ML19275A840
| ML19275A840 | |
| Person / Time | |
|---|---|
| Site: | Comanche Peak, South Texas  |
| Issue date: | 10/05/1979 |
| From: | Mark Miller Atomic Safety and Licensing Board Panel |
| To: | |
| References | |
| NUDOCS 7910190180 | |
| Download: ML19275A840 (20) | |
Text
G ?
O NRC PUDLIC D00UMKhiI E@S 4
gS LFITED STATES OF AMERICA d
cf l
4 NUCLEAR BEGUIRORY COMMISSION k
f In the Matter of
)
HOUSTON LIGHrDG AND POWER 00!fAhT, et al. )
)
Docket Nos. 50-498A (South Texas Proj.ect,
)
50-499A Units 1 and 2)
)
)
TEXAS UTILITIES GENERATING COMPANT, et al. )
)
Docket Nos. 50-445A (Cceanche Peak Steam Electric Station,
)
50-446A Lhits 1 and 2)
)
ORDER REGARDING IMIONS BASED LPON DECISION OF UNITED STATES DISTRICT COLRT (October 5,1979)
On April 3,1979, Houston Lighting and Power Cotpany (HIAP) and Te.us Utilities Generating Capany, et al. (TUGCO), filed separate motions for partial or full suamary disposition' of these two antitrust proceedings. These cotions were essentially base ~d upon the decision of the lh.ited States District Court in West Texas Utilities v. Texas Electric Service Company, No. CA 3-76-0633-F (N. D. Tex.).
In that Federal court decision, HIAP and the Texas Electric Service Company (TESCO) were found not to have engaged in concerted action against Central Power and Light Company (CP&L) and West Texas Utility Cmpany (WIU) in violation of Section 1 of the Sherman Act (15 U.S.C. 51).
HIAP filed a notion for sunnary decision, ccntending (1) that collateral estgel should be applied against CP&L (although not against the Departrent of Justice, NRC Staff, Brownsville, or South Texas Electric Cooperative (STEC) or Medina Electric Cooperative (MEC)) and (2) that HIAP should be dimissed fran the entire proceedire.
1180 318 7910190 [ b
.,.. TUGC0 filed two motions.
In the South Texas proceeding, it moved to bar CP&L frcm seeking to obtain any relief inconsistent with the District Court decision, and for su:: mary disposition in ITGCO's favor.
In the Comanche Peak proceeding, TUGC0 moved to dismiss Central and South West Cooperative (CSiO as a party intervenor or, in the alternative, for sumnary disposition, and for steps toward tetranation of the proceeding.
The City of Austin (Austin) filed its brief on the question of collateral estoppel to dispose of or limit the instant antitrust proceeding, which in effect sought to associate Austin with the relief requested by HIAP and ITGCO.
Responses in opposition to these motions were filed by the Department of Justice (Department',, the Staff, the Public Utilities Board of the City of Brownsville, Texas (Brownsville), CP&L and CSW, and TEX-LA Electric Cooperative (TEX-IA). Argunents of counsel were heard at a conference held on June 1,1979 (Tr. 217-321).
By our Order entered on June 25, 1979, the parties were advised that these motions were denied, and that a dispositive urder would be issued at a later date. The following cpinion ana decision constitutes that dispositive order.
I.
RES JUDICATA AND COLIATERAL ESwertL A.
Legal Principles The major thrust of the instant motions is the termination or severe limita-tion of the scope of this, proceeding as a result of the decisicn rendered in the U. S. District Court case, under the doctrines of res judicata or collateral estoppel. Although comparable in many respects, these related doctrines also have significant differences. The Supreme Court has thus described thes_e principles:
1180 319
. "Under the doctrine of res iudicata, a judgmmt on the merits in a prior suit bars a second suit involving the same parties or their privies based on the same cause of action.
thder the doc-trine of collateral estoppel, on the other hand, the second action is upon a different cause of action and the judgment in the prior suit precludes relitigation of issues actually litigated and necessary to the outcome of the first action.
1B, J. Moore, Federal Practice t0.405[1], at 622-624 (2d ed.1974); e.g., Lawlor v. National Screen Serv. Coro.,
349 U.S. 322, 326 (1955); Ccmissioner v. Sunnen, 33 U.S.
591, 597 (1948);l/ Cromwell v. County of Sac., 94 U.S. 351,
-353 (1876)."
