The US Nuclear Regulatory Commission (NRC) issued a final rule in the Federal Register on January 15 updating the maximum amounts of civil monetary penalties it can impose. The final rule revises 10 CFR 2.205(j) to increase the maximum penalty the NRC can issue from $298,211 to $303,471 per violation, per day, an increase of 1.764%. Similarly, the final rule revises 10 CFR 13.3 to increase the amount of a civil penalty under the Program Fraud Civil Remedies Act from $11,463 to $11,665. These monetary penalty amounts go into effect immediately and can be assessed regardless of whether the violation occurred before or after January 15.

As we previously reported regarding last year’s revisions to the civil monetary amounts, the NRC is required by the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, to annually adjust the amounts of the civil monetary penalties for inflation in accordance with a statutory formula set forth in the legislation. The NRC last updated the maximum amount of civil penalties in February 2019.

The NRC recently issued an allegation guidance memorandum (AGM) to provide guidance on the handling of certain drug and alcohol fitness-for-duty (FFD) violations. The AGM directs that licensee-identified drug and alcohol FFD violations by nonlicensed individuals not be processed in the NRC’s allegation program. This guidance took effect immediately and will be incorporated into the Allegation Manual. The next revision of Management Directive (MD) 8.8 will also incorporate this guidance by adding “Licensee-identified [FFD] drug- and alcohol-related violations by nonlicensed individuals” to the list of concerns excluded from the definition of an “allegation.”

The AGM is the result of changes to Section 4.1 of the NRC’s Enforcement Policy approved by the Commission on April 18, 2019. As we discussed at that time, an NRC Staff review found that for most FFD drug and alcohol violations, the licensees had identified the issue and conducted an internal investigation into the violation by the time the NRC received notification of the violation. Staff also found that licensees were imposing the penalties required by 10 CFR § 26.75 to appropriately disposition individual FFD drug and alcohol issues before most NRC investigations began.

As noted in this article by Morgan Lewis antitrust lawyers, the role of antitrust laws in labor markets, including in the energy field, remains a key area of focus by enforcers, including the Antitrust Division of the US Department of Justice and the Federal Trade Commission. At a public workshop on competition in labor markets in September 2019, Assistant Attorney General Makan Delrahim reaffirmed “that criminal prosecution of naked no-poach and wage-fixing agreements remains a high priority for the Antitrust Division.”

The US Department of Energy (DOE) published a notice of proposed rulemaking (NOPR) in the October 3 Federal Register to establish procedures for imposing civil monetary penalties for violations of 10 CFR Part 810 (Part 810). Notably, DOE also proposes a maximum penalty, per violation, of $102,522. If DOE views a violation as a continuing one, then each day from when the violating activity began to when it stopped would constitute a separate violation for purposes of computing the penalty. Comments on the NOPR are due by November 4, 2019.

In its updated guidance issued on April 30, the US Department of Justice Criminal Division places effectiveness at the epicenter of its factors to be utilized when evaluating a company’s compliance program in the context of a criminal investigation. As corporate compliance programs continue to be closely scrutinized, companies and their boards, senior management, and legal and compliance departments should tailor their corporate compliance programs to issues and risk areas specific to the company’s business. Senior management plays a critical role in identifying these issues and risk areas and must serve as an example and enforcer of good compliance practices. Companies cannot let their compliance programs get stale and must continue to innovate, revamp, and enhance their corporate compliance practices based on lessons learned. DOJ emphasizes that “one hallmark of an effective compliance program is its capacity to improve and evolve.”

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As part of the US Nuclear Regulatory Commission’s (NRC’s) efforts to create efficiencies in its enforcement process, the NRC Commissioners unanimously approved a staff proposal to change Section 4.1 of the NRC’s Enforcement Policy. Under this approved change, the NRC will not typically consider fitness-for-duty (FFD) drug and alcohol violations involving non-licensed individuals for enforcement action. But the NRC will still investigate if there are apparent deficiencies in a licensee’s FFD program itself or the program’s implementation. Thus, to avoid enforcement actions in the future, licensees must continue to maintain an effective FFD program for drug and alcohol violations.

The US Nuclear Regulatory Commission (NRC) Office of Investigations (OI) recently published its Office of Investigations Annual Report FY 2018. The report provides an overview of OI’s activities during the previous fiscal year and shows that OI opened 12% fewer cases than in 2017. Of the 101 cases opened in FY 2018, 40% were discrimination cases, a 4% increase from FY 2017. “Discrimination” in this context refers to retaliation for engaging in protected activities established in Section 211 of the Energy Reorganization Act of 1974, as amended. Discrimination has remained the largest case category for the past three years. Material false statement investigations reflect 16% of the cases OI opened in FY 2018, a 4% decrease from FY 2017. Investigations into other alleged violations of NRC regulations reflect 27% of the cases OI opened in FY 2018, and investigations opened to provide assistance to the NRC staff reflect 18% of the cases OI opened in FY 2018.

The NRC issued an update to Management Directive 8.11 (MD 8.11), Review Process for 10 C.F.R. § 2.206 Petitions on March 1, culminating an on-again, off-again review process that began almost a decade ago. In issuing the updated MD 8.11, the NRC also issued a corresponding update to Directive Handbook 8.11 (DH 8.11), but pushed the detailed staff guidance that was previously in MD 8.11 to a publicly available Desktop Guide. In short, the review process in the updated MD 8.11 and DH 8.11 is not markedly different from the prior versions, but the changes also reduce some of the opportunities for licensees to directly seek clarification from a petitioner about the issue being raised and allow the NRC staff to “save” what might otherwise be deficient petitions. The updated MD 8.11 also does not resolve questions as to whether the ability to submit a Section 2.206 petition is restricted to only external stakeholders.

In a rare legal challenge related to fees the NRC charges nuclear licensees for its services, the US Court of Federal Claims recently held that the costs of certain NRC services provided in connection with Confirmatory Orders (COs) are not recoverable via hourly bills to individual licensees. The court held that COs are essentially enforcement orders, and thus cannot be viewed as conveying an “individual benefit” to licensees.

The US Nuclear Regulatory Commission’s (NRC’s) revised regulations regarding the medical use of byproduct material became effective on January 14, 2019—six months after being published in final form, and nearly a decade after the proposed rulemaking. See Medical Use of Byproduct Material—Medical Event Definitions, Training and Experience, and Clarifying Amendments, 83 Fed. Reg. 33,046 (July 16, 2018). The revised regulations amend 10 CFR Parts 30, 32, and 35. The NRC also issued guidance to provide additional detail regarding the substance of the revised regulations and to assist licensees with compliance. See Guidance for the Final Rule, Medical Use of Byproduct Material—Medical Events, Definitions, Training and Experience, and Clarifying Amendments, 83 Fed. Reg. 33,759 (July 16, 2018). Among other things, the amendments change the requirements associated with