ML043570437

From kanterella
Jump to navigation Jump to search
Transcript of Pre-Hearing Telephone Conference Held on 12/17/04; Pp. 3783 - 3836
ML043570437
Person / Time
Site: Catawba  Duke Energy icon.png
Issue date: 12/17/2004
From:
Atomic Safety and Licensing Board Panel
To:
Byrdsong A T
References
50-413-OLA, 50-414-OLA, ASLBP 03-815-03-OLA, NRC-155, RAS 9026
Download: ML043570437 (56)


Text

ASs qoAa Official Transcript of Proceedings NLbUCLEAR REGULATORY COMMISSION

Title:

Duke Energy Corporation Docket Number:

50-413/414-OLA; ASLBP No.: 03-815-03-OLA Location:

(telephone conference)

DOCKETED USNRC December 21, 2004 (4:1 Opm)

OFFICE OF SECRETARY RULEMAKINGS AND ADJUDICATIONS STAFF Date:

Friday, December 17, 2004 Work Order No.:

NRC-1 55 Pages 3783-3836 NEAL R. GROSS AND CO., INC.

Court Reporters and Transcribers 1323 Rhode Island Avenue, N.W.

Washington, D.C. 20005 (202) 234-4433 Jemp/late = seW o 03A

3783 1

2 3

4 5

6 7

8 9

10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION ATOMIC SAFETY AND LICENSING BOARD (ASLB)

E C N F E PRE-HEARING CONFERENCE UI In the Matter of:

DUKE ENERGY CORPORATION Catawba Nuclear Station, Units 1 and 2 11 ll Docket Nos. 50-413-OLA fl 50-414-OLA ll ASLBP No. 03-815-03-OLA 11 II Friday, December 17, 2004 Via Teleconference BEFORE:

ANN MARSHALL YOUNG, Chairperson ANTHONY J. BARATTA, Administrative Law Judge THOMAS S. ELLEMAN, Administrative Law Judge NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

WASHINGTON, D.C. 20005-3701 (202) 234-4433 www.nealrgross.com

3784 1

2 3

4 5

6 7

8 9

10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 APPEARANCES:

On Behalf of the Licensee:

MARK J. WETTERHAHN, ESQ.

of:

Winston & Strawn, LLP 1400 L Street, N.W.

Washington, D.C.

20005 (202) 371-5703 On Behalf of the Intervenor.

Blue Ridge Environmental Defense League:

DIANE CURRAN, ESQ.

of:

Harmon, Curran, Spielberg & Eisenberg, LLP 1726 M Street, N.W., Suite 600 Washington, D.C.

20036 (202) 328-3500 On Behalf of the Nuclear Regulatory Commission:

ANTONIO FERNANDEZ, ESQ.

SUSAN L. UTTAL, ESQ.

Office of the General Counsel Mail Stop 0-15 D21 U.S. Nuclear Regulatory Commission Washington, D.C.

20555-0001 (301) 415-8339 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

WASHINGTON, D.C. 20005-3701 (202) 234-4433 www.nealrgross.com

3785 1

2 3

4 5

6 7

8 9

10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 ALSO PRESENT:

SHERRI CROSS, NSIR JOSEPH SHEA ALBERT GARRETT FRANCIS YOUNG, NRC NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE.. N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 wvw.nealrgross.com

3786 1

2 3

4 5

6 7

8 9

10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 P-R-O-C-E-E-D-I-N-G-S (10:10 a.m.)

Let's go on the CHAIRPERSON YOUNG:

record.

This is Judge Ann Marshall Young. I'm the Chair of the Board.

I have here with me Judge Baratta and Francis Young, our security expert advisor.

Judge Elleman, you are also present, right?

JUDGE ELLEMAN:

This is Judge Thomas Elleman.

Yes, I'm here.

CHAIRPERSON YOUNG: And if we could start with Staff.

Could Sue introduce who is present?

MS. UTTAL:

Yes.

This is Susan Uttal, Staff counsel.

Also with me is Antonio Fernandez, Staff counsel, some members of NSIR staff, Joseph Shea and Sherri Cross.

CHAIRPERSON YOUNG:

And BREDL?

MS.

CURRAN:

This is Diane Curran, representing Blue Ridge Environmental Defense League, and I'm alone.

MR. WETTERHAHN:

This is Mark Wetterhahn with Winston

& Strawn, Counsel for Duke Energy Corporation.

CHAIRPERSON YOUNG:

Okay.

Thank you.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 2344433 WASHINGTON. D.C. 20005.3701 www.nealrgross.com

3787 1

All right. We were just -- just to put on 2

the record what we were just discussing, we will, 3

during the hearing --

we're going to try to have 4

available for all parties locking file cabinets in 5

your respective conference rooms, around the hearing 6

room.

7 MS.

UTTAL:

Excuse me.

Judge Young?

8 CHAIRPERSON YOUNG:

Yes.

9 MS.

UTTAL:

This is Susan Uttal.

We're 10 losing part of what you're saying when the papers are 11 rustling.

12 CHAIRPERSON YOUNG:

Could everybody try to 13 avoid rustling papers, because we really need to use 14 speakerphone, and that's -- so we're -- that requires 15 that everyone keep especially quiet when --

well, all 16 the way through, except for talking.

17 Okay.

Just to confirm what we said 18 beforehand on the record, for the hearing we are going 19 to --

we are making an effort --

and I think that 20 we're going to be able to provide locking file 21 cabinets in each of the parties' conference rooms 22 around our hearing room to be used during that week.

23 In addition, if there's any incidental 24 needs for copying of exhibits that come up, obviously, 25 please try to disclose anything as soon as you have it NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com

3788 1

in advance of the hearing, if something comes up at 2

the last minute.

3 We also discussed whether the --

Ms.

4 Curran asked whether the hearing might start on 5

Tuesday, January 11th, and we're not going to do that.

6 We're going to go ahead and start on the 10th unless 7

we --

we did talk about maybe the middle of the week 8

of January --

of the first week of January we could 9

get together on the phone to address any last-minute 10 things before the hearing.

11 And if at that point it looked as though 12 we really didn't need the whole week, and that was 13 certain, we could reconsider that. But at this point, 14 we need to maintain the whole week as -- including the 15 possibility of a need for a site visit on the 14th.

16 Was there anything else that we talked 17 about before we went on the record that we need to 18 just confirm on the record? All right.

19 And I don't think that the parties had 20 anything else to talk about, so we were just going to 21 address two things.

First, on the --

on BREDL --

the 22 Staff --

I hear some papers rustling now.

I don't 23 know if we're --

24 On BREDL's appeal of the Staff's Need to 25 Know Determination, we are ready to make our ruling, NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com

3789 1

and we've talked with Mr. Young to make sure that we 2

state it in such a way that we're not disclosing any 3

safeguards information.

4 Our ruling is this.

With regard to the 5

documents that BREDL seeks access to, the Commission 6

did consider that document, and they approved it in 7

part and disproved it in part.

There were two areas 8

that the Commission approved, and we would direct the 9

Staff to provide the sections of the document at issue 10 that address those two areas to BREDL.

We do not --

11 and since those are Commission policy relating to the 12 insider threat.

13 We do not find the other portions, since 14 they were not adopted by the Commission, to be 15 Commission policy, and we don't find them to be 16 relevant such that there is a need for them by BREDL, 17 balancing out all of the relevant factors. We're not 18 getting into the privilege issue raised by the Staff.

19 We're simply placing our ruling on the factors that 20 I've stated.

21 Now, I guess --

and one of the reasons we 22 wanted to tell you that today was so that that could 23 that could be done today, assuming the Staff had no 24 problem with doing that, which we wanted to find out, 25 to just sort of see where we were.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 wtn.nealrgross.com

3790 1

I guess we're anticipating that given that 2

the Staff had gotten access to the same SRM as 3

indicated in my e-mail of yesterday, we anticipated 4

that the Staff probably would not have a problem with 5

that.