.m aurts have further refined the concept of collateral estoppel to require at least few elements sich must all be present before the doctrine can be given effect as to a prior action. 'Ihese four eierents are (1) the issue sought to be precluded must be the same as that involved in the prior action; (2) that issue must have been actually litigated; (3) it must have been determined by a valid and final judyent; and (4) the detennination must have been essential to the prior judgment.2/ The party pleading collateral estoppel has the burden of proving that all the requirenents of the doctrine are present.3_/
The Appaal Board, after an extensive review of judicial authorities consid-enng res judicata and collateral estoppel, has held that in appropriate circumstances the doctrines may be given effect in NRC licensing proceedings.
1/ arklane Hosiery, Inc. v. Shore, P
U.S.
, 99 S. Ct. 645, 58L. Ed. 2d 552, 559, fn. 5. (1979).
2/ aize v. Hanover Ins. Co., 536 F. 2d 576, 579 (3d Cir.,1976); Gulf Oil Corp. v.
H FPC, 563 F.2d 588, 602 (3d Cir.,1977); 1B Moere's Federal Practice 10.443[1]
et seg.
3/1B Moore suora, 50.408[1], at 954.
1180 320
. Thus, in Alabama Luer Ca:oany (Joseph M. Farley Nuclear Plant, Units 1 and 2),
AIAB-182, 7 MC 210 (1974), remanded on other grounds, CLI 74-12, 7 EC 203 (1974), the doctrines precluded a participant in the li-i ation of an issue d
decided in the construction pennit proceeding, fran raising the identical issue in an operating license proceeding involving the same reactor. However, it was expressly pointed out in that case that thereh no claim of either (1) signifi-cant supervening developments having a possible material bearing upon any of the isst.as previously adjudicated in the ccnstruction permit proceeding or (2) the presence of some unusual factor having special public interest implications (7 EC at 216)." The Appeal Board observed that exceptions to the application of res, judicata and collateral estoppel which are found in the judicial setting are equally applicable to adnunistrative adjudication, such as cot:peting public policy considerations involved in Soilker v. Hankin,188 F.2d 35, 37-8 (D.C. Cir.
~
1951) or Tipler v. E. I. du Pont deNenturs and Co., 443 F.2d 125,128 (6th Cir.
1971). On this score it was noted that " Professor Davis has suggested a particular need for clothug an Wnhtrative agency with the discretion to decline to invoke these doctrines in the course of ' feeling its way into an undeveloped frontier of law and policy,' 2 Davis, Administrative law Treatise,
- p. 566" (7 E C at 215).
The Corrmissioners reviewed the foregoing Alabama Power Ccr:oany case and renanded it for further developnent of facts as follows:
'*Ihe principal focus of both the Licensing Board and Appeal Board in the current proceedings was whether the instant petition involved an attempt to relitigate precisely the same contentions as those resolved in the construction pernit proceedings; and, if so, whether the doctrines of res judicata and collateral estoppel should apply. This is the first case in Miich we have
))h
. taken a close look at the applicability or these doctrines to our pmceedings.
In our view, an operating license proceeding should not. be utilized to rehash issues already ventilated and resolved at the construction permit stage. Accordingly, we are in full agreement with the conclusion reached by the Appeal Board that
'res judicata and collateral estoppel should not. be entirely ruled out of our proceedings, but rather applied with a sensitive regard fcr any supported assertion of charged circunstances or the possible existence of some special public interest factors, in the particular case....'
Due regard for these considerations convinces us that a remnd to the Licensing Board, established to rule on intervention petitions, is necessary in the circum-stances of this case. Upon such renand, petitioner shall be afforded an opportunity to make a particularized showirg of such changed circumstances or public interest factors as might c. dst with respect to this particular proceeding."4/
In one of the Seabrook decisions, it was cantended that the Appeal Board's refusal to grant a stay of the effect of the initial decision in an earlier phase of the proceeding was res judicata on a later stay notion. The so-called doctrines of repose were held precluded from operation because the issues involved in the two proceedings, " irreparable injury" to the envircrrnent versus any "significant atverse icpact" upon the enviroment, were desned to be dissimilar, and also because res judicata does not apply when the party seeking it had the benefit, when he obtained the prior ruling, of a more favorable standard with respect to burden of proof than is later available to him.5_/
In The Tolero Edison Comoany (Davis-Besse Nuclear Powr Station, thits 1, 2 and 3), ALAB-378, 5 NRC 557 (1977), the City of Cleveland sought to preclude a certain law firm from representing one of the Applicants in an NRC antitrust proceeding, because of the firm's prior representation of the city in connection with municipal bond mattere The law firm noved to dismiss the disqualification 4/
- Alabama Power Company (Farley thits 1 and 2), CLI-74-12, 7 /P.C 203-204 (1974).
