ML19331A584
| ML19331A584 | |
| Person / Time | |
|---|---|
| Site: | Midland |
| Issue date: | 03/12/1977 |
| From: | Cherry M CHERRY, M.M./CHERRY, FLYNN & KANTER |
| To: | NRC COMMISSION (OCM) |
| Shared Package | |
| ML19331A587 | List: |
| References | |
| NUDOCS 8007180664 | |
| Download: ML19331A584 (15) | |
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UNITED STATES OF AMERICA before the 5 4h.gM
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&'V NUCLEAR REGULATORY COMMISSION 4r In the Matter of
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CONSUMERS POWER COMPANY
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Docket Nos. 50-329
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50-330 (Midland Plant, Units 1 & 2)
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INTERVENORS ' OPPOSITION TO MOTION OF APPLICANT TO STAY ORDERS AND CONTINUE PROCEEDINGS ll:n 7 7 Intervenors herein (other than Dow Chemical Company), by their attorney, Myron M. Cherry, submi t this opposition to the motions of Consumers Power Company: (1) to etay the varioun orders of the Commission implementing the mandate of the Court of Appeals l
for the District of Columbia in Aeschliman v. NRC, and (2) to continue the further hearings in this cause pending disposition of the motion to stay.
Intervenors believe that this Commission acted quite properly in directing the commencement of hearings pursuant to the mandate of the Court of Appeals, and that those hearings - which have already resulted in 21 days of testimony -
should not be. arbitrarily truncated at this (point.
I.
THE GRANT OF CERTIORARI l
DOES NOT AFFECT THE MANDATE OF THE COURT OF APPEALS.
,fy Consumers ' sole ground for halting the hearings is that on February 22, 1977 (almost two weeks before Consumers filed its motions), the Supreme Court of the United States granted certiorari in Aeschliman, supra, and in Vermont Yankee Nuclear Power Corp.
In support of its position, l
8.0 0 7180 6CL/
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. Consumers offers only an irrelevance coupled with an inaccuracy.*
The irrelevance is Consumers ' lengthy recitation of the history of the eight show cause proceedings (including Vermont Yankee) which were begun af ter the Court of Appeals ' decision in the Aeschliman and NRDC cases.
What happened in those proceedings, of course, has nothing at all to do with this one.
As Consumers itself concedes, those proceedings concerned solely fuel cycle issues, which were properly postponed in light of the Court of Appeals' stay of its mandate in NRDC v. NRC.
By contrast, in this case the Court of Appeals did not stay its mandate; in fact, it expressly refused to do so.
Nor do the issues involved in the ong'oing hearings in this case involve fuel cycle matters ; to the contrary, those matters were deferred in this case by this Commission's Order of Nove'mber 5, 1976.
Thus the history of those other proceedings has no bearing on this proceeding.
Different substantive issues, and different procedural facts, are involved in this case, as the Commission explicitly recognized in its Order of November 5, 1976 in this Quite correctly, in that order this gommission interpreted case.
i the rulings of the Court of Appeals in this case as a determination by that Court that its mandate should be honored, and that the hearings required by its opinion should proceed, regardless of the pending petition for certiorari.
- We do not know why Consumers waited so long - in fact, until just three business days before the hearings were scheduled to resume - to present its motion.
Perhaps it took that much time for Consumers to review the hearing transcripts thus far, and realize the damning effect of the developing evidence on Consumers'
.pasition.
The inaccuracy to which Consumers couples its irrelevant recitation of the history of other proceedings is Consumers '
claim that this Commission's November 5,'1976 Order can no longer be followed, because the Supreme Court has granted certiorari in Aeschliman.
That is not true.
In the first place, the Court of Appeals' mandate in Aeschliman has not been stayed.
Furthermore, Consumers has never even asked the United States Supreme Court for such a stay, although it could have done so under 28 U.S.C.
52101(f) and Supreme Court Rules 27, 50, and 51.
Finally, it is obvious - much as Consumers would like to forget it - that the Supreme Court has not reversed the ruling of the Court of Appeals.
At the moment, and until the Supreme Court adjudicates Aeschliman on the merits,* the ruling of the Court of Appeals is the law of this case and must be followed unless either that court or the Supreme Court stays it.
Consumers' contrary argument, asserting that the grant of cert iorari in some arcane fashion destroys the " finality" of the judgment of the Court of Appeals, is simply wrong.
The Supreme Court has pointed out time and again that neither the grant nor the denial of certiorari imparts any conclusion, even l
1 a tentative one, concerning the merits of the case.
