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UNITED STATES OF AMERICABEFORE *HE

ATOMIC ENERGY COMMISSION

In the Matter of ).) Docket Nos . 0-329) 5- 0AConsumers Power Company _

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)(Midland Plant, Units 1 and 2))

' Applicant's Answerto Intervenors' Request

for Ruling

Consumers Power. Company hereby answers the

" Request for Ruling" filed by the Cities of Lansing

and Bay: City on August 3, 1973. ~Said Request ob-

jects to the. Applicant's noticed depositions of Earl Brush

and Bernard Wilson, _. superintendents for the Lansing and

Bay City- electric systens , 'respectively.

The objections are. untimely, inaccurate, and

without basis in law. For the- reasons set forth below,

-Applicant respectfully requests that the objections be

summarily and expeditiously denied.

1. The Request is' untimely.

Pursuant to Section 2.740a of the Commission's Rules,

'10 CFR Part 2, Applicant has noticed the depositions of

electric system. managers from ten Michigan municipals and

cooperatives._-These" depositions, scheduled to begin on

August 13, 1973, are to include the managers of the Lansing |

and Bay. City systems .

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. Several weeks -aao, Applicant's counsel informally-

advised counsel for Lansing and Bay City of our intention

to_ depose Messrs. Wilson and Brush. Initially, their

. counsel suggested the possibility of scheduling dif ficulties

but in at least six subsequent conversations counsel never

raised the objections set _ forth -in the' Request. . These

discussions were summarized in a letter between counsel on,

July 27, 1973 (Exhibit .1 hereto) . Subsequent to this letter,

counsel advised Applicant's counsel that-Mr. Wilson would,

be available for deposition during the week of August 13 -

and that Mr. Brush would be available for deposition later

in the month. In accordance with this understanding,

Applicant formally noticed the depositions of several indiv-

iduals, including Messrs. Wilson and Brush, in a letter

dated .Tuly 31,19 73 (Exhibit 2 hereto) .

The Request offers no explanation for the two-week7

delay in filing the objections contained in the instant

Request --J a -delay which clearly prejudices Applicant in

; . light ' of the fast-approaching hearing date. These grounds

alone are : sufficient for denying the Request.

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II. Agreement- concerning prior discovery of Lansing and ''

Bay City is no bar to Applicant's proposed oral depositions. |

The Request advances dae wholly untenable position:

i that agreements between the parties have limited discovery of I

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non-parties only ' to the _ document demands and written

interrogatories served in December, 19 72 upon Lansing, Bay .

City,- and nineteen other "non-party" . members of the intervening

. Michigan' Municipal Electric Association. Although these

non-party municipals opposed this discovery, following ex-haustive pleadings- and. oral argument,-2/1/

the hearing Board

ordered compliance with most-3/ of the discovery items. On

appeal, the Appeals Board held the discovery to be relevant

and affirmed the hearing Board on all grounds (except its

disposition of the " confidentially" objections).-4/

The Appeals Board did express concern ~ that compli-

ance could " burden" the municipals and therefore urged

counsel to discuss the most convenient method of producing

the required information. As the Appeals Board said:-5/

"It must be reiterated that what the partiesare to discuss is not whether the applicant shouldobtain the discovery which the Licensing Board hasallowed. As has been indicated, we are answeringthat question in the affirmative. Rather, thediscussion is to center upon (1);possible alter-native means of accomplishing the discovery; and.(2) possible feasible measures. for handling the. information claimed by the appellants to be con-fidential." [ Emphasis supplied. ]

1/ Motion to Quash Subpoena, filed January 9, 1973; Applicant'sAnswer to' Motion to Quash, filed January 14, 1973, SupplementalMotion to Quash , filed February _ 20,-1973; and Applicant's Answer tosupplemental Motion to Quash, . filed February 26, 1973.

jh/ Third Prehearing Conference, February 12,~1973 (Tr. 219-320).

3,/ Order Granting Applicant's Motion,7 February 27, 1973; and seealso-Order Denying ~ Supplemental Motion, March 6, 1973.

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Memorandum by the Appeals Board (ALAB-ll8, April 24, 19 73 ) ~,-4 1_-

attached hereto. as' Exhibit 3) .

