ML20133J350
| ML20133J350 | |
| Person / Time | |
|---|---|
| Site: | South Texas  |
| Issue date: | 10/16/1985 |
| From: | Sinkin L Citizens Concerned About Nuclear Power, INC. |
| To: | Atomic Safety and Licensing Board Panel |
| References | |
| CON-#485-816 OL, NUDOCS 8510180389 | |
| Download: ML20133J350 (13) | |
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U9ff UNITED STATES OF AMERICA 10/)d/95
- 5 0CT 17 A10 M9 NUCLEAR REGULATORY COMMISGIOt BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of
(
)
HOUSTON LIGHTING AND
(
Docket Nos. 50-498 OL POWER COMPANY, ET AL.
)
50-499 OL (South Texas Project,
(
Units 1 and 2)
(
gCeN8 [19I100 10 SEOEgN IHg EH95E 11 BECOBD1 111 OND EOS QlSCOMEBY On October 12,
- 1985, CCANP received the document attached hereto as Exhibit 1.
This document appears, from its style and the draft form and notes at the back, to be Mr. Charles Thrash's notes of the meeting held by HLSP senior management on the morning of September 12, 1981 to discuss evaluations of the contractors bidding to replace Brown and Root (B&R) and to enpress preferences among those contractors.
This document clearly fell within the discovery set forth in the Board's Memorandum and Order (Explanation of Ruling on CCANP Motion to Recpen Phase I Record) dated June 10, 1985. At page 34 of the Order, the Board included as matters to be produced by i
Applicants, the following:
"copius of internal documents or other records (in any
- form, including drafts),
or correspondence or other communications with outside persons (including but not limited to consultants), concerning (1) the decision to seek replacement of and, thereafter, to replace
- DLR, including the dates when those decisions were made.
These records should cover the time frame from April 1,
1901 through September 24, 1981 This document was not, however, produced by Applicants. Stje Letter from Jack R.
Newman to the Board dated July 2, 1905 and acccmpanying documents.
8510100309 051016 PDR ADOCK 05000490 Cf)ry7 C
PDR 1
1 i
In
- addition, CCANP directs the Board's attention to the relevance of this document to the issue of the role played by Applicants' counsel in the removal and replacement of B&R.
This issue arose after a filing by CCANP created a question in the minds of the Board whether Mr.
Jack R.
Newman may have participated other than as counsel in the removal and replacement process.
The Board ultimately decided to accept Applicants' l
portrayal of Mr.
Newman's role as
" remaining within the j
boundaries of providing legal advice." gge Memorandum and Order (Explanation of Ruling on CCANP Motion to Reopen Phase I Record),
1
}
LDP-85-19 dated June 18, 1985 at 13 - 14. Applicants seek a Board finding confirming the Board's earlier decision.
geg App.
F0F a
IX.33 at IX-22.
The document proferred in this motion clearly demonstrates i
that Mr.
Newman did provide his overall assessment of which I
l contractor was preferable (as opposed to confining himself to licensing and contractual issues),
that besides Mr.
Newman only i
Mr.
Goldberg and Mr.
Oprea offered such an atsessment, and that Mr.
Newman offered his assessment in the context of a management
)
i meeting convened for the purpose of making a decision on which
}
contractor would be recommended to the partners.
This
- evidence, confirms Mr.
Goldberg*s testimony at the Public Utility i
Commission of
- Texas, CCANP 90 at 1357 - 58 and supports the proposition that Mr.
Newman acted as other than l eg al counsel in i
this proceus.
}
Of far greater importance, the central issue in this proceeding is the character of the Applicants.
In its Partial I
Initial Decision, the Board said that the most important measure 2
of character would be "whether HLLP made material false statements or omissions and whether it addressed questions propounded by the Staff, the parties, and us with candor." PID at 20.
Furthermore, the Board agreed with CCANP "that there may be Sgmg character defects that are so serious that they are in fact uncorrectable, at least in the absence of a ' radical change in the control of Ethel corporation.
