2025-1395

Appeal from the United States Court of Federal Claims in Nos. 1:21-cv-01116-TMD, 1:21-cv-01118-TMD, 1:21-cv01119-TMD, Judge Thompson M. Dietz.

Decided: September 4, 2026

CATHERINE EMILY STETSON, Hogan Lovells Cadwalader US LLP, Washington, DC, argued for plaintiffs-appellees. Also represented by KEENAN ROARTY; KATHERINE BOOTH WELLINGTON, Boston, MA.

DANIEL FALKNOR, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, DC, argued for defendant-appellant. Also represented by LISA LEFANTE DONAHUE, AN HOANG, ELINOR JOUNG KIM,Page 2 PATRICIA M. MCCARTHY, BRETT SHUMATE; BRIGHTON SPRINGER, Office of the General Counsel, United States Department of Energy, Washington, DC.

Before LOURIE, PROST, and STARK, Circuit Judges .

STARK, Circuit Judge .

This case is the latest in a series of nuclear-waste-related contract disputes between the United States and a group of utility companies known as 'the Yankees' (the Connecticut Yankee Atomic Power Company, Maine Yankee Atomic Power Company, and Yankee Electric Power Company). The current appeal presents a single question of contract law: can the damages caused by the government’s continuing partial breach be offset by the Yankees’ investment gains earned by a legally mandated trust fund? The Court of Federal Claims answered in the negative and entered judgment in the Yankees' favor. We reach the same conclusion and, therefore, affirm.

Following World War II and the Manhattan Project, the United States enacted a series of measures to promote the civilian adoption of atomic energy. See generally Cotter Corp., N.S.L. v. United States , 127 F.4th 1353, 1357-58 (Fed. Cir. 2025). By the 1970s, “the private sector [had] become involved in the development of atomic energy for peaceful purposes under a program of federal regulation and licensing.” Duke Power Co. v. Carolina Env’t Study Grp., Inc. , 438 U.S. 59, 63 (1978). 'Today, more than 50 nuclear power plants . . . produce electricity for American homes and businesses. In all, nuclear power plants generate almost 20 percent of the electricity in America.” NRC v. Texas , 605 U.S. 665, 669 (2025).

Page 3The generation of atomic energy yields a “dangerous” byproduct: nuclear waste. Id. at 668. This radioactive material, also known as “spent nuclear fuel” (“SNF”), is “usually stored on site' at the power plant at which it is produced, until it can be safely removed. Id. 'In 1982, recognizing the need to protect the public and the environment by providing for the disposal of the nuclear waste accumulating at civilian nuclear power plants around the country, Congress enacted the Nuclear Waste Policy Act” ('NWPA'). Maine Yankee Atomic Power Co. v. United States , 225 F.3d 1336, 1337 (Fed. Cir. 2000) (“ Yankee I ”). “The NWPA was designed to solve the national problem of permanent disposal of spent nuclear materials.” Bos. Edison Co. v. United States , 658 F.3d 1361, 1371 (Fed. Cir. 2011). Among other things, the NWPA “authorized the Department of Energy (‘DOE’) to contract with nuclear power utilities as part of its plan for a national nuclear waste disposal system.” Sys. Fuels, Inc. v. United States , 818 F.3d 1302, 1303 (Fed. Cir. 2016).

Under the NWPA, “[n]uclear plant operators and utilities were mandated by Congress to enter into Standard Contracts' with DOE. Indiana Michigan Power Co. v. United States , 422 F.3d 1369, 1372 (Fed. Cir. 2005). “For our purposes, the bargain was this: The utilities would pay fees into a Nuclear Waste Fund that the government set up under the NWPA. In return, DOE committed to begin accepting and disposing of contract holders' SNF no later than January 31, 1998.' Energy Nw. v. United States , 641 F.3d 1300, 1302 (Fed. Cir. 2011).

