ML19322A177
| ML19322A177 | |
| Person / Time | |
|---|---|
| Site: | Saint Lucie  |
| Issue date: | 12/22/1978 |
| From: | Chanania F, Dewey L, Evans D NRC OFFICE OF THE EXECUTIVE LEGAL DIRECTOR (OELD) |
| To: | |
| References | |
| NUDOCS 7901040216 | |
| Download: ML19322A177 (74) | |
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UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of
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FLORIDA POWER & LIGHT COMPANY
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NRC Docket No. 50-389A (St. Lucie Plant Unit No. 2)
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NRC STAFF'S RESPONSE TO APPLICANT'S OBJECTIONS TO DISCOVERY REQUESTS AND MOTION FOR A PROTECTIVE ORDER By Motion of December 11, 1978, Florida Power and Light Company (App 1icant or FP&L) has objected to several discovery requests contained in the First Joint Request by the NRC Staff, the Department of Justice and the Intervenors (the Joint Request).
In connection with these dis-covery requests, Applicant also has moved for the entry of a protective order.
In accordance with the Licensing Board's Order of November 14, 1978, Staff hereby files its response to Applicant's motions.
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I.
APPLICANT'S OBJECTIONS TO THE TIME PERIOD ENCOMPASSED IN THE JOINT REQUEST Applicant has objected that 14 f tems of the Joint Request impose 2/
a " substantial and unreasonable search burden on the Company" by re-quiring searches for documents back as far as 1950. The Company, therefore, has requested an order limiting discovery to 1972, with provisions for earlier discovery upon motion by the party seeking production. -3/
_1j As a result of meetings held between Applicant, Intervenors, the Department of Justice and the Staff of the Nuclear Regulatory Commission, numerous potential objections to discovery requests have,been resolved.
_2_/
Applicant's Objections to Discovery Requests and Motion for a Protective Order (Motion) at 4.
3/ Id. at 8-9.
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. Staff notes that only 14 of the 89 Joint Requests require a search past the general production date of 1965.
Eight require a search to
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.6) 1950; four require a search to 1955; and two require a search to
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1960.
The limited number of these requests demonstrate that the Staff has sought to limit its discovery where possible. Only these 14 items request a document search past the date ordered in South Dade, upon which 8/
the Applicant states it has already started its cocument search. '~
Each request is based upon a belief that relevant material will be uncovered in a search back to the dates specified. And, as will be discussed, infra, Staff believes these requests are clearly within the scope of discovery.
A.
SC0pE OF DISCOVERY The scope of discovery in flRC proceedings is, of course, governed by 10 CFR $2.740(b)(1). Modeled after Federal Rule of Civil Procedure
_a,/
The 1965 date is set forth in Part C of the Joint Request, " Scope of Production." This is the same general cutoff date ordered by the Gor.rd in the South Dade proceeding.
In its Motion Applicant sug.ists the Staff and other parties are being inconsistent in setting 1965 as the relevant period for discovery and then requesting earlier dates as certain items. (Motion at 3.) But the Joint Request itself careful sets forth:
"Each paragraph contained below, unless otherwise specified, refers to all documents made, sent, dated or received from January 1,1965 to date..." (Joint Request at 6, Emphasis i
added).
,The 14 earlier requests simply fall within this exception language.
There is no inconsistency.
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_5/ Joint Request flos. 24,25,29,30,33,41,56, and 76.
6/ Joint Request Nos. 2,8,26, and 48.
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_/ Joint Request flos.12 and 39.
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l 8_/ Motion at 5.
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- ~.. - -
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_ 26(b),
that regulation provides:
Parties may obtain discotery regarding any matter not privileged, which is relevant to the subject matter in-volved in the proceedir f, whether it relates to the claim or defense of the part.y seeking discovery or to the claim or defense of any other party, including the existence, description, nature, custody, condition and location of any books, documents, or other tangible things and the identity and location of persons having knowledge of any discoverable matter.... It is not ground for objection that the information sought will be inadmissible at the hearing if the information sought appears reasonably cal-culated to lead to the discovery of admissible evidence.
(Emphasis added).
Thus, the controlling standard for determining whether a discovery request is within the scope of discovery is whether it is relevant to the subject matter in the proceeding. " Subject matter", however, in-cludes not only those matters admitted in controversy at the prehearing 10/
l con ference, - but also "the existence description, nature, custody, condition and location" of documents and people.
11/
Both the courts and the Commission have recognized the need for
" liberal discovery" under the relevancy standard. As the Appeal Board
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FED.R.CIV.P. 26(b) 28 USC; In fact, the Appeal Board has recog-i nized that 10 CFR 2.740 is modeled after Rule 26. Commonwealth Edison Comoany (Zion Station, Units 1 & 2), ALAB-196, 7 AEC 457, 460 (1974).
3/ 10 CFR D40(b)(1); Allied-General Nuclear Services et al. (Barn-well Fuel Receiving and Storage Station), L8r-77-13, 5 NRC 489 i
(1977).
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,]l/ See e.g., Detweiler Bros.. Inc. v. John Grat am & Cq,,,, 412 F. Supp.
2 416 (E.0, Wash.1976); La Chemise Lacoste v. Allicator Co.. Inc.,
4 60 F.R.D. 164 (D. Del. 1973).
Since 10 CFR 2.740(b) is patterned after FRCP 26, it has been held that "the legal authorities and Federal court decisions involving Rule 26 illiminates, and provide proper guidelines for interpreting the discovery standards set forth in the Commission's rules." Allied-General Nuclear Services et al, suora, at 492.
..l.2./
said in Commonwealth Edison Company:
Licensing boards are afforded considerable discretion and latitude as to the manner in which they will apply the discovery rules. (cites omitted). But despi*e this discretion and latitude, we think that the " broad, liberal interpretation" given to the Federal Rules must similarly be accorded the Commission's discovery rules.
The Staff believes its 14 document requests which require searches past 1965 meet the test of " relevancy" under the broad, liberal interpretation which is due 10 CFR 52.740(b)(1). Neither the Federal Rules, the Commission's Regulations, nor any Commission decision limits the definition of "relevcncy" to a f *. period.
If a demonstration of relevance has been shown, discovery should follow.
However, both the Federal Rules and the Commission's Rules of Practice provide for limiting discovery, so as not to impose an un-reasonable burden o'n the party subject to discovery. Section 2.740(b) prefaces the earlier quoted section on the " general" scope of discovery by stating: "Un1 is otherwise limited by the presiding officer J.n, accordance wi th this section..."
(emphasis added).
,11/ Commonwealth Edison Company (Zion Station, Units 1 and '). ALAB-196, 7 AEC 457, 461 (1974). See also Commonwealth Edison Cqpany. (Zion Station, Units 1 and 2), ALAB-185, 7 AEC 240 (1974).
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. Presumably the emphasized language in 52.740(b) requires that any limiting of the " general" scope of discovery be in accordance with the standards required for a protective order under 52.740(c).
- Thus, whether a Protective Order or simply a Motion to Limit Discovery is sought, the Board's decision will be governed by the analysis set forth in 92.740(c).
That analysis would allow for a limiting of the " general" scope of discovery upon a showing of "annoynance, embarassment, oppression, or undue burden or expense." ~5/
1 It should be noted, similarly, that whether styled as a Motion for a Protective Order or Motion to Limit Discovery, the burden of limiting the general scope of discovery rests upon the party seeking to restrict discovery.
In ruling upon the instant motion, therefore, the Board must ;'. lance the relevancy of the 14 Joint Requests against the burden claimed by the Applicant. Only if the burden outweighs the possible relevancy of the request is an. order limiting discovery--or a Protective Order--properly granted.
In its Motion for a Protective Order in the instant case, FP&L has demonstrated neither the lack of relevance of the Joint Requests, nor an' undue burden in producing those documents.
13/ 10 CFR 52.740(c) is the only relevant section for limiting discovery, other than those provisions dealing with " Trial production materials" in 2.740(b)(2), which are not at issue here.
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,1A/ It is not clear in what form Applicant's Motion is stated. Although styled " Applicant's Objections to Discovery Requests and Motion for a Protective Order," it could be argued that pertains only to sIV of the Applicant's paper. On the other hand, Applicant's submission in SI "that discovery and evidence in this proceeding should be limited to i
the period aginning January 1,1972" (tiotion at 8) could also be l
interpreted as a Motion for a Protective Order.
If so, it clearly l
lacks the allegation of " good cause" required in 10 CFR 2.740(c).
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u;/ 10 CFR 52.740(c). Applicant has found the need for a limiting order upon such a basis by claiming the search would be " unreasonable" (p.
4), " expensive and time consuming." (p. 5).
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B.
RELEVANCE OF DOCUMENTS REQUESTED The Applicant has not attempted an item-by-item discussion of the rele-
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vance of the objected-to document requests.
Rather, FP&L makes only broad statements as to the irrelevance of the requests, saying "(t)he burden of such a search would not be offset by the probative value of any documents 17/
produced;" -- that " documents authored more than a quarter of a century ago 18/
are of dubious. relevance at best to issues in this proceeding;" - and "When requests reach back more than a quarter of a century, their relevance cannot be assumed." --19/
The simple claim that documents are ' irrelevant is not the same thing as demonstrating that irrelevance. And while it is true that the Commission's Rules of Practice do not allow the relevance of requests to be " assumed," the Appeal Board has instructed that a " broad, liberal interpretation" be given to 10 CFR 2.740 in order to give effect to its 20/
purpose.
It is therefore equally erroneous to " assume" irrelevance.
IE/ Notes 5-7, suora.
,11/ ttation at 6.
18/ Id. at 7.
j 19j Jd. at 6.
20/ The Appeal Board has quoted with approval the Supreme Court's under-standing of the purpose of modern discovery: "They together with pretrial procedures make a trial less a game of blind man's bluff and more a fair contest with the basic issues and facts disclosed to the fullest practicable extent." Commonwealth Edison Co., suora,
7 AEC at 461, quoting United States v. Proctor & Gamble Co., 356 U.S. 677 (1958).
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s 1 As discussed, supra, there is no time limit definition to relevant dis-covery. Documents " authored more than a quarter of a century ago" are as discoverable as those authored yesterday if relevant to the proceeding.
There is nothing " dubious" about it.
The relevance to this proceeding of the 1950,1955, and 1960 document requests is simple: the U.S. Circuit Court of Appeals decision in Gainesville Utilities Dept, v. Flor,ida Power & Light Co.
In that decision, the Fifth Circuit reversed the trial court's refusal to grant judgment n.o.v. on the existence of a conspiracy to divide the wholesale power market between FP&L and Flcrida Power Corporation.
Documents an:'
evidence introduced in that case reach back to the early 1950's.
For example, in an affadavit filed by Florida Cities' attorney Robert A.
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Jablon in the South Dade proceeding, a letter from W.C. Gilman, President of Florida Power Corporation, to Richard Simpson of Monticello, Fla., dated January 30, 1951 appea rs.
The letter is indicative, according to Mr. Jablon's affadavit, of material showing "various anti-competitive actions of Florida Power & Light Company, including refusals to transmit, refusals to sell wholesale power, conspiracy to divide
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territory for wholesale power service, and monopolization."
,21/ 573 F.2d 292 (5th Cir.,1978), cert denied, U.S.
, 47 USLW 3329 (No.78-476) (November 14,1978).
2_2/ 573 F.2d at 299.
23/ Florida Power & Light Company (South Dade Nuclear Units), NRC Okt. No. P-636-A, Robert Jablon affadavit attached to Florida Cities Petition to Intervene, April 14, 1976.
24/
Id., Document No. la in the Jablon affadavit.
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Id... Jablon affadavit at 3 (unnumbered).
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While the Staff mak s no representations as to the value of that particular letter or to Mr. Jablon's assertions of its use in the South Dade proceeding, the fact that a relevant 1951 letter was obtained through discovery in the Gainesville case, suggests that further dis-covery into that time period is necessary in the instant proceeding. If such discovery was deemed relevant by the U.S. District Court in Gaines-ville, the Staff believes its limited request for similar discovery in the St. Lucie 2 proceeding is consistent with its responsibilities of investigating whether granting the proposed license would " create or main-tain a situation inconsistent with the antitrust laws as specified in
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subsection 105a."