[ footnote omitted] One of these defects might be evidenced by an intentional lack of truthfulness or candor condoned by management.
As we have observed, the Commission in CLI-80-32 emphast:ed the importance of truthfulness and
- candor, and it explicitly pointed out that a lack of truthfulness or candor could prove disqualifying.
[ cite omitted]
- Further, the Commission cited cases suggesting that willful misrepresentations to the Commission, or representations made with disregard for their
- truth, could be grounds, without more, for license denial.'
Cfootnote omitted]." PID at 23 (emphasis in original).
This document proves that Mr.
Newman was indeed present at the HLLP meeting on the morning of September 12,
- 1981, contrary to the sworn testimony of Mr.
Jordan.
Tr.
11981, L.25 - l'1982,
- /
L.7; 11983, L.7 - 10; 12163, L.25 - 12164, L.3.
- /
CCANP recently moved to reopen the Phase 11 record to admit evidence on a similar point.
See CCANP Motion for Board Ordered Production of Documents, To Reopen the
- Record, For New Contention, For Discovery, and For Extensions of Time dated September 30, 1985 at 15-16.
In response to this part of the recent CCANP
- motion, Applicants argued that Mr.
Newman was not part of the " decision-making team" and offered as substantiation these same citations to Mr.
Jordan's falso testimony to show Mr.
Newman was not even present at the crucial final meeting. See Applicants' Response in Opposition to CCANP Motion Dated September 30, 1905 dated October 10, 1985 at 16-17,'particularly the sentence "Indeed, neither the chronology entry cited by CCANP nor any other entry refers to the meeting on the morning of September 12,
- 1981, when the decision to select Bechtel was made by Mr.
Jordan.
(Tr.
- 11981, 11983, 12163-64)." at 17 (Gutterman).
At the same time,
- however, Applicants proferred a proposed finding of fact to the contrary.
Sge App.
F0F IX.20 at IX-17.
This proposed finding states that "HLLP counsel" was present at the decision-making meeting on the morning of September 12, 1981.
Since there is no testimony in the record that would suggest this
- continued on meat page *+**
1
)
This document also proves Mr.
Newman was a key participant in that decision-making meeting, centrary to the sworn testimony a
of Mr.
Goldberg.
Tr.
12677 L.15 - 18, but confirming Mr.
Goldberg's earlier sworn testimony at the PUC of Texas offered as impeachment evidence by CCANP. See Tr. 12464 L.20 - 12466, L.14:
12472, L.1 - 12481, L.21: CCANP Ex. No. 90.
The existence of this document raises other, equally serious questions about the role of Applicants' counsel in this proceeding.
The proferred document is quite similar to other documents produced by Applicants in response to the Board ordered discovery cited above.
See Letter from Jack R.
Newman to the Members of the Board dated July 2,
1985 and accompanying j
documents 17 (CCANP Ex. No. 83) and 18 (CCANP Ex. No. 120). There i
is little question that Applicants should have treated the attached document in a similar fashion, i.e.
produced it.
More disturbingly, the latest document is numbered 81001 through 81004, preceded by a hand written "D".
CCANP Ex. No. 83
- +* continued from previous page ****
" counsel" was anyone other than Mr. Newman and since the proposed finding c t +.es "Tr.
12613-14 (Goldberg)"
wherein Mr.
Goldberg testified that Mssrs.
Jordan, Oprea, Goldberg, and tjewmag met on the morning of September 12,
- 1981, the proposed finding clearly conveys that Mr. Newman was present at that meeting.
This same proposed finding cites "Tr.
12164 (Jordan)"
wherein Mr.
Jordan talks about the meeting in question.
But the proposed finding fails to cite Tr. 12163, L.25 - the last line on the previous page - wherein Mr.
Jordan testifies that Mr.
Oprea and Mr.
Goldberg were the participants with him in that inuoting and does not mention Mr.
