Free Motion in Limine - District Court of Federal Claims - federal

Case 1:98-cv-00126-JFM
Daniel Fischel

Document 816-15
Washington, D.

Filed 06/01/2004

Page 1 of 17
September 6 , 2002

Page 240

for the various components, series of names for the

various components of the analysis that I performed
on which my conclusions are based.

I just want to make sure that there s no

caveat here, you said there I s

no name that you I

aware of for putting it all together, using my phrase
in this particular case, is there also no name for

putting it all together in terms of in general
determining whether or not a plaintiff' s damage claim

in the litigation is speculative more generally, not
necessarily linked just to this case?
MS. POWELL:
THE WITNESS:

Objection, vague.

m not sure what that means

but I think in different cCj.ses the damages analyses
can vary, obviously, so I would say it' s, to the

extent I understand the question , I would say that
you would need to understand the context and the
facts and circumstances of a particular case and then you could determine the extent to which conclusions that are reached in that particular case depending on

whatever the relevant facts and circumstances

are,

what the bases is for those conclusions and what

methodology is used and what the name is or names for
the particular methodologies that are used and

whether :i(t' s one or several.

I I m not even ?ure at

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Case 1:98-cv-00126-JFM
Daniel Fischel

Document 816-15
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Filed 06/01/2004

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September 6 , 2002

Page 241

this level of generality it I s possible
this in a meaningful way.
BY MR. SHAPIRO:

to discuss

All right.

I think we

I ve covered that
Before we got

subj ect adequately for the time being.

the call from the judge we were focused on " must

move" fuel and footnote six in your expert witness
report, and you had said that the footnote was

intended to imply that the operating plants would

have " must move" fuel that would have to be taken

care of.

As I was looking at the phrase first, what

did you mean to refer to when you said that discharge
from operating reactors would have to be

removed - - would

have to be moved first, what would

be moved second then?
Again, this is attempting to capture the

concept of " must

move" fuel as used in Mr. Graves'

report.

Any one of the number of things could be

second or third or fourth or

fifth.

You didn t necessarily mean to say that

the " must

move" fuel from operating reactors has to

be moved first before plaintiffs' shutdown reactor

must move" fuel.

That I S not what you were referring

to?
I I m not sure that is necessarily what was

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- - - - - - - -- -- - - - - - . - - - - Case 1:98-cv-00126-JFM
Daniel Fischel
Washington, D.

'Filed 06/01/2004 Page 3 of 17
October 8 ,

Document 816-15

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS

YANKEE ATOMIC ELECTRIC

CERTIFIED-COPY .:..J
: Case Nos. 98- 126C,
: 98- 474C,

COMPANY, MAINE YANKEE ATOMIC:
POWER CO., and CONNECTI CUT
YANKEE ATOMI C POWER CO.,

98- 154C'

Plaintiffs,
: (Senior Judge Morrow)

UNITED STATES OF AMERICA,

(VOLUME III)

Defendant.
- - x

Washington, D.
Tuesday, October 8, 2002

Deposition of DANIEL FISCHEL, a witness
herein, called for examination by counsel for
Plaintiff in the above- entitled matter, pursuant

to notice, the witness being duly sworn by LORI MACKENZIE, a Notary Public in and for the District of Columbia , taken at the offices of Spriggs &

Hollingsworth, 1350 I Street, N.

, 9th Floor

Washington, D. C., at 9: 37 a. m. on Tuesday,
October 8 , 2002, and the proceedings being taken

down by Stenotype by LORI G. MACKENZIE , RPR , and

transcribed under her direction.
;1'

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Daniel Fischel

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~!d

You said there was 70-some order

contracts initially and then, through
consolidation there are now an effectively smaller
number of players.

Do you know what that smaller number is?

I have some understanding that maybe some
number in the 40s.