Could you address that, Staff counsel?

6 MR. FERNANDEZ:

Your Honor, we're not 7

ready to address that right now. We would endeavor to 8

resolve that issue today and inform the parties of 9

whether the Staff is going to move to appeal the 10 Board's decision and move for a stay of the Board's 11 order.

12 CHAIRPERSON YOUNG: Okay. Yes, that would 13 help us, to let everybody know that, so that things 14 could move along if --

with full knowledge of what's 15 going to be happening.

And we will try to get an 16 order confirming that out today.

17 But in any event, the parties know what 18 our ruling is, and it is on the record now. And so if 19 you let us know what you're going to do, that should 20 give everyone the information they need to move 21 forward. We'll try to get an order out on that today.

22 If not today, then it will be next week, probably not 23 until Tuesday.

24 MS. CURRAN:

Judge Young?

25 CHAIRPERSON YOUNG:

Yes.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE.. N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 v.vAv.ne3!rgross.com

3791 1

MS. CURRAN: This is Diane Curran. I was 2

just wondering, if it turns out that this new document 3

is something that Dr. Lyman needs to address in his 4

testimony, should we put in a piece of supplemental 5

direct written testimony, or should he just address it 6

when he gets to the hearing, or --

7 MR. WETTERHAHN: Well, he's going to have 8

rebuttal testimony.

9 MS. CURRAN: Well, I guess he could put it 10 he could address it in his rebuttal testimony.

11 CHAIRPERSON YOUNG:

Yes.

12 MR. WETTERHAHN:

Your Honor, just for 13 clarification, I would expect your ruling also applies 14 to Duke, so Duke would have access to this document 15 also.

16 CHAIRPERSON YOUNG:

Yes.

Thank you for 17 pointing that out.

18 MR. WETTERHAHN:

Thank you.

19 CHAIRPERSON YOUNG:

Okay.

Then, on the 20 Motion to Amend the Protective Order, I guess we would 21 just like to hear briefly from the Staff on what the 22 situation is with that, because we were a little 23 puzzled by the circumstances that were described.

24 MR. FERNANDEZ:

Your Honor, let me first 25 begin by clarifying some representations made by BREDL NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON. D.C. 20005-3701 mim.nealrgross.com

3792 1

counsel with regard to what the Staff stated prior to 2

reviewing what facility protections and what handling 3

Ms. Curran was conducting at her facility for the 4

documents that she already had.

5 Prior to making a decision on whether 6

additional documents should be kept at BREDL's 7

offices, the Staff wanted to have an understanding of 8

what measures Ms. Curran was applying and how she was 9

complying with the order before we made a decision.

10 Once the Staff communicated that to me, I talked to 11 Ms. Curran, and I expressed that the Staff wanted to 12 inspect her facilities prior to making a decision on 13 whether further access should be granted.

14 At no point did the Staff make a 15 representation of what the outcome of that assessment 16 was going to be and what further actions were going to 17 be taken subsequent to that inspection.

18 So for BREDL counsel to state that it was 19 assured that upon successful completion of the 20 inspection that further actions would be granted is a 21 misstatement of my recollection of that conversation.

22 In fact, I remember quite specifically saying that 23 before making a decision the Staff wanted to conduct 24 this inspection.

25 JUDGE BARATTA:

All right.

Now, Mr.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE.. N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.corn

I-3793 1

Fernandez, the question is:

what was the outcome of 2

the inspection?

3 MR. FERNANDEZ:

The Staff found that Ms.

4 Curran is in compliance with the order and -- hold on 5

one second. And as Mr. Stapleton communicated to Ms.

6 Curran, that Ms. Curran was adequately protecting, in 7

compliance with the order, the documents that she 8

already had in her possession.

9 JUDGE BARATTA:

In other words, she does 10 have adequate storage and procedures for ensuring that 11 disclosure of protected information inadvertently --

12 there would be no inadvertent disclosure of protected 13 information.

Is that correct?

14 MR. FERNANDEZ: For the documents that she 15 has right now, that's correct, yes.

16 JUDGE BARATTA:

And was there any 17 indication that that capacity of --

was limited such 18 that additional documents would not be adequately 19 stored?

20 MR. FERNANDEZ:

We did not reach that 21 issue. We did not consider that.

What we considered 22 was the sensitivity of the further documents that 23 could be housed at her facility.

24 JUDGE BARATTA:

And these are all 25 safeguards, so they're -- they are comparable in their NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com A__ _, __..._ _

3794 1

sensitivity?

2 MR. FERNANDEZ:

Well, to the extent that 3

some of the documents are merely documents generated 4

by BREDL, and the documents that --

and, of course, 5

we're doing this in a vacuum, because we really don't 6

know what the exhibits are yet.

But some examples of 7

documents that could be exhibits are maps that have 8

identified all the locations of the CCTV cameras at 9

the Catawba Nuclear Station, all of the locations of 10 the microwaves at the Catawba Nuclear Station, the 11 responder procedures where if there were an attack on 12 the facility.

13 So although all of the documents are 14 marked "safeguards," because under the Act that is the 15 required marking, there is additional sensitivities 16 with regard to other documents that are --

that could 17 be exhibits in this proceeding.

18 JUDGE BARATTA:

And the adequacy of 19 storage is the same, though, regardless of whether 20 there are those documents or the documents that she 21 currently has.

Is that not correct?

22 MR. FERNANDEZ: Could you please ask your 23 question again, Judge?

24 JUDGE BARATTA:

Documents that --

those 25 documents and the documents that she currently has all NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701

%wAww.nealrgross.com

3795 1

require identical storage, is that correct?

2 MR. FERNANDEZ:

That's correct.

3 JUDGE BARATTA:

And they all require the 4

same handling procedures, is that correct?

5 MR. FERNANDEZ:

That's true.

6 JUDGE BARATTA:

Thank you.

7 MR. FERNANDEZ:

I would like to add 8

something, because I --

I can see where the Board is 9

going with its questioning. And even though one could 10

argue, as Ms.

Curran has, that she is already 11 protecting safeguards documents adequately, as the 12 Staff found, that there's no reason, then, why she 13 shouldn't be allowed to have this other type of 14 information at her facility.

15 I would refer the Board to an Atomic 16 Safety and Licensing Board --

Atomic Safety and 17 Licensing Appeals Board decision found that ASLAB 410, 18 5 NRC 1398, dated 1977, in the Diablo Canyon 19 proceeding --

20 CHAIRPERSON YOUNG: What's the cite again?

21 MR. FERNANDEZ:

5 NRC 1398. The citation 22 is 1406.

In that case, which has been cited by the 23 Commission as a source of guidance for boards in 24 considering how to issue protective

orders, 25 particularly in the Statement of Considerations found NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.neafrgross.com

3796 1

at 46 Fed Reg 51718, and a final rulemaking under 2

Protection of Unclassified Safeguards Information.

3 The Commission cites this decision as 4

providing guidance to the Board, and in that decision 5

the Licensing Board stated that --

I'm sorry, the 6

Appeals Board stated, "Licensing Board may wish, 7

however, to include additional or different terms and 8

conditions in such an order," and referenced the 9

protective order.

10 For

example, "It may appear to be 11 desirable to limit the locations at which the 12 Intervenor may examine relevant portions," and here is 13 in reference to the security plan, "of the plan to the 14 offices of the applicant at the sites of any hearing 15 or prehearing conference convened to consider the 16 plan.

It would also appear desirable to preclude the 17 Intervenor from copying or taking notes about any 18 portions of the plan."

19 And then the part which I think bears 20 relevance upon the arguments made by BREDL.

"Such 21 restriction could result in a lengthened hearing.