5/
- Public Service Canpany of New Hanpshire (Seabrook Station, Units 1 rnd 2), ALAB-349, 4 NRC 235, 246, vacated on other g, rounds, CLI-76-17, 4 NRC 451 (1976).
1180 322
. proceeding on the grotnds of collateral estoppel, based upon a federal district court decision which rejected the city's effort to disqualify the see law firm from representing the see electric utility in a pending civil antitrust proceed-ing in that court. The Appeal Board sustained the application of collateral estoppel, holding that "as a general matter, a judicial decision is entitled to precisely the same collateral estoppel effect in a later administrative proceed-ing as it would be accorded in a subsequent judicial proceeding" (5 NRC at 561).
The cocmon issue in the two proceedings was whether the Code of Professional Responsibility interdicted the law firm's representation of the public untiit~;
It was held to be irrelevant that the IEC Staff and the Department of Justice were parties to the NRC antitrust proceeding, but not to the district court proceeding. The Staff, but not the Department, involved itself in the disquali-fication matter. The Appeal Board also stated:
"It is quite true that 'when the legislative intent is to vest primary power to make particular determinations concerning a subject matter in a particular agency, a court's decision concerning that subject matter may be without binding effect upon that agency,' 2 Davis, suora, S18.12 at pp. 627-28.
cf. United States v. Radio Corooration of Arerica, 358 U.S.
334, 347-52 (1959). We agree, however, with the majority of the Special Board (NRCI-76/ll at 566) that that principle does not come into play in this case.... We discern no legislative purpose that this Conmission resolve such an issue independently of a court's resolution of the same issue in an antitrust proceeding before it involving the same parties."
(5 NRC at 561)
The Appeal Board also rejected the Staff's position regarding discretionary application of collateral estoppel, stating "nothing said by us in Farlev suggests that, absent overriding empeting public policy considerations (ard here rane has been shown), an administrative agenef is free to withhold the application of collateral estoppel as a discretionary matter."
(5 NRC at 563-64, fn. 7) 1180 323
. The effect of a state court decision interpreting certain provisions of an operating license regarding required gove m ental approvals, was considered by the Appeal Board in Consolidated Edison Company of New York, Inc. (Indian Point Station, Unit No. 2), AIAB-399, 5 NRC 1156 (1977).
The licensing board had described the court's ruling as "somewhat" the law of the case.
In reversing, it was stated that "[t]here is no collateral estoppel because the Camtission Staff was not a party to the New York litigation."
(5 NRC at 1167).
It was held that even if the parties had been identical, the Camr ision would not be bound by a court decision in a collateral litigation. The Appeal Board further stated:
"In discussing the problen of conflicting decisions on the same question by adtunistrative agencies and courts, Professor Jaffe says:
'In cases where an order is directed to future relation-ships, the decision of that agency which has the major and continuing responsibility should prevail. '
L. Jaffee, Judicial Control of Adcunistrative Action 135 (1965).
In the case at bar, that would mean that Cnis""Ca' mlission would have the primary responsibility for interpreting the terms of the liceve which it issued."
(5 NRC at 1168, fn. 44)
The most recent discussion of the principles of collateral estoppel appears in the antitrust decision on the merits in The loledo Edison Camany (Davis-Besse Nuclear Power Station, Units 1, 2 and 3), AIAB-560,10 NRC (September 6,1979).
In that case, it was contended that a decision of the Federal Power Comnission favorable to an applicant on the issue of anticompetitive practices, should have been treated as a collateral estoppel. Finding that the standard which governed the FPC's decision on whether to order an interconnection was different frcm NRC's duty under Section 105c of the Atomic Energy Act, the Appeal Board said:
"Where the legal standards of two statutes are significantly different, the decision of an issue under one statute does Int give rise to collateral estoppel in a litigat. ion of a similar issue under a different statute.
See Lhited Shoe 1180 324
. Machinerv Coro. v. United States, 258 U.S. 451 (1922);
In re Yarn Processing Patent Validity Litization, 498 F. 2d 27I TT8-279 (5th Cir. 1974); Tioler v. E. I. duPont deNemours & Co.,
443 F. 2d 125,128-29 (6th Cir.1971); Pacific Seafarers, Inc.
- v. Pacific Far East Line, 404 F. 2d 804 (D. C. Cir.1968), cert.
denied, 393, U.S.1093 (1969)."
(Slip opinion, p. 209)
It also appeared that the Intervenor City obtained the prunary relief it sought fran the FPC, and that if the findings on anticanpetitive conduct had gone the other way, it would not have made any difference in the relief granted.