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In subsequent discussions with counsel, Applicant modified

several of the individual interrogatory items and reached agree-

ment -with the municipals concerning the time and method of6/'

compliance. On May 16, 1973, this agreement was adopted by

the Appeals Board in the following language:~7/

"In accordance with the request in ALAB-ll8,the parties to the appeal engaged in negotia-tions which, happily, have predt ced a substantialarea of agreement. Specifically , we . are not ad-vised by counsel that an understanding has beenreached limiting -the document requests and inter-rogatories. . Furthe r , the parties have executeda written agreement detailing the mechanics of thediscovery and the method for resolving claims ofundue burden which may arise with respect to parti-cular discovery items. We approve the agreement

." [ Emphasis supplied. ]. . .

From this course of events, Bay City and Lansing

would have the hearing Board believe that "the purpose of .the

agreements" reached pu,rsuant to the Appeals Board's order was to

" limit future discovery" such as the oral depositions Applicant (l

has noticed (p. 2) . This hypothesis is untenable on its face. ,

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The Appeals Board's orders quoted above speak exclusively of!

the method of compliance with the document demands and written j

interrogatories then before them. The agreement itself per-

~ tains 'solelyf to this written discovery. Indeed, as the

6/ The municipals, including Bay City and Lansing did not abideby . the agreement, as the hearing Board is aware. However, some ~(responses. have.been forthcoming in the past several weeks.

7/. . Decision byfAppeals Board (ALAB-122, May 16,-1973), p. 10.

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a' tached affidavit of counsel affirms, neither . oral deposi-t

tions or any other type of " future discovery" was mentioned

in the discussions of counsel leading to the aforementioned

agreement which- the - Appeals Board endorsed.

Thus, the " purpose" of the agreement between counsel

relating to written interrogatories and document demands had

nothing to do with ' " future ~ discovery" . . It is . there-

-fore clear that, neither implicitly or explicitly, did the,

agreement between counsel or the rulings 'of the Appeals Board

bar or_" limit".in any way-the oral depositions here: proposed.

III. Applicant-has not waived its right to take these' depositions.

Section 2.740a of the Rules gives a party the right

to depose "any party or other person" without leave of the~

Commission or the . presiding officer.- (Emphasis supplied.)

Thus , as the Request concedes (p. 2) , the fact that Bay City

and Lansing are not technically parties to this proceeding

provides no basis. for objecting to depositions of their

electric system managers.

Applicant's entitlement under Section 2.740a is

confirmed by _ case law under comparable sections of the.

~ Federal Rules .of Civil . Procedure. . Reques ts to vacate

deposition notices under Rule 30, F.R.Civ.P. are' granted

only 'in " exceptional" and " unusual" circumstances and thei.

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-f act that a partp has been subject' to other discovery is

no -bar to' taking oral- depositions of such a party. . U.S. v..

- Purdogg, . 30 FRD :338, ~ 340 (W.D. Mo. 1962); Cook v. Cook, 194

N.W;-2d 273, 279 (Iowa Sup. Ct. 1968) ; Kamin v. Central

States Fire Ins..Co., 22'FRD 220,-(C.D.-N.Y. 1958) (priort

sworn statemen'c) . .For example, in.Kulich v. Murray, 28 F.

Supp. 675 (S . D. N.Y. 1939), the court held daat . even though

' the- plaintif f "has availed himself of every" discovery deviceavailable under the rules, depositions were not improper.

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28 F. Supp. at.676.

In light of the Commission's Rules and applicable

case law, the Reques t's . theory (p. 2) that the depositionsi

should be barred because the " Company did not reserve the

right to take depositions against non-parties or mention its-

intent to do so" is clearly untenable. 'Nothing in the~

Commission''s -Rules requires a party to " reserve" its discovery I-

rights ; indeed, the obvious intent of Section 2.740a is to H

the contrary, . sinca depositions may be noticed without11 eave

of- the Commission or this Board. Moreover, as early as as

~Prehearing Conference on October 25, 1972, Applicant's counsel-l

indicated the likelihood of depositions of~ municipal systems

- managers (Tr. 155) , but indicated ' that a final determination

as to konents could not be made prior to receipt- of : document' 8/

~ discovery. _This view has been reiterated on many: subsequent

18/ , Review of responses to the , document demand and written inter-rogatories, following belated receipt,-Enow' reveals that written'responses.have been inadequate in some cases, 'ncluding Lansing d-and' Bay / City,.:and that oralc examination is req i. red- for the/ pre- .]J

- paration of: Applicant's.' case. 1.

