ML20214G713
| ML20214G713 | |
| Person / Time | |
|---|---|
| Site: | Comanche Peak  |
| Issue date: | 05/18/1987 |
| From: | Mizuno G NRC OFFICE OF THE GENERAL COUNSEL (OGC) |
| To: | Atomic Safety and Licensing Board Panel |
| References | |
| CON-#287-3529 CPA, NUDOCS 8705270149 | |
| Download: ML20214G713 (15) | |
Text
. ,f j h DOCKETEfi UiNRC-May 18,1987 UNITED STATES OF AMERICA .
- NUCLEAR REGULATORY COMMISSION CFFICL 2 5EC?n s.Fi i
BEFORE THE ATOPTIC SAFETY AND LICENSING BOkN$$fC c
In the Matter of ) j
)
TEXAS UTILITIES ELECTRIC ) Docket Nos. 50-445-CPA COMPANY, ET AL. )
)
(Comanche Peak Steam Electric )
Station, Unit 1) )
l NRC STAFF VIEWS ON DISCOVERY DISPUTE .
INVOLVING INTERVENOR MEDDIE GREGORY'S DISCOVERY REQUEST FOR THE CRESAP AUDIT I. INTRODUCTION On April 24, 1987, Consolidated Intervenors filed a Reply to TUEC's Opposition to Motion to Compel Re: Gregory Discovery (Sets 5 and 6)
(Consolidated Intervenors' Reply). Consolidated Intervenors' Reply ar--
gued that an audit conducted by Cresap , McCormick and Paget (the Cresap audit) was commissioned by TUEC principally "as part of the on--
going audit program at Comanche Peak," in order to " meet the more imme-
~ diate licensing requirements being imposed by .the Staff." Consolidated Intervenors' Reply at 4-6. In support of this proposition, the Consoli-dated Intervenors pointed to portions of SSER 11, requesting the Appli-( cants to respond to a number of Staff concerns. Id. at 4-5. On April 24, 1987, the Chairman of the Licensing Board requested the Staff to i
consider commenting on whether the Staff had any need for the Cresap audit in order to have answered the questions it posed to the Applicants in SSER 11. On April 28, 1987, the Staff informed the Board and par-ties that it would file a pleading by May 18, 1987 addressing the matter t
- i. 8705270149 870518 O j PDR ADOCK 05000445
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.. raised by the Board. The Staff herein files its views on the Board's question.
II. BACKGROUND This matter has its genesis in tais proceeding in a December 30, 1986 discovery request filed by Intervenor Meddie Gregory requesting information about, inter alia, the Cresap audit II . Applicants objected to the discovery and moved for a protective order 2/ . .Toint Intervenors filed a brief opposing the Applicants' motion for protective order. 3_/ ,
which was closely followed by a rejoinder from the Applicants II .
Consolidated Intervenors then filed their Reply. Applicants and Interve-nor Meddie Gregory. disagree over the purpose of the Cresap audit. Ap-plicants contend that the audit was undertaken on advice of their counsel, to assist their counsel in preparation for the Texas Public Utility 1_/ Meddie Gregory's Interrogatories and Request for Production of Doc-uments (Set 5). CASE also filed discovery in the operating license proceeding for the Cresap audit. CASE's Interrogatories to Appli-cants and Requests to Produce (June 24, 1985). After Applicants objected to providing -the audit, the Board sustained the Applicants' objection. Memorandum and Order (July 22, 1985).
-2/ Permittees' Responses (and Motion for Protective Order) to Interve-nor Meddie Gregory Requests for Production (Set 5) (February 3, 1987).
3/
Joint Intervenors' Opposition to Motions for Protective Order and Motion to Compel Re: Gregory Discovery (Sets 5 and 6) (March 3, 1987).
4/ Permittees' Response to " Joint Intervenors' Opposition to Motions for Protective Order and Motion to Compel Re: Gregory Discovery (Sets 5 and 6)" (March 18,1987).
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-~ O e Commission (TPUC) rate hearings for CPSES. See generally Affidavit of Homer Schmidt, attached to Permittees' Response (and Motion for Protec-tive Order) to Intervenor Meddie Gregory Requests for Production (Set 5)
(February 3, 1987). Meddie Gregory (and CASE) assert that the the Work Specification for the Cresap audit is inconsistent with Applicants' contention regarding the purpose for commissioning the audit. See Con-solidated Intervenors' Reply to' TUEC's Opposition to Motion to Compel Re:
Cregory Discovery (Sets 5 and 6).