Newman.
This omission suggests the l
author was well aware of Mr. Jordan's testimony to the contrary.
In essence, Applicants' have impeached Mr.
Jordan by their own proposed finding of fact.
But such a proposed finding is not evidence.
While the testimony of Mr.
Goldberg is fairly persuasive that Mr.
Newman was present at this meeting, and that Mr.
- Jordan, therefore, testified falsely on this
- point, the exhibit attached
- hereto, as a contemporaneous record of the
- event, is far better evidence and far more explicit on the point in question than Mr. Goldberg*s testimony.
4
l l
documents the meeting on the afternoon of September 12, 1981 and is numbered 81005 through 81011, preceded by a hand written "E".
4 The obvious implication of the numbering is that these two documents were kept sequentially in Applicants' files.
CCANP awaits a plausible explanation for why the document attached 5ereto as Exhibit i was not produced, particularly in light of the obvious implications of this document regarding the i
role of Applicants' lead counsel, Mr. Newman.
This document (as well as Applicants' own proposed finding j
cited above) raises a profound concern as to why Mr.
Newman, who conducted the cross examination of Mr.
Jordan, made no effort on redirect to have Mr.
Jordan correct testimony about Mr. Newman's-l presence and role on the morning of September 12, 1981.
Mr.
Newman clearly knew this testimony was in
- error, that Mr.
i Newman's participation was the point of
- error, and that Mr.
9 I
i Newman's particular role in this decision was not a matter of l
great importance to his client's position before the AGLB.
Falho testimony,
- however, is a
matter of grave importance to the determination of whether his client will receive an operattnq license or not.
CCANP awaits an explanation from Mr.
Newman on his conduct in this matter befor? seeking any further action of
(*,a Board. See 10 C.F.R. Section 2.713.
CCANP contends this motion meets the standards for reopening the record.
Regarding the timeliness criterion, CCANP argues that since 1
Applicants were under ao obligation to provide this document to the Board and parties prior to the commencement of Phase II
- hearings, CCANP cannot be faulted for its unavailability during 5
the hearings.
In
- addition, CCANP is providing this document within a week of its receipt and interrupting its work on CCANP's
- /
Proposed Findings of Fact and Conclusions of Law to do so.
Given the Applicants' clear obligation and the short period since its receipt by CCANP, the filing of this motion to reopen is timely.
As this document calls into question the veracity of Applicants' senior management officials, there is no question as to it raising a significant safety issue.
This document also constitutes a challenge to the integrity of the hearing process in light of the actions of Applicants' counsel.
If the Board intended to rely on the current record to agree-with Applicantc*
portrayal of Mr.
Newman's role in the replacement of Brown and
- Root, See Memorandum and Order (Enplanation of Ruling on CCANP Motion to Roopen Fhase I Record),
1 LbP-85-19 dated June 18, 1985 at 13 - 14; App. F0F IX.33 at IX-22, this document would change that 4tnding.
If the Board intended to rely on the current record for a
finding that there was no need to reverse or modify the Ucard's Phase I findings on Applicants' honesty and candor, the proferred evidence would change than finding.
If the Board intended to opine as to the behavior of Applicants' counsel in this proceeding, the proferred document
- / CCANP notes for the record that the preparation and production of the CCANP Motion to Reopen the Phase II Record:
II and the CCANP Motion to Roopen the Phase II Records III and For Discovery took approximately five working days.
CCANP does not, at this
- time, seek an extension of time for filing its proposed findings of fact and conclusions of law. Should a need for additional time Arise as the deadline draws closer,
- however, CCANP will remind the Doard and the parties of the time needed for these two motions and seek an appropriate extension.
l 6
mav influence that opinton.
For the above and foregoing reasons, CCANP moves the Board to reopen the record to admit the document attached hereto as Eahibit 1.
CCANP also seeks general discovery regarding this document.
