ML20148N743

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Transcript of 880405 Telcon in Washington,Dc Re Offsite Emergency Planning.Pp 9915-72
ML20148N743
Person / Time
Site: Seabrook  NextEra Energy icon.png
Issue date: 04/05/1988
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NRC COMMISSION (OCM)
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CON-#288-6066 ASLBP, OL, NUDOCS 8804070296
Download: ML20148N743 (61)


Text

q~q O UNITED STATES NUCLEAR REGULATORY COMMISSION

.=........... ...... ......................... ...............

In the Matter of: )

) Docket tios. 50-443-OL l PUBLIC SERVICE COMPANY OF ) 50-444-OL l tJEW HAMPSHIRE, et al. )

(SEABROOK STATIOrl, Ut1ITS 1 Af1D 2) ) Offsite emergency planning O

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/ ;c HERITAGE REPORTING CORPORATION O oeua w 1224 L Street, N.W., Sake 644 WseMagtoes, D.C. 20005 I

0804070296 800405 PDR ADOCK 0b000443 g T PDR

1 9915

' 1 UNITED STATES NUCLEAR REGULATORY COMMISSION e 2 ATOMIC SAFETY AND LICENSING BOARD

.Sec50T&I 3

In the Matter of: )

4 ) Docket Nos. 50-443-OL PUBLIC SERVICE COMPANY OF ) 50-444-OL 5 NEW HAMPSHIRF, et al. .)

(SEABROOK STATION, UNITS 1 AND-2)-) Offsite emergency planning 6

7 Tuesday 8 April 5, 1988 l

9 West Tower, Room 428 4350 East-West Highway 10 Bethesda, Maryland .

11 The telephone conference convened, pursuant'to 12 notice, at 10:08 a.m. i i

13 BEFORE: HON. IVAN W. SMITH, CHAIRMAN -

() 14 HON. GUSTAVE LINENBERGER, JR., MEMBER HON. JERRY HARBOUR, MEMBER i

Atomic Safety and Licensing Board 15 U.S. Naclear Regulatory Commission Washington, D.C. 20555 16  ;

APPEARANCES: ,

17 '

For the Applicants: i 18 THOMAS G. DIGNAN, JR., ESQ. i I

19 Ropes & Gray 225 Franklin Street 20 Boston, Massachusetts 02110 21 For the Federal Emergency Management Agency:  ;

22 H. JOSEPH FLYNN, ESQ.  !

Federal Emergency Management Agency i 23 500 C Street, S.W.

20472 Washington, D.C.

?4 i (Continued) .

25 I

( l Heritage Reporting Corporation  !

(202) 628-4888 l 1

e l

9916 N' 1 APPEARANCES: (Continued) 2 For the State of New Hampshire:

3 GEOFFREY M. HUNTINGTON, ESQ.

Office of the Attorney General 4 Statehouse Annex Concord, New Hampshire 03301 S

For the Intervenor NECNP:

6 ELLYN WEISS, ESQ.

7 Harmon & Weiss 2001 S Street, N.W.

8 Washington, D.C. 20009 9 For th7 Intervenor SAPL:

10 ROBERT BACKUS, ESQ.

116 Lowell Street 11 Manchester, New Hampshire 03105 12 For the Intervenor Massachusetts Attorney General:

13 STEPHEN H. OLESKEY, ESQ.

(7-j)

Commonwealth of Massachusetts 14 One Ashburton Place, 19th Floor Boston, Masschusetts 02108 15 For the Intervenor Town of Hampton:

16 (No appearance) 17 -

For the NRC Staff: (

18 7 SHERWIN E. TURK, ESQ.

19 Office of General Counsel '

U.S. Nuclear Regulatory Commission 20 Washington, D.C. 20555 21 22 23 24 25 O Heritage Reporting Corporation (202) 628-4888

9917 1 JUDGE SMITH: On the record. Let us begin with 2 reviewing Mr. Oleskey's telephone call last night.

3 Mr. Oleskey called inquiring if a telephone conference could be 4 set up because of a claim of privilege asserted 5 by -- oh, Mr. Flynn, you are present, are you not?

6 MR. FLYNN: Yes, Your Honor.

7 JUDGE SMITH: Asserted by Mr. Flynn. And I said that 8 is a good idea, because we wanted to have a telephone 9 conference to discuss the considerations of the telephone b And that is the deliberative process 10 conference of April 1st.

11 or executive privilege problems that still remain. Let us 12 begin with Mr. Oleskey repeating what he told me last night.

13 MR. OLESKEY: I told you in substance, Judge, that O 14 during the deposition of Mr. Thomas that I asked a question 15 which led Mr. Thomas to testify that there was a meeting 16 between FEMA and the NRC on the 19th of January of this year 17 involving various high officials at FEMA, as he understood it, 18 and various officials of the NRC incl-  ?.ng Victor Stello.

19 And he testified that a report of that meeting had 20 been given to George Watson, one of the counsel to 21 FEHA -- I am sorry, that George Watson, one of FEMA's counsel 22 had been present, and had reported on the meeting to Joe Flynn, 23 who had reported to Thomas.

24 And he said that the report given to him was that 25 FEMA had negotiated away a negative finding at the meeting with O Corporation Heritage Reporting (202) 628-4888

,~ 9918 Stello. But the meeting had gone from 1:00 until 6:30, and 1

2 that Stello had indicated that the NRC would engage in total 3 war with FEMA if FEMA did not. change its testimony in the' beach 4 population.

5 He further said that Grant Peterson, identified as 6 the Deputy Director of FEMA for state and-local programs, had 7 agreed to make changes; changes in the FEMA position, it 8 appears, from the context of his testimony. .

9 JUDGE SMITH: What is it that you would like to have?

10 MR. OLESKEY: He then testified that he had notes, I 11 believe, one page, two sides, which cortained additional 12 details on the information that he got from Joe Flynn in that 13 meeting, plus related information that he got from Bill Cumming h 14 the next day and Joe Flynn on the 21st, two days later.

15 I asked for the notes prefatory to further inquiry as 16 to the entire substance of that meeting and any later reports 17 on what appeared from his testimony to have been continuing 18 negotiations between the two agencies that week over the nature 19 and scope of FEMA's testimony, ultimately the testimony filed 20 on March 14th.

21 Mr. Flynn then indicated in substance that he was not 22 going to produce the notes or allow further inquiry as to the 23 scope of the meeting of the 19th, or the communication from 24 Cumming on the 20th or his own further conversation on the 25 21st, because of attorney-client privilege. And I think that O Heritage Reporting Corporation (202) 628-4888

9919 fr .

11 1 Mr. Flynn perhaps should speak further to-that point himself.

2 MR. FLYNN: Yes, Your Honor. The basic issue in my 3 mind is the scope of discovery. 'I have been very cautious in 4 making objections. And until' yesterday with one exception, I 5 have not instructed the witness not to answer questions, and I 6 have not refused to produce documents.

7 But where the line of questioning was going was 8 directly into communications with other agencies. That is 9 obvious from the testimony that Mr. Oleskey referred to. And 10 the issue of attorney-client prjrilege is secondary, although I 11 insist that it is important.

12 I had in mind when I made the objection and refused

13 to produce the document the conversation that we had on 14 April 1st, the conference call. And I had understood you to 15 say, although it was not by way of a ruling, that the discovery l

16 should be focused, that the deposition should concentrate on l

17 whether FEMA had legal, technical, and policy reasons for the, 18 position that it adopted.

19 And I also understood you to say that calls from the l

20 White House, as an example, were not within your concept of a l

21 properly focused discovery effort. That, I submit, is the 22 issue here.

23 JUDGE SMITH: Well, my comment about calls from the

! 24 White House and other potential influences upon Mr. Peterson's 25 action in approving FEMA's current position assumed that

(

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9920 x' 1 Mr. Peterson would be saying that he acted solely upon the 2 advise of his staff, and ignored other influences.

3 The premise of our discussion was that Mr. Peterson 4 approved a position set out in the testimony based upon advice 5 that he received from his staff and the reasons set out in the 6 testimony and for no other reason. If in fact there were other 7 reasons underlying the policy decision, other influences 8 underlying the policy decision, that might be another matter.

9 MR. FLYNN: Mr. Thomas was not at the meeting. We 10 are talking about double or triple hearsay.

11 JUDGE SMITH: Well, all right. That is another 12 problem, yes, I admit. But let us see if we can resolve now 13 the executive privilege consideration with respect to this 14 information.

15 MR. FLYNN: Did you wish further argument on the 16 executive privilege?

17 JUDGE SMITH: Is it FEMA's position today, I mean 18 position with respect to this conference, that FEMA's position 19 was not influenced by any statement by Mr. Stello?

20 MR. FLYNN: I have not discussed that directly with 21 Mr. Peterson. I would have to say that I believe that would be 22 his position. But obviously, other people would draw other 23 inferences from the testimony which was elicited yesterday.

24 JUDGE SMITH: So I do not believe that we are able to 25 decide this issue now on executive privilege grounds. You O Heritage Reporting Corporation (202) 628-4888

9921 1- could move on to your other grounds, attorney-client. You 2 first raised it as to scope.

3 MR. FLYNN: Yes.

4 JUDGE SMITH: I do not think that we can resolve it 5 as to scope, if by scope you are referring to our discussion as 6 to the boundt of the executive privilege. I'do not think that 7 scope as to relevancy is going-to resolve the problem. But we 8 have not discussed triple hearsay, reliability, and 9 attorney-client.

