280

BEFORE THE
U.S. DEPARTMENT OF LABOR
NORTHEAST REGION

------------------------------X
In the Matter of: :
:
OSCAR B. SHIRANI, :
:
Complainant, : Case No.: 2002-ERA-28
v. :
:
COMED/EXELON CORPORATION, :
:
Respondent. :
------------------------------X

U.S. District Court
Courtroom 1944-C
Dirksen U.S. Courthouse
230 S. Dearborn Street
Chicago, Illinois 60604

Wednesday,
December 18, 2002

The above-entitled matter came on for hearing,

pursuant to notice, at 8:42 a.m.

BEFORE: ROBERT J. LESNICK,
Administrative Law Judge

 

 

 

 

 

 

 

 

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

281

APPEARANCES:

On behalf of the Complainant:

MICHAEL C. McDERMOTT, ESQ.
134 N. LaSalle Street
Suite 1410
Chicago, Illinois 60602
312-372-4550

On behalf of the Respondent:

SCOTT E. GROSS, ESQ.
DARREN R. REISBERG, ESQ.
Sidley, Austin, Brown, and Wood
10 South Dearborn Street
Chicago, Illinois 60603
312-853-7011

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

282

Reporter: Stuart Karoubas Date: December 18, 2002
OALJ Case Name & Number: Oscar B. Shirani, 2002-ERA-28

WITNESS (FULL NAME) DIRECT CROSS REDIRECT RECROSS
Kombiz Salehi 284 326

Oscar B. Shirani 331 432 504 521
522

Ellen Dee Caya 523 565
Eliecer Palacios 590 600

 

EXHIBITS

EXHIBITS IDENTIFICATION RECEIVED WITHDRAWN REJECTED

CX 11 341 345

CX 12 345 345
CX 13 413 415

CX 15 410 411

CX 17 423 424
CX 19-21 415 417

CX 22 419 419

CX 23 421 423
CX 26 417 418

CX 27 424 426

CX 28 407 410
CX 30 420 420

CX 31 411 413

 

 

 

 

 

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

283

RX 1 528 529

RX 2 484 489

RX 3 538 539
RX 4 489 489

RX 5 545 545

RX 6 549 550

RX 7 557 559
RX 8 475 477

RX 14 469 470

RX 15 447 448
RX 16 442

RX 21 479 480

RX 32 497 498
RX 33 499 500

RX 34 462

RX 35 490
RX 36 441 442

RX 38 442 443

RX 40 459
RX 41 498 499

RX 42 466 467

RX 43 468 469
RX 44 501 502

RX 45 500 500

 

 

 

 

 

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

284

1 P R O C E E D I N G S

2 (8:42 a.m.)

3 JUDGE LESNICK: All right. We're back on the record.

4 Day two of the matter of Shirani v. ComEd/Exelon Corporation,

5 2002-ERA-28. And raise your right hand, sir.

6 (Whereupon,

7 KOMBIZ SALEHI

8 was called as a witness by and on behalf of the Complainant,

9 and after having been first duly sworn, was examined and

10 testified as follows:)

11 JUDGE LESNICK: All right. Please be seated. And,

12 Mr. McDermott, you may question the witness.

13 MR. McDERMOTT: Thank you, Judge.

14 DIRECT EXAMINATION

15 BY MR. McDERMOTT:

16 Q Would you state and spell your full and complete name

17 for the court reporter please?

18 A Certainly. My first name is Kombiz, K-o-m-b-i-z.

19 And the last name is S-a-l-e-h-i. Address is 2362 Homestead

20 No. 1 in Santa Clara, California 95050.

21 Q And when did you arrive in Chicago, Mr. Salehi?

22 A About 5 o'clock, 4:50 this morning.

23 Q What is your trade or occupation?

24 A At the present time, I work for a high-tech company,

25 an organization called KLA-Tencor.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

285

1 Q I'm sorry?

2 A KLA-Tencor is the name of the company. It's a high-

3 tech company manufacturing semiconductor devices. And I also

4 teach at the University of Phoenix, the Northern California

5 division in San Jose.

6 Q What is your educational background?

7 A I received my Bachelor degree at Northeastern --

8 State University in physics which is now referred to as Truman

9 University. I received my masters in nuclear engineering from

10 the University of Illinois. And also, I received my MBA from

11 Pepperdine University.

12 Q From where?

13 A Pepperdine University.

14 Q In California?

15 A In California, yes, sir.

16 Q Could you tell the court what your work history is as

17 a professional? What was your first professional position?

18 A In 1971, I was recruited by ComEd, I should say

19 Commonwealth Edison, right out of University of Illinois, and I

20 worked at their -- Nuclear Power Station as -- reactor engineer

21 for a span of three years. And then, subsequent to that, I

22 worked for Bechtel Power Corporation for a year in 1974, and

23 then Parsons Power for three years.

24 Q I'm sorry?

25 A Parsons.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

286

1 Q Power?

2 A Power, yes.

3 Q And where is Parsons Power?

4 A That's in Pasadena, California. And Bechtel was also

5 in, at the time, Norwalk, California, Southern California. And

6 then, subsequent to that, I worked for General Electric Nuclear

7 -- Division between 1977 and 1987 in San Jose. And from 1987

8 to 1990, I managed and founded and organized a consultant

9 corporation. And in 1990, I worked for U.S. Nuclear Regulatory

10 Commission.

11 Q The NRC?

12 A NRC, yes, sir. And in 1997, I left the US NRC and

13 was employed back with ComEd until September, or July of 1998,

14 and then was laid off by ComEd and moved back to California.

15 And after a span of about a year of unemployment, I was

16 employed by the University of Phoenix on a part-time basis.

17 And then, I got employed by KLA-Tencor at which I'm currently

18 full-time employed. That's basically my professional whole

19 work history.

20 Q That's 30 years, 31 or 2 years, correct?

21 A Since 1971, 31 years exactly. Yes, sir.

22 Q And you then, in and around, and or about the nuclear

23 industry, your whole profession --

24 A That is correct until 1998 when I left ComEd, my

25 entire career was founded under the nuclear technology, nuclear

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

287

1 industry.

2 Q Specifically, what were your duties at the NRC?

3 A For a span of six years, I was a reactor inspector

4 here at their Region 3 in Lisle. And in 1997, I joined their

5 headquarters, NRR, as a project manager, Division of Reactor

6 Projects, in Rockville, Maryland. And it was at that time that

7 I was recruited by ComEd.

8 Q What is the difference between NRC and NRR?

9 A NRR is a branch within the NRC, Nuclear Regulatory

10 Regulations. It's a section within the Nuclear Regulatory

11 Commission, it's a division.

12 Q And what were your duties at NRR?

13 A I was a project manager and the project that I had

14 responsibility was Arizona Public Power and Southern Utility.

15 And basically, I monitored their progress, monitored their

16 correspondence and managed their affairs as far as regulation

17 is concerned.

18 Q You're familiar then with NRC regulations?

19 A Yes, sir.

20 Q And you applied them on a daily basis? Or you --

21 A Yes. My job as a reactor inspector was to evaluate

22 codes and standards, conduct inspections as a reactor inspector

23 at various power plants within the Midwestern regions and

24 evaluate their performance, monitor their progress, and conduct

25 audits, conduct inspections, and evaluate their findings

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

288

1 according to the codes and standards that were prevailing. And

2 that was my job as reactor inspector.

3 Q Did you have occasion in working in Region 3 to do

4 such inspections of the ComEd reactors?

5 A Yes, several times at their Downers Grove facilities

6 as well as their power plants. The ComEd plants at the time or

7 even at the present time are basically controlled, regulated if

8 you will, within the Region 3 which is in Lisle. So, it was my

9 responsibility to come to the plants, either as a solo

10 inspector or as team inspector and monitor the activities,

11 monitor the performances in mostly announced inspections. And

12 there were events, there were cases, abnormalities, transients

13 that we needed to monitor and evaluate the performance in

14 accordance with the codes and standards.

15 Q Just briefly, you had your own consulting company, is

16 that correct?

17 A That's correct, yes, sir.

18 Q And did you apply to the NRC or did the NRC recruit

19 you?

20 A The duties and responsibilities I had in the

21 consulting company was in training nuclear engineers and

22 nuclear physicists at the boiling water reactor types. I

23 managed training business for GE for that decade I worked for

24 them, from 1977 until 1987. And I had engineering training

25 which included all engineering related training courses as well

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

289

1 as instrumentation training courses for GE, for the type of

2 plants that were manufactured by GE. And then, while I was at

3 NRC, mostly, my activities were in regulation, not so much in

4 terms of the training. If there were issues that were germane

5 to training adequacies or inadequacies, certainly I would

6 review them. The number of the inspections I conducted was in

7 the area of core physics, field performance, field safe guards.

8 Those activities pertain due to my background at GE and also

9 due to my background at ComEd.

10 Q And, again, the NRC knew of your activities, is that

11 correct?

12 A Yes, sir. Absolutely, yes.

13 Q And were you offered a job or did you make an

14 application to the NRC?

15 A I sent an application. I sent a resume and reference

16 letters, yes. I wanted to see --

17 Q Go ahead, that's all right.

18 A I wanted to see, you see, I had worked at ComEd.

19 ComEd or Commonwealth at the time was an owner-operator, and

20 then working for Bechtel and Parsons were architect engineers.

21 These are the people who designed the plants. And then,

22 working for GE, those are the individuals who manufactured the

23 plants, I wanted to complete the cycle by working for the

24 regulator, how we regulate the industry. So, that completed

25 the cycle.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

290

1 Q Have you ever been called as an expert witness to

2 give testimony either in a deposition --

3 A No. No, I have not, sir.

4 Q Have you ever been called to write reports with

5 respect to just specific issues presented or --

6 A In a court proceeding?

7 Q Yes.

8 A No, sir.

9 Q All right. So, is this your first time on a witness

10 stand in a court proceeding?

11 A Yes, sir.

12 Q And you've never been deposed or --

13 A No.

14 Q You know what a deposition is?

15 A Absolutely.

16 Q -- and sworn and you've never participated in

17 anything like that?

18 A No. My daughter is an attorney. She would sue me if

19 I, I apologize for the indulgence.

20 Q That's quite all right. Are you familiar with

21 something called the Sigma standards?

22 A Yes, 6 Sigma process. Yes, sir.

23 Q What is the 6 Sigma process?

24 A 6 Sigma process is a process that manufacturing or

25 just any products that are produced will have failure rates

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

291

1 that would be less than 99.999 percent.

2 Q Which translates into?

3 A Into allowing three failures within one million

4 products. It's a phrase that many companies as of late follow

5 and adhere to if their quality requirements comply with that

6 principle that they will only allow three failures, three

7 deficiencies, three inadequacies, three nonconformances within

8 one million products that they produce.

9 Q Did GE, for example, subscribe to that 6 Sigma

10 principle?

