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

::~)) :",. ,-...

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

Document 816-14

Filed 06/01/2004

Page 1 of 19
September 4 , 2002

Washington, D.
Page 126

tf?

from utilities?
I don

t have any opinion one way or

another other than if you

I re going

to talk about

economic efficiency from a social point of view, you

have to take this factor into

account.

If this factor is not sensitive to changes
in the aggregate acceptance rate, how do . you

take

this factor into account?
Well, I certainly didn
t say that there I s

no relationship between the assumptions about

acceptance rates and potential social

costs.

As I said, I don ' t really myself have

sufficient independent expertise to form a judgment
~~rj

about that one way or another.

But I do have

sufficient expertise to say that if you

I re going

to

reach an opinion about what is an economically
efficient outcome, you can

I t do

so without taking

social costs into account and that wasn' t done in
connection with Mr.

. Graves I opinion

about economic

efficiency, in addition to whatever other problems

may exist with his conclusions about the assumed
acceptance schedule in the nonbreach world.

You say an acceptance rate that purports
to be socially efficient should consider external

societal costs such as costs associated with

147

AlOersonKeponmg UJUlpauy, 1111 14th Street, N.W. Suite 400 1-8oo- FOR-DEPO Washington, DC 20005

Inc.

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

Document 816-14

Filed 06/01/2004

Page 2 of 19
September 4, 2002

Washington, D.

t~~~

Page 127

potential accidental discharge.

Can you think of any other external
societal costs other than that particular example,

potential accidental discharge? I was referring generally to the

possibility of accident costs borne by third parties
that are not borne by the utilities.

Accidents or

other harm suffered by third parties that are not
internalized to the utilities which accidental
discharge is an example.

Can you think of any other example?
I don
~~f~)

t really know enough. about

the

dangers that exist from nuclear fuel to be able to
provide specific examples.
comes to mind.

But that I s

the one that

What I S your understanding of the term

economic efficiency, what does that term mean to . you?
Minimizing the sum of private and social
costs and internalizing those costs to ensure that
actions that are taken are those in which the

benefits ,

private and social, exceed the costs.

And to determine whether or not private
and social costs have been minimized, would

Mr. Graves have to look at all potential factors that

might affect those costs or could he limit his study
:L/

148
LcUUtmiOn Keporung Company, Inc. 111114thStreet, N. W. Suite 400 1-8oo-FOR-DEPO Washington, DC 20005

~~\: ~\~~)

?:)

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

Document 816-14

Filed 06/01/2004

Page 3 of 19
September 4, 2002

Washington, D.
Page 130

page.
Okay, I have that.

The second page of documents considered,

starting with the third'

one down, civilian

radioactivity active waste ~anagement system
throughput rate analysis.

Next document, throughput stuqy for

the

radioactive waste management

system.

Next study, determination of cost

effective waste management system receipt

rates.

Did you consider any studies like that in

determining whether or not Mr. Graves appropriately.
~~f)

uaed
1.5

an economically efficient acceptance rate?
I don' t recall whether we ever looked at

any of those particular studies but the sentence in question refers to the plaintiffs' expert reports as

opposed to documents such as
18 .

these.

Well, you understand, don' t you, that it"

appropriate for an expert to rely on studies done by

others?
Certainly not inappropriate to do that

depending on the facts and' circumstances.
. 23

. So if th~ studies upon which Mr. Graves
relied show that the acceptance rate that he' s using

in fact is consistent with lower costs for utilities

149
Ataerson Keportmg Company, inC. 111114th Street, No W. Suite 400 1-800-FOR-DEPO Washington, DC 20005

"'-~

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

Document 816-14

Filed 06/01/2004

Page 4 of 19
September 4, 2002

Washington, D.