Among other
- things, CCANP moves the Board to permit CCANP to e:: p l or e the methods employed by Applicants to produce documents in response to the Board's discovery order of June 18, 1985; the persons involved in implementing said methodology; the location and handling of the attached document during the implementation of said methodology; the reason the attached document was not produced; the knowledge of HLLP management personnel regarding the existence of this document; the knowledge of HL&P counsel regarding the existence of this document; the authoring of Applicants'
Response
in Opposition to CCANP Motion Dated September 30, 1985 at 16 - 17 dated October 10, 1985; and the authoring of Applicants' Froposed Finding of Fact IX.28.
CCANP urges the Board to 9xtend this right to discovery to all parties, i.e.
to the NRC Staff and the State of Texas as well as CCANP.
Respectfully submitted, Lanny Sinkin Representative for Intervenor, Citizens Concerned About Nuclear Power, Inc 3022 Porter St.,
N.W.
- 304 Washington, D.C.
20000 l
/4 (202) 966-2141 l
Dated: October ><, 1905 l
Washington, D.C.
7
UNITED STAIE6 CF AMERIC4 NUCLEAR REGULATORY CGMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of
(
)
HOUSTON LIGHTING AND
(
Docket Nos. 50-498 OL POWER COMPANY, ET AL.
)
50-499 OL (South Texas Project,
(
Units 1 anJ 2)
(
GEBIJEICSIE DE SEEVICE I
hereby certify that copies of CCANP MOTION TO REOPEN THE PHASE II RECORD:
III AND FOR DISCOVERY were served by hand delivery
(*)
or deposit in the U.S.
- Mall, first class postage paid to the following individuals and entities on the 16th day of October 1985.
Charles Bechhoefer, Esquire Brian Berwick, Esquire Chairman Asst. Atty. Gen.
Atomic Safety and Licensing Board State of Texas U.S.
Nuclear Regulatory Commission Environmtl. Protection Washington, D.C.
20555 P.
O.
Box 1 548, Capitol Sta.
Austin, Texas 78711 Dr. James C.
Lamb, III Acministrative Judge Oreste Russ Pirfo, Esquire 313 Wocdhaven Road Office of the Exec. Leg. Dir.
Chapel Hill, North Carolina 27514 U.S.
Nuclear Regulatory Comm.
Washington, D.C.
20555 Frederick J.
Shon Administrative Judge Maurice Axelrad, Esquire U.
S.
Nuclear Regulatory Commission 1615 L Street, NW, Suite 1000 Washington, D.C.
20555 Washington, D.C.
20036 Melbert Schwarz, Esquire Baker and Botts Mrs. Peggy Buchorn 300 One Shell Pl ata Executive Director, C.E.U.
Houston, Texan 77002 Route 1,
Box 1684 Brazoria, Texas 77422 Atomic Safety and Licensing Bd.
U.S.
Nuclear Regulatory Comm.
William S.
Jordan, III, Esq.
Washington, D.C.
20555 Harmon, Weiss & Jordan 2001 S Street, N.W.,
Suite 430 Atomic Safety and Licensing Washington, D.C.
20009 Appeal Board U.S.
Nuclear Regulatory Comm.
Pat Coy Washington, D.C.
20555 5106 Casa Oro San Antonio, Texas 78233 Docketing and Service Section Office of the Secretary Ray Goldstein U.S.
Nuclear Regulatory Comm.
1001 Vaughn Bldg.
Washington, D.C.
20555 807 Brazos Austin, Texas 78701
(
Lanny Sinkin
- Re Diccucciono among STP participants SeptemDer 22, 19o1 regarding rcpla msnt of Architect /
Enginocr cnd Ccnotruction Manager EXHIBIT 1 lOprea,Goldberg,NetsmanandCowanandthewritermetinthe At 9:00 a.m. on September 12, 1981 Messrs. Jordan, i
25th floor conference room at Houston Lighting & Power Company to review the presentation that was to be made by HL&P during the afternoon to the other STP participants.