11 A GE claims, I should say, that it adheres to this

12 principle. 6 Sigma was a phrase that was coined by Motorola

13 Company. And then, Mr. Jack Welch of General Electric promoted

14 this --

15 Q Again, would you repeat that?

16 A I'm sorry. Mr. Jack Welch, the former CEO of GE,

17 promoted this concept and said, we as a company are going to

18 follow this practice. It's a goal and objective. It's a

19 highly noble, highly objective practice, if that is attainable.

20 As a team member of inspection while I was a member of the NRC

21 at headquarters, we conducted inspection audit of GE nuclear

22 fuel fabrication facility at Wilmington. They came quite a bit

23 short of that requirement.

24 Q Not to digress, Motorola was the leader in the 70's,

25 am I correct?

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

292

1 A Initially, yes, sir.

2 Q In quality assurance?

3 A Quality assurance, yes, sir.

4 Q And Motorola, in fact, had a campus teaching all of

5 these executives, and middle management people, in fact, still

6 have that campus in Schaumburg whether the enrollment is up or

7 down, is that correct?

8 A That is correct.

9 Q Did you ever attend that?

10 A No.

11 Q Did you ever have any special training while you

12 worked for GE, I'm sorry, when you worked for ComEd during your

13 first ten-year with Commonwealth Edison?

14 A Absolutely, yes. I received extensive training to

15 qualify, to receive my senior reactor operator's license.

16 Q Senior?

17 A Senior reactor operator's license. This is a 12-week

18 extensive training at the outset in order to get adequate

19 training to become a licensed supervisor. That's only one

20 small phase. This was a certification program at the Dresden

21 Nuclear Power Station. Because I was at Quad Cities, then I

22 had to supplement my training at the Quad Cities Station in

23 order to receive the NRC license with the SRO license at the

24 Quad Cities Station.

25 Q Did you receive other special training when you

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

293

1 worked at Commonwealth?

2 A I'm sorry?

3 Q Did you receive other special training when you

4 worked at the ComEd during this first period or first tenure

5 with ComEd?

6 A Other than certifying as an SRO which was a very

7 significant goal and objective of the company, and other than

8 receiving training to become a nuclear engineering, post

9 graduation from the University of Illinois, not really. That

10 was it.

11 Q Okay. Now, why did you, as you said it, you wanted

12 to do the industry circle. And that circle was complete in

13 your mind when you became a regulator, correct?

14 A Correct. That's correct.

15 Q Why did you leave the NRC or the NRR?

16 A I left because ComEd contacted me and offered me a

17 package that I essentially, if you will, couldn't refuse. I

18 initially refused, but, so to speak, they upped the ante, and

19 for other reasons, I left the Commission and joined ComEd.

20 Q And you were in Maryland at the time, is that

21 correct?

22 A At the time, I was in Rockville, Maryland.

23 Gettysburg was my residence.

24 Q How attractive was this package?

25 A The overall package was about a 30 percent salary

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

294

1 increase with the relocation expense not only from Gettysburg

2 to Downers Grove, but also from Lisle or I should say

3 Naperville to Gettysburg which was the expenses that were

4 incurred by me to move from Naperville working for the Region

5 into the headquarters NRR.

6 Q I see.

7 A So, in essence, I can put along with the salary and

8 benefits in aggregate, you're talking about, the first year,

9 would be about $200,000 package.

10 Q I see. What was your, when they recruited you, for

11 what position did they recruit you? Strike that. Who

12 recruited you?

13 A It was Robert Renuart, my supervisor.

14 Q Can you spell that last name?

15 A R-e-n-u-a-r-t, and Robert is his first name.

16 Q All right. And what was his title when he recruited

17 you?

18 A He was the configuration management chief. Chief of

19 configuration management.

20 Q And is configuration management a component of the

21 engineering area?

22 A It was. It was, yes.

23 Q At the time?

24 A At the time, it was.

25 Q And what specifically were your duties? What was

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

295

1 your title?

2 A My title was engineering assurance group supervisor.

3 And my duties and responsibilities included coordination of

4 engineering assurance activities of the six nuclear power

5 stations that ComEd owned and operated. It was an independent

6 oversight that ComEd had generated or had developed in response

7 to NRC's claim that the quality of engineering work at the

8 stations had lagged and had suffered. At the time ComEd did

9 not have a reputable, I should say reputation with the

10 Commission.

11 Q This is 1997?

12 A This is 1997, correct, time frame.

13 Q And in 1997, you're wearing an NRC or NRR hat,

14 correct?

15 A Correct.

16 Q And you knew of what Commonwealth Edison's reputation

17 was in NRC/NRR, correct?

18 A Yes. Absolutely true, yes.

19 Q And Commonwealth Edison, am I correct, operated more

20 plants than any other corporate power generator?

21 A That is absolutely correct. Yes, sir.

22 Q And you had prior work experience with them for at

23 least three years?

24 A That's absolutely a true statement. And my concern

25 was, at the time in 1971 to '74, we, Commonwealth, presently

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

296

1 had the highest reputation in the nuclear industry. If there

2 were any issues that would come to ComEd, Commonwealth Edison,

3 to seek advice, to seek professional guidance, essentially we

4 were the top of, the cream of the crop, if you will, in terms

5 of qualification, expertise, knowledge, and also compassion and

6 tolerance towards employees and everybody else. But

7 professionally and morally and technically, we were a sound

8 organization.

9 Q This is 1971 to '74?

10 A This is 1971 to '74 time frame. However, this had

11 drastically changed at the time, in my recollection, even as a

12 reactor inspector, I formed the view that pretty much ComEd was

13 at the bottom of the pile. Many other utilities licensees, if

14 you're going to refer to them, had better stature, better

15 technical judgments, better plant performance than ComEd.

16 Q This was a challenge for you then?

17 A It was a challenge for me.

18 Q And was it presented as such?

19 A It definitely was. Definitely, it was, that I needed

20 to come in and support myself. The reason they provided me

21 with that kind of an incentive package was that I had expertise

22 in nuclear core physics, I had expertise in field performance,

23 I had an SRO license, I had ten years of GE management

24 experience, I had the NRC experience. All of these things

25 together told them that essentially they needed my support to

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

297

1 get them out of that dilemma that they were in.

2 Q From the layman's point of view, when you come in,

3 what is you are going to for Commonwealth Edison?

4 A Coordinate engineering activities as an independent

5 oversight organization, monitoring the engineering oversight

6 that existed at the plants.

7 Q All right. This is not quality assurance?

8 A No.

9 Q This is engineering oversight?

10 A Engineering oversight.

11 Q What is the difference between quality assurance and

12 engineering oversight?

13 A Engineering oversight was an entity, as I mentioned

14 earlier, generated in response to quality assurance problems

15 that existed in the plants. And what, the licensee I should

16 say, what ComEd proposed, that because of the problems we were

17 having, that they finally pointed the direction towards

18 inadequacies in QA organizational department, that we ComEd

19 would form an independent engineering oversight that would

20 monitor engineering activities, totally independent of QA that

21 would monitor activities that would go on at the plants.

22 Q At the plants and in Downers Grove?

23 A At the plants mainly and there were certain segments

24 of it in Downers Grove, too. Yes, sir.

25 Q But primarily the plants?

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

298

1 A Primarily the plants.

2 Q The six campuses?

3 A The six plants.

4 Q All right, the six sites.

5 A The six sites.

6 Q Did you recruit a staff?

7 A No, I did not recruit. I had a staff of four

8 initially, and at the time I was laid off, I only had a staff

9 of one.

10 Q When you arrived, there were four?

11 A Correct.

12 Q Engineers?

13 A Engineers.

14 Q Plus yourself?

15 A Plus myself.

16 Q This group was a group of five?

17 A Group of five, yes, sir.

18 Q And again, what month in '97 did you start?

19 A I started in September of 1997.

20 Q Beginning, middle, end, do you recall?

21 A I believe it was the tail-end, 26, if I'm not

22 correct. It was during that time frame.

23 Q When you returned to Commonwealth Edison, did you

24 know Oscar Shirani?

25 A I had met him once during one of the audits that I

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

299

1 performed when I was a member of NRC at the Region 3. I

2 performed or conducted an engineering audit and that was the

3 first time I met the gentleman. He demonstrated, among others,

4 a mathematical software that performed some calculations. And

5 ComEd was demonstrating to me some of the engineering

6 activities that they had done to improve and, so, he was one

7 example, there were others as well.

8 Q Do you recall when it was you met Mr. Shirani under

9 these circumstances?

10 A I don't remember the exact date.

11 Q But it was prior to your return and it was only --

12 A Oh, absolutely, yes, sir. This was prior to 1997.

13 Q He didn't have any hand in your recruitment that you

14 know of?

15 A Absolutely not. No, sir.

16 Q All right. When you arrived at Commonwealth Edison

17 at the end of September 1997, did you become aware of a GENE

18 audit?

19 A I did.

20 Q And how did you become aware of this audit?

21 A My manager, Mr. Renuart, informed me that there was a

22 stop work order and that we needed to get a result. So, that's

23 the first exposure that I received. Since I had worked for GE

24 in the past, I had worked for the NRC, and also because of my

25 MBA and familiarity with the financial terms, conditions and

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

300

1 constraints, it was a natural thing for me to get involved.

2 And on top of that, it was within the purview of engineering

3 assurance.

4 Q So, it did fit within the scope of your work?

5 A It fit within the scope of my work, and also, it fit

6 within my qualification, experience and exposure, and

7 capabilities.

8 Q You had no knowledge of this stop work order or this

9 audit prior to your being employed?

10 A That's a correct statement. Yes, sir.

11 Q During that period of time, however long that period

12 of time was that they were recruiting you and making a better

13 offer or --

14 A No.

15 Q They didn't tell you anything about it, an audit

16 underway at GENE?

17 A I am not sure at this time, when I have to go back

18 during the lengthy discussion that I had with Mr. Renuart prior

19 to making his final, you know, he discussed some of his

20 challenges, whether or not he mentioned in that sitting the

21 stop work order. I don't recall if he did. I'm not certain.

22 Q Okay. But in any way, you were not brought here back

23 to Illinois to address the issues of the stop work order?

24 A No. Once I had arrived, then he discussed and he

25 said to me this was an issue that needed to be resolved.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

301

1 Q All right. How did you go about resolving this

2 issue?

3 A Certainly we had the terms of the audits.

4 Q Does that mean you were at the audit?

5 A Yes, after I came.

6 Q Okay. Then, what did you do?

7 A Then, we needed to set up a meeting and propose the

8 agenda to GE counterparts in San Jose, and we needed to take it

9 to -- to take a trip to San Jose in trying to resolve the

10 issues. And taking it all with me was the manager of QA,

11 Mr. Ed Netzel, and there were issues with respect to root cause

12 analysis. And we needed to take our expert, Mr. Jack Bunner.

