Conn. v. American Electric, Memo in Support of Motion to Dismiss ...

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
STATE OF CONNECTICUT, ET AL.,
v.
Plaintiffs
AMERICAN ELECTRIC POWER COMPANY, INC., ET AL.
Defendants
OPEN SPACE INSTITUTE, INC., ET AL.,
v.
Plaintiffs
AMERICAN ELECTRIC POWER COMPANY, INC., ET AL.
Defendants
:
:
:
:
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: 04 CV 05669 (LAP)(DFE)
: ECF CASE
:
:
:
:
:
:
:
:
:
: 04 CV 05670 (LAP)(DFE)
: ECF CASE
:
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:
MEMORANDUM OF LAW IN SUPPORT OF TENNESSEE VALLEY AUTHORITY’S
MOTIONS TO DISMISS ON FEDERAL DISCRETIONARY FUNCTION GROUNDS
September 30, 2004
Office of the General Counsel
Tennessee Valley Authority
400 West Summit Hill Drive
Knoxville, Tennessee 37902-1401
Facsimile 865-632-6718
Maureen H. Dunn
General Counsel
Harriet A. Cooper (HC4727)
Assistant General Counsel
Edwin W. Small (ES4418)
Assistant General Counsel
Frank H. Lancaster (FL4513)
Todd L. Fulks (TF9072)
Attorneys for Tennessee Valley Authority

TABLE OF CONTENTS
Page
STATEMENT..................................................................................................................................1
Introduction ............................................................................................................................1
TVA Is an Agency and Instrumentality of the United States................................................ 3
TVA Is Charged by Statute With the Multipurpose Development of the Resources of
the Tennessee Valley Region. ............................................................................................... 6
TVA’s Statutorily Authorized Activities Include the Construction and Operation of
Fossil-Fired Electric Power Generating Facilities. ............................................................... 7
In Making Decisions About the Appropriate Generation Mix for its Power Program,
TVA Considers and Balances Many Factors, Including Greenhouse Gas Emissions. ......... 8
ARGUMENT.................................................................................................................................12
Plaintiffs’ Complaints Should be Dismissed as to TVA Because TVA’s Alleged
Tortious Conduct Involves TVA’s Performance of Discretionary Functions
Authorized by Federal Law................................................................................................. 12
CONCLUSION..............................................................................................................................19
i

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
STATE OF CONNECTICUT, ET AL.,
v.
Plaintiffs
AMERICAN ELECTRIC POWER COMPANY, INC., ET AL.
Defendants
OPEN SPACE INSTITUTE, INC., ET AL.,
v.
Plaintiffs
AMERICAN ELECTRIC POWER COMPANY, INC., ET AL.
Defendants
:
:
:
:
:
: 04 CV 05669 (LAP)(DFE)
: ECF CASE
:
:
:
:
:
:
:
:
:
: 04 CV 05670 (LAP)(DFE)
: ECF CASE
:
:
:
:
MEMORANDUM OF LAW IN SUPPORT OF TENNESSEE VALLEY AUTHORITY’S
MOTIONS TO DISMISS ON FEDERAL DISCRETIONARY FUNCTION GROUNDS
STATEMENT
Introduction
Separate sets of Plaintiffs have filed two virtually identical common law nuisance
cases against the same six Defendants, alleging that global warming is a nuisance; that carbon
dioxide emissions from Defendants’ fossil-fired electric generating facilities contribute to the
alleged nuisance; and that Defendants’ electrical generation based on fossil fuels should be
reduced by judicial order. Defendant Tennessee Valley Authority (TVA), an agency and
instrumentality of the United States, has moved to dismiss both cases on several grounds,
1

including Federal discretionary function grounds. This memorandum of law is submitted in
support of TVA’s motions on Federal discretionary function grounds.
In the first case (No. 04-CV-05669), the State of Connecticut, seven other states,
and the City of New York allege that global warming is a public nuisance under Federal common
law and under the separate laws of the states in which Defendants operate. In the second case
(No. 04-CV-05670), three private entities allege that global warming is a public nuisance under
Federal common law, and a public and private nuisance under the separate laws of the states
where Defendants operate.
As described in more detail below, TVA is an agency and instrumentality of the
United States created by the TVA Act of 1933, and is charged by the TVA Act with carrying out
various Federal statutory functions, including the operation of Federal electric power generating
facilities in the Tennessee Valley region. As alleged in the complaints, TVA operates fossil-fired
electric power generating facilities in Alabama, Kentucky, Mississippi, and Tennessee.
Plaintiffs do not allege that TVA has violated any restrictions on carbon dioxide
emissions under the Federal Clean Air Act or any other Federal statute or regulatory scheme.
Nor do Plaintiffs allege that TVA has violated the TVA Act by utilizing fossil-fired facilities to
generate electric power in the Tennessee Valley region. Nevertheless, Plaintiffs ask this Court to
exercise common law authority to dictate to TVA how to carry out its Federal statutory
obligations.
TVA’s position is that Plaintiffs’ effort to have this Court sit as a common law
regulator of TVA’s statutory activities is legally precluded because the TVA Act vests authority
and discretion in TVA’s Board of Directors to conduct TVA’s statutory activities to accomplish
the purposes of the TVA Act.
2