But, I am not 100 percent sure

of that.
Let I S turn back to your expert witness
reportJ I believe it is Exhibit 4 to your

deposition.
front of you.
f~JJ

I believe it is in the compilation in

MS. POWELL:

Exhibit I?
It must be , Exhibit 1, I am

MR. SHAPIRO:

sorry.
BY MR. SHAPIRO:

I want to ask you some questions starting
wi th

Paragraph 17.
Okay.

I have it.

, 20

We are discussing greater than Class C

Waste.

What sort of greater than Class C Waste

does Yankee Atomic have?
MS. POWELL:

Objection ,

vague.

THE WITNESS:

I don' t have an opinion on

that one " one way or the other.

\in

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Daniet Fischel

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BY MS. POWELL:

Do you know how Yankee Atomic has come to have greater than Class C waste?
No , I don't know.

What about Connecticut Yankee, do you
know what sort of greater than Class C Connecticut

Yankee has?
MS. POWELL: THE WITNESS:

Objection, vague.

Not as I sit

here.

BY MR. SHAPIRO:

What about Maine Yankee, do you know what sort of greater than Class C waste the Maine
Yankee might have?

, MS. POWELL:
THE WITNESS:

Same obj ection.
No, I don't.

BY MR. SHAPIRO:

Do you how Maine Yankee has come to have
a greater than Class C waste?

No.
Do you know that Yankee Atomic has greater than Class C Waste?
My understanding is that at least some of

the plaintiffs have greater than Class C
Do you know which ones?

waste.

Not from memory, no, I ,

would have to

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Daniel Fischel

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check.
Is greater than Class C waste something
that every utility has?
I would have to check.

Do you know what percentage of nuclear
utilities have greater than Class C waste?
Not without checking, no.

Do you know how any utility would develop
greater than Class C waste?
MS. POWELL:

Objection.
Not without checking, no.

THE WITNESS:

BY MR. SHAPIRO:

You say in paragraph 17 that if greater
than Class C waste, and I see you used the acronym

15,

GTCC, I assume you mean greater than Class C

waste?
Yes.
Greater than Class C waste cannot be

included in delivery commitment

schedules, and I

know you also talk about fuel and spent fuel, but

I' II

treat them one at a

time.

If greater than Class C waste cannot ,

included in delivery commitment schedules, then
purchaser would have little incentive to engage in

exchanges, , because the exchanges would not

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Daniel Fischel

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What facts and circumstances do you need
to know?

The extent to which the cOst s that would

be incurred in trying to engage in exchanges would
be a worthwhile investment and expe~diture if the

need for on-site storage would not be eliminated
in any event because of the exclusion of greater
than Class C waste from the program.

Do you know if greater than Class C waste

has to be stored on the site of a nuclear utility
as opposed to being stored at other locations?
MS. ' POWELL;

Obj ection, vague.

THE WITNESS: ' Not without checking, no.
Do you have any knowledge of just what
the requirements are for a nuclear utility to
store greater than Class C waste?
MS. POWELL:

Same obj ection.
Not wi thout checki~g, no.

THE WITNESS:

BY MF-. SHAPIRO:
Do you know physically how a nuclear

utility goes about storing greater than Class C

waste?
MS. POWELL:
THE WITNESS:
Same objection.
Not wi thout

checking.

BY MR. SJ;IAPIRO:

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It is

, your hypothetical.

Well, it is my hypothetical, but I

represent to you that it is also the real world
and a lot of the utilities don't have greater than
Class C waste.

So I am trying to figure out why it

matters whether or not greater than Class C waste

could be included in the schedules, of a utility
that doesn't have greater than Class C

waste.

It matters for the reasons that I have

said, namely the existence of a type of nuclear

waste that requires storage, and, therefore , cost
of storage, but is excluded from a governmental
program for removing nuclear waste.

It affects the incentives of all possible

trading, partners, whether

or not they themselves

have greater than Class C nuclear waste , because

it affects the terms on which transactions can

occur.
And, for that reason , it affects the
incentives of everyone.

Have you made any attempt to quantify the
impact on effective use of utilities to exchange

delivered commitment schedules, if greater than
Class C waste cannot be stored , cannot be taken by

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Daniel Fischel

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the Department of Energy under the utilities

contracts?
MS. POWELL:

Objection, vague.