Ultimately, the government’s 1998 retrieval date proved to be overly ambitious. To date, there is no approved central repository for SNF. See NRC , 605 U.S. at 668 (“To address the storage problem, federal law has long designated the Yucca Mountain Nuclear Waste Repository in Nevada as the future permanent site for disposal of spent nuclear fuel. But the Nevada project has caused significant political controversy and has stalled.”). Hence,Page 4 thus far, DOE has not disposed of a single unit of SNF from any nuclear power plant, including those controlled by the Yankees, and there is no current date by which it expects to do so. J.A. 398 (“[T]he Government has not provided any timeline for when it intends to accept the Yankees’ SNF.”); see also Pac. Gas & Elec. Co. v. United States , 536 F.3d 1282, 1287 (Fed. Cir. 2008) (“ PG&E ') ('Without a licensed permanent repository, DOE has never built an [atomic waste storage] facility.'). The government's undisputed breach of the Standard Contract forms the basis of the Yankees’ long-running litigation.

Due to the risks entailed in the process of shutting down nuclear power plants, beginning in 1988 the Nuclear Regulatory Commission (“NRC”) directed all operators of such facilities to “provide reasonable assurance that funds will be available for the decommissioning process.” 10 C.F.R. § 50.75. NRC regulations set out several approved “methods” for providing the necessary “financial assurance.” Id. § 50.75(e)(1).

One option is an 'external sinking fund,' more commonly known as a “nuclear decommissioning trust” (“NDT”), which is “maintained by setting funds aside periodically in an account segregated from [plant operator] assets and outside the administrative control of [such operator] . . . in which the total amount of funds would be sufficient to pay decommissioning costs at the time permanent termination of operations is expected.” Id. § 50.75(e)(1)(ii). The power plant operators are required to raise the funds necessary for these NDTs from the end-consumers of the electricity they generate (“ratepayers'), via payments made to wholesale purchasers of the nuclear energy produced by the plant (“wholesalers”). Federal Energy Regulatory Commission (“FERC”) regulations permit the funds to be invested for gain, but mandate that “after decommissioning has been completed, the utility shall return the excess [fund] amount to ratepayers.'Page 5 18 C.F.R. § 35.32(a)(7). Until then, gains generated by the NDTs may be used “to fund the costs of decommissioning the nuclear power plant to which the [NDT] relates, and to pay administrative costs and other incidental expenses, including taxes, of the [NDT].' Id. § 35.32(a)(6).

C

In 1983, the Yankees executed the Standard Contract with DOE, thereby obtaining the right to operate nuclear power plants in Maine, Connecticut, and Massachusetts. See Yankee Atomic Elec. Co. v. United States , 536 F.3d 1268, 1271 (Fed. Cir. 2008) (“ Yankee II ”). Pursuant to the Standard Contract, DOE became contractually obligated to retrieve and dispose of the Yankees’ SNF in exchange for a fee. See id. By law, the Yankees are not permitted to dispose of SNF themselves, so even today they continue to retain – and securely store – significant quantities of nuclear waste on site. See generally Indiana Michigan , 422 F.3d at 1374.

As further required, each of the Yankees established an NDT, funded by the ratepayers in the three states. Since then, the ratepayers’ contributions to the NDTs have totaled $405 million. On top of that, the NDTs have returned investment earnings of $339 million since 2009, including nearly $185 million during the five-year period that is the subject of this appeal, 2017 through 2021 (the “Claim Period”).

While the Yankees have paid the removal fees required under the Standard Contract, DOE has yet to uphold its part of the bargain. 'In 1994, [DOE] announced that it could not begin disposing of nuclear waste by January 31, 1998, as the [Standard] [C]ontract required, because the repository it planned to build to store the waste would not be available.” Yankee I , 225 F.3d at 1337. This breach is ongoing and has led to four prior rounds of litigation, culminating in decisions from this court and the Court of Federal Claims holding that DOE has partially, andPage 6 repeatedly, breached the Standard Contract.¹ These judgments have also awarded damages to the Yankees adding up to nearly $500 million. See id. at 1343; Yankee II , 536 F.3d at 1271; Yankee Atomic Elec. Co. v. United States , 679 F.3d 1354, 1357-58 (Fed. Cir. 2012) (“ Yankee III ”). Of that amount, approximately $396 million has been distributed back to the ratepayers.