TVA Is an Agency and Instrumentality of the United States.
TVA is a constitutionally authorized 1 corporate agency and instrumentality of the
United States, 2 created by and existing pursuant to the TVA Act of 1933, as amended, 16 U.S.C.
1 See, e.g., Ashwander v. TVA, 297 U.S. 288, 338-39 (1936) (upholding TVA Act against
constitutional challenge relating to power sales by TVA); Goodpasture v. TVA, 434 F.2d 760,
763 (6th Cir. 1970) (“The TVA Act is constitutional.”); United States ex rel. TVA v. Three Tracts
of Land, Etc., 377 F. Supp. 631, 635 (N.D. Ala. 1974) (“It is the Court’s opinion that the
construction of a nuclear powered steam plant is authorized by the TVA Act and that the
authorization is not in violation of the United States Constitution.”); United States ex rel. TVA v.
An Easement & Right-of-Way Over Two Tracts of Land, Etc., 246 F. Supp. 263, 270 (W.D. Ky.
1965) (“TVA’s . . . integrated system of multipurpose dams, steam plants, and transmission lines,
which together improve navigation, help control floods, produce power, and serve generally to
develop the Tennessee River watershed are authorized by the commerce clause of the
Constitution . . . .”), aff’d “for the reasons stated and upon the authorities set forth in the opinion
of the district court,” 375 F.2d 120, 121 (6th Cir. 1967).
2 See, e.g., 16 U.S.C. § 831r (2000) (denoting TVA to be “an instrumentality and agency of
the Government of the United States”); Tenn. Elec. Power Co. v. TVA, 306 U.S. 118, 134 (1939)
(referring to TVA as “an instrumentality of the United States”); Ashwander v. TVA, 297 U.S.
288, 315 (1936) (referring to TVA as “an agency of the federal government”); Hill v. United
States Dep’t of Labor, 65 F.3d 1331, 1333 (6th Cir. 1995) (TVA is “a wholly-owned corporate
agency and instrumentality of the United States . . . .”); Springer v. Bryant, 897 F.2d 1085, 1089
(11th Cir. 1990) (“The TVA is a federally owned corporation that acts as an agency or
instrumentality of the United States.”); TVA v. Kinzer, 142 F.2d 833, 837 (6th Cir. 1944) (“It
[TVA] is plainly a governmental agency or instrumentality of the United States.”); Posey v. TVA,
93 F.2d 726, 727 (5th Cir. 1937) (“[T]he Authority is plainly a governmental agency of the
United States . . . .”).
Because TVA is an agency of the United States, its employees are Federal employees
(see, e.g., Jones v. TVA, 948 F.2d 258, 262 (6th Cir. 1991) (“Jones was a federal employee
during his tenure with TVA.”); Hill v. TVA, 842 F. Supp. 1413, 1416 n.2 (N.D. Ala. 1993)
(“TVA employees are regarded as federal employees in the excepted service under [the Civil
Service Reform Act].”); McNabb v. TVA, 754 F. Supp. 118, 120 (E.D. Tenn. 1990)
(“McNabb was a federal employee when he worked for TVA.”)), and they are entitled to
federal official immunity. See, e.g., Quality Tech. Co. v. Stone & Webster Engg. Co., 745 F.
Supp. 1331, 1343 (E.D. Tenn. 1989) (holding TVA’s manager of nuclear power to be entitled to
Federal official immunity), aff’d, 909 F.2d 1484 (6th Cir. 1990); Johns v. Pettibone Corp.,
843 F.2d 464, 466-67 (11th Cir. 1988) (affirming district court holding that the defendant TVA
employees, six managers and supervisors in power production and construction, were entitled to
Federal official immunity).
3

§§ 831-831ee (2000 & Supp. II 2002), with authority under 16 U.S.C. § 831c(b) to sue and be
sued in its own name. Under the TVA Act, TVA is charged with the multipurpose development
of the resources of the Tennessee Valley region for the public good, 3 and has been granted broad
statutory powers to carry out its mission. 4 TVA’s activities, including its electric power program
activities, are widely known and judicially noticeable, 5 and, as a matter of Federal law, TVA’s
authorized activities under the TVA Act are wholly governmental in nature. 6
3 The purposes of the TVA Act are broad and include not only the production, distribution,
and sale of electric power at rates as low as are feasible (16 U.S.C. §§ 831d(l), 831n-4(f)), but
also “the advancement of the national defense and the physical, social and economic
development” of the Tennessee Valley (id. § 831n-4(h)), “agricultural and industrial
development” (id. § 831), improvement of navigation (id.), control of flood waters (id.), law
enforcement (id. § 831c-3), and economic development (id. § 831u). Further, the TVA Act is to
be “liberally construed to carry out the purposes of Congress to . . . provide for the national
defense, improve navigation, control destructive floods, and promote interstate commerce and
the general welfare.” Id. § 831dd.
4 For example, TVA is authorized to condemn property in the name of the United States to
carry out the purposes of the TVA Act. See 16 U.S.C. §§ 831c(h) (TVA “[s]hall have power in
the name of the United States of America to exercise the right of eminent domain . . . .”). See
also 16 U.S.C. § 831c(g) (2000) (TVA “[s]hall have such powers as may be necessary or
appropriate for the exercise of the powers herein specifically conferred upon [TVA].”).
5 See United States ex rel. TVA v. An Easement & Right-of-Way, Etc., 246 F. Supp. 263,
269 (W.D. Ky. 1965) (“The basic facts as to the activities of TVA, including the development of
its power program and other statutory programs, are matters of public record and common
knowledge; they are contained in TVA’s annual reports to Congress and are judicially known to
the Court.”), aff’d, 375 F.2d 120 (6th Cir. 1967).
6 Contrary to the rule often applied under state law to state and local government agencies,
the authorized activities of Federal instrumentalities through which the Federal government acts
are wholly governmental and cannot be parsed into governmental and non-governmental
categories. See Fed. Land Bank v. Bd. of County Comm’rs, 368 U.S. 146, 150-51 (1961) (“[O]ur
decisions have made it clear that the Federal Government performs no ‘proprietary’ functions. If
the enabling Act is constitutional and if the instrumentality’s activity is within the authority
granted by the Act, a governmental function is being performed.”); Fed. Crop Ins. Corp. v.
Merrill, 332 U.S. 380, 383-84 (1947) (“Government is not partly public or partly private,
depending upon the governmental pedigree of the type of a particular activity or the manner in
which the Government conducts it.”); Fed. Land Bank v. Bismarck Lumber Co., 314 U.S. 95,
4

