The opinion of the court was delivered by: Knapp, Senior District Judge.
Plaintiffs have moved, pursuant to Fed. R.Civ.P. 7 and
28 U.S.C. § 1292(d)(4)(B), for an order lifting the stay of
proceedings in this action for the limited purpose of allowing
discovery to proceed.
Plaintiffs are twenty-two domestic nuclear utility companies
who seek declaratory and injunctive relief to avoid having to pay
special assessments imposed upon them by a federal statute which
they contend is unconstitutional. A fuller recitation of the
facts can be found in our prior opinions of November 25, 1998 and
April 12, 1999.
The original complaint was filed on June 12, 1998; an amended
complaint was subsequently filed before the defendants' time to
answer had expired. On June 16, 1998, the plaintiffs served a
document request on the defendants pursuant to Fed. R.Civ.P. 26
and 34. Instead of answering the complaint or responding to the
document request, the defendants elected to move to stay all
proceedings pending the outcome of related actions in the United
States Court of Federal Claims ("CFC"). We issued an Opinion and
Order dated November 25, 1998 which denied that motion and
certified the question for interlocutory appeal. Defendants then
moved to dismiss this action for lack of subject matter
jurisdiction, or, in the alternative, to transfer this action to
the CFC. In a decision dated April 12, 1999, we denied that
motion but again certified the question for interlocutory appeal.
Upon the filing of defendants' motion to transfer the case to
the CFC, a statutory stay went into effect pursuant to
28 U.S.C. § 1292(d)(4)(B). At a conference on April 22, 1999, the
plaintiffs asked that the statutory stay be lifted so that
discovery could proceed. When the defendants opposed any lifting
of the statutory stay, we directed the parties to brief the
Title 28 U.S.C. § 1292(d)(4)(B) provides, in relevant part:
In the motion at bar, we are called upon to interpret the last
sentence of the above-quoted text. The plaintiffs contend that an
order compelling the government to comply with the utilities'
request "is precisely the kind of preliminary relief contemplated
by the statute." The defendants, by contrast, assert that §
1292(d)(4)(B) does not give us discretion to allow discovery
during the stay of proceedings.
In support of their position, plaintiffs advance four principal
arguments. First, they assert that because this action seeks
injunctive relief, which is explicitly included in the exception
to the statutory stay in the final above-quoted sentence,
discovery should be permitted so that disclosures necessary for
the attainment of such relief (such as the causes of
contamination at the government's enrichment facilities and the
extent of the government's awareness of the need to address the
decontamination problem) can be elicited. Second, they claim that
the statutory stay continues to cause them substantial economic
prejudice inasmuch as another assessment of approximately $100
million will be due in October 1999. Moreover, they assert that
uncertainty regarding future assessments clouds their ability to
formulate long-range business strategies. Third, they argue that
the government would not be prejudiced were the stay to be
lifted. This is because the only issue on appeal would be where,
as opposed to whether, the case will proceed. Accordingly, any
discovery obtained in this forum would be equally valuable were
the action ultimately to be transferred to the CFC. Finally, they
maintain that a lift of the stay to permit discovery is in
accordance with the intent of the drafters of the statute.
While plaintiffs have raised several persuasive pragmatic
arguments favoring a lifting of the statutory stay, we cannot
consider them if, as defendants suggest, the statute precludes us
from exercising our discretion to permit discovery. In other
words, we must first consider whether we can lift the stay
before resolving the question of whether we should do so.
Assuming the disputed sentence of § 1292(d)(4)(B) to be ambiguous
as written, we begin our analysis with the statute's legislative
history. The portion of the legislative history here relevant
provides as follows:
To further assure that the trial proceedings on the
merits do not go forward until the jurisdictional
question is resolved, [subsection (d)(4)(B)] also
provides that proceedings in the district court shall
be stayed until sixty days after the district court
has ruled upon the motion to transfer. This
sixty-days stay allows a party sufficient time to
determine whether to take an appeal from any adverse
decision on the transfer motion. Should an appeal be
taken to the Federal Circuit pursuant to this new
provision, the stay is extended until the Federal
Circuit has disposed of the jurisdictional appeal.
However, the stay of proceedings would not bar the
granting of preliminary or interim relief under
circumstances where it would otherwise be appropriate
and where expedition is reasonably necessary. In some
cases, a delay of even sixty days could serve to
deprive a litigant of important rights or even the
primary objective of the litigation. To foreclose the
possibility that motions to transfer may be filed
solely for the purpose of delaying proceedings where
time is of the essence, this exception will permit
the granting of extraordinary relief while still
postponing consideration of the merits until after
jurisdictional questions are resolved.
H.R.Rep. No. 100-889, reprinted in 1988 U.S.C.C.A.N. 5982.
After considering the portion of the legislative history set
forth above, we believe that Congress did not contemplate
allowing discovery to proceed during a stay under §
1292(d)(4)(B), even where such discovery might ultimately lead to
the granting of injunctive relief. In our view, the exception to
the stay was intended to be employed in extraordinary
circumstances such as those involved in a TRO or a preliminary
injunction. Plaintiffs seek neither in this case. While they hint
injunctive relief might be sought in order to avoid paying the
upcoming October 1999 assessment, they do not so much as suggest
that they would be financially ruined by making such a payment.
Rather, they say only that their ability to make long-term plans
would be clouded. Should plaintiffs prevail upon the merits, any
payments they may have made would be refundable with interest.
Accordingly, they can hardly claim an irreparable injury for
purposes of a preliminary injunction.
In conclusion, while we are sympathetic to plaintiffs' argument
that discovery wouldn't prejudice the defendants because it could
be used regardless of how the appellate court rules,*fn1 we are
of the opinion that the statute leaves us without authority to
lift the stay in this context. The statute was enacted to permit
a party who loses a transfer motion in these circumstances to
receive a final determination on the jurisdictional question
before resources are wasted by litigating the merits in the wrong
forum. The House Report's use of the terms "exception" (in
reference to the lifting of the stay) and "extraordinary relief"
(in reference to the circumstances under which the stay should be
lifted) suggest to us that Congress did not intend for the stay
to be lifted for purposes of general discovery. While this leads
to an admittedly anomalous result in the facts at bar, we are
without authority to do otherwise.
For the foregoing reasons, plaintiff's motion for an order
lifting the statutory stay so that discovery can proceed is