It is not an answer to the Gainesville-prompted requests that the
" allegations were well-knnwn by 1977, when the Board ruled on the South Dade discovery requests." ~28/At the time of that ruling, the District Court jury had refused to find a conspiracy between FP&L and Florida Power Corporation and a motion for judgment n.o.v. had been denied. Thus, the parties could hardly have been expected to press the relevance of the Gainesville discovery period. However, with the decision of the Court of Appeals for the Fifth Circuit and the subsequent denial of certforari by the Suptcme Court, the Nuclear Regulatory Commission Staff could hardly overlook those allegations.
Indeed, Section 105a of the Atomic Energy Act places independent authority in the Commission to
" suspend, revoke or take such other action as it may deem necessary" -29/
25/
Id., Jablon affadavit at 3 (numbered).
27/ 42 USC 12135 c (5).
_28/ Motion at 5, note 1 (unnumbered).
l 2j!/ 42 USC 52135a.
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. when there has been a finding of violation of the antitrust laws by a licensee. -~30/
The allegations growing out of the Gainesville case are certainly within the scope of the permissible Staff investigation in the instant proceeding. The NRC Staff has always maintained that its investigations are not limited to the time frame when the immediate unit under consider-ation was first proposed. ~
To do so would be inconsistent with the prelicensing antitrust review process of Section 105c.
By authority of the Atomic Energy Act, the Commission is to determine "wF,+ther the activities uncar the license would create or maintain a situation inconsistent with the antitrust laws specified in subsection 105a.".12IAmong the laws specified in subsection 105a is the Sherman 30/ As the Board is aware, the Commission now has under advisement the Gainesville decision and what action it should take with regard to FP&L. The S ta ff ha.t urged the Commission to consolidate any 105a proceeding with the instant case. Although there are other possible routes for dealing with the Gainesville matter, it should be noted that if the Com11ssion adopts the Staff recommen-dation of consolidation, all of the material directly relevant to the Gainesville allegations woult' come into this proceeding. Much of that could probably be accomplished by granting the Joint
. Document requests now at issue; otherwise, should the Commission order consolidation and the parties enter discovery requests based on that 105a matter,the "early" discovery requests will necessarily be repeated.
JJ/ As the Applicant here has alleged. See Motton at 2.
J2/ 42 USC 12135c(5).
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Act.
It is, of course, necessary in showing a violation of Section 2 of the Sherman Act to demonstrate not only monopoly power but the willful acquisition of such power or willful maintenance of monopoly power.
It would be impossible to do so without an investigation of the past of the alleged monopolist. Thus, in NRC proceedings, it would be impossible
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to "make a finding" as to whether certain conduct was inconsistent with Section 2 of the Sherman Act without allowing an investig& tion into the past conduct of the Applicant.
For purposes of determining what relief is necessary, should a finding be made that a situation inconsistent with the antitrust laws would develop if the license were granted without appropriate conditions, the NRC Staff must also evaluate the effects of past anticompetitive practices or structure. It is impossible to evaluate effects in a vacuum.
Only by studying the past situation and comparing it with the present can the " effects" of anticompetitive practices and structure be measured for purposes of developing constructive relief. At the same time, the 35 /
Staff does not contend it has a " fishing license" to conduct discovery. -
The limited number of pre-1965 document requests demonstrate an attempt 36) to limit discovery to those areas relevant to the Gainesville matter, j
_3J 15 U.S.C. !il g. sea.
_3J United States v. Grinnell Corporation, 384 U.'S. 563, 570-571 (1966).
35/ Motion at 16.
36/ Also relevant is the SERC matter, as detailed in Alabama power Company (Joseph H. Farley Nuclear Plant, Units 1 and 2), LRp 24, 5 NRC 804 (1977).
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n The Applicant's suggestion of 1972 as the earliest date for discovery is objectionable for the reasons stated above.
In fact, such a date would seriously impair the ability of some parties to formulate and present their case. For example, to limit discovery to 1972, "the year in which the Company first gave consideration to the construction of Unit lli No. 2 of the St. Lucie Plant as presently constituted",
would fore-close the allegation of dental of access to ntotear with respect to all other planned projects of the App 1tcant.
C.
BURDEN ON THE APPLICANT The other side of the Protective Order / Limiting Order equation calls for balancing the demonstrated relevance of the discovery against the burden which would be imposed upon the party against whom discovery is sought.
It is the party resisting discovery who must demonstrate and carry the burden of showing " annoyance, embarassment, oppression or undue burden or expense."
Again, FP&L has alleged undue burden without demonstrating that it actually exists. For example, the Applicant says this " massive task" would
.nl be " expensive and time consuming."
But it is unclear just why that would be true. Presumably, most of these documents would have,already been i
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jg/ Motion at 2.
JJ/ 10 CFR 2.740(c).
- 39/ Motion at 6.
. produced in preparation for the Gainesville case. Since the Joint Re-quest contains only 14 f tems which seek discovery before the general 1965 date,10 years difference in 14 categories is apparently the Applicant's definition of " massive."
Further, the Applicant gives us no means of evaluating whether, in fact', the 14 Joint Requests would be burdensome at all. Since we have not been instructed how the files are maintained, it is impossible to e
determine--from the material now before the Board--the time or expense that would be involved in meeting the requests.
If, for example, FP&L's files are chronologically arranged, it would appear to be a relatively easy matter to " extend" the discovery request back 10 years. It may be that the Applicant's files are arranged in some other fashion, but the point is that cannot be assumed. Absent some demonstration and expla-2 nation of what the burden is, the Board cannot assume that it exists, simply on the. assertions of the party seeking to limit discovery.
Some of the assertions of burden are difficult to reconcile with common sense. For example, Joint Request No. 2 requests " copies of annual reports issued to stockholders by Company for the years 1955-l 1977..."
Unless these annual reports have been destroyed by fire, it i
is difficult to see the burden Applicant would have in locating and copying these reports. The " burden" is minimal.
These practical arguments aside, it is clear, as a legal matter, that merely the existence of "some burden" is not grounds for denying relevant discovery. ~40/
Courts have held that the fact that production
-40/ Hanover Shoe. Inc. v. United Shoe Machinery Coro. 207 F. Supp.
407 (fl.D. Pa. 1962).
. would be onerous or inconvenient is not per sjt grounds for denying a document request.
Under 10 CFR 52.740(c), the pertinent consideration is whether " justice requires" a limitation on discovery to prevent burdening an applicant. Mere size of the search or length of the relevant time period does not define burden; it is the demonstration of such hardsh' before the Board which is crucial.
However, the Applicant makes the argument that it performed "a substantial amount of work" in the South Dade proceeding and that its work, conducted "in reliance" on the Board's South Dade ruling, would 47./
have to be repeated if an earlier date is adopted.
Besides the fact the Applicant is inconsistent in its " reliance" on South Dade, --43/
Staff contends that FP&L has no basis for placing such " reliance" in South Dade.
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It is true that the parties to the St. Lucie 2 proceeding have used the South Dade discovery procedures and matters in controversy as a basis to frame the issues and discovery in the instant proceeding. This is simply a matter of litigation efficiency, directed toward the goal of expediting the licensing process. However, the South Dade proceeding has been rendered moot by the cancellation of the planned units by FP&L.
l 4]/ Rockaway Pix Theatre, Inc. v. Metro-Goldwyn-Mayer, Inc., 36 F.R.D.
15 (E.D.H.Y. 1964).
i 42/ Motion at 5.
43/ For example, he has not " relied" on the 1965 cutoff date set by the Board in that proceeding, but now rather requests a 1972 date.
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D e
. Any discovery which FP&L will repeat in this proceeding from its earlier South Dade search is not a basis for limiting discovery which the Board might order here.
D.
PROCEDURE FOR ANALYSIS As has been discussed, the proper procedure for the Board to follow in ruling on FP&L's Motion for a Protective Order /, Motion to Limit Discovery is to balance the shown relevancy of the documents against the demonstrated burden on the Applicant. The Staff believes it has shown both the relevance of the 14 Joint Requests and the lack of any demonstrated burden by FP&L, and therefore, the Motion of the Applicant should be denied.
However, FP&L has suggested another method of analysis. Re fe r-44/
encing the Manual for Comolex Litigation.
Applicant would have the Board set a general discovery date of 1972, with earlier requests possible 13/ Motion at 9.
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upon some showing in " isolated circumstances."
In one sense, this suggestion simply begs the issue. That is: where is the " general cut-off" date to be set: 1972, 1965, 1950, or some other year? But, closely read, this suggestion is also a means of shifting the burden to the party moving for discovery, rather than the party opposing discovery, as required by the Commission's Rules of Practice.
Under the Manual for Complex Litigation approach, as outlined by the Applicant on pages 8-9 of its Motion, "(t)he burden should be on the requesting party to set forth the reasons for each such exception (to the general cutoff date of 1972)." This is completely contrary to the provisions of 10 CFR 2.740, outlined earlier. That Commission Regulation, it will be recalled, follows Federal Rule of Civil Procedure 26 in allowing 4Q the discovery of "any matter, not privileged, which is relevant."
It is only upon a Motion for a Protective Order or an order limiting the 4E scope of discovery by the Board that this scope is reduced. What the Applicant is proposing is to turn this scheme upon its head, asking the Board to grant an order which would require a party seeking relevant documents to obtain Board approval, while failing to set forth what standard must be uti-lized.
Staff opposes this attempt and perhaps states the obvious in saying that 35/ Motion at 8.
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'g/ 10 CFR 2.740(b)(1) (emphasis added).
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47/ 10 CFR 2.740(c).
i 4_8/ 10 CFR 2.740(b).
8 4_9/ ~ft'~fs not. clear from Applicant's Motion what showing the party seeking discovery in the " isolated circumstances" would have to show. The phrase " good cause" is mentioned. See Fed.R.Civ. P.
35(a). This would be a higher standard for a party seeking dis-covery than showing relevance, as set forth in 10 CFR S2.740(b)(1).
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o e l while the Board is held to follow the Commission's Rules of Practice, as set forth in 10 CFR, it has no responsibility to follow any sch me proposed in the Manual for' Complex Litigation.
E., EVIDENTIARY CONCERNS A careful reading of Applicant's motion reveals a request that the Board limit " discovery and evidence" in this proceeding to a 1972 date.
As discussed previously, the Staff does not believe this is a realistic pro,posal. But even should the Board rule that 1950,1955 and 1960 are not proper discovery dates, in their limited context, this ruling should not effect the evidentiary presentation of material gained through other proceedin gs.
For example, documents the parties have obtained through the Gainesville proceed'ing, which are relevant in an evidentiary sense, to the matters at controversy in the instant proceeding, should not be precluded from admission merely because they are earlier documents. It would be error, the Staff believes, for the Board to rule now that all evidence prior to 1972 (or whatever date is finally selected) is irrelevant. Under the definition of Federal Rule of Evidence 401: relevant evidence means evidence having any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence." There will be time enough for the Board to rule on such evidence when proferred at the hearing. T:1erefore, any ruling the Board will make in response to Applicant's present motion should be limited in terms of discovery only, under the applicable provisions of 10 CFR 2.740.
5_gj Motion at 8.
5_lf Fed.R. EviA, Rules 401, 402, 28 U.S.C.
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4 II. APPLICANT'S OBJECTIONS TO DISCOVERY PERTAINING TO LEGISLATIVE ACTIyITIES Applicant objects to interrogatory 58 of the Joint Request which requires the production of documents relating to Applicant's legislative activities. It objects to this type of discovery on the basis of what 52/
is commonly referred to as the Noerr-Pennington doctrine. ~~ This doctrine confers immunity from liability under the antitrust laws for actions.
regardless of their anticompetitive intent or purpose, which merely in-volve seeking to influence the executive, legislative or judicial branches of government.
Contrary to Applicant's assertions, there are a number of reasons why interrogatory 58 is a permissible discovery request.
A.
10 CFR 2.740(b)(1) of the Commission's Rules of Practice Applicant's contentions regarding the Noerr-Pennington doctrine are at best premature since discovery of the type of documents called for in this request would be pemissible even though the documents themselves might not be admissible at trial.
