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

Case 1:98-cv-00126-JFM

Document 816-13

Filed 06/01/2004

Page 1 of 17

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... " .')
Case 1:98-cv-00126-JFM Document 816-13 Filed 06/01/2004 Page 2 of 17

Exhibit C

OFF Acceptance Schedule For Maine Yankee s SNF

Under Plaintiffs Aggregrate A~eptance Schedule

Beginning
Year
tnventoQry

Acceptance
. of

SNF

Ending Jnv~otory

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

541. 470. 457.

. 379.
353. 297. 269. 217. 193. 166. 143. 113. 83.08.

71. 12.42 77. 26. 56. 27. 52. 23. 27. 23. 29.46 30.

470. 457.
. 379.

353. 297. 269. 217. 193. 166.44 . 143. 113. 83. 83.

. Source: Backup materials to Frank Graves' Expert Witness Report.

133

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

~;'
Document 816-13 Filed 06/01/2004 Page 3 of 17
September 4, 2002

Washington, D.

~7~

Page 1

IN THE UNITED STATES COURT OF FEDERAL CLAIMS

- - - - - - - - - - - - - X

YANKEE ATOMIC ELECTRIC
COMPANY, et'

al. ,

~~~~g~I" ~11 III ~ w3
Case, Nos.

Plaintiffs,
THE UNITED STATES,

~C

I,,

98- 126C, 98- 154C,
98- 474C
Washington, D.

Defendant.

11 '
!r!'.(;,j;:

Wednesday, September 4, 2002

Deposition of DANIEL FISCHEL, a witness
t~~~l?

herein, called for ,

examination by counsel

tor

Plaintiffs Yankee Atomic, Maine Yankee and
Connecticut Yankee, in the above-entitled matter,

pursuant to notice, the witness being duly sworn 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 10:11 a. m., Wednesday, September 4, '2002

and the proceedings being taken down by Stenotype by

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

her direction.

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

Document 816-13

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Page 4 of 17
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Washington, D.

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Page 14

the plaintiffs' case and their damage model that it
just comes up over and over and over again in a

variety of different, forms throughout the report.
In paragraph 8, let' s turn to paragraph

you . re saying that if the Department of Energy had
started removing plaintiffs' spent fuel in 1998 but

did not remove all of the waste by 2010, then
plaintiff would have incurred most of the costs it is

claiming in its damages in that

instance.

Is that a

fair representation as to what you' re saying?
MS. POWELL:

The document speaks for

i tselt .
THE WITNESS:
:;~1\3

I don' t think there' s a need

to paraphrase the language in the report but what I

think the report does say, based on the damage

analysis

that the plaintiffs and their experts have

put forward and the assumptions underlying that
damage analysis, the report makes the point which,

again, is clear from the language of the report itself that the damage claim is not based on the
failure to start but rather it' s based on removal of

all of plaintiffs' nuclear waste prior to
BY MR. SHAPIRO:

2010.

I appreciate your view that you don t find

it necessary to rephrase but I find it helpful and
::/5)

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

Document 816-13

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Washington. D.C. .

Page 60

calls for a legal conclusion.
THE WITNESS: Again, I don' t want to debate

what the court held because I' m not offering opin~ons on that issue. My understanding is
contained in the report.
BY MR. SHAPtRO:

any

So your statement, the last sentence in

paragraph 8 referring. to the
limi ted to what
, of, paragraph 51

partial breach of

contract that you. re referring to in paragraph 8 is

you ve set out in the last sentence

That'

s what it refers to, correct.

So if in ' actuality

the Department of

Energy is in partial breach of obligations beyond
commenc ing acceptance ~y January 31, 199 8, ~ou don'

have an opinion as to whether or not the claimed
damages result from that further partial breach?
MS. POWELL:

Objection to the extent it

calls for a legal conclusion and
THE WITNESS:

vague.
m not sure I fully

Yeah, I'

understand the question, but I don' t think that my

opinions would change so
" 23

long; as the partial

breach

found by the court involved to a significant extent

the failure to commence disposing of spent nuclear
fuel and high- level radioactive waste by

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Daniel Fischel

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Washington, D.
Page 77

in your -- I I m not

sure of whether you re asking

hypothetical or whether you' re characterizing the

contract or the court' s

finding of what the breach

was but whatever you re doing, I don' t want to
acquiesce in it and certainly don' t want to offer an

opinion about what the contract provides, as I'
stated numerous times.