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occasions --_in informal meetings of counsel, in conference |

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calls with the Board, and on the record (e.g. , see Tr. 329- y)

330). !1

IThus,I he suggestion that Applicant has in somet

manner waived its ' prerogatives under Section 2.740a is too~

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- far-fetched to require further exposition.'

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IV. No showing is made - that the depositions will be burdensome.

| - The Commission's- Rules of Practice do not provide

for objections to deposition notices. Rather, only upon

I motion ~ and, for " good cause" shown may this Board deny or-

condition oral depositions on the grounds of " annoyance, em-i

|' barrassment, oppression, or undue burden or expense". Section

2. 7 4 0 ( c', . Even treating the instant Request as . a motion under

Section 2.740 (c) , nothing remotely. approximating " good cause"

l is manifest in the instant circumstances.(.E Although the Request refers to the issue of burden,|

' it does not describe or justify any _ burden which would warrant.

prohibition of these depositions. Such a claim would be - in- |!

|-__ substantial- since the Apolicant estimates that each deposition! -9/

'will -last only one or two days.,

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9/' Of course, the length of depositions . involve a number of,,

Tactors ;. e.g. , the responsiveness of the witness ,.' the objections'

of counsel, etc. lit should also be noted that counsel have;

. agreed that- further depositions of -those noticed and others may |

| beJnecessary. See letter from Watson to Pollock, dated July 27, '

1973 -(Exhibit 1 hereto)'.

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The insubstantiality of any burden claim is 'high- (

lighted by the depositions which the Intervenors and the

Department of Justice'took recently of 11 Company-e'xecutives.-

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These _ depositions consumed four full weeks and thousands of\>

. transcript pages; individual witnesses were on the stand for !'

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as ' long. as five days. It also is significant that these l--

depositions frequently focused upon relations between11/~~

Applicant and the Lansing and Bay. City electric systems.In th'is context, it is clear that the depositions

of Messrs. Wilson and Brush which Applicant contemplates- ||

will involve no " undue burden" and that no reason existsto ' deny the depositions on that, or any other, basis. |

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V. An expeditious Ruling is necessary. ;1

ICounsel for Bay City has agreed to make Mr. Wilson

available for deposition on August 14, 1973, in the event

the instant Request is denied; Applicant has already made

appropriate- arrangements to depose him at that time in

Michigan.

| We therefore respectfully request that; the Board

rule expeditiously on~ the instant Request and that, if at-

all possible, a - conference call be initiated- to inform theI

_ parties - of the result on or before August 10, 1973.

~~ ~E.g;, the deposition . of B.G. Campbell from May 17-to10/

May 23,_.1973, which " consumes 558 transcript pages. j.

.11/ _ThisLis:hardly surprising since-the Company and Lansing |have recently initiated coordination arrangements and sinceL*

'the L Companyf and Bay City are " head-to-head" _ competitors forelectric" loads'in a.significant market-area.. _. _ |-

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WHEREFORE, Applicant. urges that the. objections

' contained. in the Request to Applicant's deposition of :

Messrs. Brush and Wilson be denied.A

Respectfully submitted,

:

Wm. Warfield Ross,

Keith S. Watson4-

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Attorneys for Consumers Power Company

WALD, HARKRADER & ROSS1320 Nineteenth Street, N.W.

i Washington,.D. C. 20036(202) 296-2121

Of' Counsel:Harold P. Graves, Esq.Consumers Power Company

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. 212 West Michigan AvenueJackson,' Michigan 49201'

Augus't ' 8, : 19 73

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Affidavit of ~ Keith S . Watson 4

concerning discussionsand. agreements with ,

-counsel for Lansing and. B ay City .