In this regard, the Federal Rules of Civil Procedure 28 U.S.C.126(b)(1) states in pertinent part -
"...It is not ground for objection that the information sought will be inadmissible at the trial if the infor-mation sought appears reasonably calculated to lead to the discovery of admissible evidence."
Comparable wording is incorporated into the Commission's Rules of Practice 10 CFR 2.740(b)(1).
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52/ United Mine Workers v. Pennington, 381 U.S. 657 (1965); Eastern Railraod Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127 (1960).
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. The South Dade Licensing Board recognized the distinction between permissible discovery and inadmissible evidence for Noerr-Pennington type documents when it held that a similar discovery request in that JUV case was permissible:
. We are not of course, at this stage ruling upon the ultimate admissibility of evidence. Rather, in accord-ance with 10 CFR 52.740(b)(1), the test we apply is whether "...the information sought appears reasonably calculated to lead to the discovery of admissible evidence."
- This is also the test under Rule 26 of the Federal Rules of Civil Procedure.
The Board ob-serves that the interrogatories objected to on the basis of Noerr-Pennington seem to be designed to lead to the discovery of admissible evidence, even if the legislative conduct thus demonstrated may not be the basis of a finding of a violation of the antitrust laws. 5,4/
B.
Exceptions To Noerr-Pennington In. addition to the above discussed rules of discovery, there are other reasons why the Noerr-Pennington doctrine would not preclude the Applicant from producing documents pursuant to interrogatory 58. There are several well established exceptions to this doctrine to include the fact that legislative acts and practices may be used to show the purpose and character of particular transactions, even though in some cases they can not be the basis for a finding of a violation of the antitrust laws. --55/
53f It should be noted that Joint Request No. 60 in South Dade was identical to the original October 31, 1978 Joint Request No. 58 l
in St. Lucie Unit 2 (This October 31st request was subsequently l
revised by the December 11, 1970 memo of understanding between the pa rties. )
54/ Second Prehearing Conference Order, In the Matter of Florida Power
& Light Co. (South Dade Nuclear Units), Dkt. No. P-636A, February 22, 1977). Attachment G.
55/ United Mine bar9ers v. Pennington 381 U.S. 657, 670 (1965).
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Also, to the extent that the documents disclose that the legislative activities of Applicant fall within the " sham" exception to the Noerr-Pennington doctrine, then such activities can provide the basis for a finding that the Applicant has created or maintained a situation incon-
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sistent with the antitrust laws.
1.
The Noerr-Pennington doctrine permits the introduction of evidence concerning the Applicant's legislative activities to show the purpose and character of the particular activities In objecting to the production of legislative documents Applicant fails to recognize that although antitrust liability cannot be predicated on valid attempts to influence governmental actions, evidence of bonafide legislative activities is allowable in order to show "the purpose and character" of other activities. This was specifically made clear in footnote 3 of the Pennington decision where the Court points out that such s
evidence may be admissible "if it tends reasonably to show the purpose and 51 /
character of the particular transactions under scrutiny."
Since Pennington, other courts have applied this reasoning and have permitted the introduction of evidence as to " protected activities" in order to show the purpose and character of the activities in question. -~58/
56/ Eastern Railroad Presidents Conference v. Noerr Motor Freight, Inc. 365 U.S.127,144 (1960).
k 52/ United Mine Workers v. Pennington 381 U.S. 657, 670.
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~~58/ See, for example, Household Goods Carriers' Bureau v. Terrell, 417 F.2d 47 (5th Cir.), rehearing en banc, 452 F.2d 152 (1971);
Hayes v. United Fireworks, 420 F.2d 836 (9th Cir.,1969).
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. This exception was specifically cited by the South Dade Licensing Board in overruling the Applicant's Noerr-Pennington arguments. There, the Licensing Board specifically found that:
The Staff urges that the purpose and character of the applicant's activities are relevant, and that this would be a permissible showing under Pennington, supra. The Board can envision other unprotected products of this discovery. For example, we may be aided in establishing the appropriate relevant geographic and product markets for antitrust analysis in this proceeding, jiy j
2.
Sham activities The Noerr-Pennington doctrine does not apply to " sham" attempts to influence governmental acts. This exception was f7rst referred to in Eastern Railroad Presidents Conference v. Noerr Moto,r Freight, Inc.
365 U.S.127,144 (1960) where the Court stated that:
There may be situations in which a nublicity campaign, ostensibly directed toward influencing governmental action, is mere sham to cover what is actually nothing more than an attempt to interfere directly with the business relationships of a competitor and the appli-cation of the Sherman Act would be justified.
According to this exception, to the extent it may be established that l
Applicant has engaged in legislative activities to interfere with the business relationships of others, Applicant's actions are a legitimate i
area of discovery and Joint Request 58 is appropriate to examine this 4
l possibility.
)
jijy Ficrida Power & Light Co., supra, note 54 at p. 3 n.l.
p g
e
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.+
. Applicant argues at pp.14-15 of its brief that discovery in this case should not be allowed under the " sham" exception since, according to Applicant, there has been no allegation by the parties in this pro-ceeding. Applicant goes on to conclude that it would be more appropriate for the Board to defer the matter until the other parties in the case
- ave made a prima facie showing that a sham exception may exist. Sta ff cannot agree with Aeolicant's analysis. The short answer to this con-tention is that discovery will aid the parties in determining whether Applicant's legislative efforts fall within the sham exception. By i ts very nature, sham activity would be of a clandestive type that often would not be apparent without first having access to the files of the Applicant. The South Dade Licensing Board recognized this need for taking discovery in order to determine whether Noerr-Pennington doctrine, or any of its exceptions, would apply in NRC antitrust litigation. As the Board stated:
Moreover, it will not be possible until after discovery s
for the Board to determine whether the activities in question are entitled to the constitutional protection recognized by the Noerr-Pennington cases, or whether they fall within " sham" or other possible exceptions to the doctrine. Jg}/
Jgl/ Florida Power & Light Co., suora, note 54 at 3.
J 8
3~~~~~~---
w
- 3.
Previous NRC decisions regarding Noerr-Pennington In its discussion of the Noerr-Pennington doctrine, Applicant has contended that "NRC Licensing Boards have split in their decisions" regarding whether to accept discovery for this classification of docu-ments. Staff believes that a close reading of the various decisions discloses that Licensing Boards have in fact been amenable to allowing Noerr-Pennington type discovery.
Initially Applicant cites an Order issued by the Licensing Board in the Davis-Besse proceeding. ~~61/
Staff submits that the language quoted by Applicant does not necessarily preclude Noerr-Pennington documents since in the next sentence the Board stated that, "The Board might con-sider whether such activities [ legislative] were part of a broader program to create or maintain a situation inconsistent with the antitrust laws...."~~62/
In addition, in the very next interrogatory the Board pointed out that it would allow discovery with respect to other political activity if a 63/
sufficient degree of relevancy could be demonstrated '- and in the following interrogatory it allowed discovery with respect to documents pertaining to the " sham" exception of the Noerr-Pennington rule.
61/ Order on Objections to Interrogatories and Document Requests In the 11atter of The Toledo Edison Company and the Cleveland Electric Illuminating Company (Davis-Besse Nuclear Power Station, Unit 1),
Dkt. Nos. 50-346A, 50-440A, October 11, 1974 Attachment A.
j2/ 14. at 6.
63/ Id. at 7.
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.. Applicant also cites a decision of the Consumers Board to support its argument. -64/ Although in that case the Board had disallowed discovery of certain documents relating to the Applicant's political 65/
activities on the basis of relevancy, an examination of the trans-cript discloses that the Board did in fact subsequently permit exam-ination of a witness whose testimony was objected to on the basis of 16/
Noe rr-Penni ngton_.
61 /
The third ruling cited by the Applicant is that of the Duke Board.
There the Board stated that it would consider discovery of political material and grant such requests upon the showing "of prerequisites 5kl required by law."
Staff believes that since the proper prerequisites will have been shown in this case, the Duke ruling stands in favor of granting the Joint Request.
Finally, the Applicant cites the decision of the Louisiana Board. -69/
It is Staff's position that the well-reasoned opinion in Louisiana is
'/ Order Ruling on Applicant's Objections to Document Requests.....
64 1
In the Matter of Consumers Power Company (Midland Plant, Units 1 and 2), Okt. Nos. 50-329A, 50-330A, November 28, 1972. Attachment B.
g/ Id. at 2 and 3.
g/ Record, 6 February 1974, at 5625 et seq., In the Matter of Consumers Power Company (iiidland Plant, Units 1 and 2), Okt. Nos. 50-329A, 50-330A. Attachment C.
g/ Prehearing Order Number Two of Atomic Safety and Licensing Board, In the Matter of Duke Power Comoany (0conee Units 1, 2 & 3; McGuire Units 1 & 2) Okt. Nos. 50-269A, et al, November 27, 1972. Attachment D.
68/ Id. at 3.
g/ Memorandum and Order with Respect to Objections on Discovery Requests and Interrogatories, In the Matter of Louisiana Power and Licht Co.
(Waterford, Unit 3), Okt. No. 50-382A, April 19, 1974. Attachment E.
-=
,. persuasive as to why discovery should be granted in this case. There the Board granted discovery with respect to certain legislative infor-mation. As in the instant case, the Applicant argued that such discovery was precluded by the Noerr-Pennington doctrine. The Board stated:
First, Rule 26 of the Federal Rules of Civil Procedure and the AEC Rules and Regulations permit discovery cal-culated to lead to the production of admissible evidence even thougn the actual subject matter of the discovery may itself be ruled inadmissible at the time of the hearing. Thus, it remains to be seen whether the infor-mation sought by these interrogatories will lead to the production of admissible evidence even if the Board upholds Applicant's contentions with respect to the j
applicability of the Noerr-Pennington doctrine.
Second, the doctrine and the extent of the doctrine's coverage cannot be tested in a specific context with-out the proper development of evidentiary facts. That is to say, that although Applicant might claim exten-sive immunity based on the asserted applicability of the doctrine, the immunity ultimately determined to be avail-able may be substantially narrower than that claimed.
Without the development of a factual basis upon which to consider the doctrine, there is no way for the trier of facts to gauge the scope of the immunity.
Third, we note that it cannot be ascertained presently which activities Applicant itself may claim to be immunized by the doctrine; and surely, the other parties are entitled to know the factual basis upon which Applicant will argue the applicability of the doctrine. It would be most unfair if a party, merely by citing the catch phrase "Noerr-Pennington" could thereby relief itself of the responsibility of producing data in response to discovery which data might be outside of the scope of the doctrine.
In short, there must be a way to test claims of privilege based on the doctrine, and the only way to make such a test valid is through the production of data of the type sought through these interrogatories.
,e-e m -. - -
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i A case which the Applicant has failed to refer to but which was one of the more recent NRC Licensing Board decisions where Noerr-Pennington discovery has been allowed occurred is the Alabama proceeding.
The most recent decision regarding Noerr-Pennington is the above referred to South Dade decision.
Staff believes that the reasoning employed by the Louisiana, Alabama, and South Dade Boards is conclusive in overruling the Applicants' arguments in the present matter and mandate a positive finding with respect to interrogatory 58 of the Joint Request.
Applicant attempts to distinguish earlier NRC decisions regarding the Noerr-Pennington documents by contending that the decision in First National Bank of Boston v. Bellotti, 435.U.S. 765 (1978), 46 U.S.L.W.
4371 (April 25,1978) somehow makes a difference with respect to access to discovery documents. Staff does not see how Bellotti has any effect a
upon the rationale employed by the previously referred to NRC Licensing Board rulings. for allowing discovery. Bellotti merely stands for the proposition that the First Amendment rights of freedom of speech which apply to private individuals also apply to such entities as commercial corpo ra tions,
jz/ Order Granting In Part and Denying In Part Motion to Compel Pro-duction, In the Matter of Alabama Power Company (Joseph M. Farley Nuclear Plant Units 1 and 2), Dkt. Hos. 50-348A, November 1,1973.
Attachment F.
J3/ Second Prehearing Conference Order, In the Matter of Florida Power
& Light Comoany (South Dade Nuclear Units), Dkt. No. P-636A, February 22, 1977. Attachment G.