But that said, the reasons why I don

think that the plaintiffs, even if that were the contract would have established damages are those
reasons that I described before that are described .

the report.
BY MR. SHAPIRO:

I just want to make sure I understand what

your criticisms are and make sure that I ask you
about all those criticisms and I just want to make

sure that I' m

complete about

it.

I know the

government has other experts that might have

different criticisms, in fact do have different
criticisms of plaintiffs' damage claims.

I think we can move on to the next

paragraph, paragraph 9.

In this paragraph, you state

that Mr. Grace' s conclusion is speculative.

What' s your definition of speculative as

you re using it in this paragraph, and I know you use
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Daniel Fischel

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the word speculative in a number of places in the

report and tell me if you re using it differently in
this paragraph as opposed to any place else in the

report?
You know, again, I think the word has a
certain ordinary meaning.
I wasn' t intending to

place a ~pecial meaning on the word other than its
ordinary meaning.

But in this context, you know, the

ordinary meaning is that there are a series of

there' s either no basis for or to the extent that it' s possible to analyze whether there' s a basis for the assumptions.
assumptions that there are either

The reality is inconsistent with the assumptions.

It'

s not only speculative but also implausible.

I guess, I certainly agree that
speculative has an ordinary meaning.

Just to try to

help make sure we' re on the same page, could you

define speculative in that ordinary meaning for us?
I think I just did in my previous answer.

Well, you tried to define it in terms of

the specifics of what you re doing in paragraph 9 and

in the report, but I' m
would be Dan Fischel'

asking, you know, not to

define a Webster s definition of speculative.

What

s definition of speculative?

It might be the Webster

s definition.

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Daniel Fischel

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Again I don' t mean to put any special gloss on the

term.

And as I said in my previous answer, I was

just using the term to mean assumptions for which

there is not a -- an adequate basis in reality or
relevant economic evidence.

You' re aware that in, that there' s a legai

defini~ion of speculative as well, aren I t
MS. POWELL:

you?

Objection to the extent it

calls for a legal conclusion.
THE WITNESS:

I guess I ' mgenerally aware

that the term speculative is used in the legal

context.
BY MR. SHAPIRq:

And that one of the contexts that it'

used is that speculative damages are not

recoverable?
MS. POWELL:

Obj ection, again, to the

extent it calls for a legal
THE WITNESS:

conclusion.
I don t have a

I r~ally haven'

systemically studied that.

formal

opinion about it but I think it' s fair to say that

once damages are characterized as

speculative, that I

usually a reason why they should not be
BY MR. SHAPIRO:

recoverable.

Have you attempted to determine whether or

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Daniel Fischel

Document 816-13

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basis in reality?
I think that depends on the facts and

circumstances.
If an event is shown within a likelihood

of 99 percent to be true, would it have a'

sufficient

basis in reality?
It sounds like it generally speaking but

again, it depends on the facts and circumstances as

to what the assumption
, Q.

is.

So it'

s whether or not -- let' s pick one

of the assumptions you complain about generally is

future events is whether or not assumptions on
OF) ,

fut1,lre

events, whetber or not those assumptions are

speculative ,

does it depend on the likelihood that

the future event is going to happen such that if it

can be shown that the future event is 99 percent

likely that it'
it than that?

s not speculative or is there more to

1\.

well; I think precisely because it is a
s hard to say with a specific

future event it'

probability how likely it is to happen at least for

this type of event.

. Again, that'

s why context is so

important if you said there' s for all practical

purposes 100 percent chance that from now until

2010,

the sun is going to come up every day, that would be

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

Document 816-13

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Page 92

What future events is Mr. Graves assuming
that you

I re criticizing

him for making those

assumptions, whiGh particular future event
assumptions do you have in mind in paragraph 9?
I don' t really have anything specific in

mind.