The authority to exercise all of TVA’s statutory powers is vested in TVA’s Board
of Directors by 16 U.S.C. § 831a(g). The TVA Board, by statute, is composed of three United
States citizens appointed by the President for nine-year terms by and with the advice and consent
of the Senate. See 16 U.S.C. § 831a(a)-(e). As required by 16 U.S.C. § 831h(a), the TVA Board
submits annual reports to the President and Congress about TVA’s activities. 7
(. . . continued)
102 (1941) (“[W]hen Congress constitutionally creates a corporation through which the federal
government lawfully acts, the activities of such corporation are governmental.”); Pittman v.
Home Owners’ Loan Corp., 308 U.S. 21, 32 (1939) (“[T]he activities of the Corporation through
which the national government lawfully acts must be regarded as governmental functions . . . .”);
Graves v. New York ex rel. O’Keefe, 306 U.S. 466, 477 (1939) (“[W]hen the national
government lawfully acts through a corporation which it owns and controls, those activities are
governmental functions . . . .”). See also Garcia v. San Antonio Metro. Transit Auth., 469 U.S.
528, 545 (1985) (“The goal of identifying ‘uniquely’ governmental functions . . . has been
rejected by the Court in the field of government tort liability in part because the notion of a
‘uniquely’ governmental function is unmanageable.”).
Thus, the authorized activities of TVA are wholly governmental. See, e.g., In re
Agricultural Business Co., 613 F.2d 783, 787 (10th Cir. 1980) (“[T]he TVA is the United States
in action, ‘an arm of the government,’ and an agency performing wholly governmental service.”)
(citation omitted); Quality Tech. v. Stone & Webster Engg., 745 F. Supp. 1331, 1339 (E.D. Tenn.
1989) (“As has been declared by many courts, the TVA is a federal government corporation —
‘an agency performing wholly governmental services, and is an instrumentality of the United
States.’”), aff’d, 909 F.2d 1484 (6th Cir. 1990); Gold Point Marina, Inc. v. TVA, 635 F. Supp. 39,
42 (E.D. Tenn. 1986) (“TVA is an agency performing wholly governmental services . . . .”); PRI
Pipe Supports v. TVA, 494 F. Supp. 974, 975 (N.D. Miss. 1980) (“TVA is an agency performing
wholly governmental services . . . .”); TVA v. United States Carbon Prods., Inc., 427 F. Supp.
474, 477 (E.D. Ill. 1976) (“TVA is . . . an agency performing wholly governmental services.”);
TVA v. Mason Coal, Inc., 384 F. Supp. 1107, 1115 (E.D. Tenn. 1974) (“TVA is an ‘arm of the
[federal] government’ and an agency performing wholly governmental services.”) (alteration in
original), aff’d, 513 F.2d 632 (6th Cir. 1975); Knickerbocker v. TVA, 348 F. Supp. 230, 232
(E.D. Ill. 1972) (“TVA is . . . an agency performing wholly governmental service.”); Ramsey v.
United Mine Workers of Am., 27 F.R.D. 423, 425 (E.D. Tenn. 1961) (“Actually the TVA is the
United States in action, ‘an arm of the government’, and an agency performing wholly
governmental service.”).
7 TVA’s Annual Reports about its activities are subject to judicial notice. See Ill. Cent.
R. R. Co. v. TVA, 445 F.2d 308, 310 n.4 (6th Cir. 1971); Mobil Oil Corp. v. TVA, 387 F. Supp.
498, 500 n.1 (N.D. Ala. 1974).
5

