[14 ELR 10126]

Background

The case of Silkwood v. Kerr-McGee Corp.¹ involves a suit brought against Kerr-McGee Nuclear Corporation ("Kerr-McGee") by Bill M. Silkwood, as administrator of the estate of Karen Silkwood, deceased. Karen Silkwood worked as a laboratory analyst in the Cimmaron plant of Kerr-McGee located near Crescent, Oklahoma. The plant was licensed by the Atomic Energy Commission, now the Nuclear Regulatory Commission (NRC), to manufacture plutonium pins to be used for fuel in nuclear reactors. On November 5, 1974 Silkwood was contaminated with plutonium during her work at the plant. She was immediately decontaiminated and placed on a urine and fecal testing regimen. Contaimination was again detected the next day and she was decontaminated once more. Early on November 7, she spilled a urine sample, in the bathroom of her apartment, that contained a high level of insoluble plutonium. In cleaning up the spill, Silkwood contaminated herself and portions of her apartment. When she reported to work, the contamination of her body was confirmed. Based upon her account of the spill, company and federal inspectors were sent to her apartment, where local contamination was also confirmed. Her apartment was quarantined, and most of the contents were eventually seized and destroyed.

On November 13, 1974, Silkwood died in a one-car automobile accident. Thereafter, her estate brought an action alleging a conspiracy to violate her rights under the federal civil rights laws, along with a common law tort count for the injuries she suffered from plutonium contamination. Damages in a stipulated amount of $5,000 were sought for her personal property, which had to be destroyed as a result of plutonium contamination. The estate also requested $10,000,000 in punitive damages. Liability was asserted on alternate theories of negligence and strict liability. Silkwood's complaint under the civil rights laws was dismissed.² The third count of the complaint, alleging a common law tort, survived and ultimately was tried.

Kerr-McGee asserted by way of defense that the Oklahoma workers' compensation statute barred a common law tort action and that "substantial compliance" with NRC regulations barred strict liability, conclusively proved due care, and precluded punitive damages. Kerr-McGee also denied any negligence, and claimed that Silkwood had taken the plutonium to her apartment and contaminated herself.

The exposures received by Silkwood during the three incidents of contamination were all within regulatory limits for a radiation worker. (The exposure she received in her apartment exceeded that permitted for a member of the public.) Both pre- and post-mortem medical examinations confirmed that her lifetime both burden of plutonium was well below that permitted by internationally accepted standards adopted and enforced by the NRC. The only regulatory violation by Kerr-McGee pertaining to Silkwood's contamination was its failure to record properly the void dates for her urine and fecal samples — information that she failed to supply.

The District Court submitted the case to the jury on alternative grounds of strict liability and negligence. The jury was also instructed that it could award punitive damages "for the sake of example and by way of punishment, if [it found] … oppression, fraud, or malice, actual or presumed." The jury awarded actual damages of $505,000 and punitive damages of $10,000,000. Kerr-McGee's alternative motions for judgment notwithstanding the verdict and for a new trial were denied.

The Court of Appeals affirmed in part and reversed in part. The court concluded that Silkwood's personal injury claim was work-related and that her exclusive remedy was therefore the Oklahoma workers' compensation scheme. The Workers' Compensation Act did not, however, apply to claims for property damage. The Court of Appeals agreed that Oklahoma "would apply strict liability to this case of escape of plutonium, a highly toxic and dangerous substance," and that NRC regulations did not preclude application of strict liability under state tort law.³ It thus affirmed the $5,000 judgment for loss of personal property. The court reversed the $10,000,000 punitive damage verdict on the ground that it was preempted by extensive federal regulation and enforcement provisions under the Atomic Energy Act. The court stated:

Arguably, there should be a strong presumption against preemption of state laws affecting such vital interests of its citizens as those involved in the instant case. However, the nuclear industry was initially developed by the federal government, is closely linked with national security, and is extensively regulated by a Federal agency. This apparently is the basis upon which [Northern States Power Co. v. Minnesota, 447 F.2d 1143 (8th Cir. 1971, aff'd mem., 405 U.S. 1035 (1972))] was decided. We cannot read that case and [Train v. Colorado Public Interest Research Group, 426 U.S. 1 (1976)] other than as requiring us to hold invalid any state action that competes substantially with the AEC (NRC) in its regulation of radiation hazards associated with plants handling nuclear material. A judicial award of exemplary damages under state law as punishment for bad practices or to deter future practices involving exposure to radiation is no less intrusive than direct legislative acts of the state. Thus we hold punitive damages may not be awarded in this case.

It does not matter whether Kerr-McGee violated AEC regulations in the conduct of its plant operations. The AEC [14 ELR 10127] (NRC) has comprehensive powers to punish and prohibit practices it regards as improper, through its power and responsibility to license, 42 U.S.C. § 2131, investigate, id. § 2271, enjoin, id. § 2280, and seek civil and criminal penalties. Id. § 2272, 2273, 2282.⁴

The case is now on appeal to the United States Supreme Court. There are only two questions before that Court. The first is whether the appeal lies and the secondis, if the appeal does lie, whether the Tenth Circuit was correct in its ruling that punitive damages were preempted under federal law.

Issues for Discussion

This case suggests a number of questions for further thought and discussion, only one of which is likely to be resolved in the current litigation. The first question is whether punitive damages should be permitted against a federally regulated employer where the exposures are within regulatory limits, or where the exposures, in excess of regulatory limits, are subject to a comprehensive scheme of civil and criminal penalties.

Similar questions arise with respect to actual damages for a release that is within regulatory limits.⁵ Should proof of compliance with regulatory limits be either conclusive or prima facie evidence of care or, in the alternative, can any legally cognizable injury result from an exposure that is within regulatory limits?

The analysis of these questions may turn on the facts of a particular regulatory scheme, for example whether the employer or the facility is required to be licensed as well as regulated. How comprehensive is the scheme of federal regulation, and does the federal regulatory scheme include significant inspection and enforcement?

Finally, moving beyond the case of the worker, should similar rules apply in the case of exposures to members of the public where the exposures result from releases that are permitted under federal regulation?

1. 485 F. Supp. 566 (W.D. Okla. 1979), rev'd, 667 F.2d 908 (10th Cir. 1981), appeal filed May 20, 1982. Question of probable jurisdiction will be considered with the merits. Order of January 10, 1983, No. 81-2159. The case was decided by the Supreme court, __ U.S. __, 14 ELR 20077 (Jan. 11, 1984) [Ed.].

2. 469 F. Supp. 399 (W.D. Okla. 1978), aff'd, 637 F.2d 743 (10th Cir. 1980), cert. denied, 454 U.S. 833 (1981).

3. 667 F.2d 908, 921 (10th Cir. 1981).

4. Id. at 923.

5. See San Diego Building Trades Council v. Garmon, 359 U.S. 236 (1959) (compensatory damages under state law preempted).

14 ELR 10126 | Environmental Law Reporter | copyright © 1984 | All rights reserved