ML19312C605

Responds to Applicant Motion for Protective Orders.Applicant Should Not Be Permitted to Withhold Entirely from Discovery Documents for Which It Seeks Protective Orders.Certificate of Svc Encl

ML19312C605
Person / Time
Site:	Oconee, Mcguire, McGuire
Issue date:	07/31/1973
From:	Brand W, Leckie D JUSTICE, DEPT. OF
To:	US ATOMIC ENERGY COMMISSION (AEC)
References
NUDOCS 7912181003
Download: ML19312C605 (7)

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UNITED STATES OF AMERICA j BEFORE THE l ATOMIC ENERGY ComfISSION In the Matter of ) ,

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DUKE POWER COMPANY ) Docket Nos. 0-26 , 50-270A (Oconee Units 1, 2 and 3 ) , 50-369A McGuire Units 1 and 2) ) 50-370A l

ANSWER OF THE DEPARTMENT OF JUSTICE TO APPLICANT 'S MOTION FOR PROTECTIVE ORDERS The Department of Justice answers Applicant's Motion for Protective Orders , dated July 19, 1973, as follows with regard to each category of documents for which protection is sought.

1. Documents Relating to Applicant's Pending Acouisition of Electric Power Facilities Applicant's plans and procedures for acquiring electric facilities may evidence a purpose or anticipated effect of extending and abusing its mcnopoly pcwer through such acquisitions--c.g. , indications that Applicant will con-sider paying more than the fair value of facilities because their acquisition would result in eliminating actual or poten-tial competition. Applicant has not claimed these documents are irrelevant; it professes to have determined that there is little in them that would assist us..*] The Department wishes

• / That the seven intervenor cities are not directly involved In the possible sale of the facilities mentioned by 4.pplicant is , of course, immaterial, for our case against Applic.snt has never been restricted to its dealings with these cities, nor are we limited by their particular claims for relief.

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to determine for itself which of these documents will be use ful. We are entirely willing that the Board limit their further use or disclosure except upon a showing of good cause.

We do not believe an in camera inspection of these documents by the Board would be warranted or appropriate. The Depart-ment has no actual or potential business relationship with the Applicant; disclosure directly to us would in no wise prejudice its future bargaining ability. The Board is not )

l preparing a case of antitrust inconsistency against the Appli- l l

cant and should not be placed in the role of having to decide i in the first instance what_ documents might or might not be helpful in making out the various facets of our case--

particularly when, as here , no claim of legal privilege is at issue.*/,

I Our desire to inspect the documents ourselves--

accepting a limitation on further disclosure and use as appropriate--and our opposition to a procedure of in camera inspection by the Board apply equally with regard to all the other categories of documents discussed below.

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• / Although judicial in camera inspectiva is commonly employed to deal with cTaims of legal privilege , it is not considered entirely satis factory even for that purpose.

The reason is the same as here. Counsel seeking to defeat the privilege cannot effectively argue his position when blindfolded from what the " privileged" documents actually l contain and how they may bear on his case. l l

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2. Documents Relating to the Offering Price j of Electric Facilities Acquired or Considered  ;

for Acquisition by Applicant and the Sale Price of Facilities Disposed of by Applicant These documents are relevant and may be important to this proceeding for the same reason discussed above (Item 1) .

If "the methodology by which Applicant develops an offering price" (or selling price) takes into account the competitive implications of these transactions, that would be substantial, probative evidence of antitrust inconsistency. (We are not interested in mere " mathematical applications" of this price-determination methodolegy.)

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3. Documents Relating to Future Plant Sites The Department is interested in these documents insofar as they may indicate selection of plant sites with  ;

the purpose or anticipated effect of precluding their use by actual or potential competitors , e.g. , EPIC. Here again, there is no' conflict between " protection" and " disclosure";

confidentiality of sites may easily be preserved without denying the Department discovery of possibly significant evidence.*/

4. Documents Containing Information Con-cerning Aoplicant's Business Stratecy Applicant's policies concerning reimbursement for lines of other systems removed because of flooding would be significant to us if competiti re considerations were a factor

• / EPIC's nondisclosure of similar information is not in point here. This proceeding seeks to determine Applicant's antitrus t culpability, not EPIC 's .

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. I therein, i.e. , if Blue Ridge Electric Cooperative received special treatment by reason of its competitor status.