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CITY 0F WASHINGTON. -)-;

) _ss.DISTRICT OF COLUMBIA- )

Keith S. Watson) being duly sworn, deposes and.

says:'

' that he .is one of the attorneys for the ' Applicant,Consumers ' Power Company, .in antitrust- proceedings before -the Atomic Energy Commission involving the Midland Units;.

- that during the peribd h'ere involved, he has hadsupervisory responsibility -with respect to actions byApplicant's Washingtonicounsel.concerning discovery demands-'by Applicant directed to ' parties and "non-parties",

that discussions were held between Robert Jablonand me pursuant to th'e Appeals Board's order. of April 24,1973; that those discussions .related solely to .the methodsof . compliance with then-outstanding document demands: andwritten interrogatories; that at no time during thosediscussions was the subject of oral depositions .(or anyother. future discovery of the non-parties by Applicant)

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mentioned by either . counsel; and that at no time have Iagreed to, or-discussed, a' limitation on Applicant's oraldepositions ~of non-parties with Mr. Jablon or anyone else.

that during.the week of July 23, 1973, I orally.advised James Pollock of Applicant's intention to depose.Bernard Wilson and Earl Brush; that during that week andthe .following week,' Mr. jPollock and I had at least six;telephone conversations in which the: scheduling and logis-tical- problems of these depositions were discussed; th at --

_Mr. Pollock informed me~t. hat Mr. Wilson ~would be availablefor deposition during the week of - August '13,1973 and: thatMr.: Brush would be available durina the last week of August;and that1at no_ time.during_my discussions with Mr. Pollock.did he raise ' the objections to deposing Messrs. Wilcon' and. Brush which are' set forth in the Request for Ruling.-

- that on ' Augus t 7,11973, Mr. _ Pollock agreed to make. Mr. -Wilson"available to ; Applicant ~for. deposition in Grand h~ Rapids i . Michigan , - on LAu'gus t 14, 1973, in the . event the I

1 hearing Board - denies o the1 objections set ' forth in the Request. |

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that the attached statement.is true and accurate,to the best of his knowledge, information and belief.

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W'Keir.h S. Watson

Subscribed and sworn to before me this 8th dayof August, 1973.

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Notary Public -~ ' -

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My Commission Expires: j,

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-EXHIBITS TO.

! -APPLICANT'S ANSWERTO INTERVENORS' REQUEST

FOR RULING.

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r Table of Contents

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| Exhibit 1 Letter from Keith S. Watson to James C. Pollock'

dated July 27, 1973.,

Exhibit'2 Letter from Keith S. Watson to James C. Pollock| . dated July 31, 1973.i

Exhibit.3 Appeals Board Memorandum (ALAB-ll8, April 24,1973).

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EXHIBIT 1

Letter from Keith S. Watson to James C. Pollockdated July 27, 1973.

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EXHIBIT 3

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July 27,-1973

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: James C. Pollock, Esquire; 2600 Virginia Avenue, N.W.

Suite 312'

Washington, D. C. 20036l

Dear Jim:-

This will confirm our recent telephone conversationconcerning depositions of several individuals whom you represent.,

Sinca we have not yet received, or have an opportunityto review, responser to our discovelry t.o the party and non-;

iparty systems, it is not possible at this juncture to provide- !your offics . tith _ a definitivo list of deponents. However, it isour present intention to depose the following: Messrs. Keen ;

(Wolverino) , Steinbrecker (ll. !Iichigan) , Westenbroock (Top O' jMichigan) , Savago (Traverso City) Munn (Coldwater) , Edwards(Grand llaven) , Ricmcrsa '(Holland) , Wilson (Day City) , Brush(Lansing) and Kline (Presque Isle). j

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I anticipato that these depositions will average aboutono-half day each. As we agreed, further depositions of these,

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and other indivicuals may be necessary in- the light of discoveryresponuos uhich we have not as yet received.

We have also agreed that the depositions will be heldin either Jackson or~ Grand Rapids, nichighn. Uc vould propose,

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that flesars. Brush, aunn and Wilson be deposed in Jackson onAugust 2, 3, 9 or 10, 1973. We would also proposo to deposo |the ot'tcra in Grand Haven during the..ucok of August 13, 1973,and to depose those otherwise unavailable on August 23-24 or30-31, 1973.

