[author: Zachary Feldman]

For those corporations that create, sell, and distribute goods with traces of radioactive materials, the United States Nuclear Regulatory Commission (NRC) is the governing agency. Smoke detectors, clocks, fertilizer, lanterns, and even glass can be subject to regulation depending on the chemical composition of the items.

Congress created the NRC as an independent agency in 1974 to ensure the safe use of radioactive materials for beneficial civilian purposes while protecting people and the environment. The companies that sell regulated products are designated licensees under the agency, and their facilities are consistently inspected to ensure compliance with NRC requirements.

Any allegations of wrongdoing are thoroughly investigated and reported through a comprehensive procedure within the agency. The allegation is vetted through a series of steps and ultimately results in a 90-day investigation phase, concluding with a closure report addressing each specific allegation of wrongdoing.

The NRC’s assigned Special Agent for a given case conducts an investigation looking for both criminal and regulatory law violations, and the more information that the Special Agent has to work with, the easier his or her job becomes. If the NRC finds wrongdoing outside the scope of its regulations, the NRC is permitted to refer the issue to the appropriate governing body.

The NRC’s investigative reach proved useful in the case In the Matter of the Shaw Grp. Inc.^[1] In this case the defendant company moved to quash a subpoena for confidential information by the NRC, and it was denied. The Commissioner held that the associated concerns about revealing confidential company information were outweighed by the NRC’s obligation to conduct investigations to ensure nuclear safety. This means that in the world of regulating radioactive materials, companies have an increased ability to learn information about potentially infringing companies when they go through the NRC.

Why Is This Important?

When a company operating under an NRC license suspects that its product is wrongfully advertised, sold, and/or distributed by another person or company, it would be a prudent first step to file an allegation with the NRC. There are substantial costs associated with NRC regulation compliance, and it would be to a company’s benefit to monitor where and how its products are sold. An NRC investigation could help bring some of this information to light.

When an investigation substantiates misconduct, the alleging company or persons could additionally have a case for copyright or trademark infringement – two causes of action the NRC does not handle, but which are nonetheless viable.

Working with a law firm can be helpful when navigating the allegation filing process through the NRC. In order to amass the necessary evidence and support for the NRC to conduct its full-fledged investigation, companies can employ attorneys to gather as much information as possible to prepare preliminary memorandums of law. By outlining the company’s grievances and reasons for believing their validity, a company is effectively beginning and supporting a successful investigation by the government agency.

[1] See In the Matter of the Shaw Grp. Inc., Nuclear Reg. Rep. (CCH) ¶ 31672 (N.R.C. Apr. 2, 2013).

Zachary Feldman is a summer associate in the firm’s New York office.

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