To the con-trary, a decision to grant or deny certiorari necessarily " depends l
on numerous factors other than the perceived correctness of the judgment [the Supreme Court is] asked to review," and is based
- If it ever does.
One of Intervenors' claims before the Supreme Court is that further review is not appropriate at this time because of the hearings on remand.
Even though the hearings are far from complete, they have already produced more than enough evidence to cast very serious doubt on the original license grant.
See F.T.C. v. Raladam Co., 316 U.S. 149, 150-51 (1942),
and the discussion in Part II, infra.
s
- on "a limited appreciation of the issues in a case."
That is no more than the inevitable consequence of the fact that the full record is not before the Supreme Court when the decision to grant certiorari is made, and the further fact that only a four-Justice minority is needed to grant certiorari.
Ross v.
Moffitt, 417 U.S. 600, 616-17 (1974); Rogers v. Missouri Pacific R.R., 352 U.S. 500, 527 (Frankfurter, J., dissenting), 560 (Harlan, J., dissenting) ; Brown v. Allen, 344 U.S. 443, 490-92 (1953)
(opinion of Frankfurter, J., for himself and four other Justices).
The statistics themselves prove conclusively that the grant of certiorari cannot be taken as a ruling on the merits.
Over the last three Terms, the Supreme Court has reversed only 37%
of the total cases it has heard on cerciorari; it affirmed over 17%,
and disposed of by far the largest number--261 out of 570, or 45% -
by vacating the ruling below and remanding for further considera-tion.
If we exclude memorandum decisions from the picture, we find that during the same period the Supreme Court has affirmed almost one in every three rulings from which it granted certiorari
--95 out of 340, or 28% -- and has reversed only 60%.
The Supreme s
Court, 1974 Term, 88 Harv. L. Rev. 41, 277 (1975); The Supreme Court, 1975 Term, 89 Harv. L. Rev. 47, 278 (1976); The Supreme Court, 1976 Term, 90 Harv. L. Rev. 56, 279 (1977).
It is not surprising, then, that the Supreme Court itself has noted that a Court of Appeals mandate remains effective unless it is stayed, Warden v. Marrero, 417 U.S. 653, 656 n. 6 (1974), and that other courts have taken the same view.
As the District Court explained in Knauff v. Shaughnessy, 88 F. Supp. 607, 608-09 (S.D.N.Y.1949), aff'd,179 F. 2d 628 (2d Cir.1950), vac. as
, moot, 340 U.S. 940 (1951) :
"The United States Supreme Court has not reversed the decision of the Court of Appeals, Second Circuit, in respect to the petitioner Ellen Knauff.
The higher court has simply ruled that it will review that decision.
Until it is reversed it is the law of the case and is binding on the District Court."
Consumers' attempts to undercut the finality of the Court of Appeals decision here not only violate the common-sense proposi-tions just discussed, but also are at best seriously misleading.
None of the three cases on which Consumers relies supports its position.
'In Linkletter v. Walker, 381 U.S. 618, 622 n. 5 (19o5),
.the Supreme Court considered " finality" solely in the context of the question whether an earlier Supreme Court ruling (Mann
- v. Ohio, 367 U.S. 643 (1961)) would be applied retroactively.
For that purpose, the Court concluded that a conviction had not become " final" (so that the defendant could invoke Mapp only retroactively, if at all) unless all State and Federal, direct and collateral, avenues for attack on the conviction had been l
foreclosed before the date of the Mapp decision. Manifestly, that sort of question has no bearing at all on the issues we i
confront here.
Similarly, Long v. Robinson, 316 F. Supp. 22, 31
- n. 8 (D.Md.1965), merely applied the Linkletter rule in deter-mining what cases would be affected by its holding that a youth offender statute was unconstitutional.
Again, that is a far cry from this case, where the only question is whether the decision of the Court of Appeals - which has not been reversed and which has not been stayed - is effective.
Finally, F.C.C. v. Pottsville Broadcasting Co., 309 U.S. 134, 141 (1940), affords no basis for
' thinking that this Commission can ignore ad libitum the mandate of
, the Court of Appeals.
That case, which involved an interpre-tation of the Communications Act of 1934, holds only that it is not the function of a Court of Appeals to decide cases for an administrative agency; rather, once the court " lays bare" an agency error (as the Court of Appeals did in this case), the agency must then "enforc[e] the legislative policy committed to its charge" by going back and doing its job in a manner free from the previous errors.