13 So, that was our team.

14 Q He's an expert in what again, Mr. Salehi?

15 A Root cause analysis.

16 Q Root cause analysis. What is root cause analysis?

17 A Any event that occurs in the -- of the Commission, we

18 must identify the true root cause. If a light bulb burns, you

19 know, it's not enough to remove that light bulb and say the

20 problem is fixed. We have to find out what caused the failure

21 of that. And you've got to go sufficient iterations in depth

22 and detail in order to find the true root cause of the problem.

23 Q Is the root cause expert common in such an issue

24 resolution matter?

25 A It's not only it's common, it's mandated by the

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

302

1 Commission.

2 Q All right. So, it's an NRC requirement?

3 A NRC requirement, yes. In fact, in a nuclear power

4 plant, if a pump fails and you take the pump and put another

5 one in there, you get cited by the Commission because you have

6 not done an adequate root cause evaluation to determine what

7 causes the failure of that pump.

8 Q You said you had to work out these issues with your

9 GENE counterparts. Who were they or who were identified as

10 your GE counterparts in September, and I take it it's in

11 October as well, of 1997?

12 A My counterparts were two individuals under the

13 leadership of one. The two persons were Mr. Nicholls, John

14 Nicholls, Bob Nicholls, and also Mr. James Klapproth,

15 K-l-a-p-p-r-o-t-h. And Mr. Nicholls is N-i-c-h-o-l-l-s. Both

16 of these, Mr. Nicholls was the manager of the QA for GENE and

17 Mr. Klapproth was manager of engineering support and

18 engineering analysis. Both of these individuals reported to

19 Mr. Dave Helwig at the time who was the general manager of

20 GENE.

21 Q So, how did you go about accessing or gaining access

22 to your counterparts at GENE?

23 A I needed to establish communication with Mr. Helwig.

24 He had presided and he was the key individual at the audit

25 meeting and was definitely involved in the prior audit meeting

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

303

1 and the stop work order. And I had heard that he was not at

2 all happy with the outcome or the results and the findings that

3 ComEd had produced.

4 Q Who did you hear that from?

5 A I heard that from my manager, Robert Renuart. And I

6 had also heard it from Mr. Shirani and I heard it from other

7 team members.

8 Q When you say John Netzel, are you talking about

9 Mr. Netzel?

10 A Right.

11 MR. GROSS: I'll object to this testimony and ask

12 that it be stricken as hearsay.

13 JUDGE LESNICK: I can allow hearsay although the

14 objection goes to weight not admissibility. So, if it's not

15 tied in, it won't be given much weight.

16 MR. McDERMOTT: I'll tie it in. Thank you.

17 BY MR. McDERMOTT:

18 Q How did you establish, what did you do to establish

19 communication with Mr. Helwig?

20 A I telephoned and left several messages for him to

21 communicate with me, that we have got an agenda, we need to

22 come to San Jose. The stop work order was a key issue we need

23 to get resolved. It cost the company money for doing the

24 things that we were doing, so I needed to get resolution.

25 Q And how many telephone calls did you make?

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

304

1 A I don't recall exactly and precisely how many.

2 Certainly, you know, a minimum of three, four.

3 Q Were your calls returned?

4 A None.

5 Q Did you plan a trip to San Jose?

6 A We had a planned trip to San Jose and yet I could not

7 get Mr. Helwig's attention to get back to me and say, okay, why

8 are you coming, when are you coming, what's your agenda, who

9 are you bringing, what issues needed to be resolved. And I

10 needed to resolve that at his level.

11 Q Why did you need to resolve them at his level?

12 A Because he was the counterpart. He was the person

13 who presided over the previous meeting and he had the overall

14 ownership of those issues and the responsibility for the

15 resolution. It was right decision because subsequently when we

16 met, he was the person, he was the key decision maker.

17 Q Did you plan and take the trip?

18 A Oh, yes. Yes, we made it, we finally made the trip.

19 Q Do you recall when that was approximately?

20 A It was in October of 1997.

21 Q When you planned and made the trip, had you had

22 telephone communication with Mr. Helwig?

23 A I did finally. And the way I did it was peculiar

24 because I had to contact Mr., or I should say Dr. Stephen

25 Specker.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

305

1 Q Can you spell that name for the record?

2 A S-p-e-c-k-e-r, Stephen. He was at the time vice

3 president of GE Nuclear, and he was Mr. Helwig's manager. He

4 had the total responsibility. Of course, the reason I called

5 him was because I knew him from my, you know, decade of GE

6 management position. And I didn't know him on a buddy-buddy

7 tight level but I had many interfaces with him. He's very

8 competent, very professional and he supported my training

9 courses many times. I would call him, he would come to our

10 classes, he would teach our courses as a guest speaker and he

11 knows me real well.

12 Q So, you then had a conversation with this man?

13 A With Dr. Specker. And said that this was my dilemma,

14 we've got an impending situation, we've got a trip. We, your

15 customer, ComEd, are in a dire position and we, I'm not getting

16 the response. Is there a reason, have we done anything that is

17 unacceptable according to professionalism, our organization,

18 that Mr. Helwig is not responding?

19 Q And as much as you know or as much as you believe,

20 that's what caused Mr. Helwig to return your calls?

21 A I believe so, absolutely, yes. He had returned my

22 call --

23 Q Did he tell you he had talked to this Dr. --

24 A Specker. He told me that he had, Dr. Specker had

25 talked to him and he told me that he hadn't received any of the

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

306

1 messages that I had called. And it is my opinion, and it was

2 substantiated later on when we were there, that it was a false

3 statement when he said he never received the calls. And it was

4 inconceivable that numerous calls would be made to a man of his

5 stature, his position, and he wouldn't be notified, especially

6 if a customer called. Especially in a repeat basis.

7 Q Who did you meet with when you got to San Jose?

8 A The meeting was arranged. When Mr. Helwig returned

9 we communicated and he demonstrated his anger that I had

10 essentially gone around him by communicating with Dr. Specker.

11 Q What did he say?

12 A He said, there was no need to go around me, to bypass

13 me, I'm the person you want to contact, or words to that

14 effect. I don't recall exactly. I know he was frustrated, he

15 was angry that I had contacted Dr. Specker.

16 Q You had never met Mr. Helwig by this --

17 A Absolutely not, no.

18 Q How could you tell he was angry? By the phone?

19 A By the message and the exchange of words.

20 Q I see. Who did you meet with when you got to San

21 Jose?

22 A When we met, we met with Mr. Helwig and his team

23 which consisted of Mr. Nicholls and Mr. Klapproth. I knew

24 Mr. Klapproth many years both as GE and also as NRC. We had

25 conducted inspection at the GE nuclear facilities in Wilmington

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

307

1 and he was our counterpart and we audit his organization and

2 his team. He's highly professional and --

3 Q So, he's a person known to you?

4 A Absolutely, yes. I know Mr. Klapproth real well.

5 Q What was the outcome of -- strike that. What was the

6 purpose of the meeting?

7 A The purpose of the meeting, to discuss the issues

8 that were the subject of the audit that Mr. Shirani and his

9 team had conducted and tried to get the resolution of those

10 issues and convey to Mr. Helwig the things that we wanted to do

11 which was nothing unacceptable, unordinary, and which were

12 essentially the things that we at ComEd had done in order to

13 satisfy the Commission, mainly, formation of an independent

14 oversight organization that would be applied to engineering

15 activities that GE was doing.

16 Q So, you came there wearing a ComEd hat and you're

17 suggesting NRC/NRR mandated resolutions for the problems that

18 were identified in the audit, is that correct?

19 MR. GROSS: I'm going to object to the leading

20 questions.

21 MR. SALEHI: It was --

22 JUDGE LESNICK: It is leading but I'll let him answer

23 the question.

24 MR. McDERMOTT: Thank you.

25 MR. SALEHI: It wasn't, the resolution of SW, stop

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

308

1 work order wasn't promulgated by the Commission. It was

2 promulgated by our necessity. We, ComEd, needed to get beyond

3 the SW because it affected our performance, it affected the

4 operation of the plants. There needed to be a resolution. But

5 the resolution needed to meet certain minimum requirements.

6 And the certain minimum requirements that were invoked, that

7 were blessed by our management is, number one, formation of an

8 independent oversight similar to our EAG, engineering assurance

9 group. And of course, we knew that if we do not meet the audit

10 requirements, we would be in difficulty and jeopardy with the

11 Commission.

12 So, indirectly, yes, anything that the plants do

13 affects and gets scrutinized by the Commission. But the

14 resolution of the issues were not, strictly speaking, as a

15 result of, as a direct consequence of NRC's concern. It was

16 our concern that needed to be resolved.

17 Q You needed to get it --

18 JUDGE LESNICK: Let's go off the record a moment.

19 (Off the record at 9:20 a.m.)

20 (On the record at 9:25 a.m.)

21 JUDGE LESNICK: All right. Proceed.

22 MR. McDERMOTT: Thank you, Judge.

23 BY MR. McDERMOTT:

24 Q What time of the day was your first meeting with your

25 counterparts in San Jose?

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

309

1 A I don't believe the exact, but it was early in the

2 morning, I mean, you're talking about 8:00-9:00.

3 Q You didn't red-eye fly to there?

4 A No.

5 Q Like you did today?

6 A No, we arrived, no.

7 Q All right. I take it you had prepared for that

8 meeting?

9 A I certainly did, yes, sir.

10 Q And did you have a handout for that meeting or did

11 you have notes that you read from?

12 A Yes, I did. I developed a note and a memorandum

13 essentially, and I read from that note.

14 Q What was Mr. Helwig's reaction to your presentation

15 of this memorandum?

16 A The objection he had was a term that I used which was

17 the focal point of my message. And the term I used which I

18 received plenty of training, excessive training at GE, you

19 become a manager at GE, you receive excessive training

20 including -- that in any kind of negotiation, you ought to take

21 the approach of a win-win situation. If you go for a sort of

22 juggler -- and make your counterpart a losing situation,

23 chances are you're not going to succeed. And it's got to be

24 something that there would be room for him to win as well as

25 win for you. And to me, our stance, our dilemma was a lose-

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

310

1 lose proposition. And I used the term I want to negotiate, I

2 want to get things resolved based on the --

3 Q When you say "our", you mean Commonwealth Edison?

4 A ComEd, yes.

5 Q And what, did you explain in your presentation what a

6 win-win situation would be in practical terms?

7 A Yes, I did.

8 Q And what was it?

9 A I said that we, ComEd, were losing because we would

10 have to go through a torturous pass in order to get our

11 engineering work done. And we didn't certainly have the

12 expertise that GE had and we had to apply our own QA, if you

13 will, endorsement evaluation in order to get our engineering

14 work done. And it took time and it impacted the plant's

15 operations.