It was therefore stated:
"Thus, the findings were not necessary
, the Federal Power Camtis-sion's decision and therefore do not constitute collateral estoppel in later litigation. Norton v. Larnev, 266 U.S. 511, 517 (1925); Haize v. Hanover Ins. Co., 536 F. 2d 576 (3rd Cir.1976);
Iaiard v. Board or Education of City of New York, 502 F.2d 631, 637 (2d Cir. 1974); Eastern Foundation Co. v. Creswell, 475 F. 2d 351 (D.C. Cir.1973); Fibreboard Paper Products Coro. v. East Bav Union of Machinists, Ircal 1304, 344 F. 2d 300, 306-07 (9th Cir.),
cert. denied, 382 U.S. 826 (1965) ; Restatement (Second) of Judg-ments 568, Conment h (Tent. Draft No.1,1973)."
(Slip opinion, pp.
210-11)
B.
Identitv of Issues and Standards In applying the foregoing legal principles, consideration must be given to the cancarability of tbe issues involved in the tw proceedings when the appli-cation of res judicata s collateral estoppel is invoked.
Issues are not identi-cal if the second action involves the application of a different legal standard, even though the factual setting of both proceedings may be the ere.N 'Ihus the same historical facts may be involved in two actions, but the legal significance of the facts may differ because different legal standards are applicable to then.1/
b eterson v. Clark Leasing Corporation, 451 F. 2d 1291,1292 (9th Cir.1971);
P 1B Moore's Federal Practice 10.443[2].
ElJames Talcott, Inc. v. Allahabad Bank, Ltd., 444 F.2d 451, 459, fn. 8 (5th Cir.
1971), cert. denied 4G4 U.S. 940 (1971).
1180 325
_9_
Here, the District Court suit involved a civil action for injunctive relief by CP&L based upon alleged concerted refusals to deal by F2AP and TESCO, in violation of Section 1 of the Sherman Act (15 U.S.C. 51). The plaintiffs claimed that the defendants violated the Sherman Act "by having unlawfully combined, conspired or contracted between themselves and with others' to preclude the interstate flow of electricity (Pre-Trial Order, p.1).
The final order in that case prohibits CP&L from permitting electricity it receives frtu the South Texas Project to enter interstate concerce "as long as CP&L remains a carticipant in the STP agreement and as long as that agreement renains in force."
The instant proceeding involves a finding under 5105c(5) whether the activities under the license would create or maintain a situation inconsistent with the specified antitrust laws (42 U.S.C. 52135(c)).
Such an inquiry covers a broad range of activities considerably beyond the scope of the " violation" standard of Section 1 of the Sherman Act.
It is well established that in a Secton 105c proceeding, it is not necessary to show an actual violation of the antitrust laws.8_/ As the Joint Connittee on Atomic Energy described it,
'*Ihe concept of certainty of contravention of the antitrust laws or the policies clearly underlying these laws is not intended to be implicit in this standard; nor is the mere possibility of inconsistency.
It is intended that the finding be based on reasonable probability of contravention of the antitrust laws or the policies clearly underlying these laws.
It is intended that, in effect, the Cmmission will conclude whether, in its jdent, it is reasonably probable that the activities under the license would, when the license is issued or thereafter, be inconsistent with any of the antitrust laws or the policies clearly under-lymg these laws."
(Joint Conmittee Report at 14-15) 0I-Consumers Power Company (Midland Plant, Units 1 and 2), AIAB-452, 6 NRC 892, 908-912 (1977).
1180 326 In Davis-Besse, suora,, the Appeal Board noted that "Of course, arrf violation of the antitrust laws also reets the less rigorous standard of Section 105c of the Atentic Energy Act -- inconsistency with the antitrust laws" (Slip opinion at
- p. 207, fn. 277).
It was also stated:
"If the hearing record deconstrates with ' reasonable probability' that an anticompetitive situation within the Ineaning of section 105c would result from the grant of an application, the Ca:n:is-sion may refuse to issue a license or issue one with renedial conditions. Findings of actual Sherunn or Clayton Act viola-tions, however, are not necessary. Under section 105c, procancetitive license conditions are also autnorized to renedy situations inconsistent with the ' policies clearly underlying' the antitrust laws."