Page 131

and lower costs for the program, wouldn t that tend
to show that the acceptance rate that Mr. Graves is

usi~g is efficient?
I certainly couldn' t conclude that because

there' s other studies.
Q..

relevant costs and other possible

Are you aware of any other studies that

have different conclusions?
I guess I' m not aware, as I sit here,

subject to checking, that the plaintiffs' expert reports consider all of the relevant costs that I
identified in my report as I stated in the report.
~~f~

You would agree, wouldn' t you, that

at-reactor storage costs are very sensitive to
changes in the acceptance rate?

A. .

That sounds logical but, again, I don

have any particular technical expertise in this

area.

And when I say very sensitive, I mean that
at best their acceptance rates at reactor storage
costs are lower, you would agree with that?
Again, I don' t have any particular

expertise in this area but that sounds

logical.

You don' t have any reason to dispute that

conclusion?
I don '

t

have any reason to dispute it but

150
A...u""""u ""'I"'I ung '-AIUlp(lU

111114th Street, N.W. Suite 400 1-800-FOR-DEPO waShington, DC 20005

y, inc.

~),

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

Document 816-14

Filed 06/01/2004

Page 5 of 19
September 4, 2002

Washington, D~
Page 132
. o'

I don' t have the expertise to form an opinion one way

or the other.

If DOE studies show that program costs are

insensi ti ve to acceptance
gQing to tend , to

rate, isn t the

economically efficient acceptance rate one that. s
be faster then in order to minimize

at-reactor storage costs?

Not necessarily.
Why not?
Because even taking Dr. Bartlett. s
analysis at face value, there s loading costs which have to be taken into account and social costs as
~tilJ

well.

Even accepting your assumptions about storage

costs and program costs.

Let. s

go back to this about, you say that

social costs have to be included as

well.

Why is it appropriate to take into account
social costs if we' re looking at economic efficiency

between two parties, the government and Connecticut Yankee in this particular expert witness report or
just utilities generally?

Because there s a very well recognized

distinction between private efficiency and social

efficiency and you would think that the government

would be sensitive to social efficiency as well as

151
Alderson Reporting Q)mpany, Inc.

1111 14th Street, N.W. Suite 400 1-8oo-FOR-DEPO Washington, DC 20005

, ' y .

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

Document 816-14

Filed 06/01/2004

Page 6 of 19
September 4, 2002

Washington, D.

Page 134

you re going to use the criteria of economic
efficiency, you have to take into account the factors
which determine economic efficiency.

But you, yourself, can' t think of any
factors that would determine social efficiency beyond the one example that you gave of potential accidental

discharges?
" A.
That I s the one that comes to mind,
accidents generally are harm to third parties.

Turn to the next section of your
alternative acceptance rates.
That. s the

report,

subheading

between paragraph 12 and 13.
Are you examining more than one
alternative acceptance rate?

Skimming this section, it looks like

there' s one described.

alternative acceptance rate that is
Whether or not there are others, I don

have any opinion about one way or the other.

The

point is really illustrative about alternative
assumptions which could be made about acceptance

rates.
How did you come to, the one particular
illustration that you use in paragraphs 13 and 14 of

your expert witness report is an acceptance

projection, at least one that goes out 10 years and

lSlA
ruU"l;)uU -"-"l'UI1Wg '-AIUlp;my, Inc.

111114th Street, N. W. Suite 400 1-800-FOR- DEPO Washington , DC 20005

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

Document 816-14

Filed 06/01/2004

Page 7 of 19
September 4, 2002

Washington, D.

Page 135

then annual capacity report published in

1991, that. s

correct?
Correct.
How did you come to focus on using that

particular projection for your illustration?
I don

t recall.

You re aware that Department of Energy has
published a number of annual capacity reports?

Again, I don' t have any particular

expertise in this area but I think I I ve seen
discussion about it in some of the background

materials concerning this case that I
..I

reviewed.

.13

Do you have any reason to believe that the
1991 annual capacity report is any more pertinent than projections in any other capacity report?
I don t have any opinion on that one way

or the other.