16 And it was a lose proposition for GE because issuing

17 a stop work order on a company the size of GE was quite

18 significant. It was a major adverse impact on the stature and

19 the reputation of GE as a company. It is my belief that no

20 other organizations until then had told GE that the quality of

21 your work certainly was inadequate, substandard, and needed to

22 be evaluated. And most definitely, when you evaluate 56

23 packages of training, I mean, material calculations and their

24 deficiencies, all of them doesn't fall in the category of 6

25 Sigma.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

311

1 So, that was my approach. Now, it was also my

2 understanding --

3 Q That's the, as I understand it, that's the lose-lose

4 scenario?

5 A Right. That you're losing because it affects your

6 stature. There are other utilities, other individuals who are

7 commenting, hey, what is this work order? If ComEd can put a

8 stop work order on you, should we not do the same thing, if

9 your QA is lacking to that extent, maybe we ought to take a

10 look. So, the whole industry was taken aback. The GE that I

11 knew in earlier days was premium quality for premium price.

12 But premium quality had gone down significantly and that was

13 because of major cutbacks, reduction in force that they had

14 gone through.

15 Q And you knew that to be the case?

16 A I knew that to be exactly the case, yes, sir. And

17 that was the point that I identified in my message, that while

18 we were not, we, customer, we, ComEd, were not advocating that

19 they could not follow the strategy of reduction in force, we as

20 ComEd expected GE not to resort in practices that would

21 jeopardize the quality of their work. So, we had every right

22 to expect that the quality of their work meet certain minimum

23 standards.

24 Q Right. That's the lose-lose equation. What was the

25 win-win situation you suggested to Mr. Helwig?

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

312

1 A We needed to get this resolved, the stop work order

2 lifted, you improve your quality so that we don't have to go

3 through that process and you get your fame and fortune back.

4 And also, you get contracts.

5 Q Contracts from ComEd?

6 A ComEd, because we had --

7 Q That means money?

8 A Absolutely, it was money, yes. So, it was a win-win

9 proposition for them.

10 Q And you say Mr. Helwig took exception with that?

11 A Absolutely. And that was the only thing. What

12 totally surprised me at the time, out of the things that I had

13 formulated in my message, he only took the exception it's not a

14 lose-lose proposition. He said you're wrong. You're not

15 losing and we are not losing.

16 Q And did he add anything to that?

17 A No. Well, he said, you're not losing because your

18 plants are going around you and getting the engineering done by

19 us. We are not losing because they're getting our engineering

20 done anyway.

21 Q So, he's telling you that he's ignoring the stop work

22 order?

23 MR. GROSS: Objection, mischaracterization of the

24 statement and leading.

25 JUDGE LESNICK: Mr. McDermott, try to stop that.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

313

1 BY MR. McDERMOTT:

2 Q What did you interpret, I'm sorry, what did you

3 understand Mr. Helwig to mean when he told you we're not

4 losing, you're not losing?

5 A His direct reference was that your plants are

6 bypassing your process and they're asking us to do the

7 engineering work, so we're getting our job done, we're getting

8 our money. So, it's not a lose for us. And he said "I'm sorry

9 you feel it's a losing thing for you. It's not a losing thing

10 for us."

11 Q How many days were you in San Jose for this meeting?

12 A Two days, I believe.

13 Q Did you have an opportunity to do what you planned to

14 do when you were there?

15 A We did, and I also, going back to this period of win-

16 win, and I knew that Mr. Helwig's feathers were ruffled by

17 contacting Dr. Specker and I needed to get his blessings or at

18 least to get him on board. I needed for him to negotiate, so I

19 sought him out in a one-to-one meeting on the same day.

20 Q The day, the same?

21 A The first day.

22 Q The first day?

23 A Yes, sir. At 4 o'clock.

24 Q And what if anything did you say to him and what if

25 anything did he say to you?

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

314

1 A I explained to him that the reason I had to seek

2 Dr. Specker was that my numerous calls to him were not

3 answered. He said, I didn't know about that. My secretaries

4 didn't tell me. And it was my belief then, it is my belief now

5 that that was not a false, I mean that that was not a true

6 statement. And I knew that he was upset by my contact to

7 Dr. Specker. And I said, well, I didn't have any choice, we

8 needed to get this thing resolved. And he said, well, I

9 understand where you're coming from, you didn't have any

10 choice, but we'll try to do what needs to be done.

11 So, he was perhaps more conciliatory, if that is such

12 a word for that. Of course, I later found out that that's

13 totally false, he was not conciliatory at all. He was very

14 disturbed, perturbed, angry by reading, and I believe I

15 forwarded you and it can go on record what I presented in that

16 meeting.

17 Q When you had this meeting in San Jose with your team,

18 with your counterparts, you had how many years experience

19 working with GENE? I'm sorry, working for GENE.

20 A Working for GE was a decade, ten years.

21 Q Ten years. And when you had this meeting with

22 Mr. Helwig at a responsible position, do you have any idea how

23 long he worked for GENE?

24 A I don't believe he worked for GE nowhere near as long

25 as I had. I know he had worked for other utilities. I don't

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

315

1 recall how many years he had worked. I would suspect somewhere

2 -- of two or three years. I don't know.

3 Q Would you be shocked to know it's less than six

4 months?

5 A No, not at all.

6 Q Why?

7 A Because the pictures that I have heard or the phrases

8 that I have heard in reference to him was that he wasn't a --

9 MR. GROSS: I'll object. This is responding with

10 hearsay about what other people told him about --

11 JUDGE LESNICK: Yes, it's not going to be much help.

12 MR. SALEHI: I had formed an opinion.

13 BY MR. McDERMOTT:

14 Q You formed the opinion. I take it you returned to

15 Illinois?

16 A I certainly did, yes.

17 Q And I take it you made a report to your management?

18 A Yes, and the report was positive. Essentially, the

19 things that we had sought out, we had wanted to do, GE

20 complied. GE did that.

21 Q And by doing that, that meant what?

22 A That meant that his management below him got his

23 blessings, and they told me that they did not agree at all with

24 Mr. Helwig's point of view that this was not a loss situation

25 for GE. This is as clear as I know my name.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

316

1 Q Now, I'm going to ask you to look at what has been

2 previously marked and in fact admitted in these proceedings,

3 can you take a look at that, Mr. Salehi and tell the Court what

4 it is?

5 JUDGE LESNICK: You didn't tell what number that was.

6 MR. McDERMOTT: No. 8.

7 JUDGE LESNICK: Thank you.

8 MR. SALEHI: This is the document that I generated on

9 October 24th. It's got my initial.

10 BY MR. McDERMOTT:

11 Q And that document went to whom?

12 A It went to the engineering manager, it went to Bob

13 Renuart and also went to, there's the distribution right here.

14 Oswald, Gavin Clark (ph.), Burgess, Renuart, a host of

15 different players, all the sites and also it went to Oscar

16 Shirani, the QA organization. Wide distribution.

17 Q And then, in a nutshell, what is the content of this

18 exhibit? What is the content of that report?

19 A That essentially said the sites needed to apply

20 engineering review of all the work that GE performed, that no

21 safety related work would be accepted by GE without our

22 acceptance.

23 Q Accepted by ComEd, you mean?

24 A By ComEd. This is by applying our own QA measures,

25 our own QA, and that was the term. When we came back, until we

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

317

1 lifted the stop work order, until the adequacy of GE

2 engineering work would reach a level that would be commensurate

3 with the requirements, we ComEd would apply our own engineering

4 assurance.

5 Q Did you in fact do that?

6 A That was the distribution that I sent for the

7 stations to do that. My role was to distribute the

8 information. My role was not to follow --

9 Q Did the stations do that?

10 A I assume they did.

11 Q All right. Do you know, as you sit here today, when

12 the stop work order was lifted?

13 A I'm not sure of the exact date. I have been away

14 from the nuclear for four years.

15 Q Were you consulted at all about the lifting of the

16 stop work order?

17 A Well, I was involved in terms of what needed to be

18 done in order to lift the stop work order.

19 Q And is it contained that memorandum, what needed to

20 be done to lift the stop work order?

21 A I don't believe that has.

22 Q Was there another document that you generated that

23 gave a criteria for the lifting of the stop work order?

24 A I believe so, but I'm not absolutely a hundred

25 percent positive at the present time. And if it did, you know,

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

318

1 what were the requirements on that.

2 Q This certainly was not your only task in your new

3 position?

4 A No. No.

5 Q And you had work to do --

6 A Yes, coordinating engineering assurance.

7 Q Are you familiar with Mr. Shirani's companion audit

8 of Commonwealth Edison engineering in and of itself as it

9 related to the GENE audit?

10 A Yes. Yes, there was, you know, he issued that

11 finding on GE on ComEd engineering as well, and that was a

12 level one finding. That basically said ComEd's work did not

13 meet the requirements.

14 Q Is that an ordinary sort of issue?

15 A No, it was not an ordinary finding. Level one

16 finding was grave and understandably so on the part of the

17 engineering managers, most engineering managers objected to it.

18 They didn't want to have class finding essentially be reflected

19 on the records.

20 Q Did you have the occasion to review whatever that

21 finding was as written by Mr. Shirani?

22 A I did. And I concurred with it, yes.

23 Q And do you recall a meeting?

24 A I certainly do. I don't know the exact date but I

25 definitely remember vividly the day that we met. And there

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

319

1 were several objections by several engineering managers.

2 Q Can you tell me who attended this meeting?

3 A It was a large gathering. All the engineering

4 chiefs, Gavin Clark, Terry Rican (ph.), nuclear field services,

5 Mr. Hogan was not there. There were a few other

6 representatives of, just one person specifically. Mr. Renuart

7 was there, I was there. Mr. Burgess was there. A number

8 engineering managers were there. And the finding, a stop work

9 order, and especially a level one finding against the

10 engineering activities were discussed. And there were several

11 objections at the end of the day.

12 Q Was Mr. Shirani there?

13 A Yes, he was.

14 Q Was he there willingly?

15 A I don't recall if he was brought in willingly or, I

16 don't recall.

17 Q But he didn't exhibit any timidity, did he, in this

18 meeting?

19 A No.

20 Q Everybody conducted themselves in a professional

21 manner?

22 A Yes. Yes.

23 Q As much as engineers can?

24 A Yes, sir.

25 Q All right. Did you address this assemblage with

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

320

1 respect to the level one finding of Mr. Shirani?

2 A I did not address that. This was a QA finding,

3 something within the confines of engineering organization. And

4 I could understand why the engineering managers didn't like it

5 and appreciate it, but I could see as a former regulator that

6 there were merits for his point of view.

7 Q And you told them that?

8 A Yes. Yes, I think pretty much at the end of the day,

9 when I was asked for my view, I said I supported it. That

10 possibly, if I recall correctly, might have gotten turned

11 around and reduced some of the objections, because he is a

12 former NRC essentially blessing the validity of the finding,

13 even though I was not a member of the NRC at the time.

14 Q Did this meeting occur before or after the employment

15 of Oliver Kingsley, Jr. at ComEd?