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Jaces' C. L'ollock, Esquire.

July 27, 1973-' Page 2

Pleaso lot me know of the availability of theseindividuals as coon'as possible so that I can make appropriate

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arrangements for-the depositions.

Sincerely,4

Keith S. Watson

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- cc: Doard 1:cmbers!'

Wallaco E. Brand, Esq. )Joseph Rutbert, Esq.

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EXIIIBIT 2

Letter from Keith S. Watson to James C. Pollockdated July 31, 1973.

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July 31, 1973j

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James C. Pollock, Esquire2600 Virginia Avenue, N.W.Washington, D. C.,

Dear Jim: id

This will confirm our discussions concerningdepositions of those whom your office represents andconstitute a notice of deposition to those identified below.

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Wo shall take the depositions during the woek ofAugus t 13, 1973 at the Company's of;. ices in Grand Rapids,Michigan. We will depose the following in the order listod:

;nessrs. Savage, Edwards, Wilson,- Kline, Koen, Westenbroeck,j and Steinbrechcr. We would propose to take the depositions

of ;icssrs. Reimersa, Drush, and Munn in Jackson later inj the n.onth of August at a mutually agreeable time.4

The .mattors upon which the foregoing will be,

exa. lined are as follows: Their systcas ' policies and prac-,tices regarding coordination and competition with other|clectric utilitics and other transactions ~ involving competing i

clocuric systema in '.hea.r service- area; their system plans,'

policies, and activ'. tics.mncerning retail competition,industrial loam, ratos and rato design, bulk power supply, .!and gancration and transmission expansion the syste:as 'responses to previous discovery requests and relief sought. in this proceeding; and the competitive and financial via-bility of the systou each represents.

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I snall'adviso you as soon as possible as to theidentity of the reporter before whom those depositions will |

be taken.

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Ja;aos C. Pollock, EsquireJuly 31, 1973Page 2

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. - Please be advised that we also intend to meetinforz: ally with those individuals listed in Appendix C ofthe Department's lottar of July 13, 1973, whom you do not. represent. Our purposa is, of course, not to influenceor ascertain the proposed testimony of these individualsbut merely to obtain relevant, factual information whichthey may possess.

Sincerely,

Keith S. \latson

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cc: Doard tic.@ersliallaco E. Brand, Esq.Joseph Ruthorg> - Esq. ,

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EXHIBIT 3

Appeals Board Memorandum (ALAB-ll8, April 24,1973).

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UNITED STATES OF AMERICAATOMIC ENERGY COMMISSION-

In the Matter of )) Docket Nos. 50-329A

CONSUMERS POWER COMPANY ) and 50-330A(Midland -Units 1 and 2) )

CERTIFICATE OF SERVICE

I hereby certify that copies of APPLICANT'S ANSWERTO INTERVENORS ' REQUEST FOR RULING, dated August 8,.1973,in the above-captioned matter have been served on the~ follow 4 cgby deposit in the United States mail, first class or air mail,this 8th day.of August, 1973: ,

Jerome Garfinkel,-Esq.,' Chairman Dr. J. V. Leeds , Jr.Atomic Safety and Licensing Board P. O. Box 941Atomic Energy Commission Houston, Texas 77001Washington, D. C. 20545

William T. Clab ault , Esq.Hugh K. Clark , Esq. Joseph J. Saunders, Esq.P. O. Box 127A David A. Leckie, Esq.Kennedyville, Maryland 21645 Public Counsel Section

Antitrust DivisionJames Carl Pollock, Esquire Department of Justice2600 Virginia Avenue, N. W. Washington , D. C. 20530Washington, D. C. 20037

Joseph Rutberg, Jr. , Esq.L Antitrust Counsel for

AEC Regulatory StaffAtomic Energy CommissionWashington,.D. C. 20545

| Wallace E. Brand,-Esq.Antitrust 'Public Counsel 'SectionP. O.. Box 7513,

' Washington, D.. C. 20044

Atomic : Safety and Licensing BoardAtomic Energy CommissionWashington,'D. .C. 20545

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Keith S. Watson

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