TVA Is Charged by Statute With the Multipurpose Development
of the Resources of the Tennessee Valley Region.
Under the TVA Act, TVA is charged with broad responsibilities for the
multipurpose development of the Tennessee Valley region. As the Supreme Court stated in
United States ex rel. TVA v. Welch, 327 U.S. 546, 553 (1946):
The broad responsibilities placed on the Authority [by the TVA Act] relate to
navigability, flood control, reforestation, marginal lands, and agricultural
and industrial development of the whole Tennessee Valley. The T.V.A. was
empowered to make contracts, purchase and sell property deemed necessary or
convenient in the transaction of its business, and to build dams, reservoirs,
transmission lines, power houses, and other structures. . . . All of the
Authority’s actions in these respects were to be directed towards
“development of the natural resources of the Tennessee River drainage basin
and of such adjoining territory as may be related to or materially affected by
the development consequent to this Act . . . all for the general purpose of
fostering an orderly and proper physical, economic, and social development
of said areas . . .” To discharge its responsibilities the T.V.A. was granted “such
powers as may be necessary or appropriate” for their exercise. 8
Three of TVA’s major multipurpose development programs are in the areas of
electric power, river operations, and land management. These programs were recently
summarized in the Federal Register:
TVA is a multipurpose federal corporation with a mandate to foster
the social and economic well-being of the residents of the Tennessee Valley
region through the wise use, conservation, and development of its natural
resources. In carrying out this mission, TVA conducts a range of programs
and activities, including operating the Nation’s largest public power system,
serving almost nine million people in parts of seven southeastern states, and
operating a system of dams and reservoirs with associated facilities--its water
control system.
As directed by the TVA Act, TVA manages the Tennessee River and
reservoir system as an integrated water control system primarily for the purposes
of navigation, flood control, and power production. Consistent with those
purposes, TVA operates the system to improve water quality and water supply,
8 Emphasis added above and throughout this memorandum unless noted otherwise.
6

and provide recreational opportunities, and a wide range of other public benefits.
The water control system has hydroelectric generators and provides the cooling
water supply for TVA’s coal-fired and nuclear power plants and water supply for
other industries located adjacent to the reservoirs. TVA’s power system and its
management of the integrated water control system are central components of the
economic well-being of the Tennessee Valley region.
TVA also manages 11,000 miles of public shoreline to maintain the
integrity of the reservoir system. TVA has custody of and manages 293,000 acres
of land in the Valley, most of which is along the shorelines of TVA reservoirs.
69 Fed. Reg. 30,975 (June 1, 2004) (Issuance of Record of Decision, Final Programmatic
Environmental Impact Statement, Tennessee Valley Authority Reservoir Operations Study (TVA
2004)).
The TVA Act at 16 U.S.C. § 831d(l) authorizes the TVA Board to “produce,
distribute, and sell electric power” as part of its multipurpose development activities; and, in
accordance with that statutory authority, TVA operates a large electric power generating and
transmission system. That system was described in 4-County Elec. Power Ass’n v. TVA, 930 F.
Supp. 1132, 1135 (S.D. Miss. 1996):
TVA, a federal agency organized and existing under the TVA Act, 16 U.S.C.
§ 831l-831dd, maintains and operates one of the nation’s largest electric
power systems as part of a program to fulfill its mission for the development
of the Tennessee Valley region’s resources and economy. It produces and sells
electricity to 160 municipal and cooperative distributors for millions of
residential, commercial, industrial and governmental customers, and also sells
electricity directly to a number of industrial customers with large or unusual loads
and several federal agency installations. The area in which TVA supplies power
covers about 80,000 square miles, which includes most of Tennessee, northern
Alabama, northeastern Mississippi, southwestern Kentucky and parts of Georgia,
North Carolina and Virginia, and has a population of over 8,000,000.
TVA’s Statutorily Authorized Activities Include the Construction and
Operation of Fossil-Fired Electric Power Generating Facilities.
TVA’s authorized power program activities specifically include the construction
and operation of steam plants such as TVA’s coal-fired steam plants about which Plaintiffs
7

complain. 9 In Rainbow Realty Co. v. TVA, 124 F. Supp. 436, 439-40 (M.D. Tenn. 1954), in
holding that TVA had authority under the TVA Act to construct steam plants, the court pointed
out that Congress had made appropriations to TVA for the construction of eight coal-fired steam
plants:
Appropriation Acts of Congress have provided funds for eight major
steam plants now constructed or in process of construction by T.V.A.: 54 Stat.
781, covering Watts Bar Steamplant; 63 Stat. 76, 80, covering Johnsonville;
64 Stat. 37-38, covering Widows Creek; 64 Stat. 1223, 1229, covering Kingston
and Shawnee Steamplants; 65 Stat. 268, 280, covering Colbert; and 66 Stat. 637,
645, covering the Gallatin and John Sevier Steamplants. These repeated
congressional appropriations indicate clearly the interpretation by Congress
of the T.V.A. Act to authorize construction of steamplants.
See also United States ex rel. TVA v. Three Tracts of Land, Etc., 377 F. Supp. 631, 634 (N.D.
Ala. 1974) (“16 U.S.C. § 831n and § 831n-4, indicate that steam plants are to be constructed by
TVA when they become necessary to discharge TVA’s broad responsibilities for the
advancement of the national defense and the physical, social and economic development of the
area and Congress further intends that TVA should provide an ample supply of electric power for
such purposes.”).
In Making Decisions About the Appropriate Generation Mix for its
Power Program, TVA Considers and Balances Many Factors,
Including Greenhouse Gas Emissions.
TVA is well aware that burning coal and natural gas at TVA plants results in
carbon dioxide emissions and that carbon dioxide is a greenhouse gas. TVA also is well aware
9 TVA generates the bulk of the electricity needed for its power program through its
operation of 11 coal-fired steam plants (59 units), 3 nuclear steam plants (5 units),
29 hydroelectric plants (109 units), and 6 combustion turbine plants (72 units) (TVA’s 2003
Annual Report inside cover, 17; available at http://www.tva.gov/finance/reports/pdf/
TVA2003_annual_report.pdf). Lesser amounts of electric power are supplied by TVA’s
operation of 15 solar energy sites, a wind energy site (3 turbines), and a pumped storage plant
(4 units) (id.). Some amounts also are purchased from other entities.
8

