The Federal Claims Court has refused to dismiss a lawsuit by a federal contractor seeking indemnification from the United States for toxic tort and environmental cleanup claims arising out of work the contractor performed for the Atomic Energy Commission. Texas Instruments Inc. v. United States, No. 09-701 (Fed. Cl. 6/13/11). In 2007, the Department of Justice notified plaintiff that it would file a CERCLA cost recovery lawsuit against plaintiff alleging that its predecessor was the probable source of uranium contamination at the Shpack Landfill near Attleboro, Massachusetts. The company had fabricated nuclear fuels under contract with the federal government from the 1950s to the 1980s.

In 2009, plaintiff sued the United States, alleging that the federal government must reimburse it for costs incurred to address a “public liability” for a “nuclear incident” under the Price-Anderson Act (Act). Specifically, plaintiff sought reimbursement of $2,115,538 in costs incurred defending lawsuits involving the discovery of radiological materials related to contracts with the government at the landfill. The government argued that the CERCLA lawsuit was yet to be filed and therefore plaintiff’s claim was “unripe.”

Rejecting the government’s argument, the court ruled that plaintiff stated a claim under the Act because the complaint seeks monetary damages based on an indemnity provision in a contract with the United States and the complaint identifies the Act as a source of indemnification authority for plaintiff’s alleged injuries. According to the court, the allegations are sufficient to tie the toxic tort and CERCLA lawsuits to the work performed under government contract and, ultimately, to the contract’s indemnity provision.