THE WITNESS:

Not , beyond what is stated

in the report and what I have stated in my

answers.
BY MR. SHAPIRO:

W~ll, I haven't seen
haven I t

any.

Am I wrong?

seen any attempt in the report to quanti~y

the affect on incentives that you have been
talking about, about the potential inability to include greater than Class C waste on deli~ery
Y:;J

commitment schedules.
Am I missing something?
attempted to quantify that impact?
Have you

What I would say is the report concludes

that the quantification, advanced by Mr. Graves in
his extreme and implausible assumptions about

exchanges, is incorrect and fundamentally flawed
for a number of reasons ~ including the exclusions

expressed in Paragraph
But, you haven

17.

I t attempted

to quantify

the impact on incentives that you are talking
about in Paragraph 17 , have you?,
MS. POWELL:

Asked and answered.
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Daniel Fischel

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THE WITNESS:

No.

Other than concluding,

have

just stated, that

the purported
concerning this

quantification by Mr. Graves hypothetical exchange market
implausible for a number of

speculative and different reasons,

including this particular reason expressed in

Paragraph 17.
BY MR. SHAPIRO:
You haven I t attempted to identify

particular utilities that would be less likely to
engage in exchanges at approved delivery

commitment schedules if greater than Class C waste
cannot be taken by the Department of Energy under
its spent fuel program, have you?

Well, I think I have just stated that it
would affect the incentives of all utilities to

varying extents.
But, you haven't attempted to identify

which utilities would be affected more or
have you?

less,

Not as Qf this time, no.
Suppose the Department of Energy has an

obligation, entirely independent of utilities,
contracts with the Department of Energy that are

the particular subject of this dispute, to remove

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to include that information in your hypothetical

as well as lots of other relevant facts and
circumstances, in order to be able to address it
in a meaningful way.

Let me ask again about Paragraph 17, now

about failed fuel.
paragraph.

You have discussed both

greater than Class C waste and failed fuel in that

Do you know if Yankee Atomic has failed

fuel?
Not without checking, no.

D~ you know if Connecticut Yankee has
failed fuel?

Same answer.
Do you know if Maine Yankee has failed

fuel?
Same answer.

Again ,

my understanding is

that at least some of the utilities in the program

that have signed contracts have failed

fuel.

Do you have ~ny sense of what percentage

of nuclear utilities have failed

fuel?

Not wi thout checking, no.

Do you have any idea what the volume of
failed fuel is amongst all utilities?
Not wi thout checking, no.

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Reviewing Appendix E doesn t help you
figure that out?
, it doesn't.

Do you , see that the first page of
Appendix E refers to standard fuel, nonstandard
fuel, failed fuel, Paragraph A(l)?
I see that.

Do you have any understanding of what the

difference is between nonstandard fuel and failed

fuel?
, 11

MS. POWELL: THE WITNESS:

Objection, relevance.

Not other than what is

stated in the definitions, no.
BY MR. SHAPIRO:

As you look at Appendix E to the contract, and compare that to the second sentence

in Footnote 11 of your expert witness report, do you think it is possible that that senteuGe in the

expert witness report is not fully
MS. POWELL:
THE WITNESS:

correct?

Objection, vague.

since it refers to Appendix

E of the contract, which contains the provision of

the contract defining what failed fuel is, seems
pretty clear to me that that is what is being

referred to.
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BY MR. SHAPIRO:
Footnote IIi

the second sentence of

Footnote 11 of your expert witness report says

that failed fuel is spent fuel or high level waste that does not meet the general specifications for
such fuel as set forth in Appendix Now that you have taken a look at
Appendix E , do you still agree that all spent fuel

that does not meet the general specifications in
Appendix E should be deemed failed fuel?
If what you are su9gesting is ,there is no

reference in the sentence to nonstandard fuel
that is what you mean, I don' t,

, if

think that makes

the sentence inaccurate, because of the reference
to Appendix E , which has a fuller description.