of the scientific research relating to greenhouse gases and global warming. Indeed, in
conducting its power program, TVA has taken, and is taking, actions it considers appropriate
based on that research and on the potential for harm from carbon dioxide emissions. However,
in making judgments about what actions to take based on the potential for harm from carbon
dioxide emissions, TVA necessarily balances competing social, economic, and political policies
in order to carry out its statutory missions of providing low-cost reliable electric power while
also protecting the environment and supporting economic development. The fact that TVA
balances these disparate interests is a matter of public record which is documented in detail in
various Government publications, including three TVA environmental impact statements issued
in the last decade related to TVA’s power program: Energy Vision 2020, Integrated Resource
Plan/Environmental Impact Statement (TVA 1995); Final Supplemental Environmental Impact
Statement for Operating License Renewal of the Browns Ferry Nuclear Plant in Athens,
Alabama (TVA 2002); Final Programmatic Environmental Impact Statement, Tennessee Valley
Authority Reservoir Operations Study (TVA 2004). 10
TVA’s Energy Vision 2020 EIS involved TVA’s consideration of a wide range of
resource alternatives for meeting electric power needs. See 61 Fed. Reg. 7,572 (Feb. 28, 1996)
(Issuance of Record of Decision). TVA’s long-term goal was “viewed as not only maintaining
low electric rates and reliable service, but also fostering sustainable economic development and
10 As a Federal agency, TVA is subject to the National Environmental Policy Act (NEPA),
42 U.S.C. §§ 4321-4370f (2000), which requires Federal agencies to consider the environmental
effects of major Federal actions which are likely to have a significant effect on the quality of the
human environment. For major Federal actions with significant environmental impacts, NEPA
requires agencies to prepare and issue Environmental Impact Statements.
9

protecting environmental quality” and the decision process “integrated economic development
and environmental goals.” Id. at 7,573-7,574. As summarized in the Record of Decision:
Id. at 7,573.
The primary analytical method used for Energy Vision 2020 was the
multi-attribute tradeoff method. This approach allowed TVA to
quantitatively integrate the identified environmental impacts of proposed
energy resource strategies and to formulate alternative strategies to mitigate
adverse environmental impacts while retaining other beneficial
characteristics of specific strategies.
Energy resource strategies are created from different combinations of
energy resource options. Energy resource options are either supply-side options
(e.g., new generating resources such as coal-fired or nuclear units, gas-fired
combustion turbines, repowering of existing units, integrated gasification, or wind
turbines), or customer service options (e.g., demand-side management actions,
including energy efficiency improvements and energy conservation, or beneficial
electrification). . . .
TVA developed 2,000 energy resource strategies from more than 100
supply-side and 60 customer service options. These strategies were then analyzed
through the use of computer models to identify combinations of resource options
that best met the evaluation criteria . . . .
The multi-attribute tradeoff method allowed potential environmental
impacts of each strategy to be compared to all other evaluation criteria (such as
debt, electric rates, and economic development) and to all other strategies on an
objective basis. This process identified where real tradeoffs existed. One of the
most important tradeoffs occurred between better environmental performance and
electric rates because achieving better environmental performance typically
produces higher costs and higher electric rates. However, the integrated resource
planning process used by TVA allowed it to reformulate strategies repeatedly to
produce strategies that performed better across all criteria, including
environmental criteria. . . . Eventually this integration process produced seven
final alternative strategies that performed well across all of the criteria, including
environmental criteria.
The TVA Board adopted the EIS’s preferred alternative (the portfolio
alternative—a blend of the seven final alternatives) at its February 26, 1996, public meeting,
finding that “TVA’s preferred portfolio alternative better enables TVA to meet customer needs at
an acceptable level of risk and still meet the objectives of balancing costs, rates, environmental
10