The Yankees ceased producing nuclear power by 1996 and completed decommissioning of their power plants by the end of 2007. The parties agree that, but for the government's breach of the Standard Contract, the Yankees would have been defunct by 2010, and, in that event, the NDTs would also have been terminated and their holdings distributed to ratepayers. See J.A. 1757-58 (“During this claim period, each Yankee utility has maintained its corporate existence only due to the SNF stored at its site.”). At this point, the Yankees continue to exist solely to store SNF. In the meantime, the NDTs continue to be held in trust for the ratepayers.

Page 7In the nearly 20 years since the decommissioning of their plants, the Yankees have undertaken various efforts to accommodate the long-term storage of SNF at their sites until DOE finally performs under the Standard Contract. For example, in a previous claim period, the Yankees “constructed an on-site dry-storage facility, otherwise known as an Independent Spent Fuel Storage Installation (‘ISFSI’).” Consol. Edison Co. of N.Y. v. Entergy Nuclear Indian Point 2, LLC , 676 F.3d 1331, 1334 (Fed. Cir. 2012). An ISFSI is essentially a large concrete pad on which steel casks containing SNF are placed. There are many costs attendant to maintaining an ISFSI, including those mandated by regulation, “such as physical security and radiation monitoring expenses.” 26 C.F.R. § 1.468A-1(b)(6)(i).

During the current Claim Period, the Yankees’ ISFSIrelated expenses ran to $145 million. As has been permitted by NRC, FERC, and Internal Revenue Service regulations for nearly 20 years, the Yankees used the NDTs to pay these expenses. J.A. 396 (“The NDTs are the funding source that the Yankees use to pay for their ISFSI-related costs.'). Meanwhile, the Yankees' NDTs' earned nearly $185 million in investment gains during the Claim Period.

The Yankees filed this lawsuit against DOE in the Court of Federal Claims in March 2021, seeking full reimbursement of the $145 million they spent on SNF. The government did not contest liability. It did, however, seek to offset the damages it owes by the investment gains earned from the NDTs ($185 million), which would reduce the damages it would have to pay to zero. The parties filed cross-motions for partial summary judgment on “the issue of whether investment earnings on the Yankees' [NDTs] should be considered in the calculation of damages.” J.A. 2.

On February 21, 2024, the Court of Federal Claims granted summary judgment to the Yankees. Thereafter, the court entered the parties’ stipulated $145 million judgment in favor of the Yankees, subject to the government’sPage 8 right to appeal. The government timely appealed. We have jurisdiction under 28 U.S.C. § 1295(a)(3).

“We review the Court of Federal Claims’ grant of summary judgment de novo.' Richardson v. United States , 110 F.4th 1375, 1380 (Fed. Cir. 2024). The court 'shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” RCFC 56(a).

We begin by setting out several principles of contract law pertinent to our analysis. First, “the traditional damages remedy under contract law is compensatory in nature.” Cmty. Health Choice, Inc. v. United States , 970 F.3d 1364, 1375 (Fed. Cir. 2020). 'That is, the disappointed promisee is generally entitled to an award of money damages in an amount reasonably calculated to make him or her whole.” Id. (internal quotation marks omitted). “One way to achieve that end is to give the nonbreaching party ‘expectancy damages,’ i.e., the benefits the nonbreaching party expected to receive in the absence of a breach.” Oliva v. United States , 961 F.3d 1359, 1362 (Fed. Cir. 2020) (internal quotation marks omitted); see also S. Cal. Fed. Sav. & Loan Ass'n v. United States , 422 F.3d 1319, 1334 (Fed. Cir. 2005) ('Expectation damages give the nonbreaching party the benefit of his bargain by putting him in as good a position as he would have been in had the contract been performed.”).

