SCOTUS: Hanford Presumption Discriminates Against Federal Government

Wednesday, June 22, 2022 | 0

A unanimous U.S. Supreme Court on Tuesday struck down a law Washington state enacted in 2018 that presumed compensability for certain conditions suffered by federal employees and federal contractors at the Hanford nuclear reservation.

The Hanford worker presumption singled out the federal government for unfavorable treatment, the high court said in U.S. v. Washington.

“The law thereby explicitly treats federal workers differently than state or private workers,” the court said. “And, in doing so, the law imposes upon the federal government costs that state or private entities do not bear. The law consequently violates the supremacy clause unless Congress has consented to such regulation through waiver.”

Gov. Jay Inslee in 2018 enacted HB 1723, creating a presumption that respiratory disease, beryllium disease and neurological and heart conditions experienced within 72 hours of exposure to fumes or chemicals are compensable injuries for the nearly 10,000 federal contractor employees at the decommissioned nuclear production facility. The presumption also covers various forms of cancer suffered by workers at the Hanford facility where the U.S. Department of Energy is overseeing the cleanup from the production of weapons-grade plutonium for the nation’s nuclear arsenal during World War II and the Cold War.

A federal district court dismissed a lawsuit by the federal government after ruling that the presumption fell under a federal waiver of immunity in 40 U.S.C. Section 3172(a). The 9th Circuit Court of Appeals in August 2020 agreed that the presumption was within the scope of the waiver and didn’t violate the doctrine of intergovernmental immunity.

The Department of Justice, in asking the high court to review the decisions, argued that the 9th COA decision was “profoundly wrong.”

At the outset, the nation’s top court said it was not persuaded by Washington’s argument that the dispute was moot as a result of legislation enacted earlier this year.

The state argued that Inslee's signing of Senate Bill 5890 on March 11 to expand the scope of the presumption for Hanford workers eliminated the need for the nation’s top court to intervene.

SB 5890 repealed statutory language through which the Hanford presumption applied only to federal workers.

The new law “mooted the basis” for the federal government’s complaint, the state argued. And answering the question presented now would be a purely advisory opinion on abstract propositions of law in a now-defunct statute.

The Supreme Court, however, said a case is not moot unless it is impossible for it to grant any effectual relief. And if there is money at stake, as the court said is the case with the presumption, the case is not moot.

“The United States asserts that, if we rule in its favor, it will either recoup or avoid paying between $17 million and $37 million in workers’ compensation claims that lower courts have awarded under the earlier law,” the court said.

While Washington argued that even if the government wins in overturning the awards, it will not recover any payments because the new law is broad enough to cover claims filed under the previous law.

The high court said it does not interpret statutes in the first instance and would not decide the retroactivity or breadth of the new presumption. The court also said it doesn’t know how a Washington state court will resolve those questions.

“It is thus not ‘impossible’ that the United States will recover money if we rule in its favor, and this case is not moot,” the court said.

The main focus of the high court’s decision was on the effects of the waiver in U.S. Code Section 3172(a).

Washington’s attorney general argued that Congress waived federal immunity from state workers’ compensation laws on federal lands and projects through the code section. The law permits states to apply their work comp laws on federal property to the same extent as if the property were under the exclusive jurisdiction of the states.

But the high court said it doesn’t read the waiver as authorizing a state to enact a “discriminatory law” that on its face singles out the federal government for disparate treatment. The court said the waiver can be more narrowly read as “only authorizing a state to extend its generally applicable state workers’ compensation laws to federal lands and projects within the state.”

The court said statutory language referencing a federal waiver to state work comp laws applied in the same way and to the same extent as if the property were owned by the state indicates that the law contemplates applying the waiver to work comp rules that apply broadly to all types of employers.

What’s more, the court said, the federal waiver references the authority of the state to enforce work comp laws.

“This language seems to contemplate application of state provisions that apply at least in part to nonfederal (i.e., state and private) workers,” the court said. “After all, those are the laws that state enforcement authorities ordinarily enforce.”

Finally, the high court said the Constitution’s intergovernmental immunity doctrine exists to prevent discrimination against the federal government. Without such a prohibition on discrimination, states could impose unduly high costs on the federal government to benefit their citizens.

“To put the point more specifically, if discrimination is permissible here, what prevents Washington from bestowing a windfall upon its residents through an especially generous workers’ compensation scheme financed exclusively by the federal government?” the high court asked. “Washington’s voters would not mind; they would not pay for the costs of the scheme. And some Washington residents — those working for the federal government — would benefit from it.”

Washington State Attorney General Bob Ferguson in a statement Tuesday said the decision “has no effect for Hanford workers” as a result of the 2022 legislation.

“Because the Legislature already fixed the issues the federal government raised, there is little practical impact in Washington as a result of this ruling,” he said. “Hanford workers, and all others working with dangerous radioactive waste, remain protected.”

Ferguson said the federal government hasn’t challenged the new law nor indicated it plans such a challenge.