16 A I don't, I can't say with a hundred percent validity

17 it was before or after. I'm sorry.

18 Q Did it occur before or after David Helwig's arrival

19 at ComEd?

20 A It was before.

21 Q So, it would have been sometime after your generating

22 of the memorandum?

23 A Right. Right.

24 Q But before the first of the year of 1998?

25 A Correct. To the best of my recollection.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

321

1 Q Did you have occasion to see Mr. Helwig once he

2 became employed by Commonwealth Edison?

3 A Yes, I did. On one occasion, I was asked to make a

4 presentation to him in his office.

5 Q On a particular subject?

6 A It was on engineering assurance activities.

7 Q And did you make that presentation?

8 A I did.

9 Q And was there anything remarkable at all?

10 A The only thing that was remarkable was, nothing

11 really remarkable. It was calm, casual, nonchalant, no

12 emotions, no significance, no response essentially if you will.

13 Q Did he hear the presentation?

14 A He might have, now that I think about it.

15 Q Did he indicate, was there any indication he

16 understood it?

17 A I don't believe that I had the indication that he

18 understood.

19 Q And at this time, when you meet him this time, he is

20 your boss' boss?

21 A He is my boss' boss' boss' boss.

22 Q He's your boss' boss' boss' boss?

23 A He was the vice president, yes, with all the

24 engineering essentially under his belt. He was vice president

25 of ComEd. Three levels, to be safe. Renuart, Cosmer and

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

322

1 Helwig. Three levels up.

2 Q All right. So, he was your boss' boss' boss. What

3 became of your engineering assurance group?

4 A It got essentially dissolved. And it got dissolved,

5 I was laid off and I came back to California and a decision was

6 made that we were no longer require that independent oversight

7 activity of engineering activities of the plants. We would

8 just leave it at the discretion of the sites to do their own

9 oversight.

10 Q So, the purpose for which you were recruited in early

11 fall, late summer of 1997, that purpose was abandoned?

12 A That is a true statement.

13 MR. GROSS: Objection. Objection, lack of foundation

14 to what happened at ComEd after he departed and what was

15 abandoned or not abandoned.

16 JUDGE LESNICK: Why don't you lay a foundation if you

17 can?

18 MR. McDERMOTT: Sure.

19 BY MR. McDERMOTT:

20 Q Directing your attention to the first quarter of the

21 year 1998, did you have assignments, did you have tasks, did

22 you have staff similar to the assignments and staff you had in

23 the last quarter of 1997?

24 A I did, with the reduction in number of head count.

25 Q Right. So, during January, February and March, you

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

323

1 lost personnel?

2 A Correct. They were reassigned. And at the time that

3 I was laid off in --

4 Q Let me just stay in that first quarter please.

5 A Yes.

6 Q You said that there were four and yourself, a group

7 of five.

8 A Right.

9 Q Who was first reassigned during that first quarter?

10 A They were one individual and subsequently another

11 individual in November-December time frame. Two individuals

12 were reassigned, one was laid off.

13 Q That occurs before 1998, this is '97?

14 A Before 1998, yes. Before Christmas.

15 Q And they were, one was laid off and one was

16 reassigned?

17 A Correct.

18 Q Okay. Did you discuss this issue with your

19 supervisor?

20 A I did and, but this was a reduction in the scope of

21 work and scope of activities for the organization.

22 Q Had the purpose for which you had been recruited been

23 modified at that time?

24 A No, the purpose was still there.

25 Q Okay. Now, to the first quarter of 1998, you're a

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

324

1 group of three?

2 A Correct.

3 Q Did you lose staff at that time?

4 A One, I did.

5 Q And how did that person leave?

6 A That person was laid off. So, now, we're talking

7 about by May of 1998, I only had one direct report.

8 Q And did you still have assignments?

9 A We still had the assignments.

10 Q And were you still doing engineering assurance?

11 A Yes.

12 Q And were you still working with the plant sites the

13 way you had in the beginning?

14 A Yes, sir. Yes, sir.

15 Q What if anything occurred next?

16 A The next was the indication of reorganization and the

17 knowledge that there would be impending change. And the change

18 came and the change was reassignment of the one last individual

19 who worked for me to Quad Cities Station, and then the solution

20 of the independent engineering assurance at the Downers Grove

21 and relegation of responsibilities and duties solely to the

22 sites. And the premise for the use of the phrase abandonment

23 is predicated on the fact that the formation of the engineering

24 assurance group was a commitment to NRC principally because the

25 QA had lacked, suffered reduced effectiveness.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

325

1 So, in response to that, engineering assurance

2 activity was promoted. But all of a sudden, without indication

3 that the QA had improved, the independent formation of

4 engineering assurance activity was dissolved, abandoned.

5 Q The persons on your staff other than those who were

6 laid off, those who were reassigned, did they possess skills,

7 experience and training superior to yours?

8 A Absolutely not.

9 Q Pardon me?

10 A Absolutely not. No, sir. Not in my judgment.

11 Q Was there any reason that you were not reassigned?

12 MR. GROSS: Objection. Calls for speculation, lack

13 of foundation that he had any involvement in that decision.

14 JUDGE LESNICK: Sustained.

15 BY MR. McDERMOTT:

16 Q Did anybody tell you why you weren't going to be

17 reassigned?

18 A No. I knew that, although the answer, there was no

19 reason to even ask the question.

20 Q What did you know?

21 MR. GROSS: I'll object as to what he speculates

22 might have been the reason for it. He already said he doesn't

23 know what the reason is.

24 JUDGE LESNICK: Why don't you ask him how he knows?

25 BY MR. McDERMOTT:

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

326

1 Q How do you know?

2 A Okay, two things. A, my manager informed me at the

3 first meeting that he had with Mr. Helwig, before the meeting

4 he had after he became the general manager, I told him it was a

5 gesture that now that we have put a stop work order at GE, we

6 were in trouble. Putting a stop work order at GE was

7 definitely a negative response or a negative action. As a

8 member of the utility, we had no choice but to do that. So, it

9 protected the safeguards of our company. Of course, unbeknown

10 to us that if it has a negative reflection, it's a negative

11 reflection on a man that later on would become our boss' boss'

12 boss. So, that's one indication.

13 And the second indication was that Mr. Renuart, after

14 his meeting with Mr. Helwig, came down and told me point blank,

15 I told him that, hey, I ironed out our differences and he came

16 down and said, no, you didn't. Mr. Helwig is very upset with

17 your performance in that meeting. So, it doesn't take, you

18 know, with all the credentials and the knowledge and the

19 experience and the age that I have, it doesn't take a genius to

20 figure out that the type of personality that Mr. Helwig has, he

21 would retaliate. And he did.

22 MR. McDERMOTT: I have no other questions.

23 JUDGE LESNICK: Mr. Gross, you may cross again.

24 MR. GROSS: Thank you.

25 CROSS EXAMINATION

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

327

1 BY MR. GROSS:

2 Q Do you know who made the decision to terminate your

3 employment with the company?

4 A The announcement was made by Mr. Renuart with a

5 representative of HR. He came down, took me upstairs, they

6 said, sorry, you know, your position is no longer there, we

7 have eliminated engineering assurance and you have essentially

8 the benefits that is given to everybody who is laid off.

9 Q Thank you. That's, but I'd appreciate if you could

10 focus on what I'm asking you. Do you know who made the

11 decision to terminate your employment with ComEd?

12 A Other than David Helwig, I believe nobody else did.

13 Q Other than David Helwig based on what you assumed is

14 the case, is that correct?

15 A That's absolutely correct, yes, sir.

16 Q Do you know whether Mr. Renuart himself had any role

17 in that decision to terminate you?

18 A It would highly surprise me.

19 Q But you do not know?

20 A I do not know, no.

21 Q Have you had any communication with anyone in

22 Commonwealth Edison engineering since you left the company in

23 1998?

24 MR. McDERMOTT: Objection. Outside the scope of

25 direct. I don't know what this has --

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

328

1 MR. GROSS: He's already talked about issues --

2 JUDGE LESNICK: I'll allow it. I'll allow it.

3 MR. SALEHI: I communicated once with Mr. Helwig, I

4 mean, with, I'm sorry, with Mr. Renuart, and I also

5 communicated naturally with Mr. Shirani.

6 BY MR. GROSS:

7 Q And in that communication with Mr. Renuart, what

8 topics did you discuss? Was it just pleasantries, how are you

9 doing, or was there anything substantive?

10 MR. McDERMOTT: Objection, foundation.

11 JUDGE LESNICK: I'll allow the question.

12 MR. SALEHI: It wasn't just a pleasantry. We

13 discussed the outcome of retaliation by Mr. Helwig and he

14 showed strong resentment towards his treatment by Mr. Helwig as

15 well. We discussed that.

16 BY MR. GROSS:

17 Q This was after Mr. Renuart had already departed from

18 the company?

19 A No, before.

20 MR. McDERMOTT: Objection. Why do we suddenly now

21 know Mr. Renuart has departed from the company? There has been

22 no testimony to that. Maybe Counsel would like to testify?

23 JUDGE LESNICK: Counsel, I think I'm giving some

24 leeway on cross-examination. He can answer the --

25 MR. McDERMOTT: Well, he can't assume a fact that's

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

329

1 not in evidence in cross-examination.

2 JUDGE LESNICK: Go ahead. Don't go back and forth,

3 I'll allow it. Go ahead.

4 BY MR. GROSS:

5 Q Have you reviewed any of the engineering work that

6 has been done at ComEd since your departure from the company?

7 A No, sir.

8 Q Do you have any knowledge as to what engineers at the

9 stations do, have done since your departure from the company?

10 A No, sir.

11 Q Do you have any knowledge as to what the engineering

12 group within the nuclear organization does since your departure

13 from ComEd?

14 A No, I've exited the nuclear industry.

15 Q And do you have any knowledge as to whether the type

16 of work your engineering assurance group was doing is performed

17 by others within ComEd since your departure?

18 A No.

19 Q At the time you actually worked with General Electric

20 while an employee of ComEd, you indicated it started shortly

21 after you arrived at Commonwealth Edison in 1997, is that

22 correct?

23 A No, that's not correct.

24 Q Approximately how long after you arrived at ComEd in

25 1997 did you begin working on the GE audit issues?

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

330

1 A Oh, essentially as soon as I entered. However, prior

2 to joining ComEd, I was involved with the reviewing of GE as

3 part of a vendor audit when I was a member of the Commission.

4 Q I understand. After you began -- strike that. Do

5 you know about how long you were working on GE audit issues

6 after you arrived at ComEd in 1997?

7 A About a month because I was out there two weeks to a

8 month.

9 Q And the October memorandum that's Complainant's

10 Exhibit 8 is a document that you prepared after you returned

11 from GE?

12 A After I had returned, yes, sir.

13 Q And after that October 1997 memo, did you continue

14 for weeks, months to work on issues relating to the GE audit?