10 MR. FLYNN: Well, I think that the hearsay aspects 11 are obvious, and do not need to be belabored. Let me talk 12 about attorney-client. The conversations that I had objected 13 to were principally in the context of witness preparation.

O 14 Some of them were in the context of developing the testimony.

15 In any case, they are conversations between me as counsel for 16 FEMA and in this particular case with Mr. Thomas, who at the 17 time.was a witness.

18 JUDGE SMITH: Mr. Thomas was recording the advice 19 that you gave him?

20 MR. FLYNN: Well, yes. Although I am not admitting 21 the correctness of the report.

22 JUDGE SMITH: The accuracy of the report.

23 MR. FLYNd: Right.

24 JUDGE SMITH: Okay. Now who is the client?

25 MR. FLYNN: The client if FEMA. It is not O Heritage Reporting Corporation (202) 628-4888

9922

/ 1 Mr. Thomas, and it is not Mr. Peterson, nor any other witness.

2 It is FEMA. Now if the privilege is to be waived by the client 3 as opposed to the attorney, it would have to be done by someone 4 with the management authority to do that, and not the witness.

5 JUDGE SMITH: Mr. Thomas does not have that 6 authority?

7 MR. FLYNN: That is my point, yes.

8 JUDGE SMITH: All right. Hang on a moment. The 9 Board wants to consult.

10 (The Board confers.)

11 JUDGE SMITH: Back on the record. The Board would 12 like to have clarification.

7- 13 The notes that Mr. Thomas was testifying from were

(-) 14 notes of his conversation with Mr. Flynn as to which Mr. Flynn l

1 15 states are privileged by attorney-client privilege, because Mr.

36 Flynn was discussing with Pr. Thomas testimony and giving him 17 legal advice, is that correct?

18 MR. FLYNN: Wall, I do not know that I was 19 necessarily giving him legal advice. My representation was 20 that it was in the context of either preparing the witness to 1

21 testify or developing testimony.

22 JUDGE SMITH: So it could also have elements of work 23 product?

l 24 MR. FLYNN: Yes.

25 MR. OLESKEY: I would like to be heard on this at O Heritage Reporting Corporation (202) 628-4888

I>

9923-1 some point, Your Honar.

i 2 JUDGE SMIT 111. Mr. Oleskey.

3 MR. OLESKEY: Is this a good time!

4 JUDGE SMITH: Yes.

5 MR. OLESKEY ' Just briefly with respect to hearsay,-I

. , 6 do not;think that is an operative objection here. Because 7 generally in depositions, any knowledge or information which a 8 witness has which has come to his attentio., which may lead to ,

9 admissible. evidence is admissible in deposition.

10 With respect to attorney-client privilege, first of 11 al] , Mr. Thomas has been allowed to testify freely for-two'and 12 a half days with respect to all kinds conversation with 13 Mr. Cumming and Mr. Flynn, including a good portion but l.

O 14 apparently not all of the conversation which has been objected

) 16 to.

16 It is a waiver'in my view. And the only person who 17 cou]d have asserted pr.vilege on behalf of 'he client agency is .

18 Mr. Flynn by letting Mr, Thomas testify in that fashion as long 19 and freely at he did including this subject. It is clearly a 20 waiver.

21 Secondly, in any event, a report of an interagency 4

22 meeting which is essentially what we have here is hardly the kiad. of advice, let alone confidential advice, which the

. pt .. e is designed to address. So do not think that the

,

  • e exists in any case, because he was not being given 1

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9924 C)

\L/ 1 advice or counsel, but he was being told about a meeting.

2 Even if there is, it was waived by the repeated 3 inquiries that were unchalle".ged into all k.inds of 4 communications back and forth between counsel.

5 Thirdly, not as importantly, with respect to the 6 portien of the testimony that has been objected to that is Mr.

7 Lumming's, the communication of the 20th, Mr. Flynn expressly 8 waived on the record on the second day of Mr. Thomas's 9 deposition any communications with Cumming, as I understood it, 10 including specifically any communicat. ns between the Witness 11 Thomas and Cumming.

12 So what we are saying is that the only way to 13 establish whether or not this was an entirely irregular O 14 govecnmental process is to find out from Mr. Thomas, the 15 witness that we have, what he knowe about the regularity or 16 irregularity of that process.

17 He has now given us evidence which is substantiated 18 by people who were at the meeting including both McLaughlin and l

19 Peterson, whose deposition requests that the Board is aware are 20 pending, that might well lead to admissible evidence, because 21 it would show that the Commission, FEMA, the authority was 22 influenced by fcctors e'xtraneoue to ordinary governmental 23 delicerations.

24 I think that we should be allowed to make a full

( 25 record now from Thcmas at whatever level of hearsay it might O Heritage Reporting Corporation (202) 628-4888 i

I s- - ._ _ ._

9925

{T/ 1 otherwise be in order to have sufficient grounds to persuade 2 the Board or anyone else that we are entitled to follow up on 3 these seemingly very important matters with Peterson and 4 McLaughlin when it comes time for their depositions.

5 JUDGE SMITH: Now would you review again your 6 statement about the conversation between Thomas and Cumming?

7 MR. OLESKEY: Well, he was not allowed to testify to O the conversation with Cumming on the'20th.

9 JUDGE SMITH: He was not?

10 MR. OLESKEY: No. Only to stato that there had been 11 such a conversation, apparently as a follow-up to his previous 12 day's conversation with Attorney Flynn. Then he was allowed to 13 identify a similar conversation with Attorney Flynn on the O 14 21st, two days after the initial conversation, which as we

< 15 understood it, appeared to be a follow-up to the previous 10 conversation with Attorney Flynn.

17 JUDGE SMITH: Where has Mr. Flynn waived, on behalf i

18 of his agency, where has he waived the privilege?

19 MR. OLESKEY: Well, he certe. inly waived it by letting i 20 the Witness Thomas discuss a good deal of the substanco of the 21 meeting of the 19th, the one at which McLaughlin and Peterson 22 were present together with Stello and other officials from the 23 NRC, and to point out that at that meeting that it was reported 24 to him that FEliA had negotiated away this negative finding with 25 respect to its position on Seabrook, and that Stello had i N'N )

! Heritage Reporting Corporation (202) 628-4888 i

9926 ,

1 indicated that if this did not happen that the NRC would engage 2 in total war with FEMA.

3 So two very important statements were made abeut what 4 happened at the meeting. I want to explore anything else that 5 was said at the meeting, which might arguably benefit FEMA as 6 much as the Intervonors, since it will be a complete record as 7 reported to this witness. And then find out what additional 8 information was reported to the witness from Cumming on the 9 20th of January and Attorney Flynn on the 21st, which it 10 appears from the context of the examination related to ongoing 11 discussions between the two agencies about the scope of FEMA's 12 testimony.

,- 13 (Continued on next page.)

14 15 16 17 18 19 20 21 22 23 24 25 1

O Heritage Reporting Corocration (202) 628-'";99

9927 O

kl 1 MR. FLYNN: May I respond, Your Honor?

2 JUDGE SMITH: Yes, Mr. Flynn.

3 MR. OLESKEY: Briefly, the other thing, the Thomas 4 report about the meeting of the 19th, which seems to us very 5 important, is that, quote, and I am reading from the 6 transcript, "Grant Peterson had held up very well, but had 7 agreed to make changes."

8 JUDGE SMITH: Who said that?

9 MR. OLESbEY: That's Thomas testifying te what he was 10 told Peterson ha6 said or done et the meeting of the 19th. And 11 this was all reported, according to Thomas, to Attorney Flynn 12 by George Watson, who was one of those attending the meeting 13 for FEMA.

n 14 JUDGE SMITH: And your point is that that has gone so 15 far that whatever privilege there was has now been waived?

16 MR. OLESKEY: Correct.

s 17 Also, I feel more broadly that you :an't pick and 18 choose your spots with respect to attorney / client privilege.

19 You either invoke it as an agency with respect to a particular 20 witness and you are consistent, or you don't invoke it and the 21 witness testifies freely. But you can't decide merely because 22 a particularly sensitive or potentially embarrassing matter is 23 reached that then selectively you are going to invoke it.

24 MR. FLYNN: May I respond, Your Honor?

25 JUDGE SMITH: Mr. Flynn.

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\s 1 MR. FLYNN: If the position that Mr. Oleskey has just i

^

2 advocated is tantamount to saying if I allow any question 3 whatsoever about a communication that I had with the client, or 4 witness for FEMA, then I valve this forever under all  !

5 circumstances, and I submit that is simply not the law.

6 JUDGE SMITH: Did you know that Mr. Thomas was 7 bringing those notes to the deposition?

8 MR. FLYNN: No, Your Honor.

9 JUDGE SMITH: Did you know that he even had such 10 notes?

11 MR. FLYNN: Well, I wasn't surprised, but I did not 12 know that in advance. And I know from working with Mr. Thomas 13 that he customarily keeps notes.

O 14 MR. OLESKEY: Mr. Thomas has been testifying 15 throughout with large piles of notes from various sources in 16 front of him, and has used them frequently to refresh his 17 recollection.

