ML19319C311

Response to DOJ & City of Cleveland Memoranda on Claims of Privilege.Principle Invoked by City Does Not Apply. Certificate of Svc Encl

ML19319C311
Person / Time
Site:	Davis Besse, Perry
Issue date:	05/02/1975
From:	Reynolds W CLEVELAND ELECTRIC ILLUMINATING CO., SHAW, PITTMAN, POTTS & TROWBRIDGE, TOLEDO EDISON CO.
To:	Atomic Safety and Licensing Board Panel
References
NUDOCS 8002130833
Download: ML19319C311 (9)

Text

,  ; . . - May 2, 1975 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION Before the Atomic Safety and Licensing Board In the Matter of )

)

THE TOLEDO EDISON COMPANY and )

THE CLEVELAND ELECTRIC ILLUMINATING )

COMPANY )

(Davis-Besse Nuclear Power Station, ) Docket Nos. 50-346A

. Unit 1) ) 50-440A

) 50-441A THE CLEVELAND ELECTRIC ILLUMINATING )

COMPANY, ET AL., )

(Perry Nuclear Power Plant, )

Units 1 and 2) )

APPLICANTS' RESPONSE TO THE MEMORANDA 0F THE DEFARTMENT OF JUSTICE AND OF THE CITY OF CLEVELAND ON CLAIMS OF PRIVILEGE

1. On April 25, 1975, Applicants Duquesne Light Company and The Cleveland Electric Illuminating Company, jointly, and the Department of Justice, separately, sub-mitted to the Special Master legal memoranda in support of their respective claims of attorney-client and work product privilege as to the documents each had earlier presented to the Special Master for his examination, in camera.

The City of Cleveland also filed a legal memorandum gen-erally discussing the two pr1711eges. Pursuant to the order of the Atomic Safety and Licensing Board, responses to these April 25 filings are due on May 2, 1975 8002180 h"33

2. Applicants are not in a position with re-spec': to documents they have never seen to make an in-forned evaluation of the Department's particular claims of privilege. The standards to be applied in order to Gscertain whether the Department is entitled to the pro-I tection it seeks.have been discussed in some detail in Applicants' April 25 filing. It is, of course, now the l

l task of the Special Master to examine the Department's documents, in camera, and, on the basis of the articulated

legal principles regarding privilege, to determine whether l

{ they have been properly withheld frca disclosure as em-

! bodying confidential communications between attorney and c'.iant, or, alternatively, as constituting attorney's work

! product. Applicants will abide by the decision of the Special Master in this regard.

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3. Insofar as the legal memorandum submitted by the City of Cleveland is concerned, Applicants do not see any need to respond generally to the matters set forth therein, since most of the City's discussion addresses the same points analyzed by Applicants in th'eir earlier sub-4 mission to the Special Master. One section of the City's paper requires special comment, however, since it clearly i misapplies the law, improperly characterizes the record in this proceeding and urges the Special Master to under-take a review function not delegated to him by the Licensing Board.

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. . . _ _ _ . _ , . _ _. _ _ . - . _ . . _ ~ .

4. In Section G of its memorandum, the City sets forth the accepted principle that an attorney-client privilege cannot be used to protect client communications where legal assistance is being sought for illegal pur-poses. United States v Billingsley, 440 F.2d 823, 827 (7th Cir. _971). An effor't is then made, however, to sweep within that recognised exception, communicatio'ns between Applicants and their counsel "in furtherance of a plan to maintain or enhance claimant's monopoly" (p. 14).

5 The suggestion that such a leap can be made is wholly unwarranted. In the first place, there is no basis on the present record of t.is proceeding to conclude that any of the Applicants has a monopoly position in any geographic or product market. Indeed, even assuming arguendo an affirmative response to the first ten matters-in-controversy articulated by the Licensing Board, it is not altogether clear that any Applicant could properly be said to be a monopolist. At present, all that has been entablished is that each of the Applicants enjoys a dominant .

position with respect to carefully defined product markets within his respective service area. If, as Applicants have. maintained, that dominant position was attained law-fully and without predatory intent -- as is normally the case in a regulated-industry -- then consultation with l

counsel regarding the legal aspects of legitimate business plans and considerations which could affect Applicants' respective positions, one way or the other, are perfectly legal and entitled to protection. There plainly is no illegal purpose involved in such communications.

