U.S. court dismisses nuclear power lawsuit against KHNP, Kepco

Industry

Published: 19 Sep. 2023, 08:26 Updated: 20 Sep. 2023, 15:03

U.S. court dismisses nuclear power lawsuit against KHNP, Kepco

The fourth and last unit of the Barakah nuclear reactor in the United Arab Emirates built by Korean companies [KOREA ELECTRIC POWER CORPORATION]

A U.S. District Court has dismissed Westinghouse's yearlong case against Korea Hydro & Nuclear Power (KHNP) and its parent company Korea Electric Power Corporation (Kepco).

With the latest ruling favoring the state-run companies, Korea breathed a sigh of relief for avoiding a major risk in future nuclear export deals, as the country is vying to win major power plant deals in central Europe.

Korea's Czech nuclear project bid derailed by U.S. government

However, it still left room for further disputes, as the issue of intellectual property infringement of nuclear reactor technology remains yet to be fully resolved.

Westinghouse filed a lawsuit in the District Court for the District of Columbia against KHNP in October last year for intellectual property infringement, in order to block the company from selling nuclear reactors to Poland and other countries.

The Pittsburgh-based power generator manufacturer claimed that KHNP needs U.S. government consent to sell its APR1400 nuclear reactor overseas under the Part 810 export control regulation because the plant’s design incorporates Westinghouse technology.

The U.S. Department of Energy’s Part 810 regulation controls the technology transfer of nuclear reactors and equipment to foreign entities.

Had the court ruled in Westinghouse’s favor, the decision may have obligated KHNP and Kepco to receive approval from the U.S. government for nuclear exports, posing a significant setback for the country’s goal of exporting 10 nuclear plants by 2030.

However, the district court ruled in favor of KHNP and Kepco Monday, accepting the defendants’ argument that the authority to enforce the export restriction had been delegated exclusively to the U.S. Attorney General, and therefore, a private entity that is not the U.S. government does not hold the legal ground for enforcement against KHNP.

However, KHNP may continue to face legal or other administrative challenges as the dismissal did not address whether the company violated Westinghouse's intellectual property rights.

KHNP and Kepco have been claiming that while it did receive assistance from Westinghouse in the early stages of APR1400 development, the core technology is domestically developed and free from U.S. export restrictions.

The question of whether the technology transfer of the APR1400 reactor design would infringe on Westinghouse’s intellectual property rights is yet to be answered.

KHNP previously submitted a filing for its bid for an 8 trillion won ($6.02 billion) project in Dukovany, the Czech Republic, which was declined by the U.S. Department of Energy in January saying that the documentation must be submitted by "U.S. Persons,” meaning that it requires Westinghouse’s participation.

KHNP is currently pursuing arbitration over the intellectual property dispute against Westinghouse through the Korean Commercial Arbitration Board as well.

KHNP signed a letter of intent for the 1.4-gigawatt Patnow project with Polish counterparts last year to build two nuclear plants using the APR1400 reactor technology. The nuclear company is also competing with Westinghouse and France’s state-owned EDF to win the 1.2-gigawatt Dukovany project in the Czech Republic.

Following the court ruling, nuclear-related stocks closed higher in the market on Tuesday, driven by investors’ growing expectations for new deals. Doosan Enerbility increased 5.17 percent to close at 17,900 won, and Kepco Engineering & Construction rose 4.95 percent to 65,700 won.

BY SHIN HA-NEE [shin.hanee@joongang.co.kr]