An important caveat, however, is that “the non-breaching party should not be placed in a better position through the award of damages than if there had been no breach.” Bluebonnet Sav. Bank, F.S.B. v. United States , 339 F.3d 1341, 1345 (Fed. Cir. 2003) (emphasis added); see also LaSalle Talman Bank, F.S.B. v. United States , 317 F.3d 1363, 1371 (Fed. Cir. 2003) (“[I]t is a fundamental tenet ofPage 9 the law of contract remedies that an injured party should not be put in a better position than had the contract been performed.”) (internal quotation marks omitted). Thus, “a plaintiff suing for breach of contract is not entitled to a windfall.” Cmty. Health , 970 F.3d at 1375 (internal quotation marks and alterations omitted); see also White v. Delta Constr. Int'l, Inc. , 285 F.3d 1040, 1043, 1046 (Fed. Cir. 2002) (vacating “windfall” award).

Second, “the non-breaching party is expected to take reasonable steps to mitigate his or her damages.” Cmty. Health , 970 F.3d at 1375. Relatedly, “there must be a reduction in damages” paid by the breaching party “equal to the amount of benefit that resulted from the mitigation efforts that the non-breaching party in fact undertook.” Id. at 1376. However, and key here, the breaching party is not entitled to a reduction of damages for benefits obtained by the non-breaching party’s engagement in activities that are 'not properly viewed as actions in mitigation.' LaSalle , 317 F.3d at 1374.

Third, “[a] breach of contract may prevent a loss as well as cause one.” Cmty. Health , 970 F.3d at 1376 n.10 (internal quotation marks omitted). “Thus, where the defendant's wrong or breach of contract has not only caused damage, but has also conferred a benefit upon [the] plaintiff which he would not otherwise have reaped, the value of this benefit must be credited to [the] defendant in assessing the damages.” Kansas Gas & Elec. Co. v. United States , 685 F.3d 1361, 1367 (Fed. Cir. 2012) (internal quotation marks omitted); see also LaSalle , 317 F.3d at 1371 (“[T]he actual profits earned [by the non-breaching party] must be credited against [its] projected lost profits.”).

The government argues that the Yankees’ use of NDT gains to pay their breach-induced ISFSI costs mitigated the Yankees’ damages. To award the Yankees’ damages on top of their own successful mitigation efforts would, the government continues, result in a windfall, in violation of bedrock contract law. The government further insists it is Page 10entitled to a credit for the NDTs’ investment gains – benefits it contends the Yankees only received by virtue of its breach – that would fully offset what it owes the Yankees for the Claim Period. The Yankees counter that the gains earned in the NDTs are not sufficiently related to the government’s breach to be credited or counted as mitigation. The Court of Federal Claims sided with the Yankees. We do as well, for the reasons we explain in the next sections.

To obtain the offset it seeks, the government must carry its burden of proving that the Yankees’ use of NDT funds constitutes a mitigation activity. See Westfield Holdings, Inc. v. United States , 407 F.3d 1352, 1370 (Fed. Cir. 2005) (“[When] the government want[s] an offset, it [is] the government’s burden to prove [it] . . . .”). It has failed to do so, for two independent reasons. First, the government has not shown that the NDTs, even with their investment gains, have reduced or avoided any loss suffered by the Yankees. Second, the government has failed to prove that the NDTs are sufficiently connected to the government's breach. We address both failings below.

To constitute mitigation – and, therefore, be eligible for offset against damages – the non-breaching party’s activities must be part of its “efforts to avoid damages.' Indiana Michigan , 422 F.3d at 1375 (emphasis added). Hence, “mitigation costs” are those that are “incurred in a reasonable effort to avoid loss caused by a breach.' Old Stone Corp. v. United States , 450 F.3d 1360, 1368 (Fed. Cir. 2006) (emphasis added); see also Restatement (Second) of Contracts § 347 cmt. d ('[The non-breaching party's] cost avoided is subtracted from the loss in value caused by the breach in calculating his damages.”); id. § 350 (“Avoidability as a Limitation on Damages”).