309 U.S. at 145.
That is exactly what this Commission is now in the midst of doing, pursuant to the mandate of the Court of Appeals.
Pottsville Broadcasting, then, supports the Commission's November 5, 1976 Order and the ongoing hearings in this case.
It does not support Consumers' misguided attempt to halt the entire hearing process in midstream.
In short, as Consumers itself is forced to admit at p. 10 of its Motion for Stay, "neither the filing nor the granting of a l
petition for certiorari operates as a stay, either with respect l
to the execution of the judgment below or the issuance of the mandate below to a lower court [or an agency]."
STERN & GRESSMAN, l
SUPREME COURT PRACTICE (4th Ed. 1969), $17.16 at 564 (emphasis-added).
The way to stay the enforcement of a judgment pending further review is to follow the Supreme Court's rules and ask for a stay.
Consumers has not done so.
This Commission can no more unilat'erally stay the mandate of the Court of Appeals than it could, for instance, refuse to follow the mandate at all.
Consumers' attempt to transmute the Commission's acknowledged 1
ability to determine the precise shape of an administrative proceeding required by judicial decision, into a license to
. ignore the decision entirely, is insupportable.
II.
THE ONGOING HEARINGS SHOULD NOT BE STAYED FOR THE FURTHER REASON THAT THIS COMMISSION HAS AN OBLIGATION, INDEPENDENT OF THE COURT OF APPEALS '
RULING, TO CONDUCT THOSE HEARINGS.
Quite apart from its lack of any proper legal basis, Consumers ' Motion should be denied for the further reason that to grant it would run counter to this Commission's affirmative obligation to unearth and act upon the truth as it really and presently exists - not upon stale facts or unsupported conten-tions.
During the twenty-one days of hearings which have so far been held pursuant to the mandate of the Court of Appeals, enormous amounts of evidence have been brought to light which completely destroy virtually every one of Consumers' representations to this Commission in support of its construction of the Midland Nuclear Plant:
l 1.
We know, contrary to Consumers' assertions, that Dow Chemical Company - far from actively suppording Consumers in this proceeding and desiring construction of the Midland Plant - is in the posicion of a reluctant bride at a shotgun wedding, coerced into paying lip service to Consumers' demands only by Consumers' repeated threat of a lawsuit.
That in clear from Mr. Temple's September 8, 1976 letter to Dow's President, Mr. Oreffice (Board Ex.1, Appendix A hereto), and from Mr.Oreffice 's testimony before the Board (Tr. 2707-09).
e
. 2.
We know that if Dow had the choice, it would today abrogate its contractual relationship with Consumers, and that on the facts as they are today Dow would never have entered into any contractual relationship with Consumers.
Mr. Oreffice and Mr. Temple both so testified. Tr. 387-88, 409-10, 415-17, 2707.
3.
We also know that even the Commission Staff regards Consumers' claims of a need for the Midland Plant as totally spurious, insofar as they relate to the Palisades Plant, and that its " probability encoding" is at bast highly suspect, since Consumers has never done such an analysis before and the bases for the opinions cn which it is premised are completely unknown (so that there is no way to check it or analyze it).
See generally the cross-examinations of Mr. Heins, Tr. 1674 ff., and Mr. Mosely, Tr. 3279-90, 3299-3302, 3393-94, i
4.
We also know that Dow Chemical Company has very serious
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doubts about Consumers' abilitr to finance the Midland Plant (whose costs have more than tripled since the Commission author-ized construction), and about Consumers' ability to complete the plant on schedule (even the radically relax $d schedule Consumers now espouses).
In fact, "it is Dow's opinion that Consumers Power will not be able to finance the Midland Nuclear Plant as currently scheduled," for a long list of persuasive re.tsons.
Dow's Further Responses to [ Staff] Interrogatories, Feb. 28, 1977, pp. 6-8.
The testimony of Dow's President, Mr. Oreffice, is l
l blunt and to the point (Tr. 2708-09) :
. (By Mr. Oreffice]:
"Now, under the current arrangement, we don't know when we will have nuclear power and nuclear steam; and, frankly, this slippage that has occurred during the life af this agreement makes one wonder whether the dates we have now and the figures we have now will be firm or not.
"Q.
Mr. Orrefice, would it be correct to say that you do not presently have total confidence in the cost estimates given to you most recently by Consumers Power Company?
"A.
That is correct.
"Q.
Would it also be safe to say that you do not have total confidence in the schedule, present schedule, given to you by Consumers Power Company?