I can imagine lots of different possible

developments in the future, leg~l and regulatory
change, technological change, change in behavior of
the utilities.

Those are the things that come to

mind.
Going out to 2010

to take one of the

examples you gave, technological change, what

technological change do you think was sufficiently
likely that Mr. Graves should have taken it into
account in his damage model?

I I m certainly not saying that anything
sufficiently likely because, as I said, I don I t,

have

a particular opinion about any change that is go1ng

to occur or will not occur, but that'

s really the

point, it'

s very hard to predict the

future.

There may be technological changes that
significantly affect the cost of storing nuclear
fuel, as an example.
Whether that' s likely to occur,

I obviously have no opinion about one way or the

other.
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Daniel Fischel

Document 816-13

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Page 93
~~i~

But there I s so

many factors like that that

can affect costs in the future that any prediction
which tries to predict what' s going to happen between

now and 2010 is going to be somewhat

speculative,

particularly in context such as this one because as I

keep saying, predicting the future is very

difficult.

You say any prediction of the future is

going to be somewhat speculative, and I suppose

that' s also tautologically true.
Have you made any effort to quantify how
speculative Mr. Graves ' model is because he' s making

predictions based upon future events?
I haven' t made , any attempt to quantify the
~~l~~~

extent to which his costs going to 2010 are likely to
vary based on future events precisely because, well,
first of all, I don' t have the expertise to do

it,

and secondly, in some respects, I don' t think anybody

has the expertise to do it because it' s very hard to
predict future events.

I thought you said before, but let me make

sure that I' m

not wrong on this, that simply because

a damage model depends upon assumptions about future
events that doesn' t make the damage model inherently

speculative, does it?
2'5
do.

m not sure what answer that I gave that

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

Document 816-13

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. Washington, D.

Page 97

dramatically affect what' s going to happen between

now and 2010.
What variables are those?

The kinds of things that I

mentioned,

possible changes in legal and regulatory environment
possible technological changes, possible changes of

behavior of the utilities, any one of a number of

other factors that might

occur.
We talked

Well, you said that, you list three
specific items and then perhaps others.

about one of those technological changes but I
thought previously you said you can' t identify any
~(V

expected technological change that'
account?

s sufficiently

likely that Mr. Graves should have taken it into

I think the point is note what, on this

particular issue what he should have taken into
account, the question is how reliable are predictions about the future when these kinds of things that I

mentioned which can have a significant effect on the
future haven

t t yet

occurred.

Let me take the part of the question about

Mr. Graves should have taken into

account.

Can you

name one technological change, potential
technological change that you have in mind?

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Daniel FISChel

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Not a specific technological change, no,
2.

because I don' t have expertise in technology.

But

any technological change which affects the cost of
storing nuclear fuel would qualify as a possible

future event which could have a significant impact on

predictions about the future which, again, is a

reason forwai ting till the future occurs
this problem.

to, avoid

I understand your preference to wait,

but -Not always.

It'

s a trade-off.

What' s the point of waiting to ~ee if

there'

s a technological change

if . you

don' t have any

expectation that there'
technological change?

s going to be a material

I covered this at length already.
know what' s going to happen in the future.

I don

it

In this

particular area, I don' t believe any~ody knows what I

going to happen in the

future.

For that rea~on, a

damage claim which is premised on assumptions about

what I s going to happen in the future, particularly in
a context such as this, has a certain speculative

component to

it.

And the report points that out.

Therefore an alternative way to proceed

would be to analyze the additional costs that have

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Daniel Fischel

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Page 99