15 A I would say more on the order of weeks rather than,

16 well, if it was months, it was a fraction of the time.

17 Q Okay. So, let's assume no later than December of

18 1997, is that fair?

19 A December-January, I can't be that specific.

20 Q Okay. After that, did you have any involvement with

21 the efforts by GE to change any of their internal programs as a

22 result of the audit by Mr. Shirani?

23 A No, sir.

24 Q Do you have any information as to what GE has done

25 since January 1998 relating to the findings that Mr. Shirani

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

331

1 made in his audit?

2 A No, I don't.

3 Q Have you reviewed any of the follow up audit

4 materials that Mr. Shirani prepared?

5 A No, I did not.

6 MR. GROSS: I have no further questions.

7 JUDGE LESNICK: Any redirect?

8 MR. McDERMOTT: No, I have no redirect. Thank you,

9 sir.

10 JUDGE LESNICK: All right. You are excused, sir.

11 MR. McDERMOTT: Can I have just a minute just to see

12 the witness out and show him where --

13 JUDGE LESNICK: Sure. Off the record.

14 (Off the record at 9:57 a.m.)

15 (On the record at 10:07 a.m.)

16 JUDGE LESNICK: Mr. Shirani is back on the stand, you

17 may proceed.

18 (Whereupon,

19 OSCAR B. SHIRANI

20 was recalled as a witness by and on behalf of the Complainant

21 and, having been previously duly sworn, was examined and

22 testified further as follows:)

23 DIRECT EXAMINATION

24 BY MR. McDERMOTT:

25 Q Yesterday, Mr. Shirani, you were asked about your

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

332

1 activities, your assignments and I asked you what your audit

2 activities were for the year 1999.

3 A Yes.

4 Q Do you recall what they were?

5 A Yes.

6 Q What were they?

7 A I had to remind our management about the follow up

8 audit of the GE which happened in 1997 due to my obligation to

9 implement the 10 C.F.R. 50 Appendix B Criterion 16 for the

10 prompt corrective action. I had several attempts made in

11 January 1998 that the audit needs to be followed, the

12 corrective action and the cause of corrective action needs to

13 be identified. I was promised that it's going to happen toward

14 the end of --

15 Q Who promised that to you?

16 A It was just by the telephone calls to GE and they

17 were asking to give us more time.

18 Q Who in GE were you talking to?

19 A Mr. Norman Barclay and Mr. Robert Nicholls.

20 Q Did Mr. Barclay and Mr. Nicholls send you the

21 material as required?

22 A They were providing some charts and figures. No, not

23 the stuff that I was requesting.

24 Q All right. So, did you ever get from GE what you

25 requested to close, is it to close the audit?

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

333

1 A To close the audit.

2 Q Did you ever get those materials?

3 A I received some documents regarding their corrective

4 action, and in the status of their finding, I document exactly

5 what I received. One status is dated January 1998, the next

6 status is like eight, nine months later which if you refer to

7 the audit, I could identify it.

8 Q Without pulling them out, and just again, I don't

9 mean to be redundant, this document that we have been referring

10 to as the audit --

11 JUDGE LESNICK: That's exhibit?

12 MR. McDERMOTT: It's our Exhibit No. 4, Judge, 595

13 pages.

14 JUDGE LESNICK: All right.

15 BY MR. McDERMOTT:

16 Q That documents your activity in '97, '98 and '99,

17 correct?

18 A Yes.

19 Q All right. Your activity in '97 was what? The

20 physical audit?

21 A Physical audit.

22 Q And then 1998, your activity was?

23 A Providing the update status reports.

24 Q How long does it take, I'm sorry, does the Code or

25 any procedure manual or organization determine the advised time

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

334

1 or exact time to close an audit?

2 A The 10 C.F.R. 50 Appendix B, as I stated yesterday,

3 it says prompt but it doesn't give the time limit. But the

4 ASME NQA-1, they have a non-supplement and they have a

5 supplement. I believe on the non-mandatory supplements, they

6 recommend that the audit should be done within 30 days, and

7 they expect the lead auditor to receive the audit and review it

8 if the progress is made. And the lead auditor who did the

9 audit feels that the progress made is reasonable, only he can

10 provide an extension of another 30 to 60 days, depends on the

11 complexity of the product.

12 Q Did you give these extensions when requested?

13 A I gave that, I provided my response in January 1998

14 and I did not receive anything within 30 days or 60 days. I

15 received something in September --

16 Q That's not my question. Did you ever --

17 A No, I did not.

18 Q Were you ever requested and did you ever grant an

19 extension?

20 A I requested, I was not granted the extension.

21 Q You did not grant it?

22 A I did not grant the extension.

23 Q Do you know if anybody gave an extension?

24 A Nobody could have, I was in charge of maintaining the

25 supplier.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

335

1 Q All right. Was the GENE audit finally closed?

2 A Almost two years later.

3 Q And how was it closed?

4 A In like almost 18 months after the findings and

5 looking at the status, looking at all the promises that I was

6 given throughout the whole 1998, in January, toward the end of

7 January, beginning of February, I wrote an e-mail and said HOT!

8 URGENT! to all the executives and all the people who were on

9 the distribution of the original GE. And I said, the

10 statements that I used, "This is going too long. This is going

11 to be a bad reflection on our QA program. These are the 12

12 significant findings which resulted in a stop work order. NRC

13 is aware of those; if NRC comes back, this is going to be a bad

14 reflection on our QA program."

15 Q You're summarizing a document?

16 A That's what I said on the e-mail.

17 Q All right.

18 A The next day, one of the managers of the GE was right

19 at my desk before I even get there, his name was Mike, I don't

20 remember his last name. And he said, Mr. Shirani, we hear you,

21 we're going to send you to GE but just give us some more time.

22 And then, I said, 18 months has passed.

23 Q Is this a manager from ComEd or --

24 A No, this is the manager of GE who is in charge of

25 ComEd projects.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

336

1 Q And he's on site in Downers Grove?

2 A Right.

3 Q All right.

4 A So, what I told him, I said, I was at the audit,

5 NUPIC audit of GE in September and October 1998. Not only you

6 guys did not provide the status report and a complete action

7 allowing me to do the follow up throughout the whole 1998, I

8 was not even given that allowance during the NUPIC audit of

9 1998 to look at ComEd. So, this is not acceptable. I have an

10 obligation to the Code and I am supposed to do my job. You are

11 jeopardizing my obligation to the Code requirements. So, he

12 said, we're going to send you.

13 So, I was, about a month passed, nothing heard. I

14 had an audit in Boston, Massachusetts.

15 Q And what audit was that?

16 A It was one of the valve vendors in Massachusetts.

17 Q All right.

18 A I believe I was doing the exit meeting with the

19 executives and I got paged two, three times with a 9-1-1 behind

20 it. And I was saying that, God, I hope nothing serious to the

21 family, so I answered the phone, I excused myself, went

22 outside, and it was one of the managers of the LaSalle Station,

23 Mr. Dale Sinclair. And he was very upset, and he, the words he

24 said, I don't know what the hell or what the heck, you're going

25 back to GE again. I hope you're not going to cause me another

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

337

1 trouble.

2 And I said, what did I cause you? This is an

3 obligation, it's almost two years. He said, we are involved

4 with a power upgrade project, and if you go to GE, I don't have

5 any problem, but you cannot look at my project because this is

6 a major project and I don't want you to go cause another delay

7 and screw me up with my boss. That's exactly --

8 Q And who is Mr. Sinclair's boss?

9 A Well, he was one of the managers, I don't know he was

10 a direct report to Mr. Helwig or not, but all I know, the power

11 upgrade was sponsored and supported by Mr. Helwig and

12 Mr. Kingsley, both of them.

13 Q When you say the power upgrade project, what was it?

14 A Power upgrade project is that you are, should I

15 define it again?

16 Q Just define it, yes.

17 A Define it is you are increasing the thermal output of

18 the reactors, and by increasing the power, the output to the

19 generator to create more electricity. In another word, in a

20 mechanical structural term is that you are squeezing the metal

21 to get more juice out of it.

22 Q All right. Was there a program in Commonwealth

23 Edison called the power upgrade program?

24 A Yes.

25 Q When did it start?

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

338

1 A I believe around 1998 it was advocated by Mr. Helwig

2 and Mr. Kingsley.

3 Q Do you remember when in '98?

4 A Probably toward the fall.

5 Q The middle of the year?

6 A Middle of the year.

7 Q And what did the power, you're saying squeezing the

8 metal?

9 A In a layman's term, that's why I want to describe the

10 design, the power, the nuclear plant is designed for 1100,

11 let's say, Megawatts. Now, you're squeezing the metal to get

12 more juice out of it, it means you are exposing more stress to

13 the component structures.

14 Q All right, I understand that. But what are the

15 component parts of the power upgrade? Do you have to have an

16 outside vendor, for example?

17 A Yes. Commonwealth Edison, they don't do their own

18 in-house engineering and NSSS supplier scope. They are giving

19 it to the General Electric, if they are especially, if they are

20 doing it for the boiling water reactor, they contract it with

21 the BWR's owner, I mean, manufacturer which is GE. The

22 gentleman who was calling me was working for LaSalle and

23 LaSalle, Dresden, Quad Cities, they are boiling water reactors.

24 Q And what if any, do you know what the GE vendor does

25 when they come to present a power upgrade or to create a power

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

339

1 upgrade for LaSalle, for example?

2 A They do the power upgrade means that they have to go

3 and use more margins from the design to increase the output.

4 So, whatever the stress analysis that you have to, if you are

5 pressuring, putting more load on a component, of course,

6 obviously the stress would increase. So, if you have, let's

7 say, in a normal design condition you have a stress of 80

8 percent for one particular member, by increasing the power

9 upgrade, that state of the stress is going to increase.

10 Q I understand, but what does GE do --

11 A GE does the analysis to support that component, the

12 reactor, and its associated component will take the extra load

13 to provide excess energy that you want.

14 Q So, when you say analysis, do you mean calculations?

15 A Calculations.

16 Q So, they are providing new equipment?

17 A No. They provide --

18 Q Let me ask the question.

19 A Yes.

20 Q They're not providing new equipment, correct?

21 A I cannot exclude it, that they may not include the

22 new equipment, because if the existing equipment does not have

23 enough capacity, they may have to back it up with the excess

24 amount of backup support that in case of the failure, they have

25 excess --

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

340

1 Q Did SES, your supplier evaluation services group,

2 have any interaction with GENE power upgrade program?

3 A We never audited that.

4 Q You had no interaction with it?

5 A No.

6 Q Did you ever attempt to have interaction with it?

7 A Yes.

8 Q How?

9 A Because once I do the follow up audit in 1999 of the

10 GE, as Mr. Salehi put it, that if the bulb is broken, you don't

11 just go fix it with another bulb. You have to come up with a

12 root cause. So, you have to not only look at the root cause,

13 you have to expand the samples to see the same mistakes that

14 they have done, they are not doing with the new calculations

15 that they are generating for the new power upgrade. So, then I

16 have to go over it again, put my QA hat on. Criterion 7, I

17 have to address in the Code.