22 Since the Intervenor's representatives might not --

23 might have" --

I'm sorry --

"might have to refresh 24 their recollections about what they had examined 25 earlier.

But that may be an acceptable price to pay NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 vNow.ne3lrgross.com

3797 1

for the added security obtained."

2 JUDGE BARATTA:

In any case, it's quite 3

clear that the security that is in effect at BREDL is 4

adequate.

5 MR. FERNANDEZ:

Well, actually, it is 6

quite clear to the Staff that the security in place at 7

BREDL is not adequate, and we do not feel comfortable 8

having plans that have all of the CCTV cameras for a 9

nuclear powerplant, all of the microwave locations for 10 a nuclear powerplant, the response measures that a 11 security force would have to take to be located at her 12 offices. That has been the determination of the staff 13 in this proceeding.

14 JUDGE BARATTA:

It's stated that the --

15 that your own expert said that the --

it was adequate 16 for the storage of safeguards material.

Now, it's 17 either adequate, or it's inadequate.

18 MR. FERNANDEZ:

No.

He found that the 19 measures that are in place are adequate to protect the 20 information that she currently has.

There was no 21 finding made by the inspector with regard to any 22 additional types of safeguards information.

23 MS. CURRAN:

That's not what he said to 24 me.

25 JUDGE BARATTA:

That doesn't make any NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE.. N.W.

(202) 2344433 WASHINGTON, D.C. 20005-3701

%v-.vv:.ne3Irgrosc.com

3798 1

sense.

2 JUDGE ELLEMAN:

Mr. Fernandez, this is 3

Judge Elleman. You said just a minute ago that it was 4

not adequate. Can you identify what about the storage 5

capability is inadequate?

6 MR. FERNANDEZ: Well, what I would respond 7

to that, Your Honor, is that I don't have that type of 8

information.

9 CHAIRPERSON YOUNG:

But you have your --

10 you have that type of information from your expert who 11 did the inspection, didn't you?

12 MR. FERNANDEZ:

No.

The inspector only 13 looked to see what were the current measures at the 14 facility with regard to the --

I'm sorry, with regard 15 to the currently held information at the facility.

16 CHAIRPERSON YOUNG:

And what's the basis 17 of your saying that they should not be allowed to keep 18 those documents there?

And then, I want to ask 19 another question in the context of that.

This case 20 that you have pointed us to talks about the --

this 21 kind of restriction resulting in a lengthened hearing.

22 What we're talking about now is BREDL's 23 ability not only to participate in the hearing but to 24 prepare for the hearing. And we are moving this case 25 forward as quickly as possible in order to meet, if NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 vNw.neafrgross.com

3799 1

possible, Duke's needs with regard to their schedule.

2 And this case seems to say that with this 3

kind of restriction this may result, in effect, in a 4

hearing not only taking longer, but it would seem to 5

me by an analogy our preparation taking longer.

6 Now, obviously, not having these documents 7

in their own office would be a significant impairment 8

to BREDL in preparing for the hearing in this case.

9 So if you could address that.

And also, what about 10 BREDL's ability to protect the documents do you find 11 insufficient with regard to the documents that they're 12 asking to keep there?

13 Actually, I'm told by Mr. Young that we 14 should not talk about inadequacies in terms of --

15 address vulnerabilities.

16 MR.

YOUNG:

It's either adequate or 17 inadequate.

That's all --

either --

that's as far as 18 I think we should discuss it in an open forum.

19 CHAIRPERSON YOUNG:

And --

20 MR. FERNANDEZ: Your Honor, let me address 21 the timeliness issue first, and --

22 CHAIRPERSON YOUNG: Excuse me. Excuse me.

23 Court Reporter, that was Mr. Francis Young who just 24 spoke.

25 MR.

FERNANDEZ:

With regard to the NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com

3800 1

timeliness

issue, all of the parties in this 2

proceeding have been very well aware of what the 3

schedule is going to be in this proceeding since the 4

Board set it.

And Ms. Curran waited until this week 5

to file a request to modify where she should have 6

access to safeguards information.

7 She was aware that the protective order, 8

since it's been in place, limited the sites where she 9

should have access.

So if --

if any party that's 10 before you today has abused the process and now is 11 hiding behind the fact that it's not timely and it's 12 handicapping them in any way, it's clearly BREDL, 13 because Ms. Curran, from the very first time that we 14 sent out the order, and all parties agreed to it, has 15 known that her access is limited to the NRC and 16 Winston & Strawn.

17 CHAIRPERSON YOUNG:

Mr. Fernandez, I'm 18 going to interrupt you right there.

Over the course 19 of preparing for this hearing, we have had, as you 20 know, as is clear from the record, numerous need --

21 numerous situations where various of us, including the 22 Board and even the Commission, have been called upon 23 to make need-to-know determinations.

24 This has been a developing situation with 25 regard to how much information we're talking about and NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nea~rgross.com

3801 1

how many documents. Apparently, Ms. Curran last week 2

requested this from you, and an inspection was done, 3

and the result of the inspection was that Ms. Curran's 4

law firm had adequate measures in place to protect 5

safeguards material.

And --

6 MR. FERNANDEZ: Can I clarify that for the 7

record, Your Honor?

8 CHAIRPERSON YOUNG: Mr. Fernandez, let me 9

finish what I'm saying to you.

You just cited to us 10 a case in which you quoted language saying that 11 requiring this results in a lengthened hearing.

I 12 don't want to get into any argument about who --

he 13 said/she said and what happened when.

14 It's clear that all parties, including the 15 Board and the Commission, in this case have put in a 16 lot of time and energy to addressing these types of 17 security issues, and we are -- make every effort as we 18 go to address the needs as they arise.

19 For example, that is why we gave you our 20 ruling on the need-to-know this morning, so you would 21 not be delayed, so that the parties would not be 22 delayed in addressing the outcome of that, whichever 23 way that may go.

24 So let's not get into that kind of back 25 and forth about what has happened in the past. We are NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 2344433 WASHINGTON, D.C. 20005-3701 vAW:r:.nealrgrosc.com

3802 1

at a point in the process of this hearing where we are 2

getting close to the hearing, in the process of 3

proceeding where we are very close to the hearing, and 4

the parties are engaged in preparation for the 5

hearing.

6 You and I both were here at the NRC last 7

night after hours. You told me that you were working 8

on the testimony. And, obviously, this is the kind of 9

separation that is -- becomes quite intensive at this 10 point on the part of the parties. And it needs to be 11 recognized that -- that BREDL, like other parties, are 12 in that intensive preparation period.

13 And that's what we need for this. That --

14 along with the fact that the Staff has made a 15 determination that BREDL's facilities are --

or that 16 Ms. Curran's law firm facilities are adequate for 17 protecting safeguards materials.

18 Now, we can't -- Mr. Young has told us we 19 cannot get into the details about any inadequacies or 20 vulnerabilities that the Staff might see with regard 21 to these additional documents.

It seems to me that 22 what this -- what the Board is saying here, and what 23 the Commission has cited it for, is it talks about 24 something being desirable.

In other words, over and 25 above the requirements --

desirable.

And it talks NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701

%wwvr.neaIrgross.com

3803 1

about the results of the --

of any restrictions like 2

that.

3 In addition, in that case, the Appeals 4

Board and, presumably, the Commission by --

by 5

referring to this, left it to the Board --

it stated 6

that the Board was --

that the Licensing Board was in 7

the best position to determine the most appropriate 8

circumstance in which the plan may be viewed, and, 9

therefore, left it to the Board to formulate the exact 10 terms and conditions of the order.

11 And by the way, I need to get that --

the 12 cite from you.

You gave another cite in which the 13 Commission cited this case.

What was that?

14 MR. FERNANDEZ: It was in the publication 15 of the final rule amending the section of unclassified 16 safeguards information. The Federal Register cite is 17 46 Fed Reg 51718.