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. One other area which Applicant has tried to emphasize in its
)
arguments concerns the alleged " chilling effect" upon the exercise of constitutionally protected rights if Noerr-pennington type documents a
are allowed discovery. The Licensing Board in Alabama found such a defense by an Applicant to be unpersuasive and St../f sees no dis-tinction here.
III. APP'ICANT'S OBJECTIONS RELATING TO OVERBROAD REQUESTS At page 25 of its brief, Applicant objects to Joint Requests Nos.
79-82 on the basis that these interrogatories are overly broad and extend to subjects which are not relevant to this proceeding. Applicant first objects on the basis that these interrogatories are unnecessary. Speci f-ically, it contends that even though these interrogatories are relevant to the fuel supply question, such information is unnecessary since the fuel supply subject is sufficiently covered by Joint Requests 54 and 55 (plus several interrogatories contained in Florida Cities' requests). Second, Applicant objects on the basis that the requested information pertains to a proceeding which is pending before the Federal Energy Regulatory Commission.
And third, Applicant contends that providing this information would sub-stantially lengthen and complicate the discovery process in this proceeding.
Staff disagrees that all the information necessary with respect
)
to the fuel supply question can be obtained solely from Joint Requests 54
_JJ Those cases cited by Applicant regarding a " chilling effect" appear to involve more extreme situations than are present in this case. For example, Applicant cites at page 12 in support of the " chilling effect" NAACp v. Alabama 357 U.S. 449 (1958).
In that case the Court stated at 462: " Petitioner has made an i
uncontroverted showing that on past occasions revelation of the identity of its rank and file members has exposed those members to economic reprisal, loss of employment, threat of physical coersion, and other manifestations of public hostility."
Staff does not believe that disclosure of the information requested by the Joint Interrogatories reaches this standard.
.- =
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- 2 7-and 55. Document requests 54-55 may not provide information in sufficient detail to establish the competitive situation with respect to natural gas. Among other things, Joint Requests 79-82 are necessary to provide copies of contracts and documents pertaining to pricing and availability of gas supply.
Another important reason why Joint Requests 54 and 55 are not sufficient is that, contrary to Applicant's assertion, we are interested in more than just the question of fuel availability. Staff seeks to knew whether Applicant has conspired with others to monopolize the gas supply in the State of Fit.rida or whether it has unfairly acted alone or in concert with others to curtail the gas supply of smaller utilities. Joint Requests 79-82 are designed to provide this type of information.
Staff disagrees that discovery for Joint Requests 79-82 would sub-a stantially lengthen and complicate the discovery process in this proceeding.
Since, as Applicant concedes, these discovery requests have already been the subject of discovery in a FERC proceeding, the search for these documents by Applicant should not be an undue burden.
Appl'icants' objection' that the natural gas question should not be handled in this forum because it is already the subject of a FERC pro-i ceeding is unfounded. There is no element of primary jurisdiction j
involved here concerning the antitrust aspects of the natural gas question which would preclude the flRC from acting upon..this matter.
9 1
. IV. APPLICANTS' REQUEST FOR A PROTECTIVE ORDER Applicant contends that much of the discovery information in this proceeding is of a confidential nature which is entitled to a general protective order.
It has furnished a proposed protective order which in effect allows Applicant, in its sole discretion, to designate any discovery information as confidential. Staff does not quarrel with the fact that there might be some discovery materials which are entitled to confidential treatment. However, we cannot envision the necessity for the blanket type of protection which Applicant at this time seeks.
Staff believes that 10 CFR 52.740(c) regarding protective orders applies when a party seeks protection for certain specific documents for confidentiality, but not for an unlimited power to allow for all documents -to be marked confidential at the discretion of the requesting party.
The party who seeks the protection has the burden of showing why the documents should be confidential and not vice versa. Under Applicant's proposed arrangement, the roles are reversed and other parties will have the burden of demonstrating why specific documents should not be confi-dential. Staff believes this arrangement subverts both the letter and spirit of 10 CFR 52.740(c) which provides that a protective order will only be granted to a requesting party "for cood cause shown."
Staff does not believe that Applicant has shown that a blanket protective order is warranted with respect to all those materials over which it can potentially claim confidentiality. hpplicant's blanket protective order is even broader than a requested protective order which
~/ See 10 CFR 2.790(b)(1), as referenced by 10 CFR 2.740(c)(6),
73 aTTowing the withholding of "a document or a part."
i 1
3
. was rejected by an NRC Licensing Board in the Stanislaus proceeding.72Y
~
There the Applicant requested an order requiring that intervenors give advance ' notice and an opportunity for objection before using documents produced in that proceeding for other purposes.
In denying this request, the Licensing Board ruled that PGE has not attempted to list or describe with specifity any documents whose use in other fora would unreasonably compromise trade secrets or e
other identified competitively sensitive infor-mation. No good cause has been shown requiring the entry of a protective order for prior notice of other use of documents, and such a requirement would impose a substantial burden on the other parties. 75/
Just as in the Stanislaus proceeding, the Applicant here has not attempted to list and describe which documents should have confidential treatment.
Under our rules this burden is demanded of the party who requests confi-dentiali ty.
Even assuming the Staff could accept the shift of burden implicit in Applicant's proposed Protective Order for " proprietary",
76 /
confidential, and trade secret information, ~~' there are speci fic problems with the Order as drafted.
7# Order Regarding PG&E's Motion for Not) e on Notice of Use of Documents.
In the Matter of Pacific Gas & Electric Co., (Stanislaus Nuclear Project, Unit 1), Dkt. No. P-564A (June 15,1978).
75' Id., p. 3.
7J/ Proposed Motion at 1.
I J
. Paragraph one of the proposed Order stat 5s: "This order shall govern all answers, documents and other discovery materials produced by the parties..," etc. While it may be assumed the Order is designed only to apply during the discovery phase of the proceeding, that is not clearly stated in this paragraph. This ambiguity and inconsistency is a recurring problem in the order, as proposed. As will be discussed, infra, the Staff is reluctant to add as an issue to the prehearing phase of this proceeding the meaning of the terms of the Protective Order.
Paragraph five of the proposed Order states: "with respect to the government parties to this proceeding, Staff attorneys and their regularly employed consultants shall not be prohibited by this Section 5 from access..."
(emphasis added). Because of the peculiar wording of this caveat to paragraph five. NRC Staff counsel would be unable to show discovery documents marked as confidential to any of their technical support people.
On the one hand, Staff counsel's retained experts may not be hired on a
." regularly employed" basis. On the other hand, the technical Staff of the NRC, which serves the dual role of advisor and client, may not be properly classi fied as " consultants.",
The Staff sees several problems with paragraph six.
In the first place, it is drafted so ambiguously that the Staff is not sure whether it i
falls within paragraph six's provisiJns, or has been completely dealt with in paragraph five.
If within paragraph six, the Staff would object JJ/ M. Motion at 30; Paragraph 15 of Proposed Protective Order.
. that this restriction prevents it from showing marked documents to fact witnesses. Such disclosure may be necessary, for example, to re-fresh recollections and thereby obtain information sought.
Perbsps the most serious objection of the Staff is to paragra'ph 10, which provides: "No person shall make use of any confidential in-formation obtained pursuant to discovery in this proceeding other than for purposes of this proceeding." By its literal terms, this provision would present the NRC from using information obtained in the St. Lucie 2 discovery process in subsequent cases dealing with that license, the licensee, or other related matters.
For example, paragraph 10 would prevent the Staff from using infor-mation gained in this proceeding in a 105a action against Florida Power & Light Company, even if relevant to the matter under litigation.
This would be a clearly unacceptable restriction of the Staff's responsibi-lities.
It might be reemphasized that at the present time, a 105a matter involving the Applicant is pending before the Commission.
Should the Commission order that matter to proceed in a separate pro-ceeding, the information the Staff receives in the instant case would certainly be relevant and pertinent to a 105a matter.
Jg8/ 42 U.S.C. 2135a.
l J_9/ See note 30 and t' ext accompanying.
9 g
g 4
r a
s
- The Staff finds objectionable the additional requests and special handling procedure which would be required by the proposed Order. For example, paragraph four requires that trial briefs filed with the Board comply with the sealed envelope procedure of that provision of the Protective Order. The Staff believes this will seriously encumber the 80/
~~
hearing process.
More importantly, it is the NRC Staff's position that--to the largest extent possible--hearings on NRC license appli-cations should be open to the public.
If there.is a significant need to restrict public access to certain documents the Board can make appropriate orders. In preparing a brief for the Board the parties
~
should not be restricted in the presentation of documents which substan-tiate their allegations.
Furthermore, Staff would note that the procedures dictated in the.
proposed order have the potential of lengthening the discovery phase of this proceeding. By the terms of the Protective Order, the parties will be forced to argue before the Board many issues: the proper "classi fication" of a document (par.13); an independent expert's "need to know" (par. 6);
as well as ambiguities in terms of the Protective Order (e.o., pars. 5,6).
The Staff respectfully submits that it would be a more efficient use of the Board's--and all parties'--time if the Applicant would simply i
move the Board for a Protective Order on those selected documents which i
80/ As worded, even the briefs would have to be enclosed in sealed envelopes if they " comprise or contain material marked as confi-dential, or information taken therefrom..."
81 / The Staff is also concerned that the restrictive provisions of the proposed order will make it impossible to create an adequate record to preserve all matters for appeal.
e "W'*"9**^H%H m'4 e
A
. it feels most sensitive and requiring a Protective Order. Certainly, it is more logical to spend time before the Board arguing over the terms of a relevant document than such abstract factors as the definition of "outside counsel" or " regularly employed consultants."
CONCLUSION For the above stated reasons, Staff urges the Licensing Board to take the following action with respect to Applicant's obj.ections to the Joint Request:
1.
Deny Applicant's objection to the 14 Joint Requests which
. seek discovery to dates earlier than 1965, and order that such discovery may be had, without reference to evidentiary restrictions ;
2.
Deny Applicant's objections based upon the Noerr-Pennington doctrine and order discovery under the terms of Joint Request 58; 3.
Deny Applicant's objections of overbreadth with regard to Joint Requests 79-82 and order production in light of the need shown; 4.
Deny Applicant's proposed Protective Order as contrary to the Commission's Rules of Practice; ambiguous as written; and potentially burdensome; and 5.
Grant all other relief deemed appropriate to move this proceeding forward.
]
Res ectfulfy submitted, MMb At" *q Lee Scott Dewey i
Counsel for NRC Staff ha.9)
An 4 Fredric D. Chanania Counsel or NRC Staff We Dated at Bethesda, Maryland David J. E ans this 22nd day of December 1978.