"A.
That is correct.
"Q.
Would it also be safe to say that you and other members of management of Dow Chemical Company have a lack of confidence in the-management ability of Consumers Power Comoany in connection with this plant and your relationship with them?
"A.
I would say that that is a correct statement, yes."
5.
Finally, we know that any significant change or cost increase in the Midland project will cause Dow - without whom, as all agree, the Midland Plant would be a huge white elephant - to abrogate its relationship with Consumers, whatever the consequences.
See Tr. 323, 432-35, 460; Temple Direct Testimony (following Tr. 220),
i at 5.
Under those circumstances, this Commission's affirmative and continuing obligations under NEPA have a dramatically heightened importance and immediacy.
As this Commission held in Cornonwealth Edison Co., ALAB-153, RAI-73-10, 821, 823-24,
"...It is not proper to resolve a major environmental question on the basis of a set of facts existing in the past if there is good reason to believe that there may have been an appreciable, and material, change in the factual situation."
See a".so 40 C.F.R., Part 1500, 51500.13; Sierra Club v. Frochlke,
.' Coordinating Committee. Inc. v. A.E.C.,
449 F.2nd 1109, 1118-19 (D.C. Cir.1971).
On this record, there is beyond cavil " good reason" to doubt the accuracy of every one of Consumers ' represen-tations.
Nor doen this Commission's obligation to act on an accurate and up-to-date record depend in any way on the mandate of the Court of Ap'eals.
That obligation is imposed by NEPA and simple p
administrative common sense, and it certainly is in no way altered or lessened by the fact that the Supreme Court has granted certiorari in this case.
To the contrary, that obligation ' continues in full force and, as we have repeatedly pointed out to the Licensing Board, amply warrants not the suspension of these hearings, but Icther the immediate suspension of any further const uction of l
the Midland Nuclear Plant.*
That is so regardless of the pendency i
of further review proceedings involving this Commission's initial decision - a decision overtaken by developing events, just as it was overtaken by the process of judicial review.
See F.T.C. v. Raladam Co.,
316 U.S. 149, 150-51 (1942), pointing out that new or further
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hearings in a case may yield a different result, so that even a prior Supreme Court ruling ceases to be controlling.
l Constmers' desire to prevent the further development of evidence undercutting the assertions it has repeatedly made to this Commission is understandable.
That does not, however, make it right.
Just as a license suspension under the Commission's Interim Fuel Cycle Rule may result, notwithstanding the Commission's
- For that reason, we are filing contemporaneously with this i
memorandum a Motion to halt construction immediately.
. 1 November 5,1976 Supplemental General Statement of Policy, if application of the Interim Rule "would tilt the cost-benefit balance against issuance of the license" (41 F.R. 49898), so also the continuing re-evaluation and upda;ing of environmental costs and benefits which the ongoing hearings in this case serve to provide - and which is required by NEPA, quite independently of the mandate of the Court of Appeals - requires a halt to l
continued construction of the Midland Plant, and complete re-thinking of the Commission's initial licensing decision, in light of the rew and damning facts which are being revealed at every session of the hearings.
That the Court of Appeals itself directed re-evaluation of costs and benefits in this case merely underscores the importance of those ongoing hearings, and in no way detracts from the Commission's independent duty to I
conduct such a re-evaluation even without specific judicial direction.
III.
CONSUMERS' STAY MOTION MUST BE DENIED BECAUSE IT IS NOT ONLY UNFAIR TO INTERVENORS BUT ALSO IS MADE IN BAD FAITH.
Still a third, independent reason for denying Consumers '
Motion must be noted here.
We have already shown that the Motion is legally unsupportable, and actually contrary to this Commission's affirmative statutory obligations as well as to every Order the Commission has issued in this case since the Court of Appeals' Aeschliman decision.
We must add that granting the Fbtion would
- not only seriously prejudice Intervenors and convert the twenty-one
. days of hearings so far held into an utter waste. of time, but also play right into Consumers' hands.
The Motion is not, as we will show, prompted by any considerations other than Consumers' bad-faith tactical maneuvers.
It is important to recognize at what point in these proceed-ings Consumers' Motion comes.
It comes at a poiat when this Commission, the Commission Staff, and the Intervenors have invested a great deal of time, money, and effort in the ongoing hearings, and in the very midst of those hearings.
It also comes at a point;when, at the very least, it can fairly be said that considerable doubt has been raised as to the accuracy and candor of Consumers' submissions to this Commission - submissions which Dow Chemical Company itself has branded " misleading, or even disingenuous" and which have included nothing short of outright attempts to cover up the truth by manipulating witnesses and rewriting testimony.