already been incurred and again while there may be

many other problems with those costs, at least this

problem wouldn I t exist.

And I'

d have some mechanism

for dealing with costs that are incurred, if any, in
the future to the extent I don' t have all the other
potential problems.

But whether this particular problem is one
that, you know, by itself makes the, or at least this

part of the plaintiffs' damage claim unreliable as a

matter of law is really for somebody else to, really
for a court to determine.

m simply pointing out

this component of the damage claim which is

speculative for the reasons that I' ve stated.
Let me go back.

You listed three types of

things that might change in the future that give you
pause about Mr. Graves' assumptions.
possible technological changes.

We talked about

I believe the first

item you mentioned was possible legal and regulatory

changes.
Do you have any expectation of any
particular legal and regulatory changes that might
take place in the future?
No, I don' t, but, again, my opinion wasn'

based on an expectation of anything specific
happening in the future.

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Daniel Fischel

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And then likewise you also mention
behavior of utilities, but you don' t have any

expectation , that
the future?

utilities' behavior might change in

I don' t have any expectations to that

effect but I don' t have any expectation to any other

effect either. I don t know what. s going to happen
in the future.
And that' s true with all the

different areas, , that'
(Recess. )

s really the point.

BY MR. SHAPIRO:

Again, going back, Mr. Fischel, to
~XJ

paragraph 9 and 10.

Your opinion that Mr. Graves

assumptions about future events make his conclusions

speculative, what area of expertise did you apply in
order to reach your conclusion?

I think I have general expertise on

analyzing damages in cases of this type,

that, aspect

of that ,expertise.
Is that a matter of economics?

It'

s a relationship between understanding

the components of a damage claim which frequently
does require economic , expertise and

understanding the

extent to which a particular damage analysis is

sensitive to particular

assumptions.

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

Document 816-13

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Page 16 of 17
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Page 115

11, you simply note that Mr. Graves has reached an

opinion as to a certain acceptance rate schedule that

would have been applied in the nonbreach

world.

Are you saying that his opinion that this

acceptance rate would have been followed in the
nonbreach world is faulty?

m saying exactly what is stated in the

report.
Do you have an opinion as to whether
Mr. Graves ' conclusion that the acceptance schedule

shown in paragraph 11 of your report that Mr.
conclusion is faulty?

Graves'

I wouldn' t say I would use the term faulty

because I don' t have an independent expertise of what

the acceptance rate would have been had there been no

breach.

But I do have the opinion that the reasons

that the plaintiffs' experts have given for this

particular assumed acceptance rate in light of all
the relevant facts and circumstances makes this
particular conclusion speculative.

So you don' t have the requisite expertise
to determine what acceptance rate would have been
followed absent the breach?

In terms of forming an independent

opinion, that' s

correct, I don'

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Daniel Fischel

Document 816-13
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outcome would be one that would minimize the sum of

those costs.
Do you agree ' with that conclusion in

Dr. Bartlett'

s report?

m not sure I I d have an
one way or the other.
7'

opinion on that

I don

I t, have any obvious

disagreement that comes to mind, but I' m not sure I

have sufficient expertise to form a definitive

opinion as to whether Dr. Bartlett has accurately
summarized the total cost to utilities of storing and

disposing of spent

fuel.

And you have a footnote there that notes
I~~~:~)

one additional criteria th~t you say ought to be considered in order to have a socially efficient

program which is societal cost and one societal cost
you mention in particular is the potential for

accidental discharge of radioactive material, do you
have any opinion as to how sensitive potential

accidental discharge of radioactive material is to
differences in acceptance rates?

No, I don
Do you have any reason to believe that
potential for accidental discharge is at all

sensitive to differences in acceptance rates of how

fast Department of Energy would accept spent fuel
:\J

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