III. DISCUSSION ,
The Staff has generally not taken positions on discovery disputes between other parties in this proceeding, and takes no position on whether the Cresap audit should be provided by Applicants to Intervenor Meddie Gregory through discovery. The Board's inquiry, however, im-plies that the Staff's need for this information is a factor which the Board must consider in resolving the -discovery dispute. The Staff is unable to judge, based upon the limited knowledge about the nature and contents of i-the Cresap audit disclosed in the respective pleadings filed by the Appli-cants and Consolidated Intervenors, . whether the Applicants should dis-close the Cresap audit to the Staff in the construction permit extension proceeding. - In any event, resolution of the discovery dispute is in no l
5/ On the other hand, Applicants may well have to disclose the Cresap l audit to the Staff in the operating license proceeding since it may be relevant and material to the Staff's consideration of the CPSES operating license application.
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way dependent upon whether Applicants must provide the Cresapaaudit to
.- the Staff. - .
A. Applicants' Duty to Provide Relevant and Material Information to the Staff It is a well-established proposition that an applicant for a construc-tion permit or operating license has a duty to provide complete and i
accurate information to the Staff which is relevant and material to its application . See Virginia Electric and Power Co. (North Anna Power
-6/ An applicant has a similar responsibility for providing the Licensing Board with complete and accurate information which is relevant and material to the matters in controversy between the parties. Duke Power Co. (William B. McGuire Nuclear Station, Units 1 and 2),
ALAB-143, 6 AEC 623 (1973); Georgia Power Co. (Alvin W. Vogtle Plant, Units 1 and 2), ALAB-291, 2 NRC 404, 408-12 (1975); Ten- ,
nessee Valley Authority (Browns Ferry Nuclear Plant, Units 1, 2 and 3), ALAB-677,15 NRC 1387 (1982); Consumers Power Co. (Midland Plant, Units 1 and 2), ALAB-691,16 NRC 897, 910-15 (1982). The definition of materiality in this context is the same as the North '
Anna standard for assessing whether. the information must be dis-closed to the Staff. See Metropolitan Edison Co. (Three Mile Island Nuclear Station, Unit 1), ALAB-774,19 NRC 1350 at 1357-59 (1984);
. Midland, supra at 910-911.
, Under that standard, Applicants need not transmit the Cresap audit to the Licensing Board in the construction permit extension proceed-ing. That proceeding is in its very infancy; little discovery has been completed, no motions for summary disposition have been filed, and no testimony or other information has been offered for admission into the- record. Moreover, it is not clear whether there are one or more contentions admitted into this proceeding. And, as Consolidat-ed Intervenors have admitted, the original and amended contentions
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differ in the matters in which they place into controversy. -See Mo-tion to Admit Amended Contention or, in the Alternative, for Necon-sideration of Certain Previously Denied Contentions (September 30, 1986) at 2 ("The purpose of this motion is to modify our contention in light of the Commission's order of September 19, 1986
( CLI-86-15 ) . . . ") . It being unclear what matters are in controversy in this proceeding, there is no objective basis upon which to judge l (FOOTNOTE CONTINUED ON NEXT PAGE)
Virginia Electric and Power Co. v. NRC, 571 F.2d 1289 (4th Cir.1978);
Petition for Emergency and Remedial Action, CLI-78-6, 7 NRC 400, 418-19 (1978); Metropolitan Edison Co. (Three Mile Island Nuclear Station, Unit 1), ALAD-774,19 NRC 1350,1357 and 1358, n.6 (1984). " Materiality" is 1
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(FOOTNOTE CONTINUED FROM PREVIOUS PAGE) i the relevance and materiality of the Cresap audit. In sum, this pro-ceeding has not advanced to the point where an agency decision is imminent and there is a real risk of agency error if the Cresap audit is not disclosed to the Board. See North Anna, 4 NRC at 487-88, cf. McGuire, 6 AEC at 625-26 ("Indeed, the adjudication could be-iiome meaningless, for adjudicatory boards would be passing on evi-dence which would not reflect existing facts."); Midland,16 NRC at 912-13. Accordingly, Applicants should not be required to transmit 4
the Cresap audit to the Licensing Board at this stage in the con-struction permit extension proceeding. As that proceeding moves foward , however, Applicants should take care to assure that the relevance and materiality information generated by CRESAP is re-assessed in light of the ongoing status of the litigation (for additional discussion on the factors which could affect the timing of disclosure, see note 7 below).
