
reference in the Court’s Opinion related to “the 2014 Secretarial Determination,” ConverDyn, 68
F. Supp. 3d at 51, which has since been replaced. The plaintiff further contends that “[t]he 2015
Determination did not reject, and indeed reaffirms and continues, this same flawed approach to
evaluating adverse impacts.” Pl.’s Opp’n to Defs.’ Mot. for J. on the Pleadings at 14 (citation
omitted). Again, however, this unproven “fact” is nowhere in the Complaint, see generally
Compl., and courts typically “may not rely on facts outside of the pleadings” when ruling on a
motion for judgment on the pleadings, Robinson v. District of Columbia, 403 F. Supp. 2d 39, 47
(D.D.C. 2005).
The plaintiff’s argument that the alleged policy described above precludes a mootness
defense also fails because this exception applies only to claims for “declaratory relief.” Del
Monte, 570 F.3d at 321; see also City of Houston, 24 F.3d at 1429 (emphasis added) (footnote
omitted) (“[T]his circuit’s case law provides that if a plaintiff’s specific claim has been mooted,
it may nevertheless seek declaratory relief forbidding an agency from imposing a disputed policy
in the future, so long as the plaintiff has standing to bring such a forward-looking challenge and
the request for declaratory relief is ripe.”). Here, however, in the Complaint’s prayer for relief,
the plaintiff’s requests for declaratory relief have nothing to do with this alleged policy. See
Compl. at 27–28. Accordingly, because no exception to mootness applies to the plaintiff’s
20
challenge to the 2014 Determination, the Court dismisses Count II of the plaintiff’s Complaint
with prejudice.
b. Count I
Count I of the Complaint consists of three distinct components. The first component
asserts that the defendants’ “2014 Determination is arbitrary, capricious, and unlawful” in
violation of the APA. See id. ¶¶ 120, 122. The second component asserts that the defendants’
“transfers of UF6 further . . . violate[] the . . . Privatization Act [and the APA] because [the
defendants allegedly are] not authorized to transfer the conversion or enrichment services
component of UF6, only the natural uranium and low enriched uranium component.” See id. ¶¶
120, 123. The third component asserts that the defendants’ “transfers . . . also violate the . . .
Privatization Act because [the defendants allegedly] must receive fair market value for the
material[] [and the defendants allegedly value] the material at a price that is below fair market
value.” See id. ¶¶ 120, 124.
The first component of Count I is dismissed with prejudice for the reasons stated in Part
III.B.1.a of this Memorandum Opinion. In short, the first component of Count I duplicates the
plaintiff’s challenge to the 2014 Determination as set forth in Count II, which the Court has
already concluded must be dismissed with prejudice.
The Court declines to dismiss, however, the second and third components of Count I. In
its earlier Memorandum Opinion, although the Court held that the second and third components
of Count I were “[un]likely to succeed,” ConverDyn, 68 F. Supp. 3d at 51, it implicitly
recognized the existence of these components of Count I in the plaintiff’s lawsuit, see id. at 51–
52. The defendants assert that the plaintiff cannot “continue to pursue a challenge to [these]
[Department] practices underlying the uranium transfers [allegedly] covered by the 2014
21
Determination even after the Determination itself has been replaced.” Defs.’ Mem. at 13.
However, as the defendants acknowledge, the plaintiff “may . . . seek declaratory relief
forbidding an agency from imposing a disputed policy in the future, so long as the plaintiff has
standing to bring such a forward-looking challenge and the request for declaratory relief is ripe.”
City of Houston, 24 F.3d at 1429. Here, the Complaint unequivocally identifies the policies that
the second and third components challenge, see, e.g., Compl. ¶¶ 123, 124, and the plaintiff
expressly seeks a declaration from the Court invalidating these policies, id. at 28. Furthermore,
while the defendants dispute the existence of such policies, Defs.’ Reply in Support of Mot. for J.
on the Pleadings at 8–9, their argument implicates facts outside of the pleadings, see id. (citing,
inter alia, Pl.’s Mot. for Summ. J.). Moreover, at this time, the defendants’ argument is
“inadequately developed” to support an award of judgment on the pleadings. See Westcott v.
McHugh, 39 F. Supp. 3d 21, 31 (D.D.C. 2014) (Walton, J.) (citing Ry. Labor Execs.’ Ass’n v.
U.S. R.R. Ret. Bd., 749 F.2d 856, 859 n.6 (D.C. Cir. 1984)). For example, the defendants make
this argument in two paragraphs and fail to cite any cases to support it. See Defs.’ Reply in
Support of Mot. for J. on the Pleadings at 8–9; but cf. Westcott, 39 F. Supp. at 31
(acknowledging that the defendant might be able to “file an appropriately supported motion
raising the issue” at a later stage in the proceedings and declining to “address the defendant’s
inadequately developed argument at [that] time”).
The defendants contend that, even assuming that the plaintiff sufficiently pleaded the
existence of these two policies, the plaintiff lacks standing to challenge them and that such
challenges are not ripe. This contention lacks merit. As to standing, the defendants argue that
“in the absence of a specific agency action exercising and carrying out these two practices that
has caused plaintiff concrete and particularized injury, [the] plaintiff lacks standing.” Defs.’