impacts, debt, and economic development.” Id. at 7,574. One of the factors utilized in
considering the alternatives was greenhouse gas emissions. As noted in the Record of Decision:
Id.
[G]reenhouse gas emissions from the TVA system are projected to increase under
all strategies by 25 to 38 percent. This increase is still less than that projected for
the no-action alternative (it results in a 52-percent increase) and on a per unit of
electric energy basis produced 10 to 15 percent less than that produced by the
existing system. This means that the efficiency of the TVA system is improved
under the final seven alternatives.
The Browns Ferry License Renewal EIS involved the TVA Board’s May 16,
2002, decision to refurbish and restart Browns Ferry Nuclear Unit 1 and to seek operating license
extensions for all three Browns Ferry nuclear units. See 67 Fed. Reg. 41,565 (June 18, 2002)
(Issuance of Record of Decision). Again, the impact of greenhouse gas emissions was
considered. As noted in the Record of Decision:
Id. at 41,568.
On May 16, 2002, the TVA Board of Directors decided to adopt the
preferred alternative (Alternative 2) to refurbish and restart BFN Unit 1, and to
proceed with NRC license extensions for all three units at BFN. This decision
took into account environmental considerations together with economic and
technical aspects of the project. Proceeding with license extensions and Unit 1
restart is the best business decision for TVA and the Tennessee Valley in terms of
power supply, power price, generation mix, return on investment, and avoidance
of environmental impacts. This decision has the three-fold benefits of assuring
future power supplies without the environmental effects resulting from operation
of fossil fuel generating plants (including increased emissions of greenhouse
gases), avoiding the even larger capital outlays associated with new construction,
and avoiding the environmental impacts resulting from siting and construction of
new power plant generating facilities.
Finally, the Reservoir Operations Study EIS involved proposed changes in the
way that TVA operates its reservoir system. 69 Fed. Reg. 30,975 (June 1, 2004) (Issuance of
Record of Decision). The TVA Board adopted the EIS’s preferred alternative (the blended
alternative) at its May 19, 2004, public meeting. Id. Because an increase or decrease in hydro
11

generation can impact the amount of generation needed from fossil fuels, the effect of TVA’s
action on greenhouse gas emissions again was considered. As noted in the Record of Decision
discussion regarding the Commercial Navigation Alternative:
Id. at 30,978.
TVA has concluded that the Commercial Navigation Alternative, with its minor
changes in water availability limited primarily to mainstream reservoirs, has
slightly better environmental consequences than the Base Case and Preferred
Alternative and is the environmentally preferable alternative. . . . It would
provide beneficial effects on greenhouse gas emissions . . . .
ARGUMENT
Plaintiffs’ Complaints Should be Dismissed as to TVA Because TVA’s
Alleged Tortious Conduct Involves TVA’s Performance of
Discretionary Functions Authorized by Federal Law.
It is a fundamental tenet of Federal law that the performance by Federal agencies
of discretionary functions entrusted to them by statute is not subject to judicial review by way of
a tort suit for damages or for an injunction. As the Second Circuit stated in In re Joint E. and S.
Districts Asbestos Litig., 891 F.2d 31, 35 (2d Cir. 1989):
The wellspring of the discretionary function exception is the doctrine of
separation of powers. Simply stated, principles of separation of powers mandate
that the judiciary refrain from deciding questions consigned to the concurrent
branches of the government [citation omitted]. If substantial constitutional issues
are not implicated, the wisdom of decisions made by the executive and legislative
branches are not subject to judicial review [citations omitted].
Under the Federal discretionary function doctrine, conduct of a Federal agency
challenged in a tort suit is not subject to review if (1) there is no mandatory Federal statute,
regulation or policy which controls the matter, and (2) the alleged tortious conduct is susceptible
to policy analysis. See, e.g., In re Joint E. and S. Districts Asbestos Litig., 891 F.2d at 36-37;
Brotman v. United States, 111 F. Supp. 2d 418, 423, 425 (S.D.N.Y. 2000). Here, Plaintiffs have
not alleged that TVA’s challenged conduct violates any Federal statute, regulation, or policy that
12

dictates a specific course of action, even though the burden of alleging and making such a
showing is on Plaintiffs. See, e.g., Brotman v. United States, 111 F. Supp 2d at 423 (“The
[plaintiffs] have the burden of showing that the challenged action of [the Government agency]
was not discretionary but was instead ‘controlled by mandatory statutes or regulations.’”).
Absent an allegation that TVA’s carbon dioxide emissions violate a mandatory Federal statute or
regulation which controls the matter (and to TVA’s knowledge no such statute or regulation
exists), the only ground upon which these lawsuits could proceed as to TVA would be a finding
that TVA’s challenged conduct is not susceptible to policy balancing. Clearly, however, no
basis exists (or is even alleged) for such a finding.
In fact, it is difficult to imagine a better example of decisions susceptible to social,
economic, and political policy balancing than TVA’s decisions about the mix of energy sources
to be used in generating power for the public good in light of the potential for public harm
resulting from carbon dioxide emissions. 11 As TVA has recognized, nuclear generation may be
11 The Environmental Protection Agency stated the obvious in its September 8, 2003 notice
of denial of a petition for EPA to regulate carbon dioxide emissions of motor vehicles:
It is hard to imagine any issue in the environmental area having greater
“economic and political significance” than regulation of activities that might lead
to global climate change. Virtually every sector of the U.S. economy is either
directly or indirectly a source of GHG [greenhouse gas] emissions . . . .
The most abundant anthropogenic GHG, CO 2 , is emitted whenever fossil
fuels such as coal, oil, and natural gas are used to produce energy. The
production and use of fossil fuel-based energy undergirds almost every aspect of
the U.S. economy. For example, approximately 70 percent of the electric energy
used in this country is generated from fossil fuel . . . .
. . . .
The [various] approaches for reducing CO 2 emissions all have substantial
economic implications. While it may eventually be possible to achieve
13