Counsel f NRC Staff e
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L W
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j]/-f a OAI M s g ' l_ W l'a -(,( UNITED ST.'.TES OF NIERICA ATOMIC ENERGY CO2CIISSION BEFORE THE ATOMIC SAFETY AND LICENSING BO.ARD In the Matter of ) ) I The Toledo Edison Company and ) Docket Nos. 50-346A The Cleveland Electric I.Llumina- ) 50-440A tinci Company ) 50'-441A (Davis-Besse Nuclear Power ) [ Station, Unit 1) )- t ) I The Cleveland Electric Illumina- ) ting Company, et al. ) f (Perry Nuclear Powcr Plant, ) b Units 1 and 2) )- A N .. h* 8 f ORDER ON OBJECTICMS T l TO INTERROG.VIGRIES A"D CCOU;*Z"T P20UESTS 0'h 1 'c 'A. Preliminarv r. ^ Pursuant to schedul'e set for motions on discovery, each of the parties-o/ jected on various grounds to various interrog-1 b 4.; 1 I; j atories and document requests filed pursuant to 10 CFR 2.740 (b) j and 2.741 by other par-ies. Specifically, (a) Applicant, Cleveland Electric Illuminating Company (CEI), objected to the Y ) interrogatories and document requests of the City of Cleveland }- ~- (City), (b) Applicants (Toledo Edison Company, Pennsylvania Power Company, Ohio Edison and Duquesne Light Company) objected ) i to City's interregatories and document requests, (c) Applicants l i lj Except American 11unicipal Power-Ohio (All?-0) t l
l' , l, or director, and all public utilities or electrical supply or construction compani s as to which the CEI director serves as an officer or director. t 5. CEI objects to document request 16(d) relating to legislation and constitutional revision affecting the ability of electric utilities to own, finance and construct facilities and to sell electricity. CEI contends that these documents are irrelevant to the proceedings and that it would be placed under a severe burden to conduct a search for such documents. The objection is sustained on the basis that CEI's activities, if, any, in the areas of legislation or constitutional revision do not possess.the requisite degree of relevance to these pro-ceedings. Assuming that CEI did undertake legislative activities N directed to the enactment of statutes which would affect the competitive position of the City,'these activities nonetheless ) would not constitute antitrust violations in and of themselves. The Board might consider whether such activities were part of a broader program to create or maintain a situation inconsistant - with'the'antitrustlaws((butunderthedoctrineofParkerv. Brown, 317 Us 341, (19 4 2'), legislative judgments with respect to legislative structure may not be considered as antitrust violations even though they have.pn.effect upon commerce. i E e r*
l. _y_' 6.' CEI objects to document request 1G(f) which calls for f.cc.ticas claiming burden, l materials relating to municipal and further claiming that political activ,ities are' immunized from antitrust attack. CEI contends that the Noerr Doctrine The Board prevents discovery relating to political matters. does 'not agree that the blanket assertion of the Noerr Doctrine precludes all such discovery, and on that basis the objection ~ would be overruled. However, the City thus far has failed to I demonstrate the relevance of the information sought under this request to the issues admitted in this proceed $ng and on that basis the objection is sustained. In the event relevance 2 a is clearly demonstrated, the Board may reconsider its ruling. I 7. CEI objects to document request 16(g) pertaining'to i litigation doce=ents because it calls for privileged materials I and is unduly broad. CEI also claims that certain activities covered by this request may be ' immunized from an$itrust challenge since they would not fall within the " sham" lawsuit exception as set forth in California Motor Transcort Ccmcany 3 Trucking Unlimited, 404 U.S. 508 (1972). The City cited an t l example of one lawsuit which it contends has anticompetitive overtones. The City further indicated that it would be difficult, without discovery, to gauge the number of lawsuits to determine whether the " sham" exception applied. The Board agrees that it is impossible to determine if the " sham" exception applies i I t-
j -au without permitting the discovering party to ascertain the ex-tent of s.uch litigation. Also, with respect to Applicant's claim that the request is unduly broad, we note that it is limited to litigation in op; lition to the construction of competing generation or transmission facilities. Accordingly the objection is overruled with regard to litigation that may have been initiated by CEI and discovery is permitted thereto ~ ' except where CEI asserts an " attorney-client" privilege which
- ' ~
shall be handled in accordance with the provisions of Section H t. below. The obje Lion of CEI is sustained with respect to liti-8 gation that may have been initiated by other entities. 8. CEI objects to document request 16(i) calling for information regarding lahor union negotiations on the basis that this informati6n is irrelevant to any issue in this pro-i ceeding. The objection is sustained. 1 ~ 9. CEI objects to document request 16(j) whichseeks_,{_ossil ,t' fnel anppl1 ontracts, on the basis that the information is irrelevant and confidential. As to confidentiality, data other-wise discoverable may not be withheld from' attorneys, or economic and' technical advisors employed by a party even though the reques-t ID $ does involve information considered by a party to be confidential 9 h business information. However, the Board will assist the parties in protecting arguably confidential business information from l S) t l 1
=-- iff bqdMid B UNITED STATES OF AMERICA ATOMIC ENERGY COMMISSION In the Matter of ) ) Docket Nos. 50-329A CONSUMERS POWER COMPANY ) ) 50-330A (Midland Plant, Units 1 and 2) ) ORDER RULING ON APPLICANT'S OBJECTIONS TO DOCUMENT REQUESTS, THE DEPARTMENT OF JUSTICE'S MOTION TO COMPEL TIIE PRODUCT-ION OF FOUR CATEGORIES OF DOCUMENTS, AND APPLICANT'S MOTION FOR PROTECTIVE ORDERS Before ruling on the specific matters raised by the parties, a brief statement by this Board dealing with the - appropriate scope of discovery would be apropos. The Department of Justice is given 180 days during which to obtain facts from which it can draw conclusions for trans-mittal to the Atomic Energy Commission in the form of a " Letter of Advice". The Commission's Rules of Practice contemplate that the Board in the first prehearing con-forence will reach agreement with the parties as to the relevant matters in controversy and will set them forth in the prehearing conference Ord'er. Under Section 2.740 of the Restructured Rules, discovery with reg'ard to such relevant matters in, controversy may be had by the partics. It is not-the purpose of discovery to explore matters not I. 9 7-__
~. 2-in controversy. With these principles in mind, we now turn to the specific items before us. Applicant's first objection is to request no. 2 -- file indexes and documents describing Applicant's filing system. Unless we take the position that all of Applicant's files are relevant to the matters in controversy, a position we do not take, then this request calls for irrelevant material. The Department of Justice argues that the data L requested will enable it to locate relevant material. We do not agree. With the issues clearly drawn, the Department should be able to frame requests appropriately limited to relevant material. Accordingly, Applicant's objection to this request is sustained. Applicant next objects to requests for documents relating to Applicant's political activities (Request 3(e)). The Department argues that under the guise of appropriate political activities, the Applicant may have practiced a mere sham to engage in forbidden activities. Whether or I not Applicant has engaged in unfair practices through political maneuvers is a matter not relevant to the issues in controversy; mere particularly, issues pe'rtaining to t jD h i D I . - ~ ~ ~ I
.(. coordination. 'Under the Commission's Notice of Antitrust ~ Hearing, dated April 11, 1972, this Board may-not address Ltse p o mait.Rrs not in controversy. Consequently, we agree with Applicant's arguments concerning the invalidity of the request. The objection is sustained. The next matter relates to request no. 4, calling for minutes of pooling and coordination committee meetings. All parties agree that the requested documents include many 1 which are irrelevant. The Department of Justice argues that it cannot tell what is relevant without examining all of the files. This type of argument, if carried to its logical conclusion, would give the Department of Justice access to all of Applicant's documents, a procedure forbidden by Section 2.740. The request is hereby limited to those documents which deal with Applicant's power to grant or deny access to coordination, and those documents dealing with the use of this poscr against smaller utility systems. As so limited, Applicant is required to produce the documents.' I Applicant objects to the production of documents relating to its gas operations on the ground that they are not relevant. I-Possibly,{ Applicant may have used its gas operations to h l I ( i r
o ~ - y y y m,=== =_ 5625 i D"*D
- D'3~Yh ob o I
. S $$h f tb,6 1 MR. VERDISCO: No questions, your Honor. h 2 CHAIRMJR GARFINKEL: Mr. Watson? t 3 MR. WATSON: No questions, your Honor. 4 CHAIRMAN GARFINKEL: h. Jablon? j i ( 5 MR. JADLON: No questions, your Honor. { ? 6 CHAIRMAN GARFINKZL: The witness is excused, and J k E 7 we want to thank the witness for his time. The Board is v. 8 hopeful that the witness does not tal.e it personally that fi b 9 certain of the previous testimony in writing was stricken. g i. to THE WITNESS: No, sir, I (ertainly do not. 11 CHAIRMAN GARFINKEL: Okay. You're excused. ( 12 (Witness excused.) L 13 Now the Board is prepared at thf..s time to make a tt 14 ruling with respect to the motion to quash the subpoena, and [c F 15 with that, we will take a two-minute recess and we'll be right q F. 16 back. ~ ~~ i l
- % [
$ l ~ ll/?)h)(( (Brief recess.) 9 b 7{l/ TM/Af CR jo[~,05l d$ pry?dI2[ /l)& l. k' 18 CHAIRMAN GI.RFINKEL: We'll be back on the record. { l 19 Not to keep anybody in suspense, the motion to j 20 quash itself is going to be denied. Hovever, there's going E 21 to be substantial limitations. { 1: 22 Now we will go into the analysis. [i1 23 The first analysis that the Board wishes to make { I l 24 is, number ons, we will dcal with the subpoena itself in this 5 1 (- 1 25 respect. i t ti, l m
~ M [3 ke [*M'%kd* h[ f *W.$ f(y 3.'4,-- 6( -ffkS& 5 At. *
- .s.*
,I tad A mm hp W' * - #f **,M,* Fh f.P iMerkt (9 Ahlr45 wEcwiwtewas274cMmtasa:;wnwrg;amXMgym.y%tyg [j D nl - q On 5626 ovj 2 w m eb7 1 The subpoena is directed to an individual. Thare-2 fore, the only information that the Joint Intervenors are 3 entitled to, if they are entitled to anything, is information I 4 in the possession of this particular witness, uid only infor-5 mation in the possession of this witness. 6 With respect to the question of - and that will 7 be as of the date of the subpoena. 8 With respect to the question of the First Amend-9 ment, it is true that no one can challenge an individual's beliefs, an individual's right to petition the legislature, 10 an individual's right with respect to freedom of the press. 11 That guarantee is basically a guarantee against action by 12 either the Federal Government or the State Government through 13 14 the Fourteenth Amendment. It's a perfect right. 15 However, it is not an absolute right, and the courts have made it clear that the Fi::st Amendment does not 16 give abcolute rights with respect to conduct. 17 That is, conduct in subject to inquiry where it does violate a public 18 i 10 Policy of the government. i 20 The classic example is you cannot yell " Fire" [ 1 21 in a crowded movie, and things like that. If the sction 5 .F, violatet the antitrust laus, the First Amendnent does not I 22 23 bar inquilf into that question. i f 24 Now thtre is a right for this Board to sea data 25, and hear information regarding cartain conduct, espe ially 1
o or o 5627 d I a aJ eb8, ,1 .22 under the Noerr, Pennington doctrine which relates to the 2 question of a sham, if it was truly,a sham. 3 Now with respect to the question of discovery as 4 against the subpoena, the Applicant has made the point that 5 this is merely a subterfuge for obtaining discovery at a time 6 when discovery was closed. 7 There is a difference between discovery and a 8' subpoena at trial. Discovery merely seeks relevant material 9 in order to adduce evidence that would be admissible at a 10 trial, but that does not bar an individual from ignoring the 1 11 discovery method or the discovery mode and seeking the produc-12 tion of documents that are admissible in evidence at a trial. 13, However, it bars him from two things: 14 It bars him frcn inspecting and making copies of 15 that and seeking further information. The documents do not t 16 leave the possession of the party who is producing the docu- [.I 17 ments. If the documents are in the courtroom, they are truly [ [ 18 under the possession of the individual subpoenaed. They may l 9 19 be shcun, but if they are not used, actually being admitted f F 20 into evidence, they must be forthwith returned. [ k 21 And in many situations, a party does not like to -m 22 use the discovery method because he does not want to tip his g 23 case, so therefore, one party may seek the subpoena route at f% t 3 24. trial and ganble that the information will be furnished right [ l hh' 25 then and there. ?:9 l h. eL
q )" om w 3 5628 ea w .u. eb9 1 Now th3 Board did not issue an order that speci-2 fies every exact bit of evidence will be identified and 3 sumarized for the benefit of opposing Counsel prior to trial. 4 That was not the case. There is clear indication in the 5 transcript of the prehearing conferences that there may be 6 a time when witnesses will have to be identified at the trial ~ 7 and testimony be taken at that time. 8 Now let's get to the particular issue in question. 9 The Do.ird did issue a ruling with respect to the 10 question of petitioning the legislature and what-have-you, 11 political activity, as not being relevant to the issues in 12 this case, and those issues were specifically indicated at l 13 a prehearing conference, and the Board ruled that political 14 activity was not within the issues of this proceeding - 15 originally. 16 Howevor, the question of the 25-percent provision 17 has come to issue in this proceeding. Mr. Brand is, of 18 course, the party that initiated it. The Board did ask some 19 questions with regard to the 25-percent rule, and the Board j 20 does deem the 25 porcent matter as being within the issue of i, 4 4C coordination and the ecmpetitivo effect of coordination. 21 i. 22 T I 23 r 24 ~ t 25 u.