22
Mem. at 14 (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992)). However, the
plaintiff adequately identifies both alleged policies in the Complaint, see, e.g., Compl. ¶¶ 106–
17, 123–24, and contends that various harms flow from them, see, e.g., id. ¶¶ 96, 98–99, 113,
125. And the defendants have not shown that intervening developments have eliminated these
alleged policies. See Defs.’ Mem. at 14–16; Defs.’ Reply in Support of Mot. for J. on the
Pleadings at 8–9. Therefore, the plaintiff has sufficiently pleaded the existence of these two
policies and the concrete and particularized harm purportedly resulting from them. The
defendants’ ripeness argument fails for similar reasons. The premise of the ripeness argument is
that “the determination of whether [the Department]’s valuation methods result in it receiving
fair market value cannot be intelligently evaluated in the abstract, outside of final agency action.”
Defs.’ Mem. at 15 (citation omitted). However, for pleading purposes, the plaintiff has
sufficiently identified the agency actions (i.e., the two policies) that are allegedly causing the
harm. Therefore, this argument is also meritless.
For the foregoing reasons, the Court grants in part and denies in part the defendants’
motion for judgment on the pleadings with respect to Count II of the Complaint. Accordingly,
the Court dismisses, with prejudice, the first component of Count II, and declines to dismiss the
second and third components of Count II. 7
c. Count III
Under Count III of the Complaint, the plaintiff challenges the 2013 Policy on two
primary grounds. The first ground is based on the allegation that the 2013 Policy changed a prior
policy limiting uranium transfers to 10%, an action that the plaintiff characterizes as “arbitrary
7
The defendants also assert that the Court “can grant judgment to [the] defendants on these issues for the reasons
set forth in the memorandum accompanying [the] defendants’ Motion for Summary Judgment.” Defs.’ Mem. at 16
(citation omitted). However, it is premature to address these arguments because the defendants’ motion for
summary judgment is not currently before the Court.
23
and capricious, and otherwise not in accordance with law, in violation of the [APA].” Compl. ¶
134. The second ground is based on the allegation that the defendants issued the 2013 Policy
“without formal notice and without giving the public the opportunity to comment.” Id. ¶ 134.
In its earlier Memorandum Opinion, the Court held that “it is apparent that . . . the . . .
2013 Plan[] [is a] general statement[] of policy . . . exempt from notice and comment
requirements under the APA.” ConverDyn, 68 F. Supp. 3d at 52 (citation omitted). The Court
stands by its prior ruling “due to the non-binding language of the document[], the express
reservation of the Department’s ability to revise its p[olicy][], and [the] document[’s] failure to
create any rights or impose any obligations,” id. (citing Wilderness Soc’y v. Norton, 434 F.3d
584, 595 (D.C. Cir. 2006)), and because the Department “never published a final version of the
[2013] Polic[y] in either the Federal Register or, more significantly, in the Code of Federal
Regulations,” Wilderness Soc’y, 434 F.3d at 595–96; see also ConverDyn, 68 F. Supp. 3d at 42
(“The 2013 Plan was neither published in the Federal Register nor was it subject to notice and
comment.”).
The District of Columbia Circuit has held that “general statements of policy” are not
“subject to pre-enforcement judicial review” under the APA. Nat’l Mining, 758 F.3d at 251
(citing cases). Likewise, “general statements of policy” do not “require notice and comment”
under the APA. Id.
Here, the 2014 Determination was the only conceivable action that the plaintiff alleged to
be enforcing the 2013 Policy. However, because the 2014 Determination has now been replaced,
the Complaint no longer alleges any action enforcing the 2013 Policy. Consequently, the first
ground on which the plaintiff challenges the 2013 Policy fails to state a claim upon which relief
may be granted. Therefore, the Court dismisses Count III with respect to this first ground.
24
However, this dismissal is without prejudice because, as the defendants seem to acknowledge, “if
[the] plaintiff . . . is suffering harm from these practices now, it could . . . amend its complaint
. . . [to] challeng[e] the legality of the 2015 Determination.” Defs.’ Mem. at 15.
By contrast, with respect to the second ground, the Court dismisses Count III with
prejudice. Because the 2013 Policy is a general statement of policy exempt from the APA’s
notice-and-rulemaking requirements, the second ground on which the plaintiff challenges the
2013 Policy fails to state a viable claim.
IV. CONCLUSION
For the foregoing reasons, the Court grants in part and denies in part the defendants’
motion for judgment on the pleadings. Consequently, the Court: (1) dismisses, with prejudice,
Count II of the Complaint; (2) dismisses, with prejudice, Count I of the Complaint with respect
to first component of this Count; (3) dismisses, without prejudice, Count III of the Complaint
with respect to the first ground on which the plaintiff challenges the 2013 Policy; and (4)
dismisses, with prejudice, Count III of the Complaint with respect to the second ground on which
the plaintiff challenges the 2013 Policy. 8
SO ORDERED this 11th day of May, 2016. 9
REGGIE B. WALTON
United States District Judge
8
The preceding analysis is not intended to suggest that the Court would be powerless to find either of the
exceptions to mootness discussed above applicable if the circumstances warranted the inference that the defendants
were issuing Determinations to preclude the plaintiff from obtaining meaningful judicial review. As the 2015
Determination will not be valid beyond May 1, 2017, see ConverDyn, 68 F. Supp. 3d at 39 (citations omitted)
(stating that Determinations “remain valid for two years only”); 2015 Determination, 80 Fed. Reg. at 26,366 (stating
that the 2015 Determination is effective on “May 1, 2015”), it is imperative to proceed as expeditiously toward the
resolution of this case as the circumstances will permit.
9
An Order consistent with this Memorandum Opinion shall be issued contemporaneously.
25