Do you have an opinion as to whether the

projections in annual capacity reports as opposed to
projections in other Department of Energy documents

like system requirements documents or total system
life cycle cost studies are more important than those
other proj ections?

I don t have any opinion on that one way
or the other.

151B
Alderson Reportmg company, Inc.

111114th Street, N. W. Suite 400 1-800- FOR-DEPO Washington , DC 20005

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

Document 816-14

Filed 06/01/2004

Page 8 of 19
September 4, 2002

Page 137

What. s the significance of the annual
priority ranking to your analysis?

It. s

an input into the rest of the

paragraph which describes the implications of this
particular schedule.

What the implications are with respect to
the 10, 000 MTU limitation prior to 2010 and then the

subsequent paragraph discusses the further

implications of the OFF priority

system.

What area of expertise are you applying in paragraph 13 to your report? Again, I am analyzing in this particular context the implications of using alternative
assumptions regarding acceptance rates in light of

the methodological problems that I have identified in

connection with Mr. Graves choice of assumptions in

light of his criteria of economic

efficiency.

Do you have an opinion as to whether the

acceptance projection in the 1991 ACR is more
economically efficient than the acceptance rate used

by Mr. Graves in his conclusions set out in

paragraph 11 of your report?
I don' t have any opinion on that one way

or the other.

Do you have an opinion as to whether the

ISIC
LUUC;CWIl l'.epomllg

company, Inc.

111114th Street, N. W. Suite 400 1- 8oo-FOR- DEPO Washington, DC 20005

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

Document 816-14

Filed 06/01/2004

Page 9 of 19
September 4, 2002

Washington, D.

Page 138

acceptance rate set out in that 1991 annual capacity report is more appropriate for use in determining the

date upon which the Department of Energy would
complete removal of spent fuel as Mr. Graves does in
his report, and the acceptance rate that Mr. Graves
uses that. s set out in paragraph 11 of your expert

witness report?
MS . POWELL:

Objection to the extent it

calls for a legal conclusion.
THE WITNESS:
I don' t

have any opinion of

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

Are you saying that the -- you have an
opinion as to whether the acceptance rate in the 1991 annual capacity report is just as plausible for use

in projecting when the Department of Energy would
complete removal of plaintiffs ' spent fuel as the
acceptance rate used by Mr. Graves in his analysis?
I wouldn' t say I have an opinion on that

either because that requires interaction between
legal conclusions and other conclusions relating

possible alternative acceptance

rates.

I only wanted

to point out that particularly in light of the

analysis, incomplete analysis of economic efficiency
in Mr. Graves I report as well as the uncertainty

151D
Alderson Kepomng UJmpauy, Inc. 111114th Street, N. W. Suite 400 1-8oo- FOR-DEPO Washington, DC 20005

:'::\

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

Document 816-14

Filed 06/01/2004

Page 10 of 19
September 4, 2002 '

Washington, D.

Page 139
~~*i)

about whether economic efficiency is even the correct criteria, that there are other possible acceptance rates and if you use those other possible acceptance

rates, all of Mr. Graves' conclusions would not hold

up.
You say there are other possible
acceptance rates.

I believe you said earlier that

you haven' t attempted to detepmine whether or not the

acceptance rate in the 1991 annual capacity report is

more plausible than the one

Mr. Graves uses.

You

concluding though that the acceptance rate in the
. 12

1991 annual capacity report is a plausible acceptance
rate that the Department . of Energy could have used

~:!fEj)

absent the breach?

Again, I' m

not really concluding that

because to do so would require both a legal
conclusion as well as other relevant conclusions

about acceptance rates and

schedules.

m suggesting that Mr. Graves' analysis is extremely sensitive to the particular acceptance schedule which he has chosen and in light of the
insufficient justification for the choice of that

particular acceptance schedule because of the
incomplete analysis of economic efficiency as well as

the uncertainty as to whether economic efficiency is

152
Al~~n Reportmg
Company, In~

111114th Street, N. W. Suite 400 1-8oo-FOR-DEPO Washington, DC 20005

, "\\'

. ~...".""'....