18 The Code says the frequency of the audit is based on

19 important and complexity. Power upgrade and the dry cask are

20 two major projects going at ComEd.

21 Q At this time?

22 A In 1999, yes.

23 Q You were talking about 1999?

24 A Right.

25 Q All right. The power upgrade is in all sites?

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

341

1 A I'm not sure how many sites, but it was advocated at

2 all the sites. How many of them a were participant in that

3 time or not, I knew LaSalle was because the phone call

4 reflected that.

5 Q And again, you took that phone call in Boston?

6 A Yes.

7 Q The date of that Boston audit, do you recall? Is it

8 before you finally closed --

9 A Yes, because I went in May --

10 Q Let me ask the question. Is it before you closed

11 GENE?

12 A It's before I closed the GENE.

13 Q And when did you close GENE?

14 A I closed the GENE on June 15, 1999.

15 Q I'm going to ask you to look at what we've marked as

16 Exhibit No. 11.

17 A Yes.

18 (Whereupon, the document referred

19 to as Complainant's Exhibit No.

20 11 was marked for

21 identification.)

22 BY MR. McDERMOTT:

23 Q Can you tell the court what that exhibit is?

24 A Can I look at it?

25 Q You want to read it?

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

342

1 A Yes.

2 Q Take your time.

3 A It's from Russell Bastyr sent on May 7th, 1999 at

4 1:40 p.m. to Tom Joyce, his manager, cc Oscar Shirani,

5 regarding GE final results. And it starts with, "We can

6 finally get some good sleep tonight. Oscar and the audit team

7 called me right before their exit. They discussed the results

8 of the audit during the phone call. The new audit," the follow

9 up audit, "came up with one finding and three recommendations."

10 This is in addition to the past one. "The findings were

11 problematic in nature and did not have any effect on the

12 product design services at the GE supplies. The

13 recommendations was also problematic and no time was the

14 quality of the GE product in question. I will describe the

15 finding and recommendations below." And then he goes describe.

16 Q All right.

17 A Can I read the summary here?

18 Q No, it's not necessary. This letter, did you get a

19 copy of this letter from Mr. Bastyr?

20 A Yes, it was cc'd to me.

21 Q All right. So, you read it before when you read it

22 before preparing for this hearing, correct?

23 A Yes.

24 Q Is it typical for an auditor to give a preview of an

25 audit result by telephone prior to the return from the audit

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

343

1 offsite?

2 A If the audit is addressing very significant issues,

3 you have the responsibility to call your managers or the

4 manager can call you up about the status. And so, that's not a

5 norm but it could be if the audit findings are significant and

6 the management is expecting some results.

7 Q But your manager writes this letter a month before

8 you've completely written the audit, correct?

9 A Right. Right.

10 Q Were you calling him to give him updates or was he

11 calling you?

12 A He was calling me two or three times every single

13 day.

14 Q While you were in San Jose?

15 A Yes. And wanted to know the status of each day.

16 Q How many audits did you do between the original GENE

17 and this wrap up-audit? Several dozen?

18 A Yes.

19 Q Did Mr. Bastyr call you two or three times each day

20 when you were away doing any of those audits?

21 A None of them.

22 Q This contact between you and he was unusual?

23 A Yes.

24 Q And did you ever get a letter, copy of a letter from

25 Mr. Bastyr, your manager, to his supervisor on a first name

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

344

1 basis, Tom, telling him that you could finally sleep tonight?

2 Did you ever get any other letters remotely similar to this?

3 A Never saw that, anything.

4 Q Pardon me?

5 A Never saw anything before this.

6 Q And after?

7 A No.

8 Q All right. Any other audits in 1999?

9 A Yes. I was charged to look at the continental field

10 machine CFMVR Tesco, they are in Schaumburg, Illinois. And

11 they were working on there to a program for one year and the

12 first day that I entered, within half a day, I thought that I

13 could find more than 20 findings. So, I told them that it's

14 not beneficial to you to continue this audit because it's going

15 to end up with a stop in your work. But since they were just

16 starting their program, I could understand that give them the

17 opportunity to come back with the real work because the work

18 that they were doing was a mock-up.

19 So, I would not have the luxury to give them a chance

20 if that safety related. Since it was a mock-up, I allowed them

21 to go back and work on their program and in a matter of three

22 to four months, I went several times and helped them. And as a

23 result, I wrote most of their procedures and created a program

24 to stand on their own feet per 10 C.F.R. 50. And then, I also

25 created a pilot study with the president.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

345

1 Q All right. Any other audits? During 1999?

2 A 1999, it could have been some, Holtec, could be

3 Sargent & Lundy.

4 Q But nothing like the GENE audit?

5 A 1999, that's what I mentioned, my follow up audit was

6 in May.

7 Q But nothing like that, and again, asking you to look

8 at Exhibit No. 12, is that the letter closing out the audit?

9 A Yes. June 15.

10 (Whereupon, the document referred

11 to as Complainant's Exhibit No.

12 12 was marked for

13 identification.)

14 BY MR. McDERMOTT:

15 Q All right, in June 15. Again, that's more than a

16 month after the priors.

17 MR. McDERMOTT: We move to admit 11 and 12, Your

18 Honor.

19 JUDGE LESNICK: Any objection?

20 MR. GROSS: No.

21 JUDGE LESNICK: 11 and 12 will be admitted in the

22 record.

23 MR. McDERMOTT: Thank you, Judge.

24 (Whereupon, the documents

25 referred to as Complainant's

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

346

1 Exhibits Nos. 11 and 12 were

2 received into evidence.)

3 BY MR. McDERMOTT:

4 Q Mr. Shirani, let me direct your attention to the year

5 2000. Strike that. What was your evaluation for the year

6 1999?

7 A I believe it was B again. The paper says reflecting

8 excellent but the grade given to me was B.

9 Q All right. Directing your attention to the year

10 2000, in early 2000, did you receive any new audit assignments?

11 A Yes. I audited Holtec/Omni in March of 2000.

12 Q Let me ask you, just stop there. Holtec and Omni,

13 related to what?

14 A To spent fuel, spent nuclear fuel dry cask storage.

15 Q All right. What is Omni?

16 A Omni was a fabricator working under Holtec's QA

17 program because they did not have a 10 C.F.R. 50 -- program.

18 They are involved with welding pieces of the dry cask for

19 Dresden Unit 1.

20 Q You heard Mr. Landsman testify about 24 hours ago as

21 to what a dry cask is. Is that your understanding of dry cask?

22 A Yes.

23 Q Have you seen dry casks?

24 A Yes.

25 Q Have you seen dry casks in the process of being made?

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

347

1 A Yes.

2 Q All right.

3 A Several.

4 Q Did you visit the Omni site?

5 A I visited the Omni site.

6 Q Where is the Omni site?

7 A They are like about 15 miles from Holtec office, from

8 Marlton, New Jersey office of Holtec.

9 Q So, they're in New Jersey somewhere?

10 A Yes.

11 Q All right. What was the result of your Holtec, I'm

12 sorry, how many days from beginning to end or months do you

13 take, beginning to end, to do, complete and publish your audit?

14 A During the audit, usually four, five days. But then,

15 you have 20 working days or 30 calendar days to write the audit

16 report.

17 Q In this case, how long did it take?

18 A I don't believe that I was the lead auditor.

19 Q All right.

20 A I was a participant. The lead auditor writes the

21 report.

22 Q And who was the lead auditor, if you recall?

23 A I believe it was Southern Nuclear Operating Company,

24 abbreviated as SNOC.

25 Q All right. So, you're a part of the team?

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

348

1 A Yes.

2 Q And what part did you write, if you wrote a part?

3 A The first part in March because we went twice in

4 Omni, it was March and in May. I was looking at the whole

5 process of the, you know, the assignments of the area of any

6 part of the 18 criteria that it was applicable to their shop.

7 I don't remember exactly what sections of the checklist I wrote

8 but I was involved in the whole quality assurance audit.

9 Q What were the results of the audit?

10 A We found that the Holtec QA program was ineffective.

11 And then, it did impact, negatively and adversely impact the

12 dry cask storage spacers that are inside the dry cask, and

13 those dry cask spacers were already shipped to the Dresden

14 Nuclear Stations. I don't believe the other audit team, their

15 utilities had received any item that these welding issues that

16 we identified was adversely impacted. So, I immediately, once

17 I came back, I discussed the issues with Mr. Bastyr, and I said

18 those welding and their overall quality assurance program was

19 ineffective and those welding is going to have adverse impact

20 on those spacers and we have to put a stop work. In a sense,

21 it means that they have to stop the production that does not

22 come and they have to come and investigate what they had

23 already received.

24 Q And did he approve that stop work?

25 A I wrote the PIF and he signed it.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

349

1 Q When you say a PIF --

2 A Problem identification form. We did --

3 Q Is that a stop work order?

4 A No.

5 Q What is it?

6 A The problem identification form is, I guess, it was

7 one time we were writing CAR's, non-conformance report, and

8 then some other times we were writing PIF, but the PIF could be

9 the cover sheet of a CAR. Basically, you identify, anybody who

10 can even walk on the site and find something, they can write a

11 PIF. It may not necessarily constitute a CAR.

12 But in that one, we gave 24-hour notice to Holtec to

13 halt their quality assurance program, and if they don't put

14 action, an action to prevent recurrence, and a program

15 together, then we would come in 24 hours and we could stop

16 work.

17 Q So, the PIF is a threat of a stop work order? It's a

18 declaration of your intent to issue a stop work order?

19 A Yes. I would say threat is very strong. It's just

20 like quality assurance directions on implementation.

21 Q Other than the Holtec/Omni, were you assigned to

22 participate in any other audit in the year 2000?

23 A Yes. In April 2000, Dr. Kris Singh which was the

24 president of Holtec called me and he said, we are in trouble

25 with our holtite/A which is used at your casks.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

350

1 Q A what A?

2 A Holtite/A. The holtite/A is the material spelled

3 holtite. Holtite is h-o-l-t-i-t-e/A. There is a compound

4 which is mixed almost like a concrete mix that's a neutron

5 shielding material.

6 Q All right.

7 A This neutron shielding material was manufactured by

8 Nabisco in Illinois, and it was Dr. Turner who discovered it.

9 And Nabisco went out of business, this product went to Japan.

10 And Japan produced it to some utilities in the United States.

11 Apparently, holtite, I mean, Holtec was now in the business of

12 creating that material which is called NS4FR which means

13 neutron shielding for fire resistance. This is kind of

14 circumferential outside of the dry cask.

15 Q All right, I know what it is. And what did Dr. Singh

16 say was the problem?