(Footnotes anitted) (Slip opinion at p. 8)
The scope of Section 105c proceedings also includes consideration of 55 of the Federal Trade CaImission Act, which permits proscription of unfair or deceptive business practices that infringe neither the letter nor the spirit of the Sherman and Clayton, cts.9I The Appeal Board has described the sweep of Section 105c antitrust review as follows:
"It is to be recalled that in Section 5 proceedings procf of a full-blown violation of the Sherman or Clayton Acts is not required; there need only be shown a ' conflict with the basic policies of [those] Acts' (citing FIC v. Brown Shoe Co., 384 U.S. 316, 321 (1966); Atlantic Refimna Co. v. FIC, 381 U.S.
357, 369-70 (1965); FIC v. Texaco, Inc., 392 U.S. 223 (1968);
L. G. Balfour Co. v. FIC, 442 F. 2d 1, 9 (7th Cir.1971) because, as has been explained, 'the Federal Trade Comnission Act was designed to supplenent and bolster the Shennan Act and the Clayton Act...to stop in their incipiency acts and practices which, when full blown, would violate those Acts...as well as to condem as ' unfair methods of competition' existing violations of them.' FIC v. Brown Shoe Co., 384 U.S. 316, 322 (1966), quoting FIC v. Motion Picture Adv. Co., 344 U.S. 392, 394-95 (1953).
Section 105c similarly applies to situations in conflict with the policies underlying the antitrust laws.
Like Section 5 of the FIC Act, Section 105c was also designed by Congress to ' nip in the bud any incipient antitrust situation,' albeit via the NRC prelicensing review process.
9I-FIC v. Sperry & Hutchinson Co., 405, U.S. 233, 239 (1972).
1180 327
s Wolf Creek I, suora, ALAB-279,1 NRC at 572 (quoting the Joint Cmmittee Report, p.14). This similarity in purpose and standards leads us to agree with the staff that Section 5 precedents may be helpful guides to determining whether a situation not violative of the antitrust laws is, nevertheless, inconsistent with their underlying policies."10_/
There are substantial differences between the standards and issues involved in the Sherman Act, Section 1 suit based on restraint of trade by concerted action as alleged in the District Court litigation, when contrasted with the issues involved in this proceeding arising frcm allegations of nonopolization (Sherman Act, Section 2), unfair methods of ccn: petition (FIC Act, Section 5), and inconsistency with underlying policies of antitrust laws (Section 105c). Where, as here, the legal standards of two statutes are significantly different, the decision of issues under one statute does not give rise to collateral estoppel in the litigation of similar issues under a different statute.b The same rule applies to attempts t6 inwke the doctrine of res judicata, where the question is whether the second suit is based on the same cause of action as that involved in thefirstsuit.SI The causes of action here, if that term is to be used, are significantly different in the District Court suit and this Section 105c proceeding.
SIMidland, suora, 6 NRC at 911-12.
11/
- Davis-Besse, suora, Slip cpinion at p. 209. See United Shoe Machinery Corp.
- v. United States, 258 U.S. 451 (1922); In re Yarn Processing Patent Validity Litigation, 498 F. 2d 271, 278-79 (5th Cir.1974); Tipler v. E. I. duPont de Nemours & Co., 443 F. 2d 125,128-29 (6th Cir.1971); Pacific Seafarers, Inc.
- v. Pacific Far East Line, 404 F. 2d 804 (D. C. Cir.1968), cert. denied, 393 U. S.1093 (1969).
12'/
- Public Service Company of Ne.e Hampshire (Seabrook Station, thits 1 and 2),
AIAB-349, 4 NRC 235, 247 (1976); The Toledo Edison Company (Davis-Besse Nuclear Power Station, thits 1, 2 and 3), ALAB-378, 5 NRC 557, 563 (1977).
1180 328 C.
Parties It would be a violation of due process for a judgment to be binding on a litigant who was not a party nor privy to the prior litigation, and who therefore neverhadanoppertunitytobeheard.E In recognition of this principle, HILP has stated in its motion that no attenpt is being made to apply collateral estoppel against the Depart:mnt of Justice, the Staff, Brownsville, or STEC/MEC.14/
However, HIAP also moves that as a matter of discretion, "this proceeding be dismissed as to HILP for all purposes."E
'Ihere are strong public policy reasons why the Department and the Staff, as statutory parties to this proceeding, should not be collaterally estopped or hindered in conducting the full antitrust review under Section 105c which they have sought. 'Ihe Cocnission has described the public interest implications of NRC antitrust revica as follows:
"Ihe NRC's role is, in our view, something more than a neutral forum for economic dispu m between private parties. Cne evidence we have of this flows frcm the role of the Attorney General and the express requirment that his views be obtained.
If a hearing is convened, we think it should enempass all significant antitrust implications of the license, not merely the complaints of intervening private parties.