6. Furthermore, it should be pointed out that we are not involved here trith a criminal antitrust proceeding. The issues before uhe Licensing Board are narrowly confined not only by Section 05c of the Atomic Energy Act, but by the pleadings themselves. All that has been alleged, and all that the Licensing Board has jurisdiction to determine in the present context is whether there exists in the relevant geographic anc product mar-kets -- when they are ultimately determined -- a " situation inconsistent with the antitrust laws" (Section 105c of the Act; emphasis added). That is plainly an insufficient ,

l predicate on which to invade the claims of privilege as- i serted by Applicants here on the ground that their con-l fidential communications to and from counsel are in fur- .

therance of criminal activity. None of the Applicants has-even been charged with any crimes.

7 Finally, we would point out that it would be entirely inappropriate for the Special Master to base his rulings on Applicants' privilege claims upon the sort I

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of analysis urged by the City of Cleveland in Section G of its memorandum. For, to follow the City's suggestion, the Special Master would, at the very least, necessarily have.to resolve the very fact issues regarding the ex-istence of an anticompetitive situation that are scheduled for full hearing before this Licensing Board.1/ Clearly, this responsibility is not contemplated in the Licensing Board's delegation of authority to the Special Master to resolve claims of privilege. Nor is the Special Master equipped to make any such determination without access to a full record. For example, the City conveniently overstates Applicants' stipulation as to dominance, falls to inform the Special Master that the referenced refusal to wheel concerns an isolated request concerning 30 mw of power, made not by the City but by another entity (AMP-0), and ignores comple'tely Applicants' offers to the City of access to the CAPCO nuclear plants involved in i

this proceeding, tegether with back-up service when those plants are shut.down. Nor is Applicants' other evidence

~

before the Special Master which will-demonstrate that there does not exist in any of Applicants' service areas, or in the CAPC0 area as a whole, any situation inconsistent 1/ .As already noted in paragraph 6 supra, the Special Master would need to go even further than che Board can properly go in this regard before he could rule that the attorney-client privilege has been lost because the com-munications were in furtherance of an illegal purpose.

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't with the antitrust laws.  ;

8. It it for these reasons that Applicants feel compelled to respond to Section G of the City's memorandum. While we do not quarrel with the general

! principle" set forth therein, it is perfectly clear that the principle has no application in the present context 4

to a determination whether the documents submitted by Duquesne Light Company and The Cleveland Electric Illu-minating Company are entitled to the protection claimed under the attorney-client privilege.

Respectfully submitted, SHAW, PITTMAN, POTTS & TROWBRIDGE By: O. Odd %th Wm. Bradford Reynolds Gerald Charnoff Counsel for Applicants J

Dated: .May 2, 1975 e

- - . , _ - , - ~ ~, , , . . . - - , , - , - .-n--. -

UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION I

Before the Atomic Safety and Licensing Board I

In the Matter of )

)

l THE TOLEDO EDISON COMPANY and )

THE CLEVELAND ELECTRIC ILLUMINATING )

COMPANY )

. (Davis-Besse Nuclear Power Station, ) Docket Nos. 50-346A Unit 1) ) 50-440A

) 50-441A j THE CLEVELAND ELECTRIC ILLUMINATING )

COMPANY, ET AL.,

)

(Perry Nuclear Power Plant, )

l Units 1 and 2) )

i i

l CERTIFICATE OF SERVICE I hereby certify that copies of " Applicants' i Response To The Memoranda Of The Department Of Justice And Of The City Of Cleveland On Claims Of Privilege" were served upon.the persons listed on the attached 4

Service List,by hand delivering a copy thereof to each i person in the Washington, D. C. area and by mailing a copy thereof, postage prepaid, to all others, on this 2nd day of May, 1975 SHAW, PITTMAN, POTTS & TROWBRIDGE ,

By: 1 _m i - _ _LL Wm. Bradford Reynolds Counsel for Applicants Dated: May 2, 1975 9

0

. . , _ - .- - , ,y _ _- .,-_.,...,v_, ,, . - - --.--m c.. , _

( .

. UI"ED STATES OF A!4 ERICA NUCLunR REGUIATORY COtifiISSION ,

Before the Atomic Safety and Licenning Board In the flatter of ) .

)

THE TOLEDO EDIS0!! COMPA!!Y and )

• T11E ,CLE'!ELA!!D ELECTRIC ) .

ILLUI4I!!ATIi!G COMPA!!Y ) -

. )- .

(Davis-Desse Nuclear Power ,) Docket Nos. 50-346A Station, Unit 1) ) 50 Ill l0A

) 5 0 llll l A Tile CLEVELA!!D ELECTRIC ).

