July 19, 2011, Don Kreis: Entergy Wins by Losing on Temporary Injunction

Monday’s much anticipated decision by U.S. District Judge J. Garvan Murtha, denying Entergy’s request for a temporary injunction to keep Vermont Yankee open, contains something for everyone and is, thus, capable of many interpretations. One worth considering is the possibility that Entergy, by losing the preliminary injunction fight, is about to win the war.

Just as the irritating repetition of the phrase “safety, safety, safety” by Entergy’s lawyer (to reflect Entergy’s claim that safety is the real and unconstitutional purpose of Vermont’s regulation) became a dominant theme of the two-day hearing last month, Judge Murtha’s decisional mantra this week is that “trial on the merits has been accelerated.” What he might just be telegraphing to Entergy is that it doesn’t need a temporary injunction now because it stands a good chance of winning after the trial in mid-September. And that, Judge Murtha implies, will be soon enough.

Those skeptical of this theory about Judge Murtha’s decision will correctly point out that he explicitly declined to rule on Entergy’s likelihood of success on the merits. To grant a temporary injunction, he would have had to determine that Entergy is, in fact, more likely than not to prevail in the litigation overall. Though the parties briefed and then argued the merits of the case in great detail, the judge pointedly brushed over all that.

But he also wrote this: “Entergy has raised serious questions regarding its Atomic Energy Act preemption claim, warranting further briefing and a prompt full-dress trial on the merits.” (Emphasis added.) Why make such an observation? In a more conventional case, it would be an effort to nudge the parties toward settlement. But that’s an impossibility here; Vermont cannot agree only to kinda sorta force Vermont Yankee to cease operations after March 21. There is no room for compromise. So, it becomes distinctly possible that the purpose of this language in Judge Murtha’s opinion is to reassure Entergy that it is on the right track – so much so that it really ought to incur the business risk of moving forward with the fuel-rod purchases next week that will facilitate the planned refueling outage in October.

Thus, in my view, it should be cold comfort to the State of Vermont, and the assistant attorneys general making Vermont’s case, that Judge Murtha verily scoffed at Entergy’s claim of irreparable harm absent the entry of a temporary injunction. Entergy executive John Herron politely threatened, but did not promise, to forego buying new fuel rods and even shut Vermont Yankee down permanently if the Court did not grant temporary, emergency relief. Judge Murtha just as politely told Herron and his colleagues to get lost, correctly pointing out that Herron unquestionably stopped short of promising that Entergy would pull the plug without a favorable injunction decision.

Judge Murtha did not reject the notion that there is harm here in the form of uncertainty Entergy confronts about whether Vermont Yankee will stay in business. He agreed that the decision on whether to order the new fuel rods is pressing and expensive. But, he ruled, “[t]his appears to be a business decision made very difficult by the uncertainties of litigation.” In other words, neither this problem, nor employee attrition, nor the difficulties Vermont Yankee has in entering into long-term sales contracts, are harms that are both irreparable and redressable by a temporary injunction.

Two footnotes – numbers two and three, for those with the time and inclination to read the decision – offer an intriguing glimpse into how Judge Murtha views the Vermont statutes that Entergy regards as preempted by the Atomic Energy Act and the regulatory monopoly it confers on the Nuclear Regulatory Commission with respect to radiological safety. Footnote two seems to reflect some exasperation with a complicated series of state enactments that either orders the plant shut down outright as of the passage of the 2006 statute (the State’s view) or amounts to a one-house veto, exercised by the Senate in 2010, of continued operation. The judge explicitly wondered how such a scheme could be compatible with safe decommissioning, given that Vermont law does not require a final determination that it is okay to shut down the plant.

Footnote three is even more troubling from the state’s perspective inasmuch. Judge Murtha explicitly acknowledges that the record contains at least some evidence from which the Court could conclude that Entergy’s mantra is right – that, here, Vermont is indeed regulating “safety, safety, safety.”

Vermont might just win its legal battle with Entergy. But there is very little evidence of such an outcome in this week’s decision denying any temporary emergency relief. The trial starts on September 12. Forget nuclear winter and brace yourself for a nuclear fall.