'D * * } 'O ~ ~ g 5629 1 Wv o Ih I irb 1 consequently, if the Board is going to face the 2 issue of the 25 porcent provision in an official decision 3 somewhere along the way, or even if it ignores it and makes 4 neverthelessD*s going a finding that it is not relevant; 5 .. to be faced with that issue. Therefora, we th.CnT9E should f' t 6 allow sc=e inquir3 with respect to the 25 percent issue. .t 7 f e The Board wishes the parties to understand that 8 if this is a change in the Board's position'of prior rulings, t 9 than we have changed our position with regard to the 25 per-f to cent and political activity. l 11 Now, with respect to the 25 percent and the poli-12- ' tiical activity, luvs get to the actual subpoena. But, befort 13 I do, I would like. to ack one cuestion: I 14 'Jas the amount of money for transportation and i 15 what have you furriched together with the subpoena? f h 16 MR. CAELON: No, it was not, your Honor. (< 17 We spoke to Mr. Watson and I think we made an E L IS ar angcccat -- =cybe Mr. Follock can better speak to it - 6 h 19 that they will accept service and that there would be mutual-6- 4' 20 ity. E ? 21 But let Mr. Pollock speak to the questinn, because f6a 22 l he spo%c to Mr. Watson. -se 1 k. 23 MR. POILOOK: l'es, that is correct. flC w 24 ) I spoks te Mr. Watsen. He agreed to accept Service he i L as I. of the subpoena for Mr. Lcr.d, su'oject to our accepting y 1 E l
'cr. 3 - 35%+ em:wsax+n+=+:auw:n1:.q?mz&re*~MPwad w +%f1% w;nse g;;;eci;7s w w.m gg,3ggenez.q;m y g g+39;g mm w.mue-D Y'D T Dl S'630 UoJ Jp.J o oa
- d 1
service of his subpoenas to our people, should he make them. 2 Now, we contemplate, of course, paying Mr. T.aM for 3 his day in court end his transportation, should he be pro-4 duced. But by this we save the bookkaaping that would have 5 been involved had the notipn been quashed. So we stand 6 ready to give our just proceeds when it is deemed necessary, 7 your Honor. 8
- MR. WATSON:
We have no objection to. that. {f 9 CHAIRMAR GARFINKEL: ' All right. {i 10 Because, automatically, outside of the Federal 11 government personnel, a subpoena is defe":tive hithout the 12 suhuission of the fees with the subpoena. 13 MR. WATSON: We don't intend to add a Section 8, I. 1 L 14 your nonor, as lcng as we lost under 7. I-15 CHAIRMAN GAR?INKEL: My tolleague Dr. LOeds wants [i, me to enphasize that if it's treated as overruling our prior h 16 17 ruling, our prior ruling is only being overruled -- k 'our t b prior ruling only with respect to the 25 percent and politicr1 +. ja g 19 activity with the 25 percent. Period. Nothing else. The i h 20' ruling stays into eff'ect with anything else. 5 21 Now, with respect to the subpoeaa, the subpoena ] G 22 must stand on its own. It may not stand in connection with 07 l 23 any application. That is, all tha't a party receiving a [h[ t R 24[ subpcena has to do is rely on the four pages of the documents {. I, \\ + 25y involved in the schedule of the subpoena - the four corners eu 1 g
EdWidA@DDDMNNNb E b bk -- m s m:aws974? 5631 c. b3 1 of the page, that is. 2 On the attach:nant to the subpoena du.es tecum, 3 Article 4 and. Article 5 are totally defective, because it 4 was not limited in any way to the 25 percent rule, and 5 therefore no cmpliance is required, clearly, with 4 and 5 6 With respect to 1, 2, ard 3, since it's th's k 7 Board's discretion with respect to a subpoena duces tecum i 8 at the trial, and only because we are interested in adducing 9 admissible evidence, e.s against discovery evidence, and I 10 taking into account the fact that the witness that was called by the Joint Inter 7enora -- or by the Depart:nent of Justice 11 12 rather. Wasn't it the Department of Justice? I think it 13 was Mr. Brand 's witness. 14 MR. BANNAN: Mr. Mush. 15 CHAIRMAN GARFINKEL: Yes. 16 -who testified he found nothing l wrong with the f activities of the Applicant in regard to the 25 percent, we 37 r ~ I ' will allow only the production of documents which 'in 18 b any way ( relate or indicate activities that foreclose a change in the 19 it h} 25 percent rule, or activities which disclose an attenpt to 20 12 g 21 maintain the 25 percent rule. Gy W(j 22 How, with respect to the Board's indication that { this subpoens was limited cnly to Mr. Land in his individua' 23 W I capacity, this Board will not entertain a subpoena against k-24 $~. Consumar:s Power far the same informantion, unless Mr 2S 4 L.. . Land, M pg
o W ]l u t {r e 5632 m-i 0 PJ 24 1 on oral examinaticn, under oat] e a d, clearly 2 indicates to this Board that the activities that he engaged a 3 in is 'he type of activities which would come within the 4 scope of Neerr Pennington case of a sham. 5 Now, with that ruling, the Board expects Mr. 6 Land to be produced under the conditions outlined here; and 7 it's a question now of whether the Joint Intervenors are 8 still desirous of calling Mr. Land as limited herein. 9 And the Board would like to be apprised by tcznorrov 10 mornin? whether the Joint Intervenors are still desirous of 11 calling Mr. Land, and when we may expect Mr. Iand to be pre-12 sent, assuming you don't appeal, Mr. Watson, this Board's 13 ruling on the subpoena. 14 MR. WA'I SON: Mr. Chairman, I find nothing in _the 15 ; Board's order in that particular regard that disturbs me i 16 greatly. e f 17 However, Mr. Ross is presently out of the country [ r 18 and will not be here until late tonight;' and I would ask for 19 three of four more hours from the Board -- say, through I 20 lunch tcznerrow -- so that we may have a chance to apprise him i he 21 of the Board's ruling today, because I would as.cm=e the Board Ehw 22 does not plan to issue a written order, but that the trans-b 5m 23 cript will suffict.: for the order. { 24 CHAIR!G.H GAR?INKEL: Yes. hW 25 M" WATSON: Therefore he won't have a chance to b:
<n. GllD'3" rO I' A rd i 51 5633 6j dunuuJ 3 j5 I examine it until lunchtime temorrow. l' 2 [ MR. JAILON: No objection. ? 3 CHAIPFJ.N GAR?INKEL: All right. There's no objectj or F 4 to that. r 1: 5 } All exceptions, of course, to the Board's ruling 6 are herewith made a part of the record; and no exception L [ 7 has to be noted specifically. 8 If acytody feels they were adversely treated, thel.: 9 exception is autar.atically noted. l 10 The only thing is, if you do take an appeal, we'd i I l 11 like to know that. 12 MR. WATSCH: Ycu'il be among the first to know, 13 your Honor. 14 CHAIR'O.N GA".FDiKEL: Okay. 15 You're the only one, when I say "you",Mr. Watson. I 16 Your client is the only one who can make an appeal. For I 17 every other party it's an interlocutory ruling. 18 MR. WA73ON: Mr. Lard is a non-party. i l gg CHAIRMAN GARFINKEL: That's right. t 20 And any subpoena, of course, is a subpoene that l 21 may be appealed, because it's the type of thing that involves l a enforcement by the Ccmmission. i 23 Eut to any other party that's interlocutory, ard 24 they have no right of appeal at this time. 25 fC. WATSON: Thank you, sir. l
SY$$$$lEb5NW$?N$$$$WISWVSYW'?? ??? U f j u:2 5634 b' 5 1 MR. JAILLON: As a convenience, I was juJt going 2 to pose that, if it is acceptable to the Board, we have ironed 3 out our difficulties with regard to the admission of our t 4 docustents, except for two partic'ular exhibits which Mr. 5 Pollock will argue tomorrow. 6 Would it be acceptable, just to that we know when 7 he can be here ari' we can be here, if we rtove our other 8 exhibits into evidence and the deposition mcterial, say, at 9 ttro o'cloch tomorrow? 10 CHAIRMAN GARFINITL: Well, tomcorow we have one 11 witness who may te.ke all day, and we've reserved,.if necessary, 12 Friday or on notice. That is, if we finish early we'll phone ( 13 you and call you in. Therefore, Mr. Pollock does not have 14 to stay around testorrow. 15 MR. JABLON: Okay. 16 I appreciate it. 17 CHh!PMLN GARFINITL: We'll have it. We'll reserve la Friday, if necessary, to make sure we get everything in, Mr. 19 Jablon. 20 MR. JALLON: I would not want to convene the 2i Loard specially. I'd be perfe.:tly happy -- Ijust wanted to 22 do this at a time convenient to the parties. 23 If it suited the partias' convenience, I would 24 just as rocn do it when Er, Ayn.ond ec":ss. I jttst preferred 25 not to have to hav e Mr. Pc11och nittirq --
i 1 m .3 So i - [, . dJ l a i 5635 s s u pb 6 1 CHAIPJGIN GAR?INKEL: We have to get rid of the ij' 2 witness of the Regulatory Staff. If that could be finished 6 l 3 at an early time, then imediately we will request that j 4 either you, if yot. are here tomorrow morning, or we will call i i 5 Mr. Pollock to advise him that we have the time and we can I 6 do it, say, tenorrow atternoon er Friday. l 7 But cle.arly, we're<!oing to get it in before we 8 put on the case of the Applicia:.t. 9 MR. JABLON: I appreciate that coursesy very much, 10 your Eonor. 11 CHAIRMAN GARFDiKEL: Very well. 12 Wit.h tlat, we are in recess unti1 tenorrow morning l 13 at 9:00 a.m.. 14 (Ynereupon, at 5:35 p.m., the hearing in the 15 above-entitled reatter was recessed, to reconvene 16 at 9:00 a.m., Thursday, 7 February 1974, in the
- 7 same piece.}
18 19 I 20 f f 21 t .~ 22 t 23 l 24 r 25
_.. -. ~. ..c. t 2.% % $0 '?';5 :} KNU ) ';e Cc. j \\ *,,, f UNITED STATES OF AMERICA [ ATOMIC ENERGY COMMISSION Agf Ebs Q ' ..s \\.. \\- ^ ) Docket Nos. 50-269A DUKE POWER COMPANY ) 5-7 i 50-3G9A (Oconee Units 1, 2, and 3; ) 50-370A-McGuire Uni'ts 1 and 2) ) 4 PREHEARING ORDER NUMBER TWO OF ATOMIC SAFETY & LICENSING BOARD 2 r l A second prehearing conference was held before this ~ Doard, pursuant to Notice dated November 3, 1972, on November 17, 1972 at Washington, D. C. Counsel for all parties were present and the following action is taken: A. DISCOVERY _ L" 1. In view of the representations by counsel for long periods of time desired for completion of discovery IT IS ORDERED THAT each of the parties shall. report, bi-monthly, to the Board, the number i of documents that have been produced, the number of responses to requests that have been completed, \\ and the number of requests remaining to be com-pleted, commencing December 13, 1972.