Mr. Goldberg began by presenting a series of slides g hat would be shown during the afternoon.
The slides were as i
t follows:
The first two slides compared personnel by name in the eleven key slots for Bechtel, Ebasco and Stone
& Webster and the total resources of each organization i
and the places where different types of work would be done by each.
Mr. Goldberg explained that the Westinghouse turnkey proposal was not responsive to the Company's request for proposals and, therefore, had been disregarded.
4
- The next slide concerned logistics.
Ll The next slide showed proposed staffing levels I
at various stages of the work over the next year for each of the three organizations.
j The takeover experience of each of the organizations was compared on the next slide.
Planning, scheduling and cost estimate projections j
f were next compared, Bechtel expecting to complete this l
work in nine months, Stone & Webster in ten months and i
Ebasco in six months (again indicating, according to Mr. Goldberg, that Ebasco simply did not understand the scope of the work required).
l The final slides compared the takeover strategies Each would be willing to work
]ofthethreebidders.as a consultant to HL&P during the time required to I
phase out the existing contractor and phase in the successful bidder.
Mr. Goldberg explained that the construction of safety-related work will cease during the transitional period and that " construction", as it is used on the slides, will consist of rework, main-tenance of equipment already delivered, etc.
At 10:15 Mr. Newman began a discussion of licensing ge problems attendant upon the proposed change.
He felt that there was an 80s chance that a CP amendment would be required for the change of engineers (if a CP amendment is not required, an amendment of the FSAR would be the only required action).
If a CP amendment is required, Mr. Newman felt that there are two possible forks in the regulatory road:
O stool
Fork 1.
Tno NRC would rCquiro that a notico be icsued cnd that a h0cring be hold on tho quootion of "significant hazards".
If this occurs, which Mr.
Newman felt he had to give a 50-50 likelihood, a hearing could take as long as a year to complete but in vien of the transition that would be required in l
engineering at the site this may not represent much time lost.
Fork 2.
No notice or hearing - time much
/d) shorter.
At 10:25 Mr. Newman passed out and discussed the lltinueduntil10:40." implementing actions" schedule sheet, which discussion c At 10:40 Mr. Oprea asked Mr. Cowan to discuss the l][rightoftheCompany,underitscontractwithBrown& Root, to make the proposed change.
Mr. Cowan cited Section 3.4 of
,the contract and advised Mr. Jordan that there was no legal problem in the Company's doing what it wanted to do in reducing Brown & Root's scope.
Messrs. Goldberg, Newman and Oprea thereupon, at 11:00 I3 a.m., gave their individual assessments of the relative merits of the several contractors, which assessments were as follows:
Mr. Goldberg expressed the view that if the lqcompanywerestartingfromscratchhewouldchoose Bechtel but this job is not starting from scratch.
He felt that the Stone & Webster plan for sorting out the present difficulties is best and that Stone &
Webster is offering the best people.
He expressed the opinion that Bechtel would be better in Phase B and that a panacea would be to have Stor.e & Webster do Phase A and Bechtel do Phase B but that can't be done.
i l
Considering all factors, he favored Stone & Webster.
Mr. Newman said that he loans toward Stone &
f$Websteronaclosecallbutrecognizesthatthejob may overtax Stone & Webster.
He concluded by saying i
that either Bechtel or Stone & Webster was a good choice.
O S 000 i
1 Mr. Oprea expressed the opinion that Stone &
f h Webster is very impressive technically and that he was concerned somewhat about Bechtel's work " packages".
Be concluded that in his opinion it was almost a tie i
between Bechtel and Stone & Webster but he felt that the edge had to go to Bechtel.
A discussion of these views followed until noon when l7themeetingwasadjournedforlunch.
[
DiccuosiCnc amc STP participanto
ptember 22, 1981 l
Re regcrding rcplccom:nt of Archittet/
Enginocr cnd Conctructicn Man: gor J.