See Exhibit B to Dow Memorandum Regarding Hearing Preparation, Dec. 22, 1976; Tr. 2703.
In fact, the
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Commission. Staff is now investigating whether formal action f
against Consumers is warranted.
l Suddenly to halt these proceedings, for no reason other than that Consumets is afraid of what further evidence (and staff l
investigation) may reveal, would set at naught all of the hearings l
l to date and would penalize Intervenors' good-faith participation l
l in these hearings.
In fact, given the reasonable time schedule l
involved in Supreme Court review, to halt these hearings until 1
the Supreme Court finally disposes of this case on the merits 1
approximately a year from now - and to allow continued construction
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. of the Midland Plant in the interim - would in effect render all of the hearings e date nugatory.
That is exactly what Consumers wants.
Attached hereto as Appendix B are notes prepared by one of Dow Chemical Company's attorneys concerning a meeting between Dow and Consumers on September 21, 1976.
At that meeting, Consumers undertook to blackmail Dow into supporting Consumers' position (which was "to finesse Dow-Consumers continuing dispute") :
"Hanes (of Dow] replied that Dow's witness would tell the truth... Falahee [of Consumers) then made naked threat that if Dow testimony not supportive of Consumers
...and that results in suspension or cancellation of permit, then Consumers will file suit for breach and include as damages cost of delay, cost of project if cancelled and all damages resulting from cancellation of proj ect.... (Note: pretty damn close to blackmail.)"
At. the same meeting, Consumers outlined its strategy before this Commission:
" Consumers said that as long as construction continues, Consumers has a lever and will drag feet in hearing on merits...."*
Thus Consumers' entire approach to this gommission is to lie to it and, failing that, to " drag its feet" and abort these hearings.
l Consumers se admitted during the September 21st meeting we have been discussing.
Seen in light of those frank admissions, the l
l real purpose of Consumers' present Motion is as clear as it is l
l sordid.
Since - concrary to Consumers' hope that Intervenors l
- No doubt because the devious tend to impute deviousness to l
everyone else, Consumers also suggested that if construction were halted the Intervenors would drag their feet.
We will not, and we resent Consumers' cynical assumption that everyone else is as dishonest as it is.
L
_ would give up for lack of funds and searching inquiry into its position would be avoided (App. B, p.2) - Intervenors' cross-examination has brought its dishonesty into the daylight, Consumers now hopes at one stroke both to halt further exposure of its sleazy attempts to hoodwink the Commission and to proceed apace with further cons truction so that, when the hearings resume,
it can confront the Commission with the very fait accompli argument warned against in Calvert Cliffs ' Coordinating Committee
- v. A.E.C., 449 F. 2d 1109,1128 (D.C. Cir.1971), and dozens of other cases (e.g., RICE v. GSA, 397 F. Supp. 41, 58-61 (D.R.I.
1975), and cases cited).
This Commission must not allow Consumers to thumb its nose at the Commission in that fashion.
Rather, the Commission should deny Consumers' Motion, reject its tactical ploys, and immediately suspend construction of the Midland Plant.
It should'do so not only l
l because'of the important considerations outlined in Parts I and II,
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supra,_but also because Consumers' deliberate dishonesty in these t
hearings so far raises serious questions about what further l
hearings will reveal and completely forfeits Consumers ' entitle-1 ment to the privilege of a construction license.
As Judge l
Learned Hand put it in Warner Barnes & Co. v. Kokosai Kisen Kabushiki Kaisha, 102 F. 2d 450, 453 (2d Cir.1939), "When a party is once found to be fabricating, or suppressing, [ evidence), the natural, indeed the inevitable, conclusion is that he has some-thing to conceal...."
It is this Commission's duty to find out what else Consumars is hiding here.
L
. CONCLUSION For the reasons set forth herein and in Intervenors' accompanying Motion, Inter anors request that this Commission deny Consumers' Motions to stay its Orders and continue these hearings, and direct an immediate halt to any further construction of the Midland Plant - a facility which was never properly justified (as the Coart of Appeals held), and which becomes less and less justifiable with every day of further testimony.
espectfully submitted, l
tl A%6 cL./D s
Coun 41 fot Interfenors (other han Dow Chemical o.)
1 l
Myron M. Cherry Suite 4501 One IBM Plaza Chicago, Illinois 60611 (312) 565-1177 l
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