ILLUI4IliATII!G COMPA!!Y, ET AL. ) .

) . .

(Perry I!uclear Power Plant, )

~

Units 1 and 2) *

). .

SERVICE LIST .

Douglas V. Rigler, Esq. Mr. Chase R. Stephens.

Chairman, Atomic Safety and Docketing & Service Section Licensing Board .U.S. Nuclear Regulatory Commissi6n

. Foley, Lardner, Hollataugh 1717 H Street. N W.

and Jacobs .

Washington, D. C. 20006, Schanin Building

. 815 Connecticut Avenue, N.W. BenjaminH.Vogler,Esq.I Washington, D. C. 20006

• Office of General Counscl Regulation John H. Brebbia, Esq. U.S. Nuclear Regulatory Commission Atomic Safety and Licensing Board Washington, D. C. 20555

' Alston, I4111er & Gaines 1776 K Street, N.W. Robert J. Verdisco, Esq.

Washington, D. C. 20006 ,

Office of General Counsel-Esq.

-- ' Regulation John AtomicI4,Safety Frysiak,id ar Licensing U.S. Nuclear Regulatory Commission Board Panel Washington, D. C. 20555 U. S. Nuclear Regulatory Commission p Washington, D. C. 20555 '

.. Office of Cencral Counsel IRegulation

. Atomic Safety and Licensing U.S. Nuclear Regulatory Commission Board Panel Washington, D. C. 20555 U.S. Nuclear Regulatory Commission , ,

Washington, D. C. 20555 I

. t 0 e

v * .

A .

2 .

Joseph J. Saunders, Esq. Loclic llenry, Esq.

, Steven M. Charno, Esq. ' Fuller, Henry, !!cdcc-& Snyder

' . Antitrust Division 300 Madison Avenuo -

Departinent of Jur.tico Tohdo, Ohio 113604 Washington, D. C. 20530 -

Thomas A. Kayuha, Esq.

Melvin G. Berger, Esq. Ohio Edison Company Aititrust Division 47 North Main Strcot

• Dera.rtment of Justico Akron, Ohio 44308

. Wannington, D. C. 20530

• Thomas J. Munsch, Esq.

Heuben Goldberg, Esq. ~

General Attorney David C. Hjelmfelt, Esq. . Duquesne Light Company .

l'/00 Pennsylvania Ave., N.W. 435 Sixth Avenue WashinCton, D. C. 20006 Pittsburgh, Pennsylvania 15219 Frank R. Clokey, Esq. David Olds, Esq.

Special Assi:: tant *

• Reed, Smith,.Shaw & McClay Attorney Geacral Union Trust Building Room 219 Box 2009 *

,. Towne House Apartments Pittsburgh, Pennsylvania 15230 liarrisburg, Pennsylvania 17105 . *

~

. John Lansdale, Esq.

Mr. Raymond Kudukis' Cox, Langford & Brown Director of Utilities 21 Dupont Circle, N.W.

City of Cleveland Washington, D. C. 20036 ,

1201 Lakesida Avenue

Cleveland, Ohio 44114 .Wallace L. Duncan, Esq.

Jon T. Brown, Esq. -

)lerbert R. Whiting, Director Duncan, Brown & Palmer

. Robert D. Hart, Esq. '1700 Pennsylvania Ave., H.U.

Department of Law Washington, D. C. 20006 1201 Lakeside Avenue C1cycland, Ohio 44114 -

Edward A. Matto, Esq.

Assistant Attorney General John C. Engle, President Chief, Antitrust Section AMP-0, Inc. -

30 East Broad Street, 15th Floor Municipal BuildinC Columbus, Ohio 43215

• P0 High Street .-

llamilton, Ohio - 45.012 Richard M. Firestone, Esq.

. Assistant Attorney General Donald !!. Hauser,.Esq. .

Antitrust Section Corporate Solicitor ' 30 E. Broad Strcot, 15th Floor The Cleveland E3,cetric Columbus, Ohio 43215 I.1uminating 1 Company 55 Public Square .

Deborah P. Highsmith, Esq.

Cleveland, Ohio 41110 1 Assistant Attorney General' Antitrust Section *

- 30 East Broad Street, 15th Floor Columbus, Ohio 43215 Christopher.R. Schraff, Esq.

Accistanc Attorney-Cencral

. EnvJronmental Law Sectjon 361 Eas t lipond Street , 8th Floor ,

Columbus, Ohio 43219 l M 44 3 --- - --.-3 -- .w