substituted for fossil generation, but that involves tradeoffs between nuclear environmental
impacts and fossil environmental impacts. Similarly, substituting wind and solar generation for
fossil generation implicates issues of electric generation reliability as well as increased power
costs, as does substitution of natural gas generation for coal generation. Of course, electric
power costs directly affect the competitiveness of American industry in the worldwide economy
as well as the continued growth of the American economy. Also, limiting use of America’s vast
coal reserves to generate power would impact America’s goal of energy independence while
raising issues of economic harm to American coal-mining regions. Because TVA’s decisions
about its generation mix necessarily implicate all these considerations of economics, greatest net
benefit, environmental impacts, electric reliability, economic development, public safety, and
political concerns, TVA’s challenged conduct clearly falls within the discretionary function
doctrine which precludes judicial second-guessing of such conduct in tort cases such as this.
(. . . continued)
widespread capture and sequester CO 2 emissions from power plants, such an
approach would require a new generation of power plants and would be very
costly, even if implemented over many years. As for the use of alternative fuels,
governments and private companies around the world are investing billions of
dollars to explore the possibility of using non-fossil fuels for power generation
. . . . Any widespread effort to switch away from fossil fuels in [the power] sector
would likewise require a wholesale transformation of our methods for producing
power . . . . It is hard to overstate the economic significance of making these
kinds of fundamental and widespread changes in basic methods of producing and
using energy.
The issue of global climate change also has enormous political
significance. It has been discussed extensively during the last three Presidential
campaigns; it is the subject of debate and negotiation in several international
bodies; and numerous bills have been introduced in Congress over the last 15
years to address the issue.
68 Fed. Reg. 52,922, 52,928 (Sept. 8, 2003).
14

In this regard, the holding in Morris v. TVA, 345 F. Supp. 321 (N.D. Ala. 1972),
applying the discretionary function doctrine to TVA in a nuisance case, is directly applicable
here. The plaintiff in Morris was the owner of property which fronted on an embayment on
TVA’s Wilson Reservoir. Morris, 345 F. Supp. At 322. Morris alleged that TVA’s method of
operating Wilson Reservoir, which caused refuse to accumulate in and pollute the embayment,
constituted a nuisance; and he sought a permanent injunction against TVA. Id. The court
entered judgment in favor of TVA on discretionary function grounds, stating:
Id. at 323.
TVA’s motion for summary judgment is based primarily on the contention
that its fluctuation of reservoir water levels in carrying out its water control
functions as directed by statute represents an exercise of discretionary
governmental authority which is not subject to judicial review. The Court agrees.
Similarly, in Atchley v. TVA, 69 F. Supp. 952 (N.D. Ala. 1947), the court held the
discretionary function exception applicable, this time in an action for damages based on TVA’s
reservoir operations decisions:
Congress has laid down in section 9a of the TVA Act, 16 U.S.C.A.
§ 831h-1, the broad policy to be followed by [TVA] in the operation of its
multipurpose projects, but it has wisely left to [TVA] wide discretion as to
the details of operation. . . . I am convinced that Congress did not intend that
discretion to be controlled by the courts. If the plaintiffs can recover damages
for losses sustained by the method of operation adopted by [TVA] it would seem
to follow that they could control such operation through the injunctive process.
Surely Congress could not have intended that the judgment of a court or jury as to
details of operation be substituted for that of the skilled and experienced engineers
to whom this duty has been delegated.
The present case comes clearly within the principle that the
performance by executive officers of discretionary governmental duties
entrusted to them by statute is not subject to judicial review. This principle
has been reiterated time and again in mandamus proceedings to compel
executive action, in injunction suits to prevent executive action, and in
actions such as that at bar for damages claimed to have resulted from
executive action.
15

69 F. Supp. at 955; footnotes omitted.
Dalehite v. United States, 346 U.S. 15 (1953), also illustrates the point. Dalehite
involved claims for numerous personal injuries and deaths in Texas City arising out of a
disastrous explosion of ammonium nitrate fertilizer which had been produced and was being
shipped as part of a Government export program to devastated areas after World War II. Among
other things, the district court found the Government liable based on Government negligence in
various phases of the manufacturing process, including the Government’s use of TVA
specifications related to high bagging temperatures, which increased the risk of fire and
explosion. Id. at 23. The court of appeals reversed and the Supreme Court affirmed, pointing
out that the tortious conduct involved decisions touching upon the feasibility of the foreign aid
program and was thus the kind of conduct precluded from judicial review by the discretionary
function doctrine:
[T]he decision to bag at the temperature fixed was also within the [discretionary
function] exception. Maximum bagging temperatures were first established under
the TVA specifications. That they were the product of an exercise of judgment,
requiring consideration of a vast spectrum of factors, including some which
touched directly the feasibility of the fertilizer export program, is clear. . . . It
would be possible to keep the product in graining kettles for a longer period or to
install cooling equipment. But both methods would result in greatly increased
production costs and/or greatly reduced production. This kind of decision is not
one which the courts, under the Act, are empowered to cite as “negligence” . . . .
346 U.S. at 40-41.
The Second Circuit, too, has specifically applied the discretionary function
doctrine to challenged Government conduct susceptible to discretionary policy analysis. For
example, in In re Joint E. and S. Districts Asbestos Litig., 891 F.2d 31, 37 (2d Cir. 1989), which
challenged Government decisions to operate merchant ships containing asbestos during World
War II and expose the crews to the hazards of asbestos, the Second Circuit held:
16