At 9:00 a.m. on September
, 1981 Messrs. Jordan, ISoproa, Goldberg, Newman and Cowan and the writer met in the 25th floor conference room at souston Lighting & Ppwer Company Mdf to review the presentation that was to be madef uring the afternoon to ths other STP participants.
Mr. Goldberg began by presenting a series of slides
/i The slides were as that would be shown during the aftornoon.
follows:
The first two slides compared personnel by name in the eleven key slots for Bechtel, Ebasco and Stone
& Webster and the total resources of rganization
)
and the places where different types of work would be OMWr*
Mr. Goldberg explained that the Westinghouse done4 turn-key proposal was not responsive to the company's been dis-request for proposals and, therefore, regarded.
The next slide concerned logistics.
2l The next slide showed proposed staffing levels at various stages of the work over the next year for each of the three organizations.
take-over experience of each of the organizations awas compared on the next slide.
Planning scheduling and cost estimate projections j
ere next compared, Bechtel expecting to complete this l
l work in nine months, Stone & Webster in ten months and Ebasco in six months (again indicating, according to 06 003 1
_.m.
ew -
-u
.. ~...
%Mr.Goldberg,thatEb3CcocimplydidnotundGrotondtha I
l,
, scope of'the work required).
The final slides compared the take-over strategies of the three bidders.
Each would be willing to work as i
a consultant to EL&P during the time required to phase l
'. out the existing contractor and phase in the successful bidder.
Mr. Goldberg explained that the construction of safety-related work will cease during the transitional period and that " construction", as it is used on the k
slides, will consist of rework, maintenancejequipment already delivered, etc.
At 10:15 Mr. Newman began a discussion of licensing roblems attendant upon the proposed change.
He felt that there was an 804 chance that a CP amendment would be required for the change of enginee If a CP amendment is required, Mr. Newman felt that
,there are two possible forks in the regulatory road:
2 af be issued Fork 1.
The NRC would require that a notice /and M A -
I
.y I
hearing be held on the question of "significant hazards".
If this occurs, which Mr. Newman felt he had to give, a g
l 50-50 likelihood, a hearing could take as long as a year I
to complete but in view of the transition that would be required in engineering at the site this may not repre-sent much time lost.
fipfk g.. & ndSie !) k"?= 5 b****b +j ^^
l At 10:25 Mr. Newman passed out and discussed the 7.7"implementingactdons"'schedulesheet,whichdiscussioncon-tinued until 10:40.
At 10:40 Mr. Oprea asked Mr. Cowan to discuss the Wright of the company, under its contract with Brown & Root, h
N
- ,, =
. =x
==
Mr. Cowan cited
.etion 3.4 of p to mako the propoc% chnngo.
the contract and advised Mr. Jordan that there was no legal problem in the Company's doing what it wanted to do in reducing Brown & Root's scope.
Goldberg Messrs. apres, Newman and Oprea thereupon, at 11:00 1
%a.m.,gavetheirindividualassessmentsoftherelativemerits of the several contractors which assessments were as follows:
j Mr. Goldberg expressed the view that if the Company 30were starting from scratch he would choose Bechtel but this job is not starting from scratch.
He felt that the Stone & Webster plan for sorting out the present diffi-culties is best and that Stone & Webster is offering the best people.
He expressed the opinion that Bechtel would be better in Phase B and that a panacea would be to have Stone & Webster do Phase A and Bechtel do Phase B but that can't be done.
Considering all factors, he favored Stone &
Webster.
Mr. Newman said that he leans toward Stone & Webster 3l on a close call but recognizes that the job may overtax Stone & Webster.
He concluded by saying that either t
Bechtel or Stone & Webser was a good choice.
A Mr. Oprea expressed the opinion that Stone & Webster 31is very impressive technically and that he was concerned somewhat about Bechtel's work " packages".
He concluded that in his opinion it was almost a tie between Bechtel and Stone & Webster but he felt that the edge had to go to Bechtel.
A J =#m.
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