Page 11We have applied this proposition in the specific context of SNF cases. See, e.g. , Kansas , 685 F.3d at 1366 (“The injured party is limited to damages based on his actual loss caused by the breach. If he . . . sustains a smaller loss than might have been expected, his damages are reduced by the loss avoided.”) (internal quotation marks and citation omitted); Dairyland Power Co-op. v. United States , 645 F.3d 1363, 1372 (Fed. Cir. 2011) (“[A] non-breaching party’s recovery can in some cases be offset to account for costs it avoided because of the breach.”). In both Yankee II and III , for example, we considered 'the expenses [the Yankees] might have avoided” as part of their claim for reimbursement of the costs of their mitigation efforts. Yankee II , 536 F.3d at 1273; see also Yankee III , 679 F.3d at 1361 (“The Yankees agreed to reduce their breach world ISFSI costs by the estimated future cost of transferring SNF from their wet pools to DOE in the nonbreach world, on the ground these expenses were avoided because of the breach.”).

Our mitigation inquiry in the SNF context focuses on “direct savings that reduce the damages claim.” Kansas , 685 F.3d at 1366. We have, for example, found that a nuclear plant operator's 'decision to pursue higher enrichment fuel assemblies” was 'part and parcel of [its] mitigation efforts,” because it “produced a real-world benefit[:] . . . a savings of hundreds of thousands of dollars per cycle.” Id. at 1367 (internal quotation marks omitted); see also Cmty. Health , 970 F.3d at 1377 ('By enhancing the racks to accommodate high-enrichment fuel assemblies, the plaintiffs mitigated the government’s breach in a way that produced a benefit.”) (internal quotation marks and alterations omitted). In other SNF cases, we determined that “a reduction in the share of wet storage and decommissioning fees paid” were “costs that were avoided,” resulting in a credit to the government as mitigation. Bos. Edison , 658 F.3d at 1369; see also Yankee III , 679 F.3d at 1362 (deeming “Yankee Atomic’s wet storage pool costs and NRC fees” as mitigation expenditures). We have likewise Page 12approved treating 'off-site storage' costs as 'mitigation damages” when non-breaching utilities worked around the government’s breach by investing in external storage arrangements. PG&E , 668 F.3d at 1353. These types of undertakings, which avoid costs or yield “savings realized by the plaintiff as a result of the breach,” are illustrative of mitigation efforts in the SNF context. Cmty. Health , 970 F.3d at 1376 n.10 (internal quotation marks and alterations omitted).

Here, by contrast, the government fails to identify any of the Yankees’ costs that have been reduced or avoided as a result of the government’s failure to collect the Yankees’ nuclear waste. It does not, for instance, contend that any of the Yankees' 'spent fuel management cost[s]' have abated or diminished, J.A. 396; that the Yankees have fewer “radiation monitoring expenses,” 26 C.F.R. § 1.468A1(b)(6); or that they pay less for “security, analyses, [or] licensing” because of the NDTs’ investment gains. J.A. 1413. To the contrary, it is undisputed that these costs have continued to mount. Instead, the government points to a source of funds the Yankees can use to pay those (unmitigated) costs: the NDTs and their investment returns. But nothing about the availability of this funding pool decreases, in any amount, the costs associated with storing SNF at a nuclear facility. In other words, that the money is available to pay for expenses is not the same as those expenses diminishing.