18 MR. FLYNN: There are other points that I would like 19 to make, Your Honor.

20 JUDGE SMITH: Mr. Flynn.

21  !!R . FLYNN: Yes. In our -- it seems to me that it's 22 difficult to focus the argument that we ere making now without 23 the decision on the matters that were reised in our conference 4

24 call on Friday, on April 1st.

j 25 One of the things that you indicated that you were l

Heritage Reporting Corporation (202) 628-4888

~

9929 i O) k- 1 giving consideration to at that time was a Board-supervised 2 deposition of Grant Peterson, And it seems to me it makes a 3 difference in how we would decide to approach the pending 4 issue, or even argue the pending issue if we knew what your 5 decision on that was going to be.

6 Mr. Oleskey is arguing that he needs more information 7 about what Mr. Thomas says was reported to him by me, which he 8 says was reported to me by Watson, which is the report of what 9 someone else said at the meeting. I am not necessarily 10 advocating that we go ahead with the deposition of Mr.

11 Peterson, 12 My point is it makes a difference in how we perceive 13 the need to proceed with Mr. Thomas.

O 14 MR. OLESKEY: I don't entirely agree with that for 15 this reason, Your Honor i

16 I think we are entitled to know now what the report l 17 of the meeting was from one agency official to another back on 18 the 19th of January, two months almost before the testimony was l

19 filed since FEMA takes the position that its mind was ,

I 20 completely opaned, according to the testimony that has been 21 given in the various depositions in the last two weeks, until 22 March 4th. And Mr. Peterson might have a differer.t view or 23 recollection, even an initial view given all that happened 24 since the 19th of January, that would Le very different than l 25 whatever Mr. Flynn or Mr. Watson recollected when the events O Paritage Reporting Corporation j "

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9930 1 were fresh and reported on to Mr. Thomas.

2 So I think it is important to get that slice of 3 recollection contemporaneous in time with the meeting, not 4 simply to be dependent upon what somebody else said later as a 5 check on what's reported.

6 MR. FLYNN: Your Honor, I have a fundamental concern 7 here. The nature of this hearing is undergoing some real 8 change. The hearing is no longer about will the beach .

9 population on Seabrook and Hampton Beaches be adequately 10 protected. It is no longer about does FEMA's position have a 11 legal, technical or policy basis.

12 The issue is about secret meetings between NRC and 13 FEMA.

O 14 And I submit the choice is squarely before you is, is 15 that the direction that these hearings ought to go. If that 16 subject is opened up, that will be the central focus of the 17 hearing.

18 MR. OLESKEY: Your Honor, we, the Intervenors have 19 been crystal clear from the time the depositions were noted, 20 and in fact advance of the noticos when we discassed the 21 hypothetical of FEMA potentially dramatically changing its 22 position.

23 And our view has been consistent that if that 24 happened, we would want to explore the substance of the new 25 positions to undurstand technically legally what underlay O Heritage Reporting Corporation (202) 628-4888 1

9931-I)

N- 1 it, and the process under which the original ducision of June 2 and September of '87 was reached and the circumstances under 3 which this agency, using Mr. Flynn's former metaphor, arrested 4 the liner in mid-course and caused it to do a 180 degree turn.

5 We haven't wavered from that, and throughout these 6 depositions of these fear FEMA witnesses there have been 7 questions that clearly pursued both lines, and both lines, I 8 have no doubt, will be very much be the focus of the hearings .

9 when they resume in May, 10 JUDGE SMITH: All right, let's see if we can take 11 11 these items one at a time and discuss them and see if we come 12 out with any logical end to it.

13 With respect to the meetings, if there were, assuming i 14 there were meetings between the NRC and FEMA on the 19th, the 15 fact that there are two different agencies involved does not in 16 any way take away the right to assert executive privilege.

17 The agencies are bound together in this endeavor by 18 the Presidential order giving FEMA responsibilities together 19 with NRC.

20 Furthermore, the memorandum of understanding entered j 21 into by NRC -- although it was the executive director it was, I 22 understand, with the approval of the Commission -- binds the 23 two agencies together as virtually as a single entity. It even

[

24 makes provisions for FEMA assisting NRC, or producing evidence 25 for hearings for them working out between counsel for NRC and i

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9932

('_)

/ 1 counsel for FEMA responsibilities. It creates, jn effect, for, 2 at least for the purposes of executive privilege sufficient 3 privity, that we would regard the meetings between NRC and FEMA 4' as being within the decisionmaking group entitled to 5 consideration for executive privilege.

6 Now, of course, we always have the problem of does 7 the need outweigh the privilege, and we will come to that 8 later.

9 So then we hava apparently FEMA's lawyer in the 10 meeting, and as a consequence -- I am accepting Mr. Oleskey's 11 hypothesis, or representation as the basis for the ruling. I 12 understand Mr. Flynn does not agree that it's accurate, but 13 let's just take it for discussion purposes.

O 14 So Mr. Flynn, as I understand it, was in the 15 meeting --

16 MR. FLYNN: No, excuse me, Your Honor.

17 JUDGE SMITH: No, I'm sorry, he wasn't.

18 MR. FLYNN: Tnat was not the testimony.

19 JUDGE SMITH: It was --

20 MR. FLYNN: What was alleged or what was testified to 21 was that I passed on to Mr. Thomas reports from Mr. Watson.

22 JUDGE SMITH: Mr. Watson, yes.

23 Mr. Watson was in the meeting as an attorney 14 apparently to see what FEMA's position would be and execute it 25 before this Board. I would reqard his role and his efforts as O Heritage Reporting Corporation (202) 628-4888

9933

-)

1 being within the work product, attorney work product privilege, 2 and him conveying that to you, also counsel for FEMA, and L 3 conveying that to a witness, I would regard that as all being 4 within the work product privilege.

5 Furtrier, it is also within the deliberative executive 6 piivilege. So I would regard that as privileged information.

7 The waiver, I agree with Mr. Flynn that you don't 8 waive for all purposes, all times, yeur privilege. However, 9 there is an argument, I guess it's a factual argument, that you 10 can't pick and choose.

11 It seems to me that even accepting Mr. Oleskey's 12 position here you have a discrete -- excuse me a moment -- you 13 have a discrete set of facts here that he wishes to assert his O 14 privilege. I don't see that it's a waiver, but it's not clear 15 to us how far Mr. Thomas got into that January 19th meeting. I 16 don't know. I don't think that he had.

17 Could you tell me about that?

18 MR. OLESKEY: I would be happy to read you the 19 approximately one page that bears on it from the transcript, 20 Your Honor.

21 Shall I do that?

22 JUDr,E SMITH: All right.

23 MR. OLESKEY: It starts at volume 3, Page 50. I am 24 picking up for -- well, I will pick up in the miudle of the 25 page with Thomas's testimony.

O Heritage Reporting Corporation (202) 628-4888

9934 1 "Generally I can't give you much about what went on 2 because I was excluded from the meetings that were held with 3 the NRC and the meetings that were held internally with FEMA to 4 discuss the beach population. But I was told on the 19th by 5 Attorney Flynn - "

6 The witness asks, "Shall I go forward?"

7 Mr. Flynn: "Yes."

4 8 Witness continues: "That Gsorge Watson had called.

9 George had been at a meeting with a large meeting with the NRC.

10 I understand that Vic Stello, and I believe Attorney Turk were 11 at this meeting along with Grant Peterson and Dave McLaughlin 12 and Dick Krimm and his staff. And the report that was given 13 to me was that we negotiated away a negative finding at a O 14 meeting with Stello.

I 15 "I was then told additional information about that 16 meeting which had, according to my information, taken place 17 from 1:00 until 6:30 p.m. on the 19th, to the effect that 18 Stello had indicated that the NRC", the transcript said 19 "wouldn't" but I believe the testimony was "would engage in 20 total war with FEMA if we didn't change our testimony in the l

l 21 beach population. Grant Peterson had held up very well, but

( 22 had agreed to make changes, j

i 23 "Later that week on the 21st, Attorney Flynn had o 24 conversation with xc just as I was leaving.'

25 Then there was an interjection by Mr. Dignan, and a Heritage Reporting Corporation (202) 628-4888 i

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9935

[)

s- 1 question by Mr. Flynn, "What was the pending question?"

2 That led to some colloquy, some unrelated testimony, 3 earlier testimony, and then to this on Page 354.

4 "Were you aware of the meetings during the week of S the 19th of January before they took place? Were you aware 6 they were going to happen?"

7 Answer: "I was aware that there were meetings and 8 that's why I was in Washington."

9 And then he goes on to say that, "I don't believe I 10 was aware there was going to be a meeting with the NRC that 11 week, but I was aware there were going to be policy level 12 discussions that way. That's why I was in Washington."

13 Then ckipping to the bottom of the page, "What was O 14 your understanding about any reason why your agency and the NRC 15 would be meeting that week?"

16 Answer: "To discuss the beach population at 17 Seabrook."

18 And then some other testimony. Ultimately several 19 pages lager I made a request for the notes, and that's the 20 point at which Joe Flynn asserted attorney / client privilege.

21 We then had a colloquy in which I asked if he would 22 assert the privilege with respect to recollection of the 23 witness, further about what the notes said, and also about the 24 two later communications that the witness haa identified having l 25 been made by Bill Cumming and by Attorney Flynn on the 20th and

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9936 O

\-) 1 21st. And Joe Flynn said that he would similarly take that 2 position with respect to those communications.

3 And my recollection would be that would be pretty 4 much the end of it.

5 MR. FLYNN: I would just like to point out a couple 6 of things. ,

7 First, when the original question was asked that 8 elicited the testimony which Mr. Oleskey first read, I did not 9 know what the answar would be. I did assert the objection 10 which we are talking about today the next time a question was 11 asked which directly related to that subject matter.