l l It may be necessary, however, for Applicants to transmit the Cresap
! audit to the Licensing Board at some future time in the operating license proceeding, in order to fulfill their obligations under McGuire. Contention 5, which is the only contention admitted in this proceeding, questicns the adequacy of the Applicants' QA/QC pro-gram for construction. While the Applicants are currently engaged in a corrective action program for design and construction, the re-sults of which Applicants are likely to seek to have admitted into evidence, it nonetheless remains the fact that the current record focuses on the historical QA/QC program at CPSES. In addition, Applicants have suggested that they intend to rely on portions of work approved under the old QA/QC program, in the operating li-cense hearing. See generally remarks of Robert Gad, counsel to Applicants, at the August 18, 1986 Prehearing Conference. The Cresap audit is apparently intended to reassess the adequacy of the old QA/QC program and its' management; accordingly, it is likely that the Cresap audit will provide information which is relevant and material to the matter in controversy in the operating license pro-ceeding which must be disclosed to the board and parties (the timing of that disclosure is further considered in note 7 below).
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' fudged by "whether the statement is capable of influencing a decision-maker . . . " North Anna, supra at 487, 491; TMI-1, supra at 1356.
Whether the information is material in a given context must be judged by "the facts and circumstances in the particular case," and a " careful at-tention to context along with a healthy dose of common sense..."
North Anna, supra at 478. The stage of the proceeding affects the mate-riality of the information. North Anna, supra at 487-88, see also TMI-1, supra at 1358, n.7.
Based upon the limited information regarding the nature of the
- Cresap audit, it is unclear at this time whether the Cresap audit will provide information O which is material to the Staff's past decision to grant the construction permit extension. The Staff's decision in that t
- 7) Regardless of whether the Cresap audit is suspended, as Applicants l
represent (see Permittees' Supplemental Response to Meddie Gregory Interrogatories (Set 5) (February 10, 1987),- response to
! Interrogatory 5.a; Permittees' Response to " Joint Intervenors' Opposition to Motions for Protective Order and Motions to Compel Re:
Gregory Discovery (Sets 5 and 6)" (March 18, 1987)), or is continuing, as Consolidated Intervenors assert (see May 5, 1987 Letter from Anthony Roisman, Counsel for CASGo the Licensing Board), Applicants and its contractor, Cresap, McCormick and Paget , have the obligation under both North Anna and McGuire to i disclose within a reasonable time any information which is relevant l and material to the Staff's consideration of the construction permit extension and the operating license application, and the Board's consideration of the matters in controversy in the construction permit extension and operating license hearings. If Cresap had not
- begun any analysis of data prior to work suspension, then
, Applicants and Cresap are not likely to have any current disclosure obligations. On the other hand, if Cresap had begun its t consideration of the data in order to assess and address any one of l the issues identified in the 'Vork Specification, then Applicants and l Cresap must determine whether the information being analyzed must be disclosed.
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regard was made prior to the' Commission's decision in CLI-86-15, which
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-clarified-.-the legal standard of good cause for extension of a. construction permit. According to the Commission, permittees may demonstrate good -
cause in two ways. On one hand, a permittee' may establish good cause good _ cause for the extension by showing that there was good cause for the past delay in plant completion. CLI-86-15, 24 NRC 397 at 400.
Alternatively, a permittee may show good cause by demonstrating there is at present good cause for an extension. Id. at 401. However, if an l intervenor contended that the past delay was due to intentional permittee l
l misconduct, then an extension would be granted only if the policy had been repudiated. Id. at 402-403. Thus, the materiality of the Cresap
! audit must be judged by whether it provides information relevant and
- - material to whether Applicents had a deliberate policy to violate Commis-4 sfon requirements, and/or whether Applicants have repudiated that past conduct. Review of the " Work Specification - Retrospective Audit of the Comanche Peak Steam Electric Station Project" (Work Specification) sug-gests that the audit is intended to compile and assess information in areas that appear relevant to the issues delineated above. For example, the objectives of the Cresap audit include, inter alia
To determine TUGCO's ability to control each of these factors and related events; l
To assess the performance of TUGCO management in identify-ing and responding to these factors.