L f.' i I 2-s B. APPLICANTS OBJECTIONS AND MOTIONS TO LIMIT JOINT REQUEST FOR DOCUMEF2 PRODUCTION AND FOR PROTECTIVE '. '. ORDERS 2. By motion dated Octobe'r'.12, 1972, answered by . 'the Department of Justice on October 25, 1972, and, by' permission, replied to by applicant on Nove=ber 10, 1972; applicant sought relief from specified portions 3 of the Jo. int Document Request filed September 6, 1972 by the Justice Department and the intervenors. After hearing, extensive argument and endeavoring to secure .s agreement of the parties, the. following disposition ~ is made.of scid joint requests which for convenience ' are listed under the headings adopted by applicant in __( .its motion: (a) '"1. Applicant's Filing System" , Joint Request #2 is limited to the' produc-tion of af docunient showing the p esent I i ' method of filing documents-(b) "2. Applicant's Political Activity" Applicant's objection to joint requests ~ ,' number 4 (f), 4(h) and 4 (1); 6 (f) (3), 6(i) and 6 (p) ; 16, 37 and 38 are sustr.incd e e e i._ i A - mee s
w without prejudice tola renewal thereof on $42e showing of prerequisites required by l'aw. (c) "3. State-Ordered Territorial Arrangements" - Applicant's objec' tion to f,oint-request 6 (e) . is sustained.except as to documents indicat-ing that territorial divisions ~ properly ) negotiated in. regard to retail sales were used to create. territorial divisions in wholesale sales. (d) "4. Municinal and State Elections" ( ' Applicant's objection to joint request 16 is sustained without prejudice to a renewal i i thereof,on the showing of. prerequisites required by law. ~ i (e) "5. Request for All Documents in Certain Files" A'ppliEant's objections to joint' requests 13 and 17 are sustained, except insofar as items contained'in.the whol'esale' customer files whier.' refer to, or relate to, the , abil'.ty to n~ra*a at retail or to the O w i
n_. /Lelly'b,..t6c4.i ..$c./w .hNW/NENR [ d' 4 "/[^~f ' "' f,, > ' S 4 aoe:crea k N UNITED STATES OF AMERICA E APR191974> ( RECEIVEa ATOMIC ENERGY COMMISSION ca ir ee rmhrr 1974 AN 25 F' I_00
- E P BEFORE THE ATOMIC SAFETY AND LICENSING BOARD %
CP I m US,*.E C InthYN5bherof ) ) LOUISIANA POWER & LIGHT COMPANY ) Docket No. 50-382A ) (Waterford Steam Generating ) M! hj Station, Unit No. 3) ) I MEMORANDUM AND ORDER WITH RESPECT TO OBJECTIONS ON DISCOVERY REQUESTS AND INTERROGATORIES I. INTRODUCTION (. The parties to this proceeding have filed their first requests for the production of documents and interrogatories and various objections have been presented to this Board 2 with relief requested. The Board has considered all these 'i R b 1/ Position of Louisiana Power & Li2ht Coccanv with Resoect 7 to, and Obiections to. Recuests bv Joint Discoverers, March 11, 1974; (Atomic Energy Cotraission, Regulatory) g Staff's Mction in Ocoosition to Certain Discoverv Recuests j by Acolicant, the Intervenors and the Deoartment of [ Justice, March 11, 1974; Objection of Louisiana Municioat l lj Association Utilities Grouo to Joint Interroratories to 3 jy ' Joint Interrocatories to Intervenors, March 4, 1974; Motion (by Cajun Electric Power Cooperative, Inc. )
- _t_c, yf o
e" Limit Discovery, March 11, 1974 Obiections (by the Uy/ Cities of Lafayette and Plaquemine) Pursuant to Order of F Board, March L1,1974 These parties will hereaf ter be h referred to respectively as: Applicant, Staff, LMA, L Cajun, and Cities. The latter four parties and the De-partment of Justice (Justice) are the Joint Discoverers. r
6-4 Nos.13,14 and 15 - Applicant's objections to these requests are overruled without prejudice to their renewal when stipulated facts are available. Nos. 16 and 17 - To the excent that the infonnation herein sought is of a trade-secret nature, the Protective Order, detailed heretofore is applicable. Th'e objections i are overruled. i Interrogatories Nos. 1 The objections to these interrogatories are overruled, except that Nos. 2 and 4 are ILnited to documents which otherwise would have to be produced. Nos. 5-7 and 15 The objections to these inter-rogatories are overruled except that answers shall be for the time period since January 1,1960. Nos. 20 These interrogatories are objected to on ~ grounds that they are subject to the "Noerr-Pennington privilege and the First Amendment to the U.S. Constitution." In addition, interrogatory 20 is objected to as irrelevant and immaterial which objection is overruled. c-
~ ~ i , \\ Applicant's objection based on the Noerr-Pennington doctrine is overruled. This doctrine, broadly stated, holds that joint activities arguably subject to the restraints of the antitrust laws and particularly to Section 1 of the Sherman Act, may not.be proscribed or sanctioned when these joint activities are directed to influencing legislative or administracive agency action. The basis for the non-appli- + cation of the antitrust law to these activities rests in the a w constitutional guarantee of the right of free assembly and the right jointly to petition for redress of grievances. (. It may well prove that activities within the ostensible scope of these interrogatories ultLnately are shielded from claim of antitrust law violation by virtue of the appli-cability of the Noerr-Pennington doctrine. In overruling this objection, the Board does not foreclose any argument Applicant may wish to make at the time of hearing with re-spect to the protection to be afforded these activities. The fact of the activity, if any, is, however, subject to discovery. l l t 1 i T ?
- ~
n-i ( No.First Amendment threat is perceived in receiving evidence as to che occurence of joint legislative er judicial activities. Indee4 consistent with the First Anendment, ~ such activities should not be hidden fran scrutiny. First, Rule 26 of the Federal Rules of Civil Procedure and the AEC Rules and Regulations permit discovery calculated t to lead to the production of admissible evidence even though i the actual subject matter of the discovery may itself be ruled inadmissible at the time of hearing. Thus, it remains (~ to be seen whether the information sought be these inter-rogatories will lead to the production of admissible evidence even if the Board upholds Applicant's contentions with re-spect to the applicability of the Noerr-Pennington doctrine. Second, the doctrine and the extent of the doctrine's coverage cannot be tested in a specific context w1thout the proper development of evidentiary facts. That is to say,, that although Applicant might claim extensive Lnmunity based on the asserted applicability of the doctrine, the i=muni'ty ultimately determined to be available may be substantially 4 7
1. ( i narrower than that claimed. Without the development of a factual basis upon which to consider the doctrine, there is no way for the trier of facts to gauge the scope of the immunity. Third, we note that it cannot be ascertained presently which activities Applicant itself may claim to be immunized I by the doctrine; and, surely, the other parties are entitled to know the factual basis upon which Applicant will argue the applicability of the doctrine. It would be most unfair ( if a party, merely by citing the catch phrase "Noerr-Pennington" could thereby relieve itself of the responsibility of pro-ducing data in response to discovery which' data might be outside of the secpe of the doctrine. In short, there must be a way to test claims of privilege based on the doctrine, and the only way to make such a test valid is through the production of data of the type sought through these interrogatories. ' ,.A '\\ g
t _ ( Finally, we note an exception to the Noerr-Pennington doctrine based on " sham" actions or actions not taken in good faith before governmental regulatory agencies. California Motor Transport Co. v. Truckinz Unlimited, 404 U.S. 508 (1972). One test of whether joint activities be-fore governmental agencies are taken in earnest or in sham is their frequency and the substance of' the positions ad-vanced. If Applicant successfully resists producing infor-a mation as sought in these interrogatories, there will be no basis upon which other parties can attack tc. asserted non-( applicability of the antitrus t laws. No. 25 and 26 - These objections are sustained. No. 27 - The objection is overruled. No. 30 - This interrogatory is objected to on grounds that it calls for a legal conclusion. The objection is overruled. United S tates v. Continental Can Co., Inc., 22 FRD, 241,1 FR Serv' 2d 33,333 (S.D.N.Y 1958), 4 Moore, Federal Practice #26.56[3), (2d ed.1974). e l (
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- y jgg. !.:0 UNITED STATES OF AMERICA r.-.
BEFORE THE ' -( ~ 8 ~%,Ef ATOMIC. ENERGY COMMISSION \\ C ew.> v e.q/ Y k. In the Matter of ) 'b/ t3 ) AIABAMA POWER COMPANY ) Docket Nos. 50-348A (Joseph M. Farley Nuclear ) 50-364A Plant-Units 1 and 2) ) ORDER GRANTING IN PART AND DENYING IN PART MOTION TO COMPEL PRODUCTION The Joint Discoverers, by Motion dated October 1, 1973, have moved to compel the production by Applicant of certain I documentary material demanded in the " Amended Joint Discov-erera' Second Joint Request for the Production of Documents," also dated October 1, 1973. The documents requested in the nine paragraphs of the Amended Request can be generally placed in the following categories, taking t le 1 cast compl'icated first, with our discussion and rulings fol' lowing thereafter. A. Paragraph 9 seeks documents "necessary to identify each category" of Applicant's operations that Applicant con-tends is subject to " pervasive regulation" by the state or Federal Government. These documents are sought to establish the " factual context" to which Applicant's claim (that it is subject to pervasive governmental regulation) relates. The motion to compel production of these documents is denied. Discovery on the support for Applicant's claim of " pervasive" regulation or seeking instances where Applicant may have made inconsistenc statements is mora properly made, at least initially, by
/ i - 2'- e O specific interrogatories rather than a non-specific request for documents, particularly where, as here, the regulatory statutes, regulations and decisions (which are. the ultimate source of information as to what is and is not regulated) are equally available to the Applicant and to the J'oint Discov-Grers. B. Paragraphs 2, 3 and 4' demand documentation relat-ing to certain activities of the Applicant or its affiliated companies with regard to the customer-supplier relationship between competitors of Applicant and their government-owned suppliers or customers. The motion to compel prodhetion of these documents is granted. Applicant has objected to these requests, citing the so-called Noerr-Pennington doctrine, which we shall discuss in detail in Section'C below. Suffice it to say here that we agree with the Goint Discoverers wien they point out that whatever applicability that doctrine may have insofar as attempts to influence governmental policy are concerned, it has little or no applicability when applied to proprietary, or commercial affairs of a governmental body,. where the public as customer or supplier is presumed to act in a manner consistent with maximizing ' competition. George R. Whitten, Jr., Inc. v. Paddock Pool Builders, Inc., 424 F.2d 25 (1s t Cir.1970). C. Paragraph 1 demands documents relating to Appli-cant's, or the Southern Company 's (the Applicant's parent corporation), efforts to influence or affect certain spccified items of legislation by the state and federal legislatures, I..
i r
- and/or administrative regulations.
Paragraphs 5, 6, 7 and 8 demand similar dccumentation relating, it appears, to similar activity of Applicant, or its affiliated companies, to influ- ~ ence or affect other positions taken by other governmental bodies or courts, in their capacities as such. These paragraphs are very strongly resisted by Appli-cant on several grounds, the most serious being that the evidence toward which the requests are obviously directed is not relevant to the issues to be decided; since, among other things, the doctrine enunciated by the Supreme Court I in Eastern Railroad Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127 (1961), and United Mine Workers
- v. Pennington, 381 U.S. 657 (1965), the so-called Noerr-Pennington doctrine, prohibits " antitrust scrutiny" of ef-forts to influence governmental activity.
(Applicant's dbjections, hereinafter " Objections," October 11, 1973,
- p. 3).
While we recognize, of course, the teaching of the Noerr and Pennington cases, and their progeny, of the prin'- ciple that certain conduct relating to, the actual or attempted influencing of governmental action is protected from anti-trust prosecution (and presumably from being the subject of an adverse finding under the statute we are charged with construing, Section 105 (c) of the Atomic Energy Act, as amended), we are not prepared to say that all activity in this area is protected from scrutiT4 or that documentary material relating thereto is protected from discovery.