If no one else performs this function, NRC staff should sure that a cceplete picture is presented to licensing boards."_.6._/
E arklane Hosiery, Inc. v. Shore, __ U.S. __, 99 S. Ct. 645. 653-58 L. Ed. 2d P552 (1979); Blonder-Tongue Laboratories, Inc. v. University of Illinois Foundation, 402 U.S. 313, 329 (1971) < Hansberry v. Lee, 311 U.S. 32, 40 (1940).
14/
- HI4P Motion, p.10, fn.10.
Elg., p. 32; Reply of HISP, pp. 4-7 20-27.
5/ orida Power & Light Co. (St. Lucie Plant, Unit No. 2), CLI-78-12, 7 NRC 939, Fl 949 (1978).
See also Scenic Hudson Preservation Conference v. F.P.C., 354 F. 2d 608, 620-21 (2 rid Cir.1965), cert. denied, 384 U.S. 941 (1966); hi-higan Consolidated Gas Co. v. F.P.C., 283 F.2d 204, 226 (D.C. Cir.1960), cert. denied, 364 U.S. 913.
1180 329 We agree with the Staff's position that a selective invocation of collateral estoppel to apply to CP&L and CSW would have only a procedural effect in this proceeding, because neither the Steff nor the Department was in privity with the parties in the District Court suit. Hence, either or both govemmental parties could, and probably would, include in their presentation here a Sherman Act, Section 1 case against FlixP and TUGC0 (Answer of Staff in Opposition to Motions,
- p. 6). Other Intervenors such as Bansville are likewise not in privity with the parties in the court suit, and intend to assert a wide range of antitrust issues in this proceeding (Response of Brownsville, pp. 3-6).
Inasnuch as there will be an antitrust evidentiary hearing in this proceeding covering a wide range of complex issues anong multiple parties, we see no advantage in applying collateral estoppel or res judicata to HISP alone. On the contrary, a good deal.of confusion and lost time would probably result from an effort to identify evidence witich could be adnitted as to some parties but not others. The activities under the license of all of the licensees will be analyzed in some detail to determine whether they will create or maintain a situation inconsistent with the antitrust laws.
If the Department and the Staff are not collaterally estopped by the court action, as we hold, they may be assisted in presenting their evidence by having CP&L present an affirmative case.
It is not unlikely that some witnesses would be used in ccuron.
Since there will be an evidentiary hearing in any event, there would be no " considerations of economy of judicial time"E n applying collateral estoppel, but rather more i
time would probably be expended in attenpting its selective application.
17/
- Alabama Power Company (Joseph M. Farley Nuclear Plant, Lhits 1 and 2), AIAB-182, 7 AEC 210, 212 (1974).
I180 330
14 -
D.
Issues Essential to Prior Jud2 ment One of the required elenents for applying collateral estoppel is that the dete mination.of the issues made in the first action was necessary and essential to the outcome of that prior action.EI The District Court in effect found that the so-called intrastate-only policy allegedly followed by the defendants neither
" creates or maintains a situation inconsistent with the antitrust laws" (Section 105c), nor constitutes "an unfair method of cmpetition" (55, ETC Act). he Court had before it only one aspect of these proscriptions, that revolving around the issue of unreasonable restraint of trade under Section 1 of the Sherman Act.
'Ihere were no allegations or issues conceming monopolization under $2 of the Sheman Act, or unfair met. hods of cmpetition under Section 5.
The Court's
" additional findings" regarding Sect. ion SEI and Section 105c El were unnecessary and imnaterial to the detemination of the Section 1, Sheman Act cause of action. Such findings may be regarded as dicta, to which :ollateral estoppel doesnotattach.EI Only the Federal Trade Comission is e powered to make an initial finding whether a practice is an unfair method of competition under Section 5.
The Supreme Court has stated:
E/ arklane Hosiery, Inc. v. Shore, - U.S. -, 99 S. Ct. 645, 58 L. Ed. 2d 552, P
559, fn. 5 (1979); Alabama Pcwer Capany, sutra, 7 AEC at 213.
EIConclusion of Law #20.
E!onclusionofLaw#22.
C E/ onsumer Product Safety Comission v. Anaconda Co., -- F. 2d - (D. C. Cir.,
C Jan. 31, 1979).
1180 331 "A court cannot label a practice ' unfair under Section 5.