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

Document 816-14

Filed 06/01/2004

Page 11 of 19
September 4, 2002

Washington, D.
Page 148

0 '/

still would not have established that of all the

different possible acceptance schedules that might

exist.
used.

The one that he selected would be the one

that would be, would be the one that would have been

Going back to paragraph 13 for a moment,

let'

s focus on paragraph 13.

Isn' t this a legal

analysis that concludes at the bottom that the

acceptance schedule is consistent with the Department

of Energy accepting no more than 10, 000
the Nuclear Waste policy Act?

MTU prior to

2010 consistent with a statute of 1987 amendments to

m sorry, is what a legal analysis?

The conclusions you reach in paragraph
"15

13.

Is there something other than legal analysis in
paragraph 13?

Yes, because I am not offering a legal

opinion on what the acceptance schedule would have

been, what the ultimate imp1ications are of the

10, 000 MTU limitation.

All of those are legal

questions as well as other kinds of related legal

questions.
m simply pointing out that there are other acceptance schedules which exist which unlike

the one that Mr. Graves has selected seem to have at

lS2A
111114th Street, N. W. Suite 400 1- 8oo-FOR-DEPO Washington, DC 20005
"""1""'"'5 '-AIlllpallY, Inc.

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

Document 816-14

Filed 06/01/2004

Page 12 of 19
September 4, 2002

Washington, D.

Page 149

least some basis in the contract to have very
different implications.

But I I m not offering any

legal conclusions or legal opinions on what the

required acceptance schedule was or for that matter
if there was any.

I thought you just said that you re of the

view that this schedule that you are discussing in

paragraph 13,

the one in the 1991 annual capacity

report seems to be more based in the contract than
the one used by Mr. Graves?
Seems to but again I' m not offering any

opinions as to whether or not there' s any contractual

obligation to have this particular acceptance

schedule or any other one that. s quoting a provision of the contract. But as I said,
is really illustrative.

particular
the point

m not offering any opinion as to what
the acceptance schedule would have been.

m simply

pointing out that there are others, other than the

one that Mr. Graves selected that have radically

different implications for his

analysis.

And the last sentence of paragraph 13, why
did you bother to note that the acceptance schedule

in the 1991 annual capacity, report is consistent with
DOE accepting no more than 10, 000 MTU prior to 2010?

152B
. ~~VU""~ nvpvu.u6 'VV.upau

111114th Street, N.W. Suite 400 1-800-FOR-DEPO Washington, DC 20005

J, Inc.

""-"-'-"

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

Document 816-14

Filed 06/01/2004

Page 13 of 19
September 4 , 2002

Washington, D.

Page 150

For the reasons that are stated in the

report in footnote
I guess I don

t understand.

If the point

of this section of your brief

' is

simply to show an

illustration of another acceptance rate , why is it

material to point out that this alternative
acceptance rate is less than 10, 000 MTU?
First of all, I wouldn' t characterize the

document as a brief just for clarification.

Apart

from that, I think the sentence just makes a point
that if the 10, 000 MTU limitation is a binding

restriction, then Mr. Graves' acceptance schedule

violates it and the particular acceptance schedule

discussed in paragraph 13 does not violate

it.

But

whether or not it' s a binding restriction is a legal
question and I don' t have any opinion about it one

way or the other.

Then why do you bother to put it in your

report?
MS . POWELL:

Asked and answered.
For the reasons that I just

THE WITNESS:

stated.
BY MR. SHAPIRO:
Aren I t

you trying to imply in this section

of your report that the 1991, that the acceptance

IS2C
r-uUvl""ll ""'PV"U1l5

111114th Street, N. W. Suite 400 1-8oo-FOR-DEPO Washington , DC 20005

1"""J,

Inc.