- That,
~ in our view, would amount to die creation of a privilege more pervasive than the attorney-client or doctor patient privilege. We regard as frivolous Applicant's further argu-ment that, should it be required to produce the documents in question, it will have a " chilling effect" on Applicant's First Amendment right of petitioning its government. The language of Noerr and Pennington, followed by California Motor Transport Co. v. Trucking Unlimited, 404 U.S'. 508 (1972), and United States v. Otter Tail Power Co., 360 F. Supp. 451 (D. Minn.1973), and others, makes it clear I that the " doctrine" has no clearly. defined outlines,and exceptions to its applications do, exist. We see no basis, therefore, for completely prohibiting discovery into the area by the Joint Discoverers. Any evidence whirch is to be of-fered must an any event pass muster under the Noerr doctrine (and its exceptions), as well as under the more general tests of admissibility before it will be received in' evidence in i this proceeding. In granting this motion to compel, hcwever, we are given pause by the feeling that we are very near to the fine line between what constitutes a " fishing expedition" and legitimate discovery, but if we are to err, we must err on - the side of liberality in discovery, particularly since the statute we are charged with ' interpreting has never been applicd to a factual situation. IT IS.S0 ORDERED. e s--
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d. THE ATOMIC SAFETY AND LICENSING BOARD e &(. By: 1b* (W/.{I aGw * ^ Michael L. Glaser By: [)t[/ '45 ~ Carl W. Schwarzv I Md.ca. M/ gh <C d By: Walter W. K. Bennett l Dated: November 1, 1973 e O O e i O e* G e 9 e l P-
1 i hp-- \\ A1TMC/IN0N T S~ &L l 4r s l I p $11 T LWW bk @nd, hMU 9 @Qe# DN UMTED STATES OF M1 ERICA NUCl2AR REGULATORY CO:.BIISSION hyg[) g g), j[-p3 N' dd Bafore..tha, Atomic Safety and Licensing Eoard ['. 7I[Q,M/ f ) In thefaqtg.; of ) et[i h0Eike F10RIDA FOns AND LIGHT COMPANY ) Docket No. P-636A (South Dade Nuclear Units) ) ,SECONb PREHEARING CONFERENCE ORDER On January 31, 1977 the Board conducted the second j . rehearing conference in this proceeding to consider p qbjections to discovery req'uests. During the prehearing conference certain rulings on objections were made and l ad_ditional rulings are set forth below. i Time Period i 9 The_ relevant period for litigation in this proceeding f and for discovery begins January 1, 1965. Requer,ts for exceptions to this period will be entertafr.ed by the Board but only to 'the extent that information to be produced from prior to January 1, 1965 relates substantially to events or situations after that date. Requests for ex-ceptions must be factually' specific and are to be mnde to _ the Board p Jiarch 15, 1977 // Requests for" exceptions filed // after March 15, must set forth a good reason for late filing. O e o +
- ah% 9.
i - 2.- l 1 Legislative Activitiem ApplicantsobjecttoInterrogatoryNo.g0oftheJoint Request and to Interrogatories 21(e) and 26(5) and (6) of the Florida Cities' Request to Applicants, relating to Applicants' legislative activities on the basis of the Ncerr-Pennington d'octri.ne* and on the basis of excessive breadth. Similarly, Applicants have requested discovery against Cities concerning their respective legislative se activities. Cities do not object to interrogatories to them concerning legislative activities but insist upon parity with Applicants in this respect. Applicants and Cooperatives have agreed in their. Memorandum of Under- ~ standing dated February 8, 1977 with respect to Cooperatives' legislative activities (Interrogatories to Cooperatives Nos. 177 and 178).
- See p. 7 et seq. of Applicants' Objections to discovery citing Eastern Railroad Pres. Conf. v. Noerr Motor Freient Co,,,365 U.S. 127 (1961) and United Mine Workers of America v.
Pennington, 381 U.S. 657 (1965).
- Applicants Interrogatories to Cities Nos. 234-239, 269-275, and 293.
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9 4 I ! We are not, of course, at this stage ruling upon the ultimate admissibility of evidence. Rather,nin accordance with 10 CFR 62.740(b)(1), the test we must apply is whether "... the information sought appears reasonably calculated to lead to the discovery of admissible evidence." This is also the test under Rule 26 of the Federal Rules of Civil Procedure. The Board observes that the interrogatories objected to on the basis of Noerr-Pennington seem to be designed to lead to the discovery of admissible evidence, even if tW1.u.1vemonduct _ thus demonsDAted-a&y -ni ~ be the basis of a finding no n vd.olat-ion -of-thesn+i tr.ust lawp Mor.eover, it will not be possible until after J discovery for t'he Board to determine whether the activi-l 1 " ties in question are entitled to the constitutional pen-tection recognized by the Noerr-Pennington cases, or
- The Staff urges that the purpose and character of the l
Applicants' activities are relevant, and that this would be a permissible showing under Pennington, supra. The ' Board can envisinn n+her unprotected nrnan"+= af + hie-discoverr. For example, we may be aided in establishing the appropriate relevant geographic and product markets for antitrust analysis in this proceeding.
- In additiqn to Noerr and Pennington, supra, see California Motor :(nsnort Co. v. Trucking Lnlimited, 404 U.S.
- dos, (107E)~IEd'atter Tail Power Co.
United States, 410 U.S. 361 # 1P'/1) and 417 U.S. 901 (1971). ,,r m:-w,
~, . ' s, uwer' vospible ,Jhether they may fall within "= ham" or exceptions to the doctr,.ine. s f Therefore the Board overrules the following i objections to interrogatories relating to legislative activities based upon Noerr-Pennington because we see as a reasonably expected result the discovery of admissible evidence: 1. The Board overrules Applicant's objection to Joint Request Int ^rroga tory - No - Anato the extent that it depends upon Noerr-Pennington. However the Board sustains a portion of Applicant's objection to the breadth of the interrogatory. Documents pertaining to legislation "....nnemibly affecting competition betwaan alac+ vie " tTl i ties in _the State of Florida." could emb_ race all o{ A Fp uca_nf s considerations and activi+4ac with respect to legislation, and is too broad Y_Thg Board _ grants _ leave to refile this requan"1ma_gr before March 1, 1977. The Board overrules the objection to that port' ion of Interrogatory No. 60 relating to proposed legislation to allow small systems to participate in joint ventures. 2. The Applicants Noerr-Pennington objections to Cities' Interrogatory No. 21(e) (as modified) are overruled. We sustain a portion of Applicant's objection to this interrogatory based upon breadth. Instead of requiring production of data about legislation and constitutional revision "affecting" the ability of electric utilities to own, finance, .and construct facilities and to sell electricity, we limit production to data pertaining to legisla-tion or constitutional revision directly related to those abilities. 3. Applicant's objections to Cities' Interrogatories No. 26(5) and (6) are overruled except to the extent that 26(5) relates to the Board's request to the parties to negotiate concerning the issue of tax subsidization of utilities. (See Tr. 177 and " Tax Advantages" below) e .4Y Nw - ._I O ,m_, , ~,,
e . ) 4. Cities' reservations concerning parity with Applicants in producing data relative to legisla-tive activities (Cities Objections to. Applichuts ' Discovery Against Cities,
- p. 10) have been satisfied by che 1'cregoing rulings."
Discovery of Legal Opinions and Positions" The Board assured the parties that complete disclosure of larm1 np4ninne and nositions on_the issues will be made before the e vidantinrv hearing, and requested the parties to confer in an effort tn nrrae to mutually ancan+ehle _s_ tag.es pf,.dinc l osure, and to a report with recommendations l by March 15,_ 1977. (Tr. 155, 156 and 159) Therefore the 1 Board defers ruling on interrogatories and request'for documents pertaining to the legal opinions and positi'ons. Tax Advantages Many interrogatories and requests are concerned with relative tax advantages and disadvantages and the benefits Jof operatine in tha n'thli a e^-+n" anm7a*ad +n +ba nri va ta _ sector.h(Al_1 parties have agreed to negotiate toward a simplification of this issue with the objective that a"n abbreviated factual record in support of the differing positions may be made. The Board requests that the parties report to it on the results of their negotiations on or before. March 15. (Tr. 177) ~ e e l l i
- hepreame' '"' '~' y 3-3g 3 g*y
~;' ; 33 7 _ y, ;,,; e,s.
U R e - Work product Applicant's objection to Joint Request Interrogatory u 87(d) is overruled. In replying to Interrogatory 87(d) the Applicant may avoid disclosing the mental, impressions, conclusions, opinions, or legal theories of its representa-tives concerning these proceedings. Applicants may seek'the assistance of the Board toward this end. Applicant's Objections to " Fishing" Applicant's objections to Cities ' Interrogatories 17 and 20(a) and (e) are sustained. Acquisition Procedures The Board defers ruling upon the Cities' objections to Applicant's interrogatories regarding procedures necessary to acquire a municipal electric power system and the legal theories surrounding the antitrust significance of acquisitions of this nature (Nos. 168, 188-192) pending further negotiations between Cities,and Applicant and a report to the Board by, March 15, 1977. (Tr. 187) Participation in South Dade Cities' objections to Applicant's interrogatories Nos. 105 to 108 are in general overruled. However, with respect to No.108(b) the Board requests Cities and W%eu ~-
J e j i ] Applicants to include this subject in their negotiation " in the manner anticipated in connection with 168 and 188-192 and report to the Board on or before March 15. Cooperatives' Objections The Cooperatives' objections to interrogatories which may produce, trade secrets (51-53, 55, 60 and 121) ~are over-ruled. However Co_ operatives may reauest a protective or, der (10 CFR 92.740(c).and 92.790) n or'before March 15. The Cooperatives' objections predicated upon general relevancy considerations (p. 15 Cooperatives' Objections) have now been satisfied by the First Additional Memorandum of Understanding Between Applicants and Cooperatives dated February 8, 1977. All recommendations to the Board for corrections and modifications of this order are to be filed by March 4,1977. IT IS SO ORDERED. / -y?.y/$f n W. Smith, Chairman A?.' // ' Daniel 51. Head, Member A h $W a John M. Frysiak > Member f if IssuM a. ecthesda, Maryland thi.s 22nd day of February, 1977. N ' w ~ ~,. _... _,,_,
UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of ) ) FLORIDA POWER & LIGHT COMPANY. ) NRC Docket No. 50-389A (St. Lucie Plant, Unit No. 2) ) CERTIFICATE OF SERVICE I hereby certify that copies of NRC STAFF'S RESPONSE TO APPLICANT'S OBJECTIONS TO DISCOVERY REQUESTS AND MOTION FOR A PROTECTIVE ORDER in the above-captioned proceeding have been served on the following by deposit in the United States mail, first class, or, as indicated by an asterisk, through deposit in the Nuclear Regulatory Commission's internal mail system, this 22nd day of December,1978. Ivan W. Smith, Esq., Chai rman J.A. Bouknight, Jr., Esq. Atomic Safety and Licensing Board E. Gregory Barnes, Esq. Panel Lowenstein, Newman, Reis & Axelrad U.S. Nuclear Regulatory Commission 1025 Connecticut Avenue, N.W. Washington, D.C. 20555
- Washington, D.C.
20036 Valentine B. Deale, Esq. Tracy Danese, Esq. Atomic Safety and Licensing Board Vice President for Public Affairs Panel Florida Power & Light Company 1001 Connecticut Avenue, N.W. P.O. Box 013100 Washington, D.C. 20036 MiaNi, Florida 33101 Robert M. Lazo, Esq., Member Jack W. Shaw, Jr., Esq. Atomic Safety and Licensing Board John E. Ma thews, Jr., Esq. Panel Mathews, Osborne, Ehrlich, McNatt, U.S. Nuclear Regulatory Commission Gobelman & Cobb Washington, D.C. 20555
- 1500 American Heritage Life Building 11 East Forsyth Street Docketing and Service Section Jacksonville, Florida 32202 Office of the Secretary U.S. Nuclear Regulatory Commission Mr. Robert E. Bathen Washington, D.C.
20555-
- Mr. Fred Saf fer R.W. Beck & Associates Jerome Sal.tzman, Chief P.O. Box 6817 Antitrust & Indemnity Group Orlando, Florida' 32803 U.S. Nuclear Regulatory Commission Washington, D.C.
20555
- Dr. John W. Wilson Wilson & Associates Thomas Gurney, Sr., Esq.
-2600 Virginia Avenue, N.W. 203 North Magnolia Avenue Washington, D.C. 20037 Orlando, Florida 32802-W e ** Ww w e
. r. . c Robert A. Jablon. Esq. Daniel J. Guttman, Esq. Alan J. Roth, Esq. 2600 Virginia Avenue, N.W. Washington, D.C. 20037 Donald A. Kaplan, Esq. Melvin Berger, Esq. Mildred L. Calhoun, Esq. P.O. Box 14141 Washington, D.C. 20044 William H. Chandler, Esq. Chandler, O'Neal, Avera, Gray, Land & Stripling Post Office Drawer 0 Gainesville, Florida 32602 Atomic Safety and Licensing Board Panel U.S. Nuclear Regulatory Commission Washington, D.C. 20555
- Daniel M. Gribbon Herbert Dym Joanne B. Grossman Covington & Burling 888 Sixteenth Street, N.W.
Washington, D.C. 20006 M s as.a., Fredric D. Chanania Counsel for NRC Staff f 4
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