Power Plant and Utility Litigation

Egan, Fitzpatrick, Malsch & Lawrence has been involved in much of the major nuclear power plant litigation that has occurred in the past decade in the United States, and in several large power plant construction “prudence” proceedings before state public utility commissions. In addition, as the regulation of public utilities in recent years has moved toward a more competitive structure and then back to more traditional regulatory approaches, the firm/s attorneys have been called upon to play significant roles in utility ratemaking and related proceedings when unique, cutting-edge issues, often involving constitutional questions, have arisen. The following are some examples of this experience.

South Texas Nuclear Project

The firm served as nuclear counsel to several firms in the multi-year litigation concerning the two-year shutdown of the South Texas Nuclear Project, representing the City of Austin, a non-operating owner, against the plant’s operator Houston Lighting and Power Company. At the same time, Mr. Fitzpatrick, at that time at Strasburger & Price, represented the City of San Antonio, another non-operating co-owner, in the same litigation in Texas state court, and in arbitration.

This litigation involved dozens of depositions, sponsorship of numerous expert witnesses, the review and management of over a million documents, and extensive media interactions and city council meetings. The firm secured rare NRC permission to depose key NRC officials, including a Regional Administrator. Together, the two cities settled their cases for a combined total of nearly $400 million (Austin during jury deliberations and San Antonio just before trial).

Previously, Mr. Fitzpatrick represented the City of San Antonio in litigation by the owners of the South Texas Nuclear Project against the architect/engineer/constructor of the plant, Brown & Root, Inc., and its parent company, Halliburton Corp. This litigation, concerning cost and schedule overruns, resulted in a $750 million settlement, of which $210 million went to the City of San Antonio. At the time, this was the largest single private lawsuit settlement in U.S. history.

Millstone Nuclear Power Plant

The firm was nuclear counsel to several firms in the multi-year litigation concerning the nearly three-year shutdown of the Millstone Nuclear Power Plant in Connecticut. In that action, the firm represented the eleven non-operating co-owners, who claimed damages against operator Northeast Utilities for mismanagement and safety violations.

The firm devised the litigation plan for the Millstone action, secured expert witnesses, and handled the NRC interface. The case was successfully settled in arbitration.

Separately, Mr. Fitzpatrick (while at Strasburger & Price) represented the Connecticut Municipal Electric Energy Cooperative—a Millstone power purchaser—in successful litigation in federal court relating to the same Millstone plant outage.

Non-Operating Plant Owners

The firm has represented numerous non-operating co-owners of nuclear power plants across America, and for several years published the periodical Co-Owners Quarterly, a magazine of information and legal advice to such entities. For example, the firm devised monitoring plans for the non-operating owners of Seabrook and assisted the non-operating owners of the Cooper nuclear station in their lawsuit challenging the management and shutdown of that unit.

Texas-New Mexico Power Company

The firm served as technical counsel in the multi-year construction prudence litigation before the Texas Public Utilities Commission concerning Texas New Mexico Power Company’s circulating fluidized bed coal-fired power plant in northern Texas – the largest such unit in the world. Among other things, the firm identified and sponsored expert witnesses, risk assessment modelers, and system production modelers. This action resulted in the successful introduction to the rate base of the contested unit, saving the company from bankruptcy.

Beaver Valley Nuclear Power Station

Mr. Egan served as co-lead counsel in the $4.5 billion construction prudence litigation concerning Duquesne Light Company’s Beaver Valley Nuclear Power Plant near Pittsburgh. This multi-year action before the Pennsylvania Public Utility Commission involved extensive cross-examination of witnesses and experts, the production of an extensive affirmative case, preparation of expert reports, and management of tens of thousands of documents. Mr. Egan pioneered the concept of the “indirect effects of regulations,” which helped the company secure the lowest rate disallowance (zero dollars) in the history of such litigation nationwide.

Perry Nuclear Power Plant

Mr. Egan served as nuclear and technical counsel to other firms in the multi-billion dollar construction prudence proceeding for the Perry 1 Nuclear Power Plant near Cleveland before the Ohio Public Utilities Commission. This litigation concluded successfully, with less than one-percent of the plant’s cost being disallowed from the rate base.

Experience, Teamwork, Success!