12 JUDGE SMITH: So your representation is that you

, 13 asserted the privilege as soon as you became aware of the need i

O 14 to.

15 MR. FLYNN: That is my representation, Your Honor.  !

16 MR. OLESKEY
I think that in a direct sense the 17 transcript supports my interpretation which is that Joe decided 18 he had better let the witness testify to a good many things r

19 about communication between himself and the witness, or other 20 FEMA lawyers and officials and Thomas.

21 But when he heard what this was decided to pull back, 22 and I just don't think he is entitled to do that even if it's 23 otherwise privileged.

24 And with respect to work product which we are 25 discussing, Your Honor, I just don't see how a lawyer's factual i

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9937 1 report of what happened at a meeting fits in the category of 2 his uork product.

4 3 JUDGE SMITH: Well, he's addressing the potential 4 witness as I understand it, and reviewing the position of the 5 agency to prepare testimony in this very ,aring, 6 Is that correct, Mr. Flynn?

7 MR. FLYNN: Yes, that is my position.

8 MR. OLESKEY: I don't think that's a very strong 9 privilege where arguably if you had Peterson, McLaughlin or any 10 other person who was at the meeting here today giving a 11 contemporaneous recollection, I don't think they would be able i 12 to invoke work product or attorney client obviously. And I 13 don't think under these circumstances that even the agency O 14 would be able to invoke executive or deliberative process here, 15 because as I understand it that rests fundamentally on a 16 presumption of regularity in the administrative procesr, but 17 that it falls away when you present actual facts which show a 18 realistic danger of partiality, or taint, or undue influence, 19 and that's clearly what we are saying happened here even though 20 it may not be a convention undue --

21 JUDGE SMITH: I can't listen.

22 MR. OLESMEY: Excuse me?

23 JUDGE SMITH: Go ahead, proceed.

24 MR. OLESKEY: Even though it may not be convention 25 undue influence saying outsiders acting on agency, in the O Heritage Reporting Corporation (202) 628-4888

9938 1 context of the relationship of those two agencies and the 2 history that the Board is awara of, there are differences of 3 opinion since approximately last February of '87 over i

4 sheltering at Seabrook.

5 JUDGE SMITH: All right, Mr. Oleskey, you are dumping 6 too much on us. I can only handle it one point at a time.

7 MR. OLESKEY: Excuse me, Judge, I will see what Mr.

8 Dignan says, i

9 JUDGE SMITH: All right. The Board is going to 10 confer for a moment off the record.

11 (Board confer.)

12 JUDGE SMITH: We are back on the record, ladies and i 13 gentlecon.

l O 14 Still trying to take this one point at a time, we 15 believe that the privilege was properly asserted. It was a 16 discrete change in the testimony, and, of course, the portion 17 that he has already testified about is no longer privileged.

l 18 But the part that he hasn't testified about and the notes that t 19 pertain to the balance of his testimony are -- we wil.1 i

20 recognize the world product privilege.

21 And it's nrt only the word product privilege, but the 22 executive privilege follows it through.

23 The question is, should the executive privilege be r

24 preserved. And it is exactly the type of executive privilege 25 that is intended by the cases that I have read on the matter.

() Heritage Reporting Corporation (202) 628-4888 l

9939  ;

1 Here are two agencies charged with an important health and 2 safety consideration, and they are having, assuming that Mr.

3 Thomas is correct, they are having a very, very candid 4 discussion, nobody is holding back on advice to the other, and 5 it is the type of advice that is sought to be preserved by the 6 executive privilege.

7 People apparently had strong opinions, and strong 8 opinions are protected. Strong advice is the very type of 9 advice that is anticipated by the executive privilege. If 30 every bit of advice a decisionmaker receives was bland and 11 uncontroversial, or correct on the face of it, patently 12 correct, there would be no need for the executive privilege.

13 So we think that the executive privilege should apply O 14 if there was in fact a meeting between the NRC and FEMA.

15 However, that's not the end of it.

16 We have been led to understand that Mr. Peterson made 17 his decision based upon, one, the facts and the position set 18 out in the March testimony, and the supplemental testimony of 1

19 January 25th. If Mr. Thomas is correct in what he has already 20 stated, there may be some question as to whether Mr. Peterson J

l 21 would be believed if he said there was no other influence in l

22 arriving at that decision.

]

23 But the problem is we go too far down the road i

24 speculating on what Mr. Peterson might say or what he might not ,

~

i

25 say.

P O Heritage Reperting Corporation (202) 628-4888

9940 i 1 But it seems to me that the Intervenors have come up 2 with some reason to attach the representation that Mr. Peterson 3 made his policy decision based solely upon the advice of his i 4 staff and the information contained in the testimony.

5 But what do we do with that? That is the question:

6 What do we do with that in this case?

7 And as I sit here right now, I don't know. Let's 8 review why we are in this debate today, and it is, as I stated 9 on April 1st, we would not be talking about this for five 10 minutes, or one minute if it were not for the rebuttable 11 presumption.

12 The Board, at the time when the rebuttal presumption 13 uas favoring the Intervers;s, the Board made it clear that we

> ( 14 were not going to be very much impressed by rebuttal 15 pre s un.ptions . We will be impressed by the rationale and the 16 technical basis of FEMA's witnesses.

17 The policy basis is something that we are required by 18 regulation to recognize, but we also recognize that the 19 rebuttable presumption tends to weaken and even vanish when it 20 is brought into question.

21 Now that the advantage goes to the Applicant we feel l

22 pretty much the same way, exactly the same way. The law, the l 23 Commission's regulations, the facts of this case require this 24 Board to look at the testimony of FEMA and give it the 25 appropriate weight.

O Heritage Reporting Corporation (202) 628-4888

9941 1 The policy aspects of the position simply are not 2 that important to us. We can tell you right now we do not feel 3 o great need to.have, in addition to the legal and technical 4 basis, to have a statement of policy from Mr. Peterson, or any 5 other official of FEMA.

6 We wonder even if the rebuttable presumption has any 7 place in a contested hearing.

8 On the other hand, we recognize that the rebuttable 9 presumption is an evidentiary consideration granted by the 10 regulation as to which a party is entitled, and we don't want 11 to sweep it out without full consideration.

12 All of this goes to whether there is a need to set 13 aside the executive privilege for the use in this case. Our O 14 feeling as we sit here now is that we don't see that strong 15 need to -- it may very well be that the deliberative process I 16 privilege led to -- I mean the deliberative process, or the 17 executive process in this care led to a policy which we will 18 ignore, but the executive privilege is intended not for the 19 present case but for the future cases. It is to prevent in the 20 future advisers to decisionmakers being chilled in their 21 willingness to give candid, free advice.

i 22 So we see a strong need to protect the executive 23 privilege in this area. And unless we see a very, very strong 24 need overriding that for the evidence in this case, we are 25 going to protect it.

Heritage Reporting Corporation

(202) 628-4888 M

- . - . _ . , . . , , - , . _ . . . _ . _ - , , . . - _ . , . - - . _ ._.. _ . _ _ . . _ _ _ . _ .- r -- - - - - - -

9942  ;

1 So where you are, I don't know. FEMA is not --

2 number one, FEMA is not a party to this proceeding, has no 3 burden of proof. Institutionally I would imagine that FEMA 4 does not care whether the Board gives them a rebuttal  ;

5 presumption as to their position.

6 There is another matter, too, and that is the 7 memorandum of understanding as to which this Board feels bound, 8 makes it clear that FEMA is not a party to the proceeding and 9 should not be subject to the same discovery requirements that a 10 party would be.

11 We would regard in that respect, then, FEMA as having 12 a certain amount of immunity only from a normal discovery which 13 would be set aside only if FEMA is coming pounding in here 14 strongly asserting the rebuttable presumption of its policy, l

l l 15 which we don't see.

l l 16 So where we are coming out is that the more we hear

! 17 the less likely we are to look at anything FEMA is doing in 18 this case other than the legal and the technical bases as 19 having an influence.

I 20 Now what does that do to the Intervencrs who are 21 pounding on this?

22 The most that you can expect, the most that you can 23 hope to win in your discovery dispute is to diminish the l

l 24 executive privilege -- I mean the rebuttable presumption which 25 FEMA's position is entitled to. And that's why we say that I

(

Heritage Reporting Corporation (202) 628-4838

9943 Q

(J 1 your discovery needs are not that great because we don't give i 2 that much weight to the rebuttable presumption.

3 Mr. Dignan has a right to that if he is otherwise 4 entitled to it, and we -- I guass we understand from his 5 comment on Friday the he does not want that rebuttable 6 presumption swept aside.

7 Well, we are inclined to sweep it aside ber ause we 8 have a situation here which we already know about, vhich we 9 already know about on the evidentiary record and from the 10 discovery proceedings and which our greatest focus is going to 11 be on the technical bases for it, for FEMA's position, and the 12 legal analysis. And it is a position that we took from the

) 13 very first day of this hearing that we will be impressed by the O 14 quality of the rationale and the quality of the technical i

15 basis, and not much impressed in a contested hearing where we 16 have the responsibility of the policy rebuttable presumption.

17 Now that is where we come out right now, and we will 18 hear from whoever wants to be heard from. ,

19 First, I might say to the Intervenors, would you i

20 address the point that I am making that if we do not believe l

21 that the policy aspects are important to us, and that the 22 rebuttable presumption is important to us, what do you have to 23 gain by destroying it?