Do you have any idea how fuel becomes

failed?
MS. POWELL:

Objection, relevance.
No" I don

THE WITNESS:

It.

Not as I sit

here without checking.

What is your understanding of what the
contract requires in terms of the Department of

Energy' s obligation to accept failed fuel?
MS. POWELL:

Objection to the extent it

calls for a legal conclusion.

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H?!

BY MR. SHAPIRO:

Do you have any knowledge of the
technical feasibility of transporting failed fuel?

MS. POWELL: Same obj ection.
THE WITNESS:
No , I don'

BY MR. SHAPIRO:

Does technical feasibility come into play
in determining whether or not Department of Energy

would accept utilities' failed fuel, with the same
schedule as the rest of its spent fuel?
MS. POWELL:

Same obj ~ction and also

object to the extent it calls for a legal
;;~~f;)

conclusion.
THE WITNESS:
I don 't have an opinion on

, 15

that one way or the other.
BY MR. SHAPIRO:

Do you have any

knowledge of how failed fuel is
MS. POWELL:
THE WITNESS:

stored.

Objection, vague.

Not as I sit here, no.

BY MR. SHAPIRO:

Do you have any understanding of how the
storage of failed fuel compares to the storage of
spent fuel that is not failed?
MS. POWELL:

Same obj ection.
Not as I sit here , no.

THE WITNESS:

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experiment.
Or whether there has ever been a real

world situation whe~e you could have a

sufficiently controlled experiment, so you could

begin to answer a question like that, at least in
a particular context.

For purposes of your opinion in these

cases, you haven't attempted to quantify the

difference between how efficient market would be
if it is bilateral trading as opposed to the

auction procedure that Mr. Graves uses in his

report?
~~~~J

Well , I would say that is correct, except
to the extent that all of these points are a

response to the quantification contained in
Mr. Graves' s report in an attempt to show how

extreme and implausible the assumptions are that

underlie that quantification.
Is bilateral trading an unusual part of
th~ economy, generally?

It is not an unusual part of the economy
generally for certain purposes.

But, it would be

very unusual for other purposes, such as the one
contemplated in, or the assumptions that are made
in Mr. Graves' s report.
;;;:J

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Well, taking into account those rules

that might lead to a suboptimal result, do you

have an opinion, though, as to whether or not, at
the end of that process, with whatever the rules are, the market for delivery commitment schedules

would be efficient on an allocative basis, if the
Department of Energy was otherwise accepting spent
fuel from utilities?
MS. POWELL:

Same objection.

THE WITNESS:

Again, I would say there is

no way to know, based on the experience in other
regulatory contacts where the rules for exchanges

have been similar to the ones that exist

here.

I would say that it is not likely that

this particular exchange market, in the

hypothetical that you have described, would work

all that well in the sense that the rules would
interfere with the ability of participants in the

market to reallocate themselves in an optimal way.
If you want to say that that is an
inefficiency, then if that is the way you want to

use the term inefficiency, then that is what I

would say.
BY MR. SHAPIRO:
I f

the Department of Energy was otherwise

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of making the second exchange.

Do you have any opinion as to how short

of completely optimal the allocation of acceptance rights would likely be if the Department of Energy
was otherwise accepting spent fuel from utilities?

No.

I don 't think it is possible to know

that.
Are you saying it is not possible to know

with certainty, or it is not possible to make any
reasonable estimate of how efficient, allocatively
, 11

efficient

the market would end up being?
MS. POWELL:

Objection, vague.
It is certainly,

THE WITNESS:

possible to

know with certainty.

I think there are some

things that you could say, which I have said,
, 16

based on the experience of other participants in
different regulatory schemes, based on the rules
that existed in those regulatory -schemes that are

referred to in the report and in the footnotes to

the report.
But, any kind of prec~se prediction as to

what would occur in this market, I think would be

very difficult, if not impossible, to make.
What features of a market determine
whether it would perform efficiently?
, i

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