Of all the documents for which Applicant seeks protection, the one probably most vital to the Department's case, judging from its description, is the 'jnternal memorandum dated November 10, 1970, outlining Applicant's strategy in regard to the negotiation of future wholesale contracts ,

particulcrly in light of the possible advent of EPIC." We believe a major element of Applicant's anticompetitive conduct has been a policy of preventing the formation of alternative (to Applicant), competing sources of bulk power supply in the Piedmont Carolinas. EPIC would be one such alternative supplier. EPIC's feasibility depends on the support of municipal and cooperative electric distribution systems who now contract to purchase their bulk power supply from Appli-cant. Any " strategy" of Applicant regarding the negotiation of future wholesale contracts with these systems surely must relate to its desire to keep them in the fold and away from EPIC. Withholding such a crucial document from discovery in this proceeding would be patently unfair.*/

5. Documents Relating to Particular Individuals The Department concurs in Applicant's proposal to limit disclosure of these documents initially to counsel in N

• / Applicant's motion appears to concede the importance of this document. Compare its albeit reluctant proposal for limited disclosure thereof (p. 7, last paragraph) with its blanket opposition to production of all categories of docu-ments previously discussed.

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t this proceeding. Should they prove to be relevant evidence, we would make a good cause showing to the Board.

CONCLUSION l

For the reasons stated above, Applicant should not be permitted to withhold entirely from discovery the documents for which it seeks protective orders. The Board may safe- 1 guard any legitimate interest of Applicant in confidentiality by appropriately limiting the examination and use of these documents in this proceeding.

Respectfully submitted,

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DAVID A. LECKIE WALLACE E. BRAND Attorneys, Antitrust Division Departnent of Justice Washington, D. C.

July 31, 1973

UNITED STATES OF ANERICA BEFORE THE ATONEC ENERGY COMMISSION .

I In the Matter of )

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DUKE POWER COMPANY ) Docket Nos'. 50-269 A, 50-270A

. (Oconee Units 1, 2 and 3 ) 50-287A, 50-369A McGuire Units 1 and 2) ) 50-370A I '.'

CERTIFICATE OF SERVICE I hereby certify that copies of ANSWER OF THE DEPARTMENT OF JUSTICE TO APPLICANT S MOTION FOR PROTECTIVE ORDERS, dated July 31, 1973, in the above-captioned matter have been served on the follow-ing by deposit in the United States mail, first class cr air mail, this 31st day of July,1973

Honorable N# alter W. K. Bennett William Warfield Ross, Esquire

, Chairman, Atomic Safety and George A. Avery, Esquire Licensing Board Keith Uatson, Esquire Post Office Box 185 Toni K. Golden, Esquire Pinchurst, North Carolina 28374 Wald, Markrader & Ross 1320 Nineteenth Street, N.W.

Honorable Joseph F. Tubridy Washington, D. C. 20036 Atomic Safety and Licensing Board 4100 Cathedral Avenue , N.W. J . O. Tally , Jr . , Esquire Washington, D. C. 20016 J. A. Bouknight , Jr. , Esquire 1 i

Tally, Tally & Bouknight l Honorable John B. Farmakides Post Office Drawer 1660 Atomic Safety and Licensing Board Fayetteville, North Carolina 28302 U. S. Atomic Energy Commission  ;

l Washington, D. C. 20545 Troy B. Conner, Esquire l President Reid & Priest l Carl Horn, Duke Power Company 1701 K Street, N.W.

President, 422 South Church Street Washington, D. C. 20006 Charlotte, North Carolina 28201 Joseph Rutberg, Esquire .

William H. Grigg, Esquire Benjamin H. Vogler, Esquire l Vice President and General Counsel Antitrust Counsel for AEC Duke Power Company Regulatory Staff 422 South Church Street U. S. Atomic Energy Commission Charlotte, North Carolina- 28201 Washington, D. C. 20545 W. L. Porter, Esquire Mr. Abraham Braitman, Chief l Office of Antitrust and Indemnity l Duke Power Company 422 South Church Street U. S. Atomic Energy Commission Charlotte, North Carolina 28201 Washington, D. C. 20545 l

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David Stover, Esquire Mr. Frank W. Karas, Chief Tally, Tally & Bouknight Public Proceedings Branch 429 N S tree t , S .W. Office of the Secretary of Washington, D. C. 20024 the Commission U. S. Atomic Energy Commission Atomic Safety and Licensing Washington, D. C. 20545 Board Panel U. S. Atomic Energy Commission Chairman, Atomic Safety and Washington, D. C. 20545 Licensing Appeals Board U. S. Atomic Energy Commission Washington, D. C. 20545 I:. :,

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'l DAVID A. LECKIE Attorney, Antitrust Division Department of Justice Washington, D. C. 20530 O

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