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

Document 816-14

Filed 06/01/2004

Page 14 of 19
September 4, 2002

Washington, D.
Page 151

rate in the 1991 annual capacity report is somehow
more plausible than the rate used by Mr. Graves?
MS. POWELL:
THE WITNESS:

Asked and answered.

No, I' m

not, at least as a

matter of any independent conclusion that I have

reached.
BY MR. SHAPIRO:

You refer to the acceptance rate in the
1991 annual capacity report as an alternative to the
acceptance rate Mr. Graves posits.

Mr. Graves is -- the rate he uses is the
same in paragraph 11 of your report has a ramp-up of 3000 MTU per year and then says that 3000 MTU per
year will be used in each subsequent year.
The 1991

annual capacity report simply goes out 10
a total of 8200 MTU per year.

years, for

Do you have any understanding as to

whether or not 8200, acceptance of 8200 MTU per year
would constitute acceptance of all of the spent fuel
for 8200 total per year is acceptance of ~ll the

spent fuel that the Department of Energy is obligated
to accept under its contract with utilities?
MS. POWELL:

Again, objection to the

extent it calls for a legal conclusion.
THE WITNESS:
I don' t have an opinion one

152D
fUue::niOn ftCl"'uwg '-'Vuopauj, Inc. 111114th Street, N. W. Suite 400 1-8oo-FOR-DEPO Washington, DC 20005

"."" .....:

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

Document 816-14

Filed 06/01/2004

Page 15 of 19
September 6 , 2002

Washington, Do

f!~
IN THE UNITED STATES COURT OF FEDERAL CLAIMS

Page 158

YANKEE ATOMIC ELECTRIC '
COMPANY, et
al.

CERT~fIED COP
Case Nos.

..I

Plaintiffs,
THE UNITED STATES,

98- 126C, 98~ 154C,

Defendant.

