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US Ecology, Inc. v. United States

ELR Citation: 31 ELR 20575
Nos. No. 00-5062, 245 F.3d 1352/52 ERC 1438/(Fed. Cir., 03/30/2001) aff'd

The court holds that a low-level radioactive waste facility developer lacks standing as a third-party beneficiary to bring suit for the breach of an alleged contract between California and the U.S. Department of the Interior (DOI) for the sale of land where the facility would be built. In 1993, DOI and California agreed to transfer certain land, and the developer, who would build and run the low-level radioactive waste facility on the land, paid the purchase price for DOI. Subsequently, under a new Administration, DOI rescinded the transfer's approval and refused to transfer the land. The developer then sought damages as a third-party beneficiary to the land transfer agreement. The court first holds that there is no indication in the evidence presented by the developer that DOI ever intended for the alleged contract to confer a right on any third party. Although DOI cooperated with the developer, it did so only because the developer was assisting the state in its effort to purchase the land. Further, the developer presented no evidence that the state was bound to develop the facility even if DOI did transfer the land. Moreover, DOI did not expressly confer a right on the developer as a third party in the contract documents. Also, DOI's retention of a reversionary right to the land if the state did not license the operation of the facility is undisputed evidence that DOI was uncertain as to whether the state would proceed with the facility on the land. The court next holds that even if DOI had intended to confer a third-party right, the developer did not qualify as a third party because the developer was not licensed by the state to operate the facility, and the state was not obligated to license the developer.

[A prior decision in this litigation is published at 31 ELR 20260.]

Counsel for Plaintiff
Karl S. Lytz
Latham & Watkins
505 Montgomery St., Ste. 1900, San Francisco CA 94111
(415) 391-0600

Counsel for Defendant
Mark R. Haag
Environment and Natural Resources Division
U.S. Department of Justice, Washington DC 20530
(202) 514-2000

Michel, J. Before Plager and Linn, JJ.