The date is October 22, 1981.

18 MS. CURRAN:

1981?

19 MR. FERNANDEZ:

That's correct.

20 CHAIRPERSON YOUNG:

Okay.

Thank you.

21 Now, in light of what I've said, I think 22 we need to wrap up the argument on this very quickly, 23 and then it may be that Judge Baratta and Judge 24 Elleman and I need to talk and come back to you on 25 that.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com

3804 1

MR. FERNANDEZ: Your Honor, can I briefly 2

summarize the Staff's position for the Board?

3 CHAIRPERSON YOUNG:

Keep in mind Mr.

4 Young's caution.

5 MR. FERNANDEZ: Yes. What we're trying to 6

tell the Board today is that the Staff, as the 7

Commission's security expert, has found that the 8

exhibits in this case, which could include maps of 9

CCTVs for this facility, response procedures for this 10 facility, maps of the microwave locations, should not 11 be stored at Harmon Curran. And that that finding is 12 based on our expertise, and that we feel that those 13 documents should not be stored there, those types of 14 documents.

And --

15 JUDGE BARATTA: Can I ask you one question 16 before you go on, Mr. Fernandez?

17 MR. FERNANDEZ:

Sure, Your Honor.

18 JUDGE BARATTA:

Are those types of 19 documents stored in the offices where Mr. Wetterhahn 20 is?

21 MR. WETTERHAHN:

The answer is yes, 22 because we make them available to BREDL at our 23 location here.

24 JUDGE BARATTA:

Thank you.

25 MR. FERNANDEZ:

And that summarizes our NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE.. N.W.

(202) 234.4433 WASHINGTON. D.C. 20005-3701 wvwa nealrgross.com

3805 1

position before the Board.

2 MR. WETTERHAHN:

Your Honor, may I be 3

heard for a second? This is Mark Wetterhahn.

4 CHAIRPERSON YOUNG:

Go ahead.

5 MR. WETTERHAHN:

We would agree that the 6

documents in question, although we have enumerated 7

them, are the most detailed kinds relating to the 8

security of the plant.

Any loss or disclosure would 9

be devastating and really diminish-the security of the 10 facility.

11 I can't speak to the preparation at Ms.

12 Curran's law firm. All I can say is that any time you 13 put such documents in another location it tends to 14 diminish the overall security.

It's a fact of life.

15 We here have always cooperated in making 16 documents available to the point of saying already we 17 would make them --

we would come down here and make 18 them available on weekends before the hearing to 19 facilitate their preparation.

20 So while there's a slight additional 21 difficulty in coming here --

we're only a few blocks 22 away --

the fact that we've made them available for 23 all this period of time during business hours, and we 24 would make them available at --

during weekends, 25 diminishes their need for it.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 v.v.v:.neakrgcos.com

3806 1

Again, I can't say anything about the 2

track record at Ms. Curran's offices. All I can do is 3

quote you from an e-mail I received from Duke in 4

Charlotte.

They documented the fact that this week 5

they received a package from Harmon,

Curran, 6

Spielberg & Eisenberg, whose contents, although they 7

were double-wrapped, the interior didn't indicate that 8

they were safeguards information. That could have led 9

to a disclosure of safeguards information.

It did 10 not, but it's an example of things that happen if you 11 increase the distribution of these sensitive 12 documents.

13 I would ask that the Board consider these 14 and deny the --

giving copies of these documents to 15 BREDL for the next few weeks.

16 CHAIRPERSON YOUNG: Mr. Wetterhahn, did I 17 understand you correctly?

You said that apart from 18 the weekends you only are providing access during 19 business hours?

20 MR. WETTERHAHN:

During business hours.

21 Our business hours extend --

I get here very early, 22 6:00 in the morning, and there's always someone here 23 until at least 6:00 at night.

So 12 hours1.388889e-4 days <br />0.00333 hours <br />1.984127e-5 weeks <br />4.566e-6 months <br /> a day is a 24 considerable period of time of the day to give them 25 access.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 v.'ww.nealrgross.com

3807 1

CHAIRPERSON YOUNG:

But not in the 2

evening.

3 MR. WETTERHAHN: Not in the evening. But 4

if there's one evening they need access, we'll give 5

them access. But we believe that the time period that 6

we've given them access is reasonable, and we've gone 7

out of our way to compensate for any problem in their 8

not having those documents.

9 MS. CURRAN:

Judge Young, I'd like to be 10 heard if I could.

11 CHAIRPERSON YOUNG:

Go ahead.

12 MS. CURRAN:

I just have a couple of 13 points.

I just want to make clear why it is, first, 14 that we want to see these documents in my office, and 15 it's only in my office.

And I do have a steel file 16 cabinet that has sufficient capacity for any 17 additional documents.

18 It is very cumbersome to go to Winston &

19 Strawn.

Certainly, we've done it, but it means 20 dragging a lot of other documents along with us, 21 because you're doing an integrated review.

And 22 there's only so much paper that you can carry, and 23 it's --

it's just -- it's very -- it's difficult.

It 24 is cumbersome, it's time-consuming, and we really 25 don't have that much time to prepare for the hearing.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com

3808 1

Between the filing of the rebuttal testimony and the 2

hearing, there's just a weekend.

3 And the other point X want to make is 4

we're not talking about an endless amount of time. We 5

have only asked for the period of time between when 6

the initial testimony is filed and when proposed 7

findings are filed, so that we can really spend the 8

time that we need to spend doing a good job on this.

9 I want to address the issue of timeliness, 10 too.

The issue of --

of serving exhibits on us came 11 up not at a --

a conference.

I think it was before 12 the one on the --

well, I know I raised it a while 13 ago. At the most recent conference, it was said --

we 14 said the parties would try to work it out.

And the 15 way we tried to work it out was I got a call from Mr.

16 Fernandez on the 9th, which --

I mean, maybe he said 17 we're not going to decide until Bern Stapleton looks 18 at your offices.

19 But we all knew that the issue before us 20 was whether to amend the protective order, which 21 clearly required that we could only look at the 22 documents at Winston & Strawn and the NRC Staff 23 offices.

24 So, and when I got the response, after Mr.

25 Stapleton examined my office, when I spoke to Ms.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com

3809 1

Uttal and asked her, "Why are you denying me access to 2

the documents?" she said, "Because the protective 3

order says you have to look at them at Winston &

4 Strawn and our office."

5 But that was the whole thing we were 6

talking about changing.

So it was kind of like, why 7

did I go through this if --

if the reasoning of the 8

staff was going to be the same, and they weren't going 9

to consider anything different?

10 Well, and I also want to clarify that Bern 11 Stapleton said to me, "I don't see any reason why you 12 can't get these exhibits at your office."

So --

13 CHAIRPERSON YOUNG:

We would like to 14 ask --

15 JUDGE BARATTA: I have one last question, 16 if I could.

Mr. Fernandez?

17 MR. FERNANDEZ:

Yes, Your Honor.

18 JUDGE BARATTA: Do you know when material 19 commonly gets --

is at the highest risk of disclosure?

20 Is it during storage? Is it during use? Is it during 21 transmission? Do you have any idea? I don't know the 22 answer.

I'm just --

23 MR. FERNANDEZ:

I do not know, and the 24 Staff is shaking their heads.

So I'm assuming they 25 don't know either.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 ww.-.v.nea1rgross.com

3810 1

JUDGE BARATTA:

Thank you.

2 CHAIRPERSON YOUNG:

Okay.

We're sorry.

3 We'd like to ask everyone to hold on.

4 Judge Elleman, if you could hang up, and 5

we're going to call you back on another line.

And 6

we're just going to put you on hold for a few minutes 7

while we confer.

8 JUDGE ELLEMAN: All right. Are you going 9

to call me on my cell phone, or on my other hard line 10 into my office?