24 MR. OLESKEY: Well, I would sey. Your Honor, in part 25 that the kind of evidence that the discussion this morning is O Heritage Reporting Corporation (202) 628-4888 l

9944 1 focused on can't fall on the credibility and good faith of 2 the -- potentially of the technical and legal bases that are 3 offered in support of the position, the technical and legal 4 bases which you said the Board considers to be principally the 5 things at issue.

6 JUDGE SMITH: All right, now, you have deposed the 7 technical witnesses.

8 MR. OLESKEY: Right.

9 JUDGE SMITH: And you are prepared to cross-examine 10 them as to their credibility, their candor, their integrity, 11 the whole basis of their technical position.

12 MR. OLESKEY: But they are only the people who carry l _ 13 the ball. They are not the people who set up the plays. They

\J 14 are not the quarterbacks.

15 JUDGE SMITH: Let's assume just for the purpose of 16 arguing that FEMA's decisionmakers have decided to change their 17 position for inappropriate reasons, for corrupt reasons, for 18 the purpose of argument. But we have witnesses who are not 19 party to any such inappropriate decisionmaking, whose testimony 20 is worthy of belief as much as if they had been third-party 21 witnesses.

22 You have had an opportunity to depose those people 23 and discovery their bases, and you will have an opportunity to 24 cross-examine ther..

25 Are the Intervenors -- I think your argument about O Heritage Reporting Corporation (202) 628-4888

h 9945 I 1 the credibility of the technical witnesses j a a good one. But 2 the Intervonors are taking the position that they are entitled 3 to inquire into the policy bases, and that is a two-edged 4 sword.

5 If you argue the importance of that, then you must 6 necessarily be arguing that the rebuttable presumption is an i 7 important consideration to us in the hearing.

8 MS. WEISS: Rebuttable presumption is in the rules,  ;

9 Your Honor, and I don't know whether it can be waived by the 10 parties. Certainly haven't been waived by the parties.

11 And I would just like to make one further point if I 12 may. And that is that if Mr. Oleskey said there is a 13 presumption of regularity that attaches to the activities of (b

'- 14 both of these agencies as a matter of federal administrative 15 law, all the way up through the appeals, the judicial review of 16 these cases, and they will receive deference in accordance with 17 a degree to which there have been irregularity, and if we can 18 demonstrate on thi. record that there is evidence to believe i 19 that the agencies have not moved in a deliberative fashion with 20 regularity but they have either colluded or have been subject 21 to pressure, that is clearly relevant to the degree of 22 deference that they ought to get, not only from you on the 23 rebuttable presumption, but also in court.

24 JUDGE SMITH: So you are going to argue then, Ms.

25 Weiss, that we should give deterence then to_ FEMA's position '

(

Heritage Reporting Corporation (202) 628-4888 l f

s 9946 C

i 1 because it is FEMA's position.

2 MS. WEISS: I am not going to argue that. I expect 3 that there is a rebuttable presumption in your rule.

4 JUDGE SMITH: That's right.

5 MS. WEISS: I don't think that you necessarily have 6 certainly the pre-emptive authority to waive it.

7 JUDGE SMITH: Well, 1.o, we have the authority. The 8 rebuttable presumption is an evidentiary rule, and we have the 9 authority and the responsibility to decide evidentiary matters.

10 MS. WEISS: That's right, on the evidence.

11 JUDGE SMITH: Right.

4 12 MS. WEISS: But we have to have an opportunity to 13 present some of that evidence and to make a case. And I don't

' 14 think it can be waived pre-emptively as essentially a mechanism 15 for avoiding have to put that evidence on the record.

16 We believe it's our right to put that evidence on the 17 record, Your Honor.

18 JUDGE SMtTH: So you're assuming that rebuttable 19 presumption, which is operating against you right now, as your 20 right so you can shoot it down.

21 MS. WEISS: Yes.

22 JUDGE SMITH: Okay. That's creative.

23 MS. WEISS: Well --

24 (Laughter.)

25 JUDGE SMITH: Anybody else want to be heerd on this Heritage Reporting Corporation (202) 628-4888

9947 1 point?

2 MR. BACKUS: Yes, I have got one thing, Judge Smith.

3 This is Bob Backus.

4 You premised much of this discussion by saying that 5 the executive privilege was designed to protect the free flow 6 of advice.

7 JUDGE SMITH: In the future.

8 MR. BACKUS: Yes. And I would just say that I think 9 that -- well, I think on the basis of what we now have what wc 10 are talking about is not advice, not legal advice on the 11 attorneys here, but simply using the attorneys as a vehicle of 1 ?. communication between the agencies. And I would just ask you 13 to consider that that's not something that needs to be 14 protected.

15 JUDGE SMITH: Well --

16 MR. BACKUS: I don't think that we are trying to 17 discover deliberative process within the agency; just further 18 discovery as to exactly what was communicated as a result of 19 this interagency meeting.

4 20 JUDGE SMITH: No, I think that the work product and i

21 the deliberative process are intertwined inseparably in this 22 case. I mean we are talking about a decisionmaking, apparently 23 a meeting in which the cognizant agencies are trying to arrive 24 at a decision that is theirs to make under the law, and the 25 executive privilege follows the communication through Watson, O Heritage Reporting Corporation (202) 628-4888

9948 1 through Flynn to Thomas if it exists, and we found that it does 2 exist. The work product is just another aspect of it.

3 MR. BACKUS: One other point I would like to make, 4 Judge Smith. This is Attorney Backus again.

5 On the second day of the Thomas deposition Flynn and 6 Cumming engaged in an extensive discussion at the very opening 7 in which they made it very clear that they were waiving any 8 privilege for any communication to Mr. Cumming even before he 9 withdrew his appearance and was designated as a witness on 10 January 25th. They went through and got every party to agree 11 that they were not going to assart any privilege.

12 Now part of what we are seeking to discover here, 13 according to Mr. Thomac, is communications that came through O 14 Mr. Cumming, and Mr. Flynn is even trying to maintain the 15 privileges to Mr. Cumming. And as to that I think it's been an 16 explicit undeniable waiver, and I can refer to the transcript 17 pages of the Thomas deposition where this was discussed before 18 Mr. Thomas actually began testifying on the second day.

19 JUDGE SMITH: I am having trouble plugging Mr.

20 Cumming into this --

l l 21 MR. BACKUS: The testimony of Mr. Thomas, Judge l

22 Smith, was that he had notes of conversations after the meeting 23 on the 19th. And I believe he said that some of them came from 24 things he heard from Mr. Flynn, who of course was end is now 25 counsel of record, and some of them came from Mr. Cumming, who Heritage Reporting Corporation (202) 628-4888

{

9949 1 had acted as counsel but had withdrew and became a witness as 2 of January 25th.

3 And what I am saying is that Mr. Cummir.g and Mr.

4 Flynn explicitly waived any privilege in regard to 5 communications made to Mr. Cumming.

6 JUDGE SMITH: At any time?

7 MR. BACKUS: Any time.

8 JUDGE SMITH: Ever.

9 MR. BACKUS: Up to the time of the deposition; that's 10 what they said.

11 JUDGE SMITH: Is that true, Mr. Flynn?

12 MR. FLYNN: Your Honor, it's true in a very limited 13 sense. Let me explain what I mean by that.

O 14 Mr. Cumming came into the deposition room on the 15 morning of the second day of Mr. Thomas's deposition and he 16 said, in effect, I need to know if any of the parties wish to 17 assert any claim of confidentiality or privilege as to r 18 communications made to me, that is to Mr. Cumming.

19 And he said, if I do not hear from any of the 20 parties, and especially if I don't hear that they have gone to 21 the Board and submitted the contents of those communications to 22 the Board in camera, I will assume that no party, or no witness 23 wishes to assert a claim of privilege as to those 24 commurications; that is, communications between Mr. Cumming.

25 And when he was depostd, he again commented that he O Heritage Reporting Corporation (202) 628-4888

I 9950 1 had not heard from any party or any witness that such a claim 2 of privilege was asserted.

3 What we are talking about here is not within the 4 ambit of that. What we are talking about now is communications 5 from Mr. Cumming, and that's different.

6 JUDGE SMITH: Yes, well, what -- I understand that.

7 What did Mr. Cumming have in mind? What witness, 8 what parties would be covered by that?

9 MR. FLYNN: Well, I believe he had in mind 10 conversations that he had with Mr. Turk. In fact --

11 JUDGE SMITH: Oh, I see, all right.

12 MR. FLYNN: And he also may have had in mind

- 13 conversations with Mr. Thomas.

\ 14 But, again, the focus of it was communications to Mr.

15 Cumming and not necessarily communications from him.

16 MS. WEISS: Judge, Mr. Cumming insisted that Ed 17 Thomas state on the record, as every other counsel was asked la to, that he, Thomas, didn't assert any privilege with respect 19 to any communication involving Cumming. And Thones did that on 20 the record after counsel had been asked to do so.

21 I don't understand now this selective interpretation 22 of this, or this limiting interpretation that Joe is putting on 23 what Cumming said.

24 Cumming came in to Thomas's deposition on day one, 25 asked to be heard out of course, said that since he was going O Heritage Reporting Corporation (202) 628-4888 e

9951 l

.m -

1 to be a witness and since Thomas was going to be a witness 2 before anyone, to clear the decks right then, and make it clear 3 thtt no privilege with respect to communications involving him 4 was being asserted period.

5 MS. WEISS: And one certainly can't claim a privilege 6 as to half the conversation. You can't say that you can 7 testify as to what I told you, but not as to what the response 8 was.