98- 474C

Washington, D. C .
Friday, September 6, 2002
Continued deposition of

DANIEL FISCHEL, a

~~~J

witness herein, called for examination by counsel for
Plaintiffs Yankee Atomic , Maine Yankee and

Connecticut Yankee , in the above-entitled matter
16'

pursuant to notice, the witness being duly swo rn by CYNTHIA R. SIMMONS, a Notary Public in and for the
District of Columbia, taken at the offices of

Spriggs

& Hollingsworth, 1350 I Street, N. W., Washington,
C., at 10:03 a. m., Friday, September 6, 2002, and

the proceedings being taken down by Stenotype by

CYNTHIA R. SIMMONS, RMR, CRR, and transcribed under

her direction.

:~6~
~C.:/

153
Alderson Reporting Company, Inc. 1111 14th Street, N. W. Suite 400 1- 800~FOR- DEPO Washington, DC 20005

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

Document 816-14

Filed 06/01/2004

Page 16 of 19
September 6, 2002

Washington, D.

Page 168

plaintiffs' spent fuel in the absence of a breach

would be relevant to your

conclusions.

And I believe

m a little bit unclear and that' s what I wanted to

get , back to.
Is it your opinion that that date, the

date when the government would complete removal of

plaintiffs' spent fuel in the absence of a

breach;

that th~t date is irrelevant to the opinion that you
reached, your first opinion noted in paragraph seven?
MS. POWELL:

Asked and answered.
I think we covered that so

THE WITNESS:

many different times but I just want to make
Can I have the question read
THE REPORTER:

sure.

back, please.
And let me move

Question:

on to another question I wanted to verify, you may

recall that one issue, another issue we covered with
respect to that first opinion was whether or not the

date upon which the government would remove, would
complete removing plaintiffs I spent fuel in the

absence of a breach would be relevant to your

conclusions.

And I believe

I' m a

little bit unclear

and that I s what I

wanted to get back

to.

Is it your opinion that that date, the

date when the government would complete removal of

plaintiffs I

spent fuel in the absence of a breach

154
Al4erson, Reporting Company, Inc, 1111 14th Street, N. W. Suite 400 1- 800- FOR- DEPO Washington, DC 20005

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

Document 816-14

Filed 06/01/2004

Page 17 of 19
September 6, 2002

Washington, D.

Page 169

that that date is irrelevant to the opinion that you

reached, your first opinion noted in paragraph

seven?
THE WITNESS:

m not sure I fully
Again, this is covered

understand that question.

extensively in the report.

Covered very

extensively-

on Wednesday, the first day of the
not sure what I can add.

deposition.
it; my

The report I think makes

clear , and certainly my testimony about

opinion that the fundamental conceptual flaw of the

plaintiffs I

damage claim which was highlighted in my

first opinion is that the claim is not based on when
the government was obligated to begin removing spent

nuclear fuel which is the preach , but rather focuses
on removal of spent nuclear fuel by a certain date
which is not the breach.

And because the costs of

storing the nuclear fuel will exist in both the

breach and the nonbreach world to use the

plaintiffs

terminology, for that reason the plaintiffs i damage

claim is fundamentally flawed from its

inception.

It' s measuring the wrong thing. There are
many other flaws as well but that' s certainly a

fundamental flaw.
, 24
BY MR. SHAPIRO:

One of the things you just said was that

155
till 14th Street , No Wo

Alderson Reporting Company, Inco Suite 400 1- 800-FOR- DEPO Washington , DC 20005

,::.\ '.!

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

Document 816-14

Filed 06/01/2004

Page 18 of 19
September 6 , 2002

Washington, P.

Page 174

THE WITNESS:

Again, I think this is

context specific so you need to refer me to a

particular context that ' you

have in

mind.

I f it I S

different from what we covered at length on

Wednesday, I I 11 do my best to respond.

If it'
bit.

exactly the same as what we covered on Wednesday and
I don' t have anything: to add , I'll say that.

Let me change it around a little

there a difference in your mind in the way you'

defining speculativeness as opposed to the word
likelihood, is the speculati veness of an event

different than its likelihood?

MS. , POWELL:
THE WITNESS:

Vague.
m not sure what that

question means.

BY MR. SHAPIRO:

Let me give you a specific

example.

In my

common understanding of the word speculative, if an
event is 90 percent likely to happen, I would say

it I S not speculative,

is that consistent with your

understanding of speculative?

It depends on the facts and

circumstances.

What do you have to know about the facts

and circumstances?

The specific context , the way the event is

156
till 14th Street ,

Alderson Reporting Company, Inc. N.W. Suite 400 1-800-FOR- DEPO Washington, DC 20005

,;,

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

Document 816-14

Filed 06/01/2004

Page 19 of 19
September 6, 2002

Washington, D.

Page 239

of trading permits or licenses the report itself
refers to a vast body of economic literature on that

subject. So that would be ' a
conclusions that I reached.

description of the

various methodologies that I used in reaching the

Is there a literature that you' re relying

upon on the subj ect

as to whether or not damage

claims are speculative?
MS. POWELL:
THE WITNESS:

Objection, vague.

I think in the context of

this case, everything that ,

ve just referred to is a

literature and other aspects of my

methodology,

everything that I refer to is an input into my
conclusion that plaintiffs' damage analysis in this
case is speculative.
BY MR. SHAPIRO: I understand they' re all inputs but what

m looking for is how you put it all together, and

it'

s that put it all

simply the Dan

together" analYf?is - ~ is that Fischel analysis that you I re applying

or is there some other, is there a particular name
that it has that it' s known in the field?

There'
putting it all

s no name that I' m aware of for

together, if that I f? your phrase in
I would say there is a name

this particular case.

157
Alderson Reporting Company, Inco

1111 14th Street, No W.

Suite 400 1":800-FOR- DEPOWashington ,

DC 20005