11 CHAIRPERSON YOUNG:

We could call you on 12 your cell phone, and then that way you wouldn't break 13 this connection.

14 JUDGE ELLEMAN: Okay. And you've got that 15 number, don't you?

16 CHAIRPERSON YOUNG:

Yes, I do.

17 JUDGE ELLEMAN:

Okay.

Give me just a 18 minute, then.

19 (Whereupon, the proceedings in the 20 foregoing matter went off the record at 21 10:46 a.m. and went back on the record at 22 11:31 a.m.)

23 CHAIRPERSON YOUNG: All right. Again, we 24 apologize.

25 Would everyone be available to get back NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE.. N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com

3811 1

together at 3:00 this afternoon?

2 MS. CURRAN:

What time did you say?

3 CHAIRPERSON YOUNG:

3:00.

4 MS. UTTAL:

Your Honor, I leave at 2:30 5

today. And I can't stay because I have no child care 6

for my children.

7 MR. FERNANDEZ:

And I'm getting a root 8

canal done at 2:00.

9 (Laughter.)

10 CHAIRPERSON YOUNG:

Judge Elleman?

11 JUDGE ELLEMAN:

Yes.

12 CHAIRPERSON YOUNG:

What other time --

13 you're going --

you're going to be leaving shortly, 14 and you won't be back until about 3:00, right?

15 JUDGE ELLEMAN:

Well, it looks like my 16 luncheon engagement is going to have to be cancelled, 17 so I can move forward the 3:00 time if we need to.

18 CHAIRPERSON YOUNG:

1:00?

Would 1:00 --

19 JUDGE ELLEMAN: Okay. Yes, I can do 1:00.

20 MS. CURRAN: Judge, 1:00 is all right for 21 me.

22 MR. WETTERHAHN: 1:00 is fine for me, too.

23 It's Mark Wetterhahn.

24 MS. UTTAL: Susan Uttal. 1:00 is fine for 25 me.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.corm

3812 1

CHAIRPERSON YOUNG:

Well --

2 MS. UTTAL:

Mr. Fernandez will not be 3

here, though.

4 MR. WETTERHAHN: He'd rather have a root 5

canal.

6 MS. UTTAL:

Yes, he would.

7 CHAIRPERSON YOUNG: Before we do that, we 8

need to make sure that we can get the Court Reporter.

9 The Court Reporter isn't done now.

I'm thinking we 10 originally scheduled for you to be available until 11 1:00. I don't know if we have to go through formal --

12 now, there's a message on my phone right now.

I 13 wonder who --

14 MS. CURRAN: Judge Young?

15 CHAIRPERSON YOUNG:

Yes.

16 MS. CURRAN:

This is Diane Curran.

It's 17 my understanding that the Staff is going to --

if you 18 do give us access to the documents, the Staff is going 19 to appeal it.

So I'm just wondering if we could have 20 this conversation on Monday, because they're not going 21 to send the documents to Winston & Strawn anyway. And 22 I'm just concerned about the time for producing the 23 testimony 24 CHAIRPERSON YOUNG:

Right.

What we're 25 trying --

what we're working on we're hoping might NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 2344433 WASHINGTON. D.C. 20005-3701 w%.mnealrgross.com

3813 1

address some of the issues.

And I'm sorry, I just 2

don't want to go further than that --

3 MS. CURRAN:

Yes.

4 CHAIRPERSON YOUNG:

at this point. But 5

just give us a few minutes more.

In a moment or two, 6

we should know whether 1:00 will work, and then --

and 7

once we get on the phone at 1:00. We should not take' 8

more than just long enough to basically tell you what 9

our ruling is.

10 MS. CURRAN:

Okay.

11 MR. FERNANDEZ:

Sorry for having a root 12 canal.

I apologize.

13 CHAIRPERSON YOUNG: They're not really as 14 bad as everyone --

15 (Laughter.)

16 I mean, the drilling part is the part that 17 hurts.

The actual root --

18 MR. WETTERHAHN:

I don't think you're 19 helping him.

20 (Laughter.)

21 MS. UTTAL:

The thing with the drilling 22 is, if you get enough novocaine and other things, then 23 you don't feel it.

24 MR. FERNANDEZ:

I'm happy to inform you 25 that my dentist is one of these new-fangled dentists NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 2344433 WASHINGTON, D.C. 20005-3701 vowwwu.neaIrgross.com

1 2

3 4

5 6

7 8

9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 3814 that believes in putting you completely out.

So I'm looking forward to it.

(Laughter.)

CHAIRPERSON YOUNG:

Take a little nap.

MR. FERNANDEZ:

Yes.

MR. WETTERHAHN:

I can only think of the Marathon Man.

CHAIRPERSON YOUNG:

Oh, gosh. Thanks for that thought.

now.

It's record for (Laughter.)

I'm going to give you the pass code right 4534.

MS. CURRAN:

Say it again, please.

CHAIRPERSON YOUNG:

4534.

MS. CURRAN:

Okay.

CHAIRPERSON YOUNG: Did everyone get that?

MR. WETTERHAHN: And same dial-in number.

CHAIRPERSON YOUNG:

Same dial-in number.

MS. CURRAN:

Okay.

CHAIRPERSON YOUNG:

So we're off the now.

We apologize for the delays.

(Whereupon, the proceedings in the foregoing matter went off the record at 11:35 a.m. and went back on the record at 1:10 p.m.)

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE.. N.W.

WASHINGTON, D.C. 20005-3701 (202) 234-4433 v.^eo.m..nea1rgross.com

3815 1

CHAIRPERSON YOUNG: Okay. Let's go on the 2

record.

3 I'm Ann Marshall Young, the Chair of the 4

Board.

I have here with me Judge Anthony Baratta and 5

our security expert adviser, Mr. Francis Young.

6 Judge Elleman, you're also present?

7 JUDGE ELLEMAN:

I'm present.

8 CHAIRPERSON YOUNG: And if we could just 9

go through the Staff and BREDL representatives again.

10 MS.

UTTAL:

This is Susan Uttal 11 representing the Staff.

I have with me Joseph Shea, 12 Sherri Cross, and Albert Garrett.

13 MS.

CURRAN:

This is Diane Curran 14 representing the Blue Ridge Environmental Defense 15 League.

16 MR. WETTERHAHN:

This is Mark Wetterhahn 17 with Winston & Strawn representing Duke.

18 CHAIRPERSON YOUNG:

All right.

We said 19 that we'd give you our ruling, and we're ready to do 20 that. And I've written out part of it, and I'm going 21 to try to read that to you and then address any 22 specifics that we need to.

23 All right.

Without going through a 24 summary of what BREDL is requesting, we note that 25 BREDL had stated that its --

that its request is NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON. D.C. 20005-3701 www.nealrgross.com

3816 1

necessary in order to allow it a

sufficient 2

opportunity to review exhibits in preparation for 3

hearing, and we note the time period requested, again, 4

through the filing of the reply for proposed findings 5

of fact and conclusions of law.

6 After hearing all the arguments of counsel 7

this morning, we find that BREDL's request is a 8

reasonable one if this proceeding is to be conducted 9

without further delay. We've consistently endeavored 10 in this proceeding to move forward without undue 11 delay, both to further the general desirability of 12 conducting adjudication of proceedings in a timely and 13 efficient manner, and to accommodate as much as 14 possible Duke's planning and schedule with regard to 15 the proposed MOX lead test assemblies.

16 The case cited by the Staff counsel in 17 support of its argument against the request of BREDL 18 provides that it may be desirable to limit locations 19 where sensitive materials may be examined.

But the 20 case also recognizes --

and I should say it's the case 21 of Diablo Canyon, 5 NRC 1398, and I'm going to be 22 quoting from page 1406 cited to us by the Staff.