9 MR. BACKUS: And lastly, Your Honor -- this is Backus 10 again -- Cumming, of course, testified for two days about 11 conversations he had before he was designated a witness.

12 How he can now be protected against testifying 13 against certain other thir.gs that he said is beyond me.

O 14 MR. FLYNN: Your Honor, this goes back to the part of 15 our conversation earlier today, and that is if waiving 16 privilege in one context means that it's waived in all context, 17 and I believe you have already decided that matter.

18 MS. WEISS: I don't agree. I mean this is the 19 broadest possible pre-emptive general waiver. It was not a l 20 failure to assert a privilege. It was a completely general 21 waiver.

22 MR. DIGNAN: Could I respectfully point out, Your 23 Honor -- this is Tom Dignan -- that the waiver that they are 24 talking about as I heard from Cumming is this.

25 Cumming wanted everyone else to waive. He was O Heritage Reporting Corporation (202) 628-4888

9952

( 1 waiving nothing. He asked everybody else,to waive because he 2 said, I am going to be asked about conversations I had with 3 various people, and if you assert you have got some kind of a 4 privi.lege that I have to uphold for you, I want to know it 5 beforehand. And it wasn't a waiver of the privilege that 6 people went around waiving, people like me. I didn't know what 7 I was waiving, because I didn't think I had a privileged 8 conversation with Mr. Cumming anyway.

9 But the fact of the matter is there was no waiver by 10 FEMA in this action. FEMA sought a waiver from everybody 11 else -- FEMA in the form of Cumming -- that he could talk 12 freely and not be hit over the hecd that he had let go of 13 privileged information as far as they were concerned.

O 14 So I don't how this can possibly be a waiver by FEMA.

15 It was a waiver by everybody but FEMA the way it went around 16 the room.

17 JUDGE SMITH: All right.

18 Well, the meeting of January 19th between officials 19 of FEMA and officials of NRC is privileged, the discussion is, 20 and it has not been waived, and we will regard that as a 21 traditional privilege. We see no need, no litigative needs yet 22 to set that privilege aside for the litigation.

23 It may come up. We don't want to go too far down the 24 road. The argument made that it may affect the credibility of 25 the witnesses, we don't know about that. That's pre. mature for O Heritage Reporting Corporation (202) 628-4885 1

9953 1 us to rule on that.

2 We don't see -- I didn't read Mr. Keller's testimony, 3 or Dr. Hock's testimony as being infused with policy 4 considerations, but you will have an opportunity to cross-5 examine those people before the Board and let us make a 6 judgment as to what their candor is and what their credibility

~7 is, if they really believe what they are saying or if they are 8 saying it because they were threatened, or coerced into it, 9 that's your -- your chance will come up. That's what we are 10 paid to decide.

11 Your difficulty is that I do think the Intervenors 12 have made a threshold showing that we could not simply just 13 take an affidavit from Mr. Peterson that his policy was O 14 predicated solely upon the history as set out by Mr. Cumming in 15 the testimony and the advice of his staff at a meeting where 16 they arrived at it. I think that they have raised enough 17 outside, extraneous information to be allowed to -- if Mr.

18 Peterson is going to have any input at all -- to not be 19 required to rest upon an affidavit. So there is where you are.

20 (Continued on next page.)

21 22 23 24 25 O Heritage Reporting Corporation (202) 628-4888

3 9954 1 MS. WEISS: Your Honor?

2 JUDGE SMITH: Ms. Weiss?

3 MS. WEISS: Will we be precluded, assuming there is 4 some reason to provide deposition for Matthew to Peterson about 5 what happened at the meeting of the NRC on the week of January 6 19th?

7 JUDGE SMITH: Where we are right now, as far as I see 8 it, well, we didn't get to the supplemental testimony yet -- I 9 want to talk about that in a moment -- but we have witnesses 10 that are coming to the hearing, and they're going to testify, 11 and we're going to make our decision based on upon what they 12 said and the cross-examination of those witnesses. And we 13 don't see, at this time, any rebuttable presumpt: n in feror of O 14 FEMA's position. We will look at it as to the quality of their 15 analysis and the -- the quality of their analysis. As we would 16 any other witness. There's nothing magic. There is no special 17 weight because of the fact that there are FEMA witnesses 18 attendant to that panel.

19 To go to your other point, Ms. Weiss, it has not been 20 the custom of this board to give any special weight to staff 21 witnesses. They stand or fall upon their own credibility 22 unless the issue, itself, is the staff's position.

23 MS. WEISS: The reason why I asked the question, Your 24 Honor, is that, frankly, I am not interested in having Mr.

25 Peterson if all that I am allowed to ask him is for him to O Heritage Reporting Corporation (202) 628-4888

9955 1 elaborate on his official version of reality and if I'm not 2 allowed to ask him about other facts which might cast a 3 different light, which might offer an alternative view as to 4 what was actually going on at FEMA.

5 It's no good whatsoever to me to provide a forum for 6 somebody to review what I know is going to be a one-sided 7 version of facts, since I know I can't ask questions about 8 other facts that I know.

9 JUDGE SMITH: Well, Ms. Weiss, when I look at the 10 equities of the situation before us, that the most you can --

11 putting aside witness credibility -- the most that you can hope 12 for in your discovery efforts is to shoot dawn that rebuttable 13 presumption and the board deciding now that, in the absence of O 14 something further which has been offered to us, there is no 15 rebuttable presumption, then you have need for the information 16 you're seeking.

17 MS. WEISS: If he's supporting his ruling, 18 eventually, then, evidence of improper conduct, of corruption 19 or collusion between the two agencies is going to be ruled out 20 as though this points forward. Then that, you know, from 21 my --

12 JUDGE SMITH: Put it in a diffe' rent context.

23 MS. WEISS: Well, I don't want to hear Mr. Peterson 24 then, speaking clearly, just for myself. I don't care to be a 25 part of making a one-sided record.

O Heritage Reporting Corporation (202) 628-4888

9956 O

'(_/ 1 JUDGE SMITH: All right. That's fine, but if you 2 assert that corruption or irregularity in the process is an 3 issue in this case, explain it.

4 MS. WEISS: Well, I think that we have, Your Honor.

5 I think we have evidence that there were meetings at which FEMA 6 was told that if had it changed its position or there would be 7 total war, that FEMA's position was, quote-unquote, negotiated 8 away. FEMA's evidence would like to portray what happened as a 9 deliberate, evolving process, and we have got enough to present 10 an alternative view.

11 JUDGE SMITH: All right, well, whero does it take 12 you?

13 MS. WEISS: Well, I think you cannot consider these

) 14 issues purely as a matter of -- that you cannot ignore that if 15 these witnesses are giving only the official version of the 16 facts and there were other things that went on, that you would 17 have to have that in your mind when you weigh whether what they 18 would say on other issues was true or false, or if it's weighed 19 as I first weighed it.

20 JUDGE SMITH: Ms. Weiss, there's no way that you can 21 revive that I can see in the facts of this case, rebuttal for 22 presumption attendant to the FEMA's first panel and the first 23 position. Absent that, unless you can show irregularity in the 24 process, as hafing some evidentiary relevance to the issues 25 before us, I don't know what we can do for you.

O Heritage Reporting Corporation (202) 628-4888

9957 1 MS WEISS: I think what we are attempting to do is 2 show that there was irregularity in the process and that that 3 bears on the weight which you can give the FEMA evidence --

4 JUDGE SMITH: Right.

5 MS. WEISS: -- and the NRC evidence, that it can't be 6 disregarded. Certainly, it can't be disregarded in the 7 preemptive fashion that we have to field out, to develop, what 8 the paint was, what direction it took, whether substantive 9 positions were fabricated after the fact in order to justify 10 pre-determined conclusions rather than going the other way 11 around, that you gather the facts first and then reach the

]

12 conclusion. That would have to bear on the weight that you 13 gave NRC's position and FEMA's position, and that you can't say O

\~# 14 that we are precluded from developing that evidence at this 15 stage.

16 JUDGE SMITH: Well, Ms. Weiss, what I -- the point i 17 was making is we are not giving weight to positions.

18 MS. WEISS: But I'm not talking about the rebuttable 19 presumption, but you're going to be weighing evidence.

20 JUDGE SMITH: Right.

21 MS. WEISS: But weighing evidence that FEMA presents 22 and evidence that we present.

23 JUDGE SMITH: And you attack the credibility of those 24 witnesses with all of the energy that you can muster. And 25 you've had depositions, opportunities to do that. And if you O Heritage Reporting Corporation (202) 628-4888

F 1

9958 I)

(- 1 can demonstrate that those witnesses are not worthy of belief 2 or that less weight should be given to them, that's fine. But 3 that does not give you any reason to invade the deliberative 4 process.

5 MS. WEISS: Please, Mr. Chairman. You're stopping us 6 at the threshold right now. Right now we have evidence that 7 suggests that a conclusion was reached and did paint it to the 8 agency and that a basis was fabricated thereafter in order to  ;

9 give it a plausible, some plausibility, a plausible basis. And 10 we have evidence that suggests that, and you're stopping us at 11 the threshold from developing it. If we could develop it, I 12 don't see how it could help but bear on the question of how 13 much weight you're giving this evidence.

14 JUDGE SMITH: The evidence or the witnesses?

15 MS WEISS: Don't see any substance.

16 JUDGE SMITH: The evidence that comes from the .

17 witnesses?