We need spend little time discussing whether the contested choices
involved considerations of public policy. It is difficult to imagine a clearer
example of a decision grounded in social, economic, and political policy than the
choice of how to prosecute a world war.
Similarly, in In re “Agent Orange” Prod. Liability Litig., 818 F.2d 210, 214-15 (2d Cir. 1987),
which involved injuries resulting from exposure to Agent Orange being tested in Hawaii, the
Second Circuit held:
The governmental acts of which the Hawaiian plaintiffs complain fall within [the
discretionary function] exception. It cannot be seriously contended that the
decision to use Agent Orange as a defoliant was anything but a discretionary act.
Vaizburd v. United States, 90 F. Supp. 2d 210 (E.D.N.Y. 2000), also illustrates the
principle. There, a huge influx of sand had accumulated and was continuing to accumulate on
plaintiffs’ beachfront property as a result of the design and implementation of a shoreline
protection project by the Corps of Engineers; and the plaintiffs sought relief against the
Government for continuing nuisance. Id. 212-13. The court held the discretionary function
doctrine applied because no Federal statute, regulation or policy mandated a specific course of
action (id. at 214), and the Corps of Engineers’ decisions in designing and implementing the
project implicated a wide-range of policy considerations, including economics, resource
allocation, budgetary constraints, greatest net benefit, damage prevention, environmental
impacts, reliability, safety, political implications, and community input and cooperation. Id.
at 215.
Further, comparable cases decided under the related doctrine of nonjusticiable
political question are in accord. 12 The decisions in Pauling v. McElroy, 278 F.2d 252 (D.C. Cir.
12 One of the established grounds for holding a case nonjusticiable because it involves a
political question is that deciding the case on the merits would require the Judiciary to secondguess
discretionary decisions of the Executive and/or Legislative Branches. See Greenham
17

1960), and Pauling v. McNamara, 331 F.2d 796 (D.C. Cir. 1964), are closely analogous both
factually and legally to the present cases against TVA. In McElroy, plaintiffs sought to enjoin
the Secretary of Defense and members of the Atomic Energy Commission from detonating
nuclear weapons for testing purposes, alleging that the world-wide fallout from such nuclear
testing would increase the radioactive strontium in soil, increase the amount of contamination in
the world food supply and in the bones of human beings, contribute to the exposure of human
beings to radiation, and cause possible injury to plaintiffs and others. 278 F.2d at 253. The D.C.
Circuit affirmed dismissal of the case, stating:
The District Court correctly held that the . . . complaints presented no
justiciable controversy. The relief here sought is to stop actions of the Executive
which Congress has explicitly authorized. . . . The acts and powers challenged
here are plainly authorized by law and are not prohibited by the Constitution. . . .
[It is] settled law that the questions presented by the pleadings are in that area of
the law where the Executive and the Legislature are supreme.
Id. at 254. In the subsequent McNamara case, plaintiffs sought the same injunctive relief based
on allegations that they had been damaged genetically, somatically, and psychologically.
331 F.2d at 799. The district court dismissed the case on four grounds, including the ground that
“the actions and powers challenged were plainly authorized by law and the Constitution.” Id. at
797. Affirming, the D.C. Circuit stated “[t]he District Court was plainly correct on all points”
and held the case was properly dismissed based on the
fundamental principle that the executive action challenged by the pleadings
plainly falls in that area where the Executive and Legislative Branches are
supreme and final, reviewable only by the electorate, not by the courts.
(. . . continued)
Women Against Cruise Missiles v. Reagan, 591 F. Supp. 1332, 1335 (S.D.N.Y. 1984) (noting
that a case is nonjusticiable if there is an “impossibility of deciding [the case] without an initial
policy determination of a kind clearly for nonjudicial discretion”) (quoting Baker v. Carr,
369 U.S. 186, 217 (1961)).
18

Id. at 798. See also Ferris v. Wilbur, 27 F.2d 262, 264 (4th Cir. 1928), where the court affirmed
dismissal of a case seeking to enjoin as a nuisance the storage of high explosives at a Naval mine
depot, stating:
[A] suit for injunction will not lie against an official of the Executive Department
to restrain as a nuisance a use of government property authorized by Congress and
within the discretion of the executive.
dismissed as to TVA.
CONCLUSION
For the reasons stated and upon the authorities cited, these actions should be
Respectfully submitted by TVA through its attorneys,
September 30, 2004
Office of the General Counsel
Tennessee Valley Authority
400 West Summit Hill Drive
Knoxville, Tennessee 37902-1401
Facsimile 865-632-6718
Maureen H. Dunn
General Counsel
Harriet A. Cooper (HC4727)
Assistant General Counsel
Edwin W. Small (ES4418)
Assistant General Counsel
Frank H. Lancaster (FL4513)
Todd L. Fulks (TF9072)
By:
/s/Edwin W. Small
Edwin W. Small (ES4418)
Telephone 865-632-3021
003721111
Attorneys for Tennessee Valley Authority
19