23 "It may be desirable to limit locations 24 where sensitive materials may be examined, but the 25 case also recognizes in so providing that this may NEAL-R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701

%v,^n.nealrgross.com

3817 1

result in a lengthened hearing."

2 The Appeals Board in that case also noted 3

that the Licensing Board is in the best position to 4

determine the most appropriate circumstance in which 5

a document may be viewed and left it to the Board to 6

formulate the exact terms and conditions of the order.

7 We make our ruling, then, in this matter 8

in this light, i.e. in view of the goals of protecting 9

the security of very sensitive material as well as 10 minimizing the possibility of any lengthening of the 11 hearing in this matter or any related delays, and 12 recognizing also the very reasonable and legitimate 13 need of counsel to prepare its case adequately in 14 order to participate in the proceeding and evidentiary 15 hearing in a meaningful way.

16 To be in a position of not being able to 17 examine exhibits in preparation for the hearing or 18 proposed findings during the evening hours as needed, 19 and without having to carry voluminous amounts of 20 documents, many of a sensitive nature themselves, back 21 and forth to opposing counsel's office, which seems to 22 be essential if this proceeding is to be conducted in 23 a timely manner without further delay.

24 Part of the concern for protecting the 25 security of sensitive materials that particularly NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 wwAr:.nealrgross.com

3818 1

concerns us with regard to BREDL's request is the 2

desirability of avoiding risks associated with 3

repeated transport of sensitive safeguards materials 4

now in BREDL's possession back and forth to opposing 5

counsel's

office, which we find increases the 6

likelihood of losing control of sensitive material.

7 Thus, to fulfill these three goals --

8 protecting the security of very sensitive materials, 9

avoiding

delay, and permitting the meaningful 10 participation of Intervenor BREDL in this proceeding, 11 we herein order with regard to BREDL's request 12 amendment to the protective order to allow the holding 13 of the exhibits at the law office of BREDL's counsel 14 during the time period requested, with the following 15 proviso. And this is what we've been working on, and 16 we have just had it confirmed that this is a possible 17 that it will be possible to do this,
and, 18 specifically, to do it on next Tuesday morning.

19 A

member of the NRC Staff who is 20 knowledgeable in physical security and handling and 21 storage of safeguards material, and who has been 22 assigned to conduct an independent inspection, finds 23 after such inspection and consultation with BREDL 24 counsel that BREDL counsel can effectively, with 25 measures now in place, along with any additional NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 vr.rAww.ne3lrgrcss.com

3819 1

reasonable measures arrived at in consultation with 2

BREDL counsel, ensure the effective safeguarding of 3

the exhibits in question in her law office.

4 The Board requests the Staff to coordinate 5

this activity and expect that in doing so the Staff 6

will operate in good faith to ensure that --

I'm sorry 7

expect that in doing so the Staff will operate in 8

good faith to ensure that appropriate measures are 9

taken to separate the functions of the independent 10 inspector from those of the Staff working on the 11 Catawba proceeding, and that this, along with the 12 provision to the inspectors of the parties' agreed 13 description of the documents in question --

and we 14 would ask you to work together on that --

will be 15 sufficient to assure the appropriateness of the 16 inspection.

17 We expect that BREDL counsel will operate 18 in good faith to accommodate the inspection and work 19 with the inspector regarding any reasonable additional 20 measures recommended to ensure appropriate protection 21 of the exhibits.

22 Finally, we expect that all parties will 23 cooperate in this matter as we have described in order 24 to avoid delay and ensure the furtherance of this 25 proceeding, including the evidentiary hearing and NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON. D.C. 20005-3701 www.r.neairgross.com

\\ _ _, _.

3820 1

related preparation for it, and the proposed findings 2

of fact and conclusions of law, all in a meaningful 3

manner.

4 We don't know who may --

who in OGC the 5

people in physical security may have spoken with, but 6

Judge Baratta can give you more details on the 7

arrangements that he has been communicating with the 8

person at that division on. And we do understand that 9

OGC has been involved in it in some manner, and we 10 don't know whether that is with you, Ms. Uttal, or 11 not.

12 MS. UTTAL: I'm sorry. Who consulted with 13 who?

14 CHAIRPERSON YOUNG: Judge Baratta is going 15 to explain the discussion.

16 JUDGE BARATTA:

Yes.

As you know, the 17 Office of Facilities and Security actually has 18 personnel within the Security Division who conduct 19 assist visits for contractor personnel or 20 contractors to look at their --

whether or not their 21 they have adequate physical security procedures to 22 safeguard safeguards information, as well as 23 classified information.

24 So we made a request to Mark Lombard, who 25 is Acting Director of the office while Tom Martin is NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nea!rgross.com

3821 1

out, and he then consulted with OGC, as well as his 2

staff, and agreed that it was appropriate for them and 3

that they could, in fact, do an assist visit to Ms.

4 Curran's office with the intent of ensuring that the 5

physical security and procedures that she has are 6-adequate to safeguard material of this sort.

7 And he has agreed to have that done on 8

Tuesday morning, and we're asking that the Staff work 9

with them. We're going to be making a request of all 10 of you with respect to the type of material and such 11 that we -- that you anticipate would be stored there, 12 so that that's clear.

13 We'll also --

we may want to, in fact, 14 have our -- Mr. Young meet with whoever the individual 15 is that will be doing that assist visit to instruct 16 them on what --

you know, what the purpose of that 17 visit is, etcetera, and it has to be as specific as 18 possible by Mr. Lombard.

19 MS. UTTAL: So I understand what happened, 20 the Board went outside --

outside the record and 21 outside the parties to consult with and have 22 consultation with another part of OGC regarding what's 23 going on in this case?

24 CHAIRPERSON YOUNG:

No.

No, let me 25 explain.

The first thing the Board did was speak to NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 vrrr:.nczIrgross.com

3822 1

the Chief Judge and ask --

the first thing that the 2

Board --

Judge Baratta thought of this idea, and the 3

Board consulted with the Chief Judge, which I actually 4

meant to mention earlier, to discuss whether it might 5

be appropriate to see whether we could get an 6

independent inspection.

7 After speaking with the people in physical 8

security, after Judge Baratta spoke with the people in 9

physical security, they on their own apparently 10 contacted someone at OGC about the appropriate process 11 to do this. We were concerned that --

wanted to make 12 sure that any process that we put in place was 13 appropriate in view of consideration such as whether 14 we --

whether we should go through the Commission and 15 thought that if the Staff would cooperate in 16 coordinating this activity that that would not be 17 necessary.

18 And so, obviously, we're asking all of you 19 to cooperate in this.

We don't know what your 20 responses are going to be, but with regard to 21 consultation with OGC, do you know who that was with?

22 That was done by --

we don't know who that was with.

23 That was done by --

24 MS. UTTAL:

Mr. Lombard?

25 CHAIRPERSON YOUNG:

Mr. Lombard?

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WA.ASH!NGTON, D.C. 20005-3701

%rA-.wv.nea1rgross.com

3823 1

JUDGE BARATTA:

Yes.

2 CHAIRPERSON YOUNG:

Mr. Lombard.

And 3

so --

4 JUDGE BARATTA:

After he consulted with 5

his boss.

6 CHAIRPERSON YOUNG:

Mr. Martin?

7 JUDGE BARATTA:

No, Martin is not here.

8 Okay.

I'm sorry.

He consulted with his superior.

I 9

don't remember the name.

10 CHAIRPERSON YOUNG:

So basically what 11 we're proposing here is a process that would allow for 12 an inspection. Frankly, we suspect that Mr. Stapleton 13 knew what type of materials were involved when he did 14 his inspection.

But to --

to make sure that the 15 concerns of the Staff are met, the idea of having an 16 independent inspection, and that the arrangements to 17 see how that could be done in a timely manner, because 18 what --

what we are concerned with here are the three 19 goals.