18 MR. FLYNN: Your Honor, I would like to suggest that 19 if this hearing were to go forward without any testimony from 20 FEMA, then you would actually focus on the technical issues.

21 And if that information came from the applicant's witness, for 22 example, you would have a very simple issue, and that is, is 23 the position correct, is it well supported, or isn't it.

I 24 I think your analysis is correct that that is and 25 should be the focus of the hearing.

O Heritage Reporting Corporation (202) 628-4886

9959 1 MR. OLESKEY: Judge, this is Steve Oleskey. Let me 2 just make one other brief observation.

3 It seems to me that FEMA and the NRC are now pretty 4 much in the position in terms of the hearing originally 5 contemplated by the Memorandum of Understandiitg, that is, in 6 substance, FEMA is appearing as an expert witness on behalf of 7 the NRC. And what the evidence, if it's accurate, that comes 8 out of the meetings of the 19th of January, says is that the 9 NRC got together with FEMA and directed its conclusion that 10 week, before the supplemental filing by FEMA on the 25th of 11 January, before the New Hampshire filing that was supposed to 12 be the key to FEMA's position on February lith and well before, 13 obviously, FEMA's actual position was formulated between O 14 approximately the 4th of March and the 14th.

i 15 So, if that's the context, if FEMA's back as a 16 witness for the NRC, presenting their evidence, I think that [

17 half of that testimony, that I think we would be in a position l 18 to bring in if we are allowed to complete the depositions in 19 the fashion we contemplate, that the decision was made in the 20 middle of January and dictated by the NRC and that FEMA's not 21 operating in the context also contemplated, as I view it, by 22 the Memorandum of Understanding as a kind of expert agency and i 23 holding itself aside, in a sense, even more an expert witness 24 to formulate independent questions of ,iudgment on these 25 important issues.

( I Heritage Reporting Corporation (202) 628-4888 [

9960 1 I think that's relevant, to be brought into the case 2 when we attack these witnesses. It's true that we may not be 3 able to do it entirely through these witnesses. We may have to 4 ask you to bring in other witnesses. I acknowledge that.

5 JUDGE SMITH: Well, your arguments really do not take 6 into account the importance of the deliberative process. We 7 value that very highly, and you have not made a case showing 8 that it is needed in the context, yet,.of this case.

9 Now, you're going to have an opportunity to cross 10 examine these people and demonstrate either that they are not 11 to be believed or more evidence is needed. I don't know. But 12 I might also say that I do not see, I do not see, the sinister 13 implications that Ms. Weiss does and the interviewers do in the O 14 meeting between the NRC and FEMA. They, obviously, had 15 difference of opinion.

16 MR. TURK: Your Honor, this is Sherwin Turk. I've 17 held myself back from this discussion until now.

18 JUDGE SMITH: Well, you weren't going to succeed in 19 that because we are going to search you out, Mr. Turk, in just 20 a moment.

21 MR. TURK: I'd like to make one comment if I can.

22 It's a gossamer web. I recall reading that in some poetry. I 23 think that's exactly what we have here. The Interveners are 24 trying to use third-hand hearsay, from a witness who was not 25 present at a meeting, to try to allege that there was some sort O Heritage Reporting Corporation (202) 628-4888

9961

) 1 of improper comment made by Mr. Stelle to FEMA. The Intervonor 2 are very far from having any direct evidence or any credible 3 evidence on that.

4 Mr. Thomas, himself, has indicated that his superior 5 was called to Washington in December. The complaints about Mr.

6 Thomas's position on the Beach testimony. Mr. Thomas has 7 indicated that in the fall of 1987, FEMA was moving away from 8 the position which she had originally espoused. The fabric 9 which these Intervenor are attempting to weave here with, have 10 you believe, that in mid-January of 1988, the NRC exerted 11 pressure on FEMA in an attempt to get it to change its view.

12 It's simply not true. There are a lot of inaccuracies in Mr.

13 Thomas's testimony. If Mr. Thomas is brought as a witness O 14 before the board, perhaps some of those inaccuracies will come 15 out, but I don't think that the corrective privilege should 16 fall on third-hand hearsay, particularly from a witness whom 17 this board has already had occasion to examine and has already 18 had occasion to view his credibility.

19 JUDGE SMITH: All right, Mr. Turk. Let me ask you 20 one other thing, Mr. Turk. You are asserting privilege on the 21 meeting of January 19th on behalf of your clients?

22 MR. TURK: No, I am not.

23 JUDGE SMITH: You are not?

24 MR. TURK: I made a statement to Mr. Cumming when I 25 was asked whether I am waiving privilege. I said that I was O Heritage Reporting Corporation (202) 628-4888

9962

( 1 not aware if that privilege had been asserted, and until I 2 become aware that any such privilege is asserted I cen only 4

3 discuss waiver. Now, in fact, I have not discussed with my 4 client whether they wish to assert the privilege.

5 JUDGE SMITH: That's on the meeting of January 19th?

6 MR. TURK: That's right. I have not asked my client 7 whether they wish to assert privilege after that meeting. So I 8 can't tell you whether you or not we would want to assert that 9 privilege or waive any such privilege.

10 JUDGE SMITH: That is, indeed, a gossamer web. Well, 11 our ruling so far as what it is, we have not seen extraneous 12 information of such a degree to inquire into those meetings as 13 it relates to the testimony offered by FEMA in its March O 14 version. We will wait and see what happens when you cross 15 examine them or what else you come up with, but we have not, 16 even taking Mr. Thomas' version of it, which we agree that we 17 had problems with, but even taking his version of it, I do not 18 see a statement that might arise in a conference of that nature 19 as being sufficient to destroy the Executive Privilege.

20 I mean it is the nature, it is tha very nature, of 21 Executive Privilege to allow people to sit around and speak in 22 strong terms and not have it come out later on to defeat them.

23 It's the future chilling effect that we're concerned about.

24 Not the present one in this case because what is said is 25 already said.

O Heritage Reporting Corporation (202) 628-4888

9963 Ox 1 Now, we do have, we want to move on to the testimony, t

2 The testimony incorporates by reference the testimony of i

3 January 25th, which included Mr. McLaughlin. The testimony i L

4 does not show that it's severable as seems to be by a three i t 5 member panel. If that testimony, if that attachment to your i 6 March testimony is offered at the hearing, the board would  ;

7 entertain a motion to strike the testimony of January 25th 8 because of the inability of the parties to cross examine Mr.

9 McLaughlin on it, either in form of depositions or by his 10 presence at the hearing. I don't know what to tell you to do.

11 We hate to tell -- we don't like to tell FEMA, or anybody, how 1 12 to clean up their act because we're saying, if we do that, that  ;

i 13 if they do certain things then they have met our standards, and J

O 14 it's not for us to decide.

15 We're just telling you in advance that the way you've 16 presented it now, we would be very sympathetic to a motion to 17 strike the January 25th attachment, supplemental testimony I 18 attached to your March testimony.

19 MR. FLYNN: I appreciate that advice, Your Honor.

20 MR. TURK: Your Honor, for the record, let me note r

21 that I was interviewed by the press about this purported 22 statement by Mr. Stello. And I indicated that I was not aware i

23 that any such statement had been made. And I'm informed that i

l 24 the Public Affairs of NRC is also talking to Mr. Stello and has

25 provided a statement to the press categorically denying that Heritage Reporting Corporation (202) 628-4888  !

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9964

- 1 that kind of a statement was made.

i 2 MR. OLESKEY: You know, this gets to an issue that

! 3 concerns all of us, Judge, since we're here and that is the 4 dual capacity that Mr. Turk has from time to time as both i 5 counsel and witness. And I think I speak for Intervenors when 6 I say that we're very uncomfortable with the way he moves back 7 and forth, or appears to move back and forth, on occasion i

8 between attorney status and quasi-party or fact witness status.

9 I want to put him on notice before the board that we 10 may seek to deal with that in front of the board later in these 11 hearings.

12 JUDGE SMITH: All right, now. How did the press find 13 out about the statement attributed to Stello by Thomas?

O 14 MR. OLESKEY: The press, I think, is aware from 15 earlier discussions, has been covering these depositions i 16 throughout.

) 17 JUDGE SMITH: They have not been covering the 1

18 depositions. They've been interviewing people who leave the l

19 depositions.

20 MR. DIGNAN: That's correct, Your Honor. And they 21 got no interviews of the Applicant.

22 JUDGE SMITH
Now, Mr. Oleskey, you're telling me

! 23 that somebody's free to read that deposition, ascribe a 1

24 statement to Mr. Stello, and I expect the MRC staff to remain 25 silent about it.

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9965 1 MR. OLESKEY: I don't think Mr. Turk has the right in f 2 the hearing to play a dual role. That's my only point, Your 1 3 Honor, ,

4 JUDGE SMITH: Well, you can't pick and choose a  !

S narrow aspect of that point and expect to succeed. You live by 6 publicity, you'll die by it. I don't like having our hearings f

7 turn into a circus. j 8 MR. OLESKEY: Well, as far as I'm concerned, the I 9 depositions aren't a circus and the hearings haven't been a 10 circus, at least not as far as any entertainer has influenced [

11 or affected them.

12 MR. TURK: Your Honor, I'd like to note, just so the

(

13 board is aware of how the depositions have been conducted, that l

O 14 members of the press have been present altting outside the t

15 deposition room, during the deposition of Mr. Thomas.

16 JUDGE SMITH: I know.

17 (Continued on next page.)