It can only affim or vacate an agency's judpent to that effect. '
'If an order is valid only as a determination of policy or judgment which the agency alone is authorized to make and which it has not made, a judicial jMgmmt cannot be made to do service for an 92 (1943)."b:. judgment. ' SEC v. Chenery Corp., 318 U.S. 80, administrat4 Similarly, only the NRC is empowered to make the initial determination under Section 105c whether activities under the license would create or maintain a situation inconsistent with the antitrust, and if so what license conditions should be required as a remedy. The Commission has thus described the statutory policy regarding NRC antitrust review:
"But other policies are also reflected in Section 105c, viz, that a government-developed, monopoly-like nuclear power electricity generation not be utilized in ways which contravene the policies contained in the various antitrust acts.
Section 105c is a mecha-nism to allow the smaller utilities, municipals, and cooperatives access to the licensing process to pursue their interests in the event that larger utility applicants might use a government license to create or maintain an anticcmpetitive market position."23/
Since the NRC and not the court has been given the responsibility of making the " inconsistent with" findings and possible license conditions under Section 105c, the District Court findings in this regard are not binding here.
It is not necessary for us to decide whether the Disl.ict Court exceeded its jurisdic-tion in making such findings, as argued by the Staff,b theDepartrent,b Brownsville,b andCP&LandCSW.E It is sufficient to hold that the doctrines of collateral estoppel and res judicata do not apply to these findings.
EFIC v. Sperry & ilutchinson Co., 405 U.S. 233, 249 (1972).
E orida Power & Light Co. (St. Lucie Plant, Unit No. 2), CLI-78-12, 7 NRC 939, Fl 946 (1978).
b nswer of the NRC Staff, pp. 5, 9.
A 2_5,/ esponse by the Department of Justice, p. 26.
1180 332 R
b esponse of the Public Utilities Board, pp. 10, 27.
R 27/
- Answer of Central Power and Light Ccepany, p.11.
E.
Exceotions Based on Public Policy It has been recognized by both the Appeal Board and thc Cocmission that exceptions to the application of res judicata and collateral estoppel which are found in the judicial setting, are equally present where administrative adjudica-tion is involved. One such exception is the existence of broad public policy considerations cr special public interest factors which would outweigh the reasons underlying the doctrines..8/ The unique nature of NRC antitrust review as
?
linked to licensing considerations, constitutes such a special public interest factor in this context.
In South Texas, the Ccnmission held that Congress intended that it should review antitrust allegations "primarily, if not exclusively, in the centext of licensing...."NI Although holding that in the field of antitrust NRC's. expertise is not unique and that it was not given broad antitrust policing powers independent of licensing, its special role in this area was thus described:
"Through the licensing process, we can effectuate the special concern of Congress that antiempetitive influences be identified and corrected in their incipiency. No nuclear power can be generated without an NRC license and the licensing process thereby allows us to act in a unique way to fashion renedies, if we find that an applicant's plans may be inconsistent with the antitrust laws or theirunderlyingpolicies."El This unique function of the NRC licensing process also involves making a jMgent or estirnte as to the future, in considering what effect activities 28/
- Alabama Power Cmpany, suora, 7 AEC at 203-04, 213-16.
EIHouston Lighting & Power Cmpany, et al. (South Texas Project, Unit Nos.1 and 2), CLI-77-13, 5 NRC 1303,1316 (1977).
EIId., at 1316. See also Davis-Besse, suora, slip opinion at p. 35.
1180 333 under the license would have on the carpetitive situation. The regulatory scheme established by Congress in Section 105c proceedings was designed to " nip in the bud any incipient antitrust situation", albeit via the NRC licensing review process.b/ As Professor Davis has observed, '% hen the legislative intent is to vest prirarf power to rake particular determinaticra concerning a subject matter in a particular agency, a court's decision concerning that subject matter may be without binding effect upon that agency."
(2 Davis, Administrative Isa Treatise,
$18.12 at 627-28 (1958))
The Appeal Board has quoted with approval the above obser/ation of Professor Davis, although it was held not applicable to a claim by the City of Cleveland that a law firm which had formerly represented it in bcnd matters, should be precluded from representing an opposing applicant in an NRC antitrust proceeding.32/ In that case, there was no discernible legislative purpose that NRC only should resolve such a comucn issue, involving the construction of the Code of Professional Responsibility as interdicting the law firm's representation ofanotherclient.NI The facts in that case are quite different from the instant situation. That issue concerned a rather peripheral ratter which did not essentially involve the unique NRC role in a Section 105c proceeding. Here, the very nature of the NRC antitrust review and the significant responsiblities borne by the Department and the Staff, evoke special public interest factors which preclude the application of collateral estoppel or res judicata.