Thus, the Cresap audit, if thoroughly and objectively implemented in ac-cordance with the Work Specifications, may identify information suggesting a management policy to violate NRC requirements if such a policy existed (and, of course, if the factual information supporting such a finding is
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still- extant). - On the other _ hand, Cresap may well complete its audit c 'without findin'g any information suggesting that such a policy existed.
Until Applicants have had a reasonable opportunity to assess the rele-vance and materiality of that audit to the standards laid out by the Com-mission in CLI-86-15, no one .can determine - whether the Cresap audit contains information which draws into question the validity of the Staff's earlier decision to grant the construction permit extension. Thus, until the _ Cresap audit is completed8 _/, no judgment can be made as to whether Applicants should provide the audit to the Staff pursuant to its North Anna obligations.
'On the other hand, it appears that the Cresap audit may provide' information which is, relevant and material to the Staff's consideration of Applicants' operating license application. According to the Work Specifi-cation, the subobjectives of the Cresap audit include, inter alia:
To assess the overall performance of TUGCO in planning, engineering, constructing and licensing CPSES;
! To develop an increased understanding of the primary factors causing cost and schedule changes;
, To determine TUGCO's ability to control each of these factors and related events; l
To assess the performance of TUGCO management in identify-
- j. ing and responding to these factors; Work Specif1 cation, p.2., II. " Objectives. " Information on the first two subobjectives may be relevant and material to the Staff's assessment as to l
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As discussed in note 7 above, App 1bants may be required to disclose information material to the construction permit proceeding in advance of the actual completion of the Cresap audit and the pubTeation of l
tlie audit report.
, . whether there is reasonable assurance that the construction of the CPSES facility ,ha,s been completed in conformance with the CPSES construction t permit, the PSAR, and the rules and regulations of the NRC, as well as whether there is reasonable assurance that the - facility can be operated without endangering the public health and safety. See 10 C.F.R. Section 50.57(a)(1), (2) and (3). The Staff must have reasonable assurance that all significant problems have been identified and are corrected before it can issue an operating license. The Cresap audit may provide the Staff with information that could affect its assessment on those factors. In addition, information in the Cresap audit on the last two subobjectives may be relevant and material to the Staff's assessment as to whether there is reasonable assurance that the activities authorized by an operat-ing Ifcense for CPSES will be conducted in compliance with NRC require-ments, and if the Applicants are technically qualified to engage in the activities to be authorized by an operating license for CPSES. See 10 CFR Section 50.57(a)(3). A review of the scope of issues that are to be addressed in the Cresap audit strongly suggests that information relevant l
l and material to the the factors that must be considered by the Staff may j be presented in the Cressp audit. For example, in the area of design i engineering, the Work Specification indicates that the audit should address, among other things:
l The processes and and control mechanisms used by TUGCO to approve design changes, and to manage the performance of i design engineering.
Integration of engineering in support of both procurement and j construction.
The timeliness of response to NRC directives.
l Design coordination.
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. Work Specification, p.5, III. Scope. Information on these issues is likely to be rele.vant in determining whether all problems have been identified and corrected, and whether ' the current management of TUEC has the technical capability and management competence to operate CPSES - mat-ters!which the Staff must evaluate.
Another example is in the area of quality assurance. The Work Specification indicates that the audit should address:
The organizational strategy and philosophy adopted by TUGCO for assuring quality at CPSES.
Evolution of quality assurance organizations and procedures over the life of CPSES.
Contractural. requirements for quality assurance among prime contractors.
Work Specification, 'p. 6. Information on these issues appears to be di-
, rectly relevant in determining whether all problems with the management of the Applicants' QA program have been identified and corrected, wheth-I er there is a problem with contractors and vendors' QA programs, whether the current QA program under which corrective action is being implemented is adequate, and whether the Staff has assurance that the current - QA management, as well as executive management, has the l
l technical capability and management competence to operate the plant in conformance with the Commission's regulations.
