A federal judge has dismissed a lawsuit challenging a decision by the U.S. Nuclear Regulatory Commission (NRC) that cleared a key regulatory hurdle for the planned restart of the Palisades Nuclear Power Plant in Michigan.
The ruling by the U.S. District Court for the Western District of Michigan leaves intact the NRC’s exemption decision and reinforces the legal process established by Congress for reviewing nuclear licensing actions.
Court Rules District Court Lacked Jurisdiction
The court concluded that it did not have the authority to hear the case because federal law assigns judicial review of NRC licensing decisions to the U.S. Courts of Appeals.
According to the ruling, both the Atomic Energy Act and the Hobbs Act direct challenges involving final NRC orders related to nuclear licensing proceedings to the appellate courts rather than federal district courts.
As a result, the lawsuit contesting the exemption granted for the Palisades facility was dismissed.
NRC Granted Exemption as Part of Restart Process
The legal dispute centered on actions taken by the NRC in July 2025 after Holtec Decommissioning International LLC sought approval to restart the Palisades Nuclear Power Plant in Covert Township, Michigan.
Holtec had informed the NRC in March 2023 of its intention to bring the previously shut down and defueled facility back into operation.
Alongside requests to amend the plant’s operating license and transfer reactor operating authority, the company also applied for an exemption from certain NRC regulatory requirements.
The NRC approved the exemption together with the requested license amendments and operating authority transfer in July 2025.
Federal Law Governs Review of NRC Orders
The decision emphasized that Congress established a specific legal framework for reviewing final NRC actions involving nuclear licensing.
Under the Hobbs Act, the U.S. Courts of Appeals have exclusive jurisdiction over such cases, including exemption decisions issued during licensing proceedings.
The ruling therefore did not address the merits of the exemption itself but instead focused on which court has the authority to hear challenges against NRC decisions.
Justice Department Welcomes Outcome
Principal Deputy Assistant Attorney General Adam Gustafson of the Justice Department’s Environment and Natural Resources Division said the decision allows the Palisades restart project to continue moving forward.
He stated that preserving the NRC’s exemption decision supports domestic energy production while helping communities benefit from reliable nuclear power generation.
Palisades Restart Moves Ahead
The dismissal removes a legal obstacle for the Palisades Nuclear Power Plant as efforts continue to return the facility to service.
If restarted, the plant would become one of the few commercial nuclear facilities in the United States to resume operations after being shut down, making the project closely watched across the country’s energy sector.
NRC Continues Oversight of Nuclear Licensing
The NRC remains responsible for licensing and regulating commercial nuclear power plants and other civilian uses of nuclear materials across the United States.
Its authority includes issuing, renewing, amending and terminating operating licenses, as well as granting exemptions from regulatory requirements when permitted under federal law, subject to the judicial review process established by Congress.