In urging us to reach a different conclusion, the government relies heavily on our decision in LaSalle , 317 F.3d at 1372. There, we held that the government was entitled to a damages offset where its non-breaching counterparty, a regional thrift savings bank, had mitigated its damages by arranging to be purchased by a third-party bank. This 'substitute transaction,' we found, allowed the thrift to continue operating and, ultimately, generate profits, which had to be credited against the projected losses stemmingPage 13 from the government’s breach (for failing to undertake various measures to prevent the bank from entering receivership). Id. at 1371-72. The government compares 'the continued maintenance of the NDTs and the reimbursements the Yankees received from the investment gains” to that “substitute transaction.” Open. Br. at 28.

The government misreads LaSalle . Our holding there was that the “ reduction of loss through a substitute transaction is generally a direct mitigation of damages.' Id. at 1373 (emphasis added); see also id. at 1372 ('If the nonbreaching party makes an especially favorable substitute transaction, so that he sustains a smaller loss than might have been expected, his damages are reduced by the loss avoided as a result of that transaction.”) (emphasis added; internal quotation marks and alterations omitted). In other words, the core principle of LaSalle is that mitigation efforts can result in an offset of breach of contract damages when they reduce or avoid loss - a conclusion exemplified by the long line of precedent discussed above.

Because no such reduction or avoidance of loss has been shown here, we conclude that the NDTs’ investment gains do not constitute a “mitigation activity” and, therefore, cannot be credited against the damages owed by the government for its breach of contract.

There is a second reason that the NDTs’ investment gains do not constitute mitigation activity: they are not a direct consequence of DOE’s breach.

The “general rule,” applicable here, is “when there is a direct relation, in time and in subject matter, between the breach and mitigating events, the damages are reduced accordingly.' LaSalle , 317 F.3d at 1371-74. '[U]nrelated events and remote consequences,” however, “do not reduce the liability of the wrongdoer for the losses caused by the wrong.' Id. at 1373; see also Kansas , 685 F.3d at 1366 ('Damages do not extend to remote consequences of the Page 14breach.”). The burden is on the breaching party to prove that the non-breaching party’s actions are directly related to the breach such that they constitute mitigation. See LaSalle , 317 F.3d at 1373-74. The government has not met its burden here.

The relationship between the NDTs' earnings and DOE’s breach is temporally remote. Each of the Yankees’ NDTs was established by 1984, more than a decade before DOE’s breach began in 1998. When they were created, the NDTs were for decommissioning the Yankees' plants, a process the Yankees completed by 2010. Of course, when it became clear that the government could not honor its SNF retrieval obligations in the early 2000s, the applicable regulations were amended to expand the scope of “decommissioning' to include SNF storage and ISFSI-related costs. The Yankees have used their NDTs solely for those purposes ever since. But none of this more recent history changes the fact that the NDTs were created prior to DOE’s breach.

The government counters that this reasoning ignores the partial, ongoing nature of its breach. It insists that '[t]he operative point in time for determining the NDTs' temporal relation to the breach is not when the fund was established. It is during the claim period when the Yankees' damages accrued, and the Yankees received reimbursements for their ongoing spent fuel storage costs from the NDTs.” Reply Br. at 1. The government cites no authority that supports this assertion, and we reject it.

Nor has the government shown the required direct relationship in subject matter between its breach and the NDTs’ profits. The Yankees’ NDTs and their investment gains, on the one hand, and DOE’s failure to take the Yankees' SNF, on the other, are not 'reasonably directly related.” LaSalle , 317 F.3d at 1366 (“[M]itigation is limited to actions reasonably directly related to the breach and its proximate consequences.”). The Yankees created the NDTs because the NWPA required them to do so; they continue Page 15to hold the NDTs, in trust for the ratepayers, because various statutes and regulations require them to keep doing so. See, e.g. , 10 C.F.R. § 50.75; 18 C.F.R. § 35.32(a)(6)-(7). The investment gains earned by the NDTs during the Claim Period are simply a “remote consequence” – a favorable one, to be sure - of DOE's breach of contract. LaSalle , 317 F.3d at 1372; see also Hughes Commc’ns Galaxy, Inc. v. United States , 271 F.3d 1060, 1072 (Fed. Cir. 2001) (recoupment of money from third parties was “too remote” to be 'type of mitigation' that 'reduce[s] [non-breaching party’s] damages”). Hence, they are not mitigating activities that may be offset against the damages owed by the government to the Yankees. LaSalle , 317 F.3d at 1371 (“[I]t is improper to credit the wrongdoer with the profits that the non-breaching party was able to achieve, through no action by the wrongdoer, in mitigating the damages caused by the breach.').²