Perhaps most important, the Work Specification indicates that the I
audit will be oriented towards assessing the adequacy of the management decisions during CPSES design and construction. Work Specification, l p.3, III. " Scope." Such information on management may be material to the Staff's assessment of the current management's capability and 1
I competence.
In sum, given the nature and scope of the Cresap audit's work, it is likely that the Applicants v:111 have to provide the Cresap audit to the Staff in the operating license proceeding g, .
B. Applicants' Duty to Provide the Staff with Information Generated by the Cresap' Audit is Independent of and Unrelated to their Discovery Obligations Although Applicants may well have to provide the Cresap audit to 4
the Staff in accordanice with its responsibility under North Anna, such action by Applicants is independant of, and has no relevance to the reso-lution of the discovery dispute between Applicants and Intervenor Meddie Gregory in the construction permit proceeding. For one thing, disclosure to the Staff does not necessarily mean that the information is subject to public disclosure. For example, under 10 C.F.R. Sections 9.5(a)(4) and -
2.790(b)(1) and (2), trade secrets and commercial or financial informa-tion, and privileged -or confidential information may be protected from public disclosure in response to a Freedom of Information Act request, as well as under discovery against the Staff. If appropriate, Applicants may request that the Staff withhold from disclosure all or part of the Cresap l audit as containing such information when it transmits the audit to the i Staff. 10 C.F.R. Section 2.790(b)(1) and . (2). To the extent that the Cresap audit might constitute such protected information,. it will not be disclosed should a request for the audit he received by the Staff in ac-9/
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Again, as discussed in note 7 above, it is difficult to state with certainty when the Applicants obligation to provide information regarding the Cresap audit to the Staff, and/or the Board and par-ties ripens, given the lack of firm information as to the status of the audit.
cordance with either 10 C.F.R. Sections 9.8 or 2.744. Accordingly, it would be erroneous for the Board to assume that submission of . the 2 - .
Cresap audit to the Stsff will automatically moot the discovery dispute.
More importantly, the reason why the disclosure of the Cresap audit to the Staff does not affect the discovery dispute is because the point of reference for assessing whether disclosure should occur differs between the two situations. In fulfilling its responsibility under North Anna, the Applicants must determine whether the information is material to the Staff's consideration of the entire scope of both the Applicants' operating license application and their construction permit extension request. See generally Petition for Emergency Relief, supra at 418-19. By contrast, the only information,which Intervenor Meddie Gregory is entitled to re-ceive under discovery is that which is relevant to the matters in contro-versy in the construction permit extension proceeding EI . See, e g ,
Commonwealth Edison Co. (Zion Station, Urifts 1 and 2), ALAB-185, 7 AEC 240 (1974); Pacific Gas and Electric Co. (Stanislaus Nuclear Project, Unit 1. LBP-78-20, 7 NRC 1038,1040. Clearly, the scope of information
- which Applicants must disclose to the Staff is both broader and different from that to which Intervenor Meddie Gregory is entitled to under discov-ery in the construction permit proceeding. If Applicants need not dis-close in discovery what they must disclose to the Staff in fulfillment of their responsibility under North Anna, it perforce follows that the Board 10/ The Staff notes that the request for the Cresap audit was filed by Meddie Gregory, an intervenor whose sole admission is in the con-struction permit extension proceeding.
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can resolve the discovery dispute without regard to the Staff's need for ,
P the disclosure.
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4 IV. CONCLUSION While Applicants have an independent duty to provide all relevant and material information regarding their requests for a construction"per-mit extension and an operating license to the Staff, Applicants' responsi-bilities in this regard are entirely separate from its responsibilities to ,
disclose information under discovery. Applicants' submission of the Cresap audit to the Staff in conjunction with thei.? responsibilitics under North Anna does not necessarily mean that Applicants have realved any privilege against discovery, or that the audit is in the pu'blic domain.
Accordingly, the Board should resolve the discovery dispuie between In-tervenor Meddie Gregory and Applic' ants' without regard to the need of the Staff for the Cresap audit.