20 We're concerned with the protection of 21 sensitive information, and, quite frankly, we're very 22 concerned about the transporting back and forth, which 23 obviously would be necessary without this.

We agree 24 with BREDL counsel on that.

25 We're also concerned with delays, as we NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON. D.C. 20005-3701

%AA'w.neaIrpross.com A___, __..._ _

3824 1

have repeatedly discussed here.

And that's why, for 2

example, we made our earlier need-to-know ruling from 3

the bench this morning, and we're making this ruling 4

now, in order to avoid delay.

5 And the third consideration is the 6

protection of meaningful participation in this 7

proceeding by all parties, including the Intervenor.

8 So balancing all those interests, we feel that this is 9

the most appropriate manner in which to proceed, and 10 we would request Staff to assist in coordinating this, 11 and all parties to assist by coming up with an agreed 12 description of the types of documents that we're 13 talking about --

that up to this point we have found 14 it desirable to provide additional protections of --

15 by requiring inspection in the Winston & Strawn 16 offices.

17 We see that at this point in the 18 proceeding the need to prepare for the hearing, and 19 this sort of intensive period of preparation, and to 20 prepare for proposed findings of fact and conclusions 21 of law afterwards, warrants a different approach 22 consistent with furtherance of all three goals that we 23 have mentioned before.

24 So that's our ruling. Are there --

Judge 25 Baratta or Judge Elleman, do you have anything to add?

NEALR. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE.. N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com

3825 1

JUDGE ELLEMAN:

No, I have nothing.

2 JUDGE BARATTA:

No, I have nothing.

3 CHAIRPERSON YOUNG:

Do the parties have 4

any questions for us?

5 MS. UTTAL:

I just have two things that 6

I'd like to say.

And I don't want to belabor the 7

point that we discussed this morning, but it was not 8

the results of the inspection that necessarily drove 9

the decision. It was the nature of the documents that 10 the Staff believes requires more protection than the 11 documents that are now in Ms. Curran's possession.

12 The second thing that I wanted to ask the 13 Board --

the Staff will be requesting --

petitioning 14 for review by the Commission of the decision 15 permitting the documents to be sent --

to be stored at 16 Ms. Curran's office. We had asked for a stay pending 17 the filing of the appeal, which I will do Monday.

18 CHAIRPERSON YOUNG:

We, frankly, I guess 19 had hoped that providing for this additional measure 20 of an additional NRC inspection would --

21 JUDGE BARATTA: In which we were going to 22 identify the nature of the documents, so there would-23 be no question as to the adequacy of the safeguards in 24 place.

That's why we chose to do it that way as 25 opposed to relying on the previous one, which NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com

3826 1

apparently you felt was not adequate because it only 2

covered the documents that they currently have.

3 CHAIRPERSON YOUNG: And also, we had hoped 4

that this would --

this would address the concerns, so 5

as to avoid further delay,'because obviously as --

as 6

the Appeals Board recognized in Diablo Canyon, when 7

the requirements for heightened inspection in a 8

different location are in place, that might lengthen 9

a hearing.

So we're operating out of concern.

10 So in terms of the stay, Tuesday morning 11 is --

is the time that this should be done.

Now, if 12 you're asking for a stay of our ruling pending your 13 appeal submission, we don't really have any control 14 over what that will do in terms of the timing of this.

15 And we don't know whether the person that we're 16 talking about would even be available to do the 17 inspection on another day, especially as we get closer 18 to the holidays.

19 So the Staff may want to reconsider your 20 request for stay, and assuming all --

assuming BREDL 21 is in agreement, go ahead and have the inspection, and 22 you can --

you can still pursue your appeal.

23 MS. UTTAL:

Well, Judge, the portion of 24 the Board's order that concerns me most is the 25 possibility of turning over documents.

As to any NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 wrw.nealrgross.com

3827 1

arrangements made short of

that, such as an 2

inspection, I want to --

I'm not asking for a stay of 3

that, if it can be arranged.

What I'm asking for is 4

a stay of having to turn documents over.

5 CHAIRPERSON YOUNG:

Well, actually, just 6

conferring as you were talking, certainly if the 7

Commission feels that a stay is appropriate, then I 8

think that that would be most appropriate.

But if 9

you're taking the appeal to the Commission on Monday, 10 then you should be able to get a response from them 11 prior to --

12 MS. UTTAL:

Okay.

Then, I'll file a 13 motion for a stay with the Commission.

14 CHAIRPERSON YOUNG: And I am going to try 15 to get this order out, as well as the other one, today 16 so that you'll have them. I am not planning to be in 17 the office on Monday or on Tuesday morning.

Judge 18 Baratta will be here, and I can be probably reached by 19 telephone, or at least I can get back to people within 20 a reasonable time during that time period.

Judge 21 Baratta knows how to reach me.

22 JUDGE BARATTA:

Is it our understanding, 23 then, that your request to the Commission, you have no 24 objection to the inspection proceeding, that you will 25 be specific in your request that it will only be to NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701

%rv-An.neaIrgross.com

3828 1

turn over the material that you request a stay on?

2 MS. UTTAL:

Can you hold on one second?

3 CHAIRPERSON YOUNG:

And we realize we 4

haven't heard from BREDL yet. After Ms. Uttal speaks, 5

we'll hear from the other parties as well.

6 MS. UTTAL:

Judge, I'm going to --

Judge 7

Baratta, in answer to your question, I'm going to have 8

to consult further with the Staff about that 9

particular point.

So I can't really answer the 10 question now.

11 MS. CURRAN:

Judge Young?

12 CHAIRPERSON YOUNG: Oh. I thought you had 13 said earlier that you did not oppose going ahead with 14 the inspection.

15 MS. UTTAL:

Well, I've been --

the Staff 16 is sitting next to me, and we're having some 17 discussion about that. So I'm going to withdraw that, 18 and I have to talk further with them.

19 CHAIRPERSON YOUNG:

Okay.

And, Ms.

20 Curran, go ahead.

21 MS. CURRAN:

Well, I was just going to 22 comment that it sounded from the Board's order as 23 though the inspection was something that --

the Board 24 thought that our security measures were adequate, but 25 that to hold out an olive branch to the Staff NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 wvN.nealrgross.com

3829 1

essentially the Board was willing to go through this 2

additional inspection, or have me go through it.

3 And I think I heard Ms. Uttal say that it 4

doesn't really matter how that inspection comes out.

5 Maybe that's wrong, but that makes me wonder, is this 6

inspection a good use of anybody's time, if that was 7

the point of time.

8 CHAIRPERSON YOUNG: You know, if the Staff 9

if Staff gets a stay, and certainly you all can 10 agree to hold off on the inspection -- I guess just to 11 clarify, I think that our --

our suggestion of the 12 inspection was to address the issue of the 13 desirability of heightened additional measures as 14 discussed in the Diablo Canyon case, since apparently 15 the Staff is saying that --

that apparently Mr.

16 Stapleton's inspection was not made with that in mind.

17 Now, again, knowing how knowledgeable Mr.

18 Stapleton is, we expect that he actually would have 19 known that.

But to address the needs of those 20 heightened protections, as discussed in Diablo Canyon, 21 that's the reason for the inspection by an independent 22 inspector from the Staff who has been given specific 23 information on the types of documents that we're 24 talking about, so that he can take that into 25 consideration.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 2344433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com

3830 1

And as I said before, we were asking the 2

Staff to coordinate this, so that this could be an 3

appropriate Staff activity that would not necessitate 4

going before the Commission and requiring their time 5

and attention, which would obviously involve not only 6

their time and attention but some degree of delay in 7

going through that request process to seek to 8

accomplish this through that route.