E/ Midland, suora, 6 NRC at 912. See also Kansas Gas and Electric Co. GJolf Creek Generating Station, thit No.1), ALAB-279,1 NRC 559, 571-72 (1965).
32/
- The Toledo Edison Ccxnpany, suora at p. 5, 5 NRC at 561.
EIg.,at562.
Il80 334 II. GIHER STATUIES, GIIER PROCEEDDGS The moving parties additionally argue that the enact =ent of PURPAb and its vesting of FERC with the power to order wheeiing and interconnection, eliminates the need for a Section 105c antitrust review involving allegations of anticcm-petitive conduct and requests for interconnection and wheeling. However, the legislative historyE and the language of PURPAE clearly establish that it was not intended to divest NRC or any other antitrust tribunal of jurisdiction, nor to require deferral of such matters to FERC.
During Senate consideration of the Conference Report, Senator Metzenbaum, a manager of the bill and a member of the conference camtittee, stated:
"It was not the intent of the conferees to codify in any way the rights of parties in presenting and prosecuting allegations of anticccpetitive conduct before the Federal and State courts, or before administrative agencies, including the FEPC and the Nuclear Regulatory Cemhsion.
Both have legal obligations to consider antitrust issues. Where any of these agencies presently have the authority to order transmission, coordination or other relief pursuant to a finding of anticagetitive conduct, undue discriranation or unjust and unreasonable rates, terms, conditions or the like, this authority would not be disturbed.
The act does not limit the present authority of these agencies in this regard.
'Thus, a party which has been denied wheeling services for anti-cottpetitive reasons will not be hindered by this legislation frcm proceeding in the Federal courts or elsewtere. Likewise, the authority of the NRC in conducting an antitrust review under the provisions of the Atomic Energy Act of 1954, as amended, would not be affected by this extremely limited steel-ing authority granted to FERC under this new legislation.
These two agencies are charged with different responsibilities with respect to wheeling. FERC's new autiority is conditioned on conservation, efficiency, reliability, and public interest.
NRC's authority relates to correcting"or preventing a situation inconsistent with the antitrust laws.
(124 Cong. Rec. 517, 802 (daily ed., October 9,1978))
E ublic Utility Regulatory Policies Act of 1978, Pub. L. No.95-617, 92 Stat.
P 3117 (1978).
E ouse Rep. No. 95-1750, 95th Cong., 2d Sess. at 68, 92.
H E ecticn 214 of PURPA.
I180 335 S
Accordingly, it cannot be hek, that proceedings by FERC based upon this statute in any way supersede the instant PRC proceedirg.
The noving parties next cite the order issued by the Texas Public Utility Comission (TPUC) in its Docket No.14, to support their contention that this NRC proceeding should be terminated. The TPUC order required CP&L to disconnect its radial tie into Oklahoma, which had put it and other interconnected utilities into interstate cmrerce. This order is presently under vigorous attack in state and federal courts, based on the constitutional considerations of a state placing an undue burden on interstate ccmnerce.EI We do not need to decide grave constitutional issues, but we hold that our statutory responsibilities under Section 1050 mmot be impaired or limited by a state agency. We do not assume that TPUC would take any action resulting in unnecessary confrontation.
The movants have.also cited the injunction issued by the District Court as another reason to terminate or sharply limit the instant proceeding. That order provides in pertinent part that "CP&L is hereby permanently enjoined frcm permitting power it receives from STP to enter interstate comerce as larg as CP&L rmains a participant in the STP Agreement and as long as 58.2 of that agreenent remains in force." Since it is contended that 58.2 of the participa-tion agreement is inconsistent with the antitrust laws by its intrastate cmmerce limitation, this Board could, if the evidence required it, approve a license condition excising or reforming that section of the agreement. The District Court's injtuction does not bar NRC raedies, nor require the dismissal of this proceeding.
EIIn addition to proceedings in the state district court of Texas, the State of New Mexico has petitioned the United States Supreme Court to hear this case under its original jurisdiction (New Mexico v. Texas, Original Action No. 82).
1180 336 For the foregoing reasons, the notions of HISP and TUGCO are denied. We are not persuaded that interlocutory review is necessary or appropriate and hence decline the requests to certify the questions raised in these motions to the Cocmissicn or the Appeal Board (10 CFR SS2.718(i), 2.730(f)).
It is so ordered.
FOR THE ATQEC SAFEIY AND LICENSING BOARD
/fcv%
f.5.!
'bl Marshall E. Miller, Cbniman Dated at Bethesda, Marf and l
this 5th day of October 1979.
1180-33T