Respectfully sutmitted, Geary ,h Counsel or NRC Staff
! Dated at Bethesda, Maryland this 18th day of May,1987
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DOLMETEE Ll5HHC A UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION ~87 - ifAY 20 P2 :09 2 BEFORE -THE ATOMIC SAFETY AND LICENSING BOARD -
0Fft y i%m[]-
00CHO mc BRMICn In the Matter of ' -)
. )
TEXAS UTILITIES ELECTRIC ) Docket Nos. 50-445-CPA' t $ C,OMPANY, ET AL. s ,)
i ' . ()
~ (Comanche Peak Steam Electric ).
Stttion, Unit 1) )
/
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CERTIFICATE OF SERVICE I hereby certify that copies' of "NRC STAFF VIEWS ON DIhCOVERY p~ DISPUTE 7NVOLVING INTERVENOR MEDDIE GREGORY'S DISCOVERY
. REQUEST FOR THE CRESAP" AUDIT" in the above-captioned proceeding have been served on the following by deposit in the United States mail,- .
first class,' (ori as, indicated by an asterisk, through deposit in the NucIcar Regulatory Commission's internal mail system, this - 18th day of May,1987: ;
Peter B. Bloch, Esq. , Chairman
- Mrs. Juanita Ellis Administrative Judge President, CASE
, Atomic Safety and Licensing Board- 1426 South Polk Street U.S. Nuclear Regulatory Commission Dallas, TX 75224 ,
Washington, DC 20555 s ,
t Renea Hicks, Esq. -
Dr. K'e,nneth A. McCollom , Assistant Attorney General
- AdmirM.rative Judge
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Environmental Protection Divisio~n 1107; tiest Knapp P.O. Box 12548, Capital Station Stillwater, OK 74075 s Austin, TX 78711 Elizabeth B~ Johnson. Robert A. Wooldridge, Esq.
Administrutive Judge ,
Worsham, Forsythe, Samples Oak Ridge National Labcratory >
a Wooldridge P.O. Box X, Building 3F00l 2001 Bryan Tower, Suite 3200 Oak Ridge, TN 37830 . Dallas, TX 75201 Dr. Walter H. Jordan '
' Joseph Gallo, Esq.
Administrative Judge. Isham, Lincoln & Beale
- 881 W Outer Drive Suite 1100 '
- Oak Ridge, TN 37830 g' 1150 Connecticut Avenue, N.W.
Washington, DC 20036 N
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Billie Pirner Garde Mr. W. G. Counsil GAG - Midwest Offfee Executive Vice President 104 E.. Wisconsin Avenue - B Texas Utilities Generating Company Appletoin, Vf 54911-4897 -
400 North Olive Street, L.B. 81 Dallas, TX 75201 William L. Brown, Esq.* Anthony Z. Roisman, Esq.
U.S. Nuclear Regulatory Commission Suite 600 611 Ryan Plaza Drive, Suite 1000 1401 New York Avenue, N.W.
- Arlington, TX 76011 Washington, DC 20005 Mr. Harry Phfilips William H. Burchette, Esq.
Resident Inspector / Comanche Peak Mark D. Nozette, Esq.
Steam Electric Station Heron, Burchette, Ruckert
- c/o U.S. Nuclear Regulatory Commission & Rothwell, Suite 700 P.O. Box 38 1025 Thomas Jefferson Street, N.W.
Glen Rose, TX 76043 Washington, DC 20007 Lanny Alan Sinkin James M. McGaughy l Christic Institute GDS Assoc. Inc.
1324 North Capitol Street 2525 Cumberland Parkway, Suite 450 Washington, DC 20002 Atlanta, GA 30339
- Robert D. Martin
- Atomic Safety and Licensing Board U.S. Nuclear Regulatory Commission Board Panel
- i 611 Ryan Plaza Drive, Suite 1000 U.S Nuclear Regulatory Commission Arlington, TX 76011 Washington, DC 20555 Robert A. Jablon, Esq. Atomic Safety and Licensing Appeal Spiegel & McDiarmid Board Panel
- 1350 New York Avenue, N.W. U.S. Nuclear Regulatory Commission Washington, DC 20005-4798 Washington, DC 20555 Thomas G. Dignan, Esq. Docketing and Service Section*
Ropes & Gray Office of the Secretary 225 Franklin Street. U.S. Nuclear Regulatory Commission Bostcp, Mfi 02110 Washington, DC 20555 W
Gyary S. Mizuno V Coun or NRC Staff
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