The government warns that affirming the Court of Federal Claims judgment for the Yankees results in an improper windfall, placing the Yankees “in a better position Page 16than they would have enjoyed had DOE performed.” Open. Br. at 21. We disagree.

Although the funds in the NDTs (including their investment gains) are available to the Yankees as an interim source to cover the costs incurred due to the government’s breach, these monies are essentially a loan to the Yankees; the Yankees are not entitled to keep them. The NDTs consist entirely of funds provided by the ratepayers, and it is the ratepayers to whom the holdings of the NDTs will be returned when DOE at last completes performance under the Standard Contract. See 18 C.F.R. § 35.32(a)(7). When the Yankees draw on the NDTs to cover breach-related costs, they are, in effect, borrowing against a fund that belongs to the ratepayers. The damages awarded here will simply serve to pay the ratepayers back. Reducing this damages award to zero, as the government asks us to do, would leave the NDTs – and, ultimately, the ratepayers – $145 million worse off than they should be.

In these circumstances, this is no windfall to either the Yankees or the ratepayers. The victims of the government’s breach are by no means “better off” as a result of that breach. Instead, they are being restored to the position they would have occupied had the breach never occurred. The affirmed judgment requires the government to reimburse the Yankees for having paid, using the ratepayer-contributed NDT funds, the costs imposed on the Yankees by the government’s breach of contract. It does not provide any windfall to them.³

Page 17One final point further convinces us that the NDTs' gains are not a mitigation effort: the logical consequences that would follow were we to hold otherwise. Were we to rule that the government is entitled to a credit against damages owed when the NDTs generate investment gains, we would have to similarly conclude that the Yankees are entitled to collect greater damages in any claim period in which the NDTs experience investment losses.⁴

The NDTs and their investments are either mitigation activities or they are not. See Hughes , 271 F.3d at 1072 (holding that same activity cannot be mitigation only when profitable for non-breaching party, as this “would destroy [the] symmetry between [the] reduction and escalation of damages”). If they are, as the government insists, then the government could offset the investment gains against the damages it owes for the current Claim Period, but only at the cost of having to add to the damages owed if, during another period, the NDTs experience investment losses.

The government has not agreed to accept this risk. At oral argument, it suggested that it might owe such additional damages when it finally performs and this litigation

fundamental reality that the NDTs are held in trust for the Yankees’ ratepayers, who, but for the damage caused by the government’s breach, would have their principal contributions to the NDTs returned to them as well as the investment gains realized by the NDTs.

Page 18concludes. See Oral Arg. at 1:30-3:30.⁵ But it strongly implied it would never pay for the NDTs' investment losses during any period of partial breach. If, as seems to be the case, the government refuses responsibility for losses in the NDTs, it cannot benefit when those same NDTs happen to enjoy gains. J.A. 7 (“Just as the Yankees may not ask for increased damages should their NDT investments yield losses, the government may not ask for reduced damages due to gains in the Yankees’ NDTs.”); see also Dominion Res., Inc. v. United States , 641 F.3d 1359, 1365 (Fed. Cir. 2011) (observing that nuclear utility 'cannot ask for increased damages should its investment of [funds] return less than [expected], and the government cannot ask for a reduction in damages should [the] investments return more”). The proper result, then, is to deny the government an offset against the damages it owes for DOE’s breach.

We have considered the government’s remaining arguments and find them unpersuasive. Accordingly, for the foregoing reasons, we affirm the judgment of the Court of Federal Claims.