9 JUDGE BARATTA:

And I think, Ms. Curran, 10 the other thing I'd like to add is that this group 11 that we're talking about is part of the administrative 12 organization of the agency and is not a part of the 13 Staff.

Even though we refer to them as Staff, they 14 are not part of the Staff that participates in the 15 adjudicatory process.

16 MS. CURRAN:

Oh, okay.

17 JUDGE BARATTA:

It's actually more like 18 the landlord, okay, for lack of.a better definition.

19 Okay? So that's why we went that route. And they're 20 the ones, for example, that design the security 21 systems for the buildings and that sort of stuff.

22 CHAIRPERSON YOUNG:

And also do the --

23 JUDGE BARATTA:

And also do the assist 24 visits for the contractors. That's a routine function 25 of theirs, but they have no --

they do not participate NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 wvwN.nea!rgross.con

3831 1

in the adjudicatory process in any way, shape, or 2

form.

3 MS. CURRAN:

Okay. And what is the name 4

of the office again?

5 JUDGE BARATTA:

It's the Office of --

the 6

whole organization is Administration, and then under 7

that is the Office of Facilities and Security.

8 MS. CURRAN:

Okay.

9 JUDGE BARATTA:

And it's within that 10 Office of Facilities and Security that we spoke with 11 the Chief of the Security Division.

12 MS. UTTAL:

Judge Baratta, I just wanted 13 to correct one thing. The admin staff is part of the 14 staff.

They do all answer to the EDO.

They're just 15 not part of this litigation, and they're not part of 16 NSIR, which is the staff we have been consulting with 17 regarding security.

So they're not involved in this 18 case.

19 JUDGE BARATTA:

It's the staff, but it's 20 not the staff.

Let's just leave it at that.

21 CHAIRPERSON YOUNG: It's a different part 22 of the staff.

23 MS. UTTAL: That's true. It's a different 24 part of the staff.

25 CHAIRPERSON YOUNG:

That's why we were NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234.4433 WASHINGTON, D.C. 20005-3701 vr'.:.ncafrgross.com

3832 1

requesting that the staff, in coordinating it, ensure 2

the appropriate separation between the different parts 3

of the sta'ff.

4 Well, I guess the only thing --

Duke, Mr.

5 Wetterhahn, did you have anything you wanted to say 6

about this?

7 MR. WETTERHAHN: I don't think I can give 8

Duke's position until we determine from BREDL exactly 9

what documents it would request. And we would request 10 that it identify those documents expeditiously and 11 refer to them by title and also their discovery 12 document number or Bates number.

13 MS. CURRAN:

Sure.

14 MR.

WETTERHAHN:

So we can have a 15 definitive and specific basis of discussing this.

16 CHAIRPERSON YOUNG:

And that would 17 include --

18 JUDGE BARATTA:

I'm sorry.

19 CHAIRPERSON YOUNG:

Go ahead.

20 JUDGE BARATTA: Yes. The Board will also 21 need that information, so that we can convey that to 22 whoever does the visit.

23 MR. WETTERHAHN:

I will circulate an 24 updated index of all documents which have been made 25 available to BREDL for --

to the Board and all NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE.. N.W.

(202) 234-4433 WASHINGTON, D.C. 20005.3701 www.nealrgross.com

3833 1

parties, probably by Monday morning.

2 CHAIRPERSON YOUNG: Okay. So send that to 3

Judge Baratta's attention.

4 MR.

WETTERHAHN:

Yes.

That's not 5

safeguards.

It's going to come by e-mail.

6 JUDGE BARATTA:

Thank you.

7 CHAIRPERSON YOUNG:

Okay.

Okay.

And 8

then, what I was going to say --

what I was going to 9

say is that obviously this --

the motion applies to 10 the exhibits for the hearing. And so BREDL can tell 11 what their exhibits are, but if there are any 12 additional ones on the part of Duke or the Staff the 13 it would apply to those as well.

So if you could 14 all indicate what documents you intend to submit as 15 exhibits.

16 MS. CURRAN:

Okay.

17 JUDGE ELLEMAN:

Judge Young?

18 CHAIRPERSON YOUNG:

Yes.

19 JUDGE ELLEMAN:

This is Judge Elleman.

20 I'm a little confused on the status of the Tuesday 21 morning security review.

22 Ms. Curran, did you say you would prefer 23 not to go through with this if the decision on the 24 stay order is not known by Tuesday?

25 MS. CURRAN:

Well, I do want to have NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com

3834 1

access to these documents, and I'm willing to go 2

through it just to get it out of the way, so that if 3

we get a favorable ruling I could get the documents.

4 So I will say yes to that.

I was just 5

raising a question to the Board as to whether you 6

wanted to include that -- continue to include that as 7

a requirement of your order, since it didn't yield any 8

compromise by the paries.

9 CHAIRPERSON YOUNG:

Well, our order 10 basically --

I mean, what we're doing is we're --

11 we're ordering that.

12 MS. CURRAN:

Yes.

13 CHAIRPERSON YOUNG: And I don't know if I 14 indicated in the order, but I'll try to, that Tuesday 15 morning is the time when this person would be able to 16 do it.

And then, depending upon what actions the 17 Staff takes and what response they get, then that 18 would occur or not occur, and you can communicate with 19 the Staff in terms of just scheduling issues.

20 MS. CURRAN:

Okay.

Well, I will plan to 21 go ahead with it, and I hope the Staff will give me a 22 call and let me know when this person is coming.

23 CHAIRPERSON YOUNG:

And do we know --

24 JUDGE BARATTA:

No, we don't know the 25 exact time, but as soon as we coordinate --

or get it NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234 4433 WASHINGTON, D.C. 20005-3701 vwr.-nea3rgross.corn

3835 1

coordinated, we'll let you know.

2 MS. CURRAN:

Okay.

Thank you.

3 CHAIRPERSON YOUNG:

And then, I'm just 4

going to --

I'm going to try to get this order and the 5

other order done, which we're all just about run out 6

of our deadline time, but --

I need to call SECY about 7

that. But then, on Monday, just direct --

if you need 8

to talk with anyone, talk with Judge Baratta, and I'll 9

give him how to reach me.

10 I'll take my cell phone with me 11 everywhere, so I'll just -- you can call me on my cell 12 phone if you need to reach me. And if I'm unavailable 13 or out of range or something, I should be able to get 14 back to anyone, you know, within a reasonable time.

15 And if I need to come in, I'll come in.

16 In any event, any other things that we 17 need to take care of?

Can anyone --

18 MS. CURRAN:

Not from BREDL.

19 MS. UTTAL:

Not from the Staff.

20 JUDGE BARATTA: And we will be asking Mr.

21 Young --

I want to emphasize this --

to meet with 22 whoever is going to do the inspection on Tuesday, so 23 that it's clear, you know, what the purpose of such 24 is.

25 That's all I have.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WVASHINGTON, D.C. 20005-3701 w.wv.w.nealrgross.com

1 2

3 4

5 6

7 8

9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 3836 CHAIRPERSON YOUNG:

Okay. Thank you, all.

(Whereupon, at 1:40 p.m., the proceedings in the foregoing matter were adjourned.)

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

WASHINGTON, D.C. 20005-3701 vAmA.nealrgross.com (202) 234-4433

CERTIFICATE This is to certify that the attached proceedings before the United States Nuclear Regulatory Commission in the matter of:

Name of Proceeding: Duke Energy Corporation Docket Number:

50-413/414-OLA; ASLBP No.

03-815-03-OLA Location:

Teleconference were held as herein appears, and that this is the original transcript thereof for the file of the United States Nuclear Regulatory Commission taken by me and, thereafter reduced to typewriting by me or under the direction of the court reporting company, and that the transcript is a true and accurate record of the foregoing proceedings.

Eric Mollen Official Reporter Neal R. Gross & Co., Inc.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W.

(202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com