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( 1 MR. TURK: Speaking of Oak, Thomas, or Keller.

2 MS. WEISS: That seems to be true, they were out.

3 they've been out there the whole time.

4 MR. TURK: We've had, they were never -- too far.

5 But Your Honor, I normally don't speak to the press myself.

6 Yes, and they were followed to the bathroom by a press camera.

7 That led my client to speak with the press.

8 MR. DIGNAN: Your Honor, let's get it clear on the 9 record the way the game should be played, at least the context.

10 The first day of the depositions I showed up, I was sure there i

11 would be press coverage, and I wasn't surprised. it, was 12 channel 5, with its cameras and everybody else in town.

13 I brought with me a press spokesman from the - , on

' O 14 the theory because I do make it a rule simply not to talk to 15 the press but you have to have somebody there to give our 16 version of the facts.

, 17 1 went out and met with Mr. Oleskey. Mr. oleskey 18 said he did not want my press representative to be in there 19 unless I would agree to just let the press in the deposition l

1 j 20 room. I said to him at that point, well Mr. Oleskey I don't i

l 21 need my press representative, if as and when you'll agree with 22 me you're not going to talk to the press.

l 23 Mr. Oleskey took the position that he always talks to 24 the press, and he thinks that's appropriate. That's fine, and

! 25 that's his business. But what's really going on here is we ask i

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( 1 a nice sensational third or fourth degree hearsay question, get 2 a crack about Vic Stello, and then there is immediately a press 3 conference. Indeed it will reflect in the record, we had to 4 wait, to start a deposition because Mr. Backus was holding a 5 press conference outside.

6 How, I mean that's alright, I'm a great believer in 7 the First Amendment. But to jump on Shirlen (ph) Turk, for 8 doing what he just did there is beyond the pale. Shirlen Turk 9 is in the same position I'm in. He's got one hand tied behind 10 his back by his own views of what the press are, and these 11 people have been going out and giving the press exactly what 12 they want the press to hear out of the entire deposition.

13 JUDGE SMITH: Mr. Dignan, I'm going to put an end to O 14 it. We are not concerned about the press. If Mr. Oleskey 15 wishes to make a motion with respect to Mr. Turk he can do it.

16 We will look into the circumstances, though.

17 We do not have the authority nor the desire to 18 control the parties' communication with the press. But I'm 19 just not sympathetic to Mr. Oleskey's position that he reveals 20 information in a deposition and then expects no reaction. It's 21 all part of it, Mr. Oleskey.

22 Let's move on. Anything further?

23 (Continued on next page.)

24 25 O Heritage Reporting Corporation (202) 628-4888

f 9968 l 1 JUDGE SMITH: Is there anything further by any i

2 party? I i  !

3 MR. OLESKEY: I guess net, Your Honor. l 4 JUDGE SMITH: Is there any --

5 MR. BACKUS: What -- wanted to know, is the Board 1

6 ready to tell us what is going to happen with the request for 7 further deposition in any sense. We have a list of other

[ f 8 parties that we wanted to depose, 9 I must say I would associate myself with Attorney t

10 Weiss, that if Mr. Peterson is going to be limited to only 11 testifying to the official FEMA position without opportunity to

! 12 explore the background of how that was obtained, I would not be 13 interested in his testimony.

O 14 JUDGE SMITH: It's entirely up to Mr. Flynn, whether 15 he wishes to offer Mr. Peterson as a witness. We are not

16 telling Mr. Flynn that if he makes Mr. Peterson available in
17 depositions or if he makes him available as a witness, or if he 1

i 18 files an affidavit, what the result will be.

I 19 other than to say that we're not in the mood to j

, 20 accept an affidavit based upon the fact that we know that he 21 attended a meeting with NRC, if the affidavit states what I 22 thought it would state on our conference on April 1st.

23 We're not going to tell you people how to run your 24 case. We're just deciding now that we see no need to invade i'

25 the executive privilege because the only need that we can

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4 9969 i

! ( l imagine at this time, or the only need that we can identify at 2 this time is as it relates to the rebuttable presumption.  ;

3 We do not find a set of facts before us where FEMA is a 4 entitled to reauttable presumption. The remaining problem is l 5 how do these meetings and how does the actions of the policy 6 makers, decision makers, impact upon the credibility of the 7 fact witnesses offered in the testimony in March. We don't

)

8 know. We don't know how that's going to work.
9 We'll wait and see how you cross-examine them. You

< 10 had an opportunity to depose them and presumably you know now 11 what the basis of their testimony is. That summarizes our i 12 ruling.

13 MS. WEISS: We had just one other outstanding

( 14 problem, Your Honor, that I think is what Mr. Backus was i

15 raising, which is we have outstanding depositions noticos for a i

16 variety of other witnesses and whom I felt at least I would 17 like to have a ruling on those.

18 JUDGE SMITH: What are those witnesses?

19 MS. WEISS: Mr. Wingo, Mr. Erimm, Mr. Vickers, oh, J 20 Mr. Krimm isn't on there. Mr. Wingo, Mr. Vickers, Mr.

i l 21 McLaughlin, Mr. Peterson, anybody else? And Mr. Becton,

{ 22 General Becton.

23 JUDGE SMITH: I don't even know who those people are.

l 24 They've been identified to us as policy-level people and they i

i 25 would be covered by our ruling that we will not allow them to i

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() Heritage Reporting Corporation (202) 620-4008

" 9970 i 1 be inter"lewed, be deposed, based upon their dellborative 1 2 process, in arriving at the FEMA position. l i

3 MS. WEISS: And I take it then that you've just made  ;

4 a ruling denying the remainder of the deposition requests j 5 including Mr. McLaughlin and Mr. Peterson?

I 6 JUDGE SMITH: If I understand the purpose, as I 7 stated, was that these are policy makers at FEMA and the l 8 purpose ot your examining them is to probe the deliberative 9 process at arriving at that policy. i 4 i 10 MS. WEISS: Well, the purpose of McLaughlin is the )

11 fact witness, that he be in addition to a policy maker, and we j 12 wish to depose him because he's attached, you see, as -- [

! 13 attached to that testimony. f i

O 14 JUDGE SMITH: And we stated that we won't accept that 15 testimony unless they make him available for deposition or the f i ,

16 testimony is withdrawn or reformulated or nomething, but we l j 17 don't want to tell FEMA how to clean up their tastimony.

18 It's up to them. They're going to offer it. We're l

! 19 just telling them now that the very thing that you, your point i

l 20 is well made.  ;

I 21 MS. WEISS: Well, let me just finish. Thero's a l

22 flow, Your Honor.  !

l  ;

i 23 There's a flow between that January 25th testimony

! l l 24 and the March 14th testimony, which presunably shows the l 25 evolution of the FEMA position and the evolution cf the FEMA l

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9971 1 policy. And I think we're entitled to ask Mr. McLaughlin about j 2 how FEMA moved from one to the other.

3 MR. FLYN!1
Your Honor, I think this misses the point i

4 of our testimony. As I stated several times, what we are 5 offering is a technical and policy / legal explanation of the 6 position that we've taken.

i 7 I heard the advice that you gave earlier, that if we

8 don't submit Mr. McLaughlin to deposition you will not look 9 kindly on an effort to introduce that testimony. I think on 10 balance our preference would be to withdraw the testimony.

11 JUDGE SMITH: Yes, well, I might also point out to 1

12 you that the policy aspects of FEMA's presentation before this 13 Board are not acceptable.

O 14 I mean, unless you make your policy makers more 15 available, or there is better explanation of the policy. Now

] 16 we don't see much policy, but we see some policy in that 17 testimony. I think that's about the best advice we can give 18 you, i 19 MR. FLYliti: I understand your point, Your Honor. And 1

20 at this point what I am prepared to say is that we are

] 21 certainly not interested in submitting any of our management-d 22 level people to inquiry into the meeting of January 19th or any 23 other discussions as to which the deliberative process i

. 24 privilege might apply.

25 flow I'm leaving the door open a little bit. We may i

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() 1 decide that we should allow a deposition of perhaps Mr.

2 Peterson on the-subject of what the policy considerations were,  !

3 but I am not promising that we will do that at this point. f i

4 I'll negotiate that with the Intervenors af ter I have i 5 had a chance to consult with Mr. Peterson.

{

6 JUDGE SMITH: All right, anything further? All 7 right. That's the end of our conference, and thank you for -

8 joining us.

9 (Whereupon, at 11:44 a.m., the telephone conference 10 was concluded.)

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[

7 1 CERTIFICATE l r

'O 2 l

3 This is to certify that the attached proceedings before the j 4 United States Nuclear Regulatory Commission in the matter oft {

5 Names Public Service Company of New Hampshire, et al.  !

(Seabrook Station, Units 1 and 2)  !

6  ;

7 Docket Number: 50-443-OL: 50-444-OL 8 Placet Bethesda, Maryland 9 Date April 5, 1988 10 were held as herein appears, and that this is tho original j 11 transcript thereof for the file of the United States Nuclear J 12 RegulatoryCommissiontaken$k$$hhEkh$Nliybymeand, 13 thereafter reduced to t>Pewriting by me or under the direction i l

14 of the court reporting company, and that the transcript is a l 15 true and accurate ry rd o (;e f going oceedings.

16 /S/ J 7 l sl J i 17 (signature typed): Kent Andrews  !

18 Official Reporter 19 Heritage Reporting Corporation  !

20 21 22 23 24 25 O Heritage Reporting Corporation

(.102) 626-4886