17 A The problem was that another competitor to them, NAC

18 International who also in the business.

19 Q Can you spell NAC?

20 A NAC, I don't know what it's abbreviated for but it's

21 NAC International, had put a safety significant report to the

22 NRC as a potential Part 21. And for the, you know, for the

23 benefit of the audience who are not familiar what the 10 C.F.R.

24 is, if you find significant issues with any design or product,

25 you have to notify NRC to look at the impact for all the other

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

351

1 users.

2 Q You mean if you're a citizen? Or who is mandated to

3 do this?

4 A This is United States NRC, 10 C.F.R. 50 Appendix B,

5 and then the other one is 10 C.F.R. Part 21.

6 Q I see.

7 A So, they kind of work together.

8 Q All right. So, NAC International alerts NRC about

9 this issue at Holtec. And what does Dr. Singh want you to do?

10 A Dr. Singh called me and he says, a few months from

11 now, you guys are going to load your casks, so it's going to be

12 a vested interest for ComEd to go and look at this product and

13 we want to use your reputation. And I don't know where he

14 heard that. He called me, that we want to use -- Shirani. I

15 think this is what all those nicknames by my company managers

16 was broadcasting -- that I was named -- Shirani.

17 And he said, he took it like a compliment, and he

18 says we want you to come here, audit us, then we can tell NRC

19 there's no issues. And I told Mr. --

20 Q Is that unusual for a vendor to call you and request

21 an audit?

22 A Yes.

23 Q All right. What did you do when that occurred?

24 A Then I talked to Mr. Bastyr and Mr. Bastyr said stay

25 out of it. We don't want to be getting sued in the courts with

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

352

1 the fights between NAC International and Holtec.

2 Q All right.

3 A I understood. I said that's fine. That's his

4 request.

5 Q What happened next?

6 A And then he said, why don't you talk to the Dresden

7 management, they are the one making the decision. I went there

8 and I said --

9 Q When you say you went there, you physically went

10 there?

11 A I went there physically because we had, every two

12 weeks, I had a biweekly meeting for the dry cask project.

13 Q I understand. You're the dry cask --

14 A Oversight.

15 Q Oversight project.

16 A Right. So, I brought up the issue and I said, first,

17 I have two vested interests in here.

18 Q I didn't ask you what you said. I asked you what you

19 did. You brought the subject up at this biweekly meeting that

20 you're attending?

21 A Yes.

22 Q And did they, what happened then? Not what was said,

23 not the whole story, what happened next?

24 A I decided that we should go and do the audit, it's

25 going to be our advantage.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

353

1 Q "Our" meaning the company?

2 A Yes.

3 Q "Our" meaning the company Dresden, correct?

4 A Yes.

5 Q "Our" meaning the company Dresden because they're

6 storing there, is that right?

7 A Dresden Unit 1, yes.

8 Q What happened? What did you do next?

9 A I could understand their point of view but from my

10 point of view, I also had to fulfill my obligation to see if

11 the cask is correct or not, to fulfill my obligation.

12 Q What did you do next?

13 A So, I went to audit the Holtec for that project.

14 Q Didn't you the Dresden message back to Mr. Bastyr?

15 A Yes.

16 Q That's what you did next, right?

17 A Yes, and he says fine.

18 Q What changed his mind?

19 A Dresden management runs the dry cask, so he has to

20 support them. So, he has assigned me to support them, so if

21 they agreed, he had to agree with it.

22 Q You did an audit? No?

23 A I did, yes.

24 Q An audit?

25 A Yes, we did an audit.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

354

1 Q Where did you go to do this audit?

2 A I went to Holtec but I also sought the assistance of

3 the three subject matter experts. That's like my tradition to

4 make sure that I do a good audit. Southern Nuclear provided

5 subject matter experts, NYPA, New York Power Authority,

6 provided the subject matter expert, and Commonwealth Edison

7 provided their Joe Reiss was one of the physicists. He was

8 very familiar with the dry cask physics and design. So, I had

9 a very good team. We spent about three to four days.

10 Q Where?

11 A At Holtec office.

12 Q New Jersey?

13 A New Jersey. And now, the audit, they looked at the

14 design, I looked at the rest. And then, the audit resulted in

15 a finding, major finding, but still endorsed holtite/A. We

16 figured that the audit does not have any impact on the

17 holtite/A so, the holtite/A is a good product. But I cited

18 Holtec that they failed to fulfill their obligation to the 10

19 C.F.R. Part 21 because NAC had told them that, you know, they

20 had used this product in the United States and in Japan. I

21 told Holtec, what did you do with that? He says we just

22 removed them, once we tested their samples, they were not good,

23 we removed them from ASL.

24 I said, do you know that you have failed your

25 obligations to the 10 C.F.R.? He says, in what sense? I said,

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

355

1 you should have notified the NRC because you found significant

2 holes in that sample. And then, they accepted the finding and

3 this was reflected in Spent Fuel Magazine and Macra Hill (ph.)

4 -- two news reporters interviewed me, and the result of this

5 interview was published worldwide, Spent Fuel Magazine and

6 Macra Hill.

7 Q What was your next audit?

8 A That was June and July audit of U.S. Tool and Die,

9 another fabricator of Holtec.

10 Q This is the third fabricator for Holtec at this time?

11 A Yes.

12 Q Omni, correct? The one you just testified to, and

13 now, U.S. Tool and Die.

14 A U.S. Tool and Die.

15 Q All right. Was the last audit you testified to, was

16 that a NUPIC audit?

17 A June and July?

18 Q The last one you testified to.

19 A Oh, the May one? It was a special audit between HUG

20 members which other utilities were involved in the dry cask,

21 they could get a copy of it.

22 Q All right. So, it was published? All right.

23 A It's in NUPIC because DSQG is part of the NUPIC.

24 Another term used, dry cask storage quality group, DSQG, is

25 like 20-some members of the NUPIC who are involved with that

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

356

1 dry cask project.

2 Q How were you assigned to this U.S. Tool and Die

3 audit?

4 A I got a call from the DSQG chairman, Mr. Jim Gill.

5 Q And again, DSQG is what?

6 A Dry cask storage quality group, it's like a QA or

7 oversight group within the utilities of the HUG members. HUG

8 means Holtec Users Group.

9 Q All right.

10 A The ones who are using the Holtec design are HUG

11 members, and Exelon is one of those.

12 Q Now, what was the content of the call?

13 A They said, we have found repeated problems with the

14 welding issues, and our QC people, they have found other

15 problems. The report that comes from your resident inspectors

16 at Holtec reflects a lot of nonconformances and we need to take

17 care of this because very soon we're going to be all adversely

18 impacted to load the casks. So, we got to do this nationwide,

19 this NUPIC and DSQG audit together.

20 Q Why would they call you instead of Mr. Bastyr?

21 A Because they wanted to know if I would accept.

22 Probably they should have called him first.

23 Q Well, is it possible they did call him first?

24 A I'm not sure.

25 Q Did you discuss this "problem" assignment at the time

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

357

1 with Mr. Bastyr?

2 A Yes, I did.

3 Q And what was his reaction?

4 A Mr. Bastyr said, I have not budgeted for the U.S.

5 Tool and Die. And if they are not on our actual supplier list,

6 begin with the Holtec, so that's a Holtec problem. And I said,

7 well, we have found a lot of problems with Holtec, so it's not

8 they're relying on a problem, they're to solve another problem

9 on their issue. So, he says talk to the station. If the

10 station approves it, you can go.

11 Q So, you again go to, this then Dresden again?

12 A Again, yes.

13 Q And they go through the same, this is again the same

14 meeting?

15 A Biweekly meetings, yes.

16 Q Biweekly meetings. Did you bring their

17 recommendation back to Mr. Bastyr?

18 A Yes. I told them that they supported it and he says

19 fine.

20 Q When was that audit conducted?

21 A That was June 19th to 23rd of 2000, and I had to

22 extend it to July 4, another three days.

23 Q Through another what?

24 A Another three days.

25 Q Three days?

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

358

1 A Yes.

2 Q Was there anything else going on in SES on the

3 personal side at this time?

4 A I believe we were like four people reported to

5 Mr. Bastyr.

6 Q No, what I'm talking about is company-wide. Was

7 there anything else going on within nuclear during this period

8 of time?

9 A Oh, yes. The company was going through the process

10 of the merger because there was like, almost they were, almost

11 it took a year or a year and a half effort to consummate this

12 merger on October 20th of 2000. So, it started middle of 1999

13 until it was the final --

14 Q How did it impact on you as a worker in SES during

15 this period of time?

16 A I was trying to apply for some jobs, but before, once

17 I was doing this audit, this is very important and I would like

18 to highlight this --

19 Q No, let me ask a question please.

20 A Yes.

21 Q When you say you were trying to apply for some jobs,

22 what does that mean?

23 A Because during the merger process, there are jobs

24 that, you know, come in on the ECOS, electronic computer --

25 Q What is, tell us what the ECOS is.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

359

1 A It's the electronic computer opportunity system to

2 the best of my knowledge.

3 Q All right. And everybody in ComEd at this time or

4 soon to be Exelon at this time has access to this ECOS?

5 A Yes. Yes.

6 Q And when you say they were advertising for jobs, is

7 this company-wide?

8 A Company-wide between ComEd's side and also the

9 Philadelphia people side.

10 Q When you say they're advertising for jobs, what do

11 you mean? And what were you --

12 A There are departments that are going to be generated

13 over the expansion of the work because once there is a merger,

14 there's going to be a lot of, you know, reduction in some areas

15 and also increasing some other areas. So, there are

16 opportunities for the employees to take advantage and apply;

17 and especially, if you're looking for a promotion, that would

18 be nice to see if you meet the requirements of a higher

19 position and you will be interested to apply.

20 Q Now, was this job advertisement done early in the

21 year? I mean, in January, February, March or was it

22 summertime?

23 A I would say throughout the 1998 but most --

24 Q I'm talking 2000.

25 A 2000, yes. Around, I would say, the second-third

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

360

1 quarter.

2 Q All right. What jobs did you apply for?

3 A I applied for some positions within the nuclear, I

4 don't know exactly the titles but there were some openings that

5 I felt like I meet the requirements. And also, the company had

6 an, I guess, announcement that in addition to the four

7 positions that you could nominate yourself for, you could also

8 apply for two more positions through your manager, and your

9 manager will nominate you for that position.

10 Q So, let me get this straight. There was a company-

11 wide announcement on four positions?

12 A No. I said each employee is entitled to apply, to

13 self-nominate themselves for four positions.

14 Q And how did you come to know that?

15 A It was known through the company.

16 Q All right. So, that's a company-wide bulletin?

17 A Right.

18 Q Okay. And on top of this four, what are these other

19 two?

20 A They said you also could ask your supervisor for two

21 additional nominations. So, I figure that --

22 Q When did you come to know this?

23 A In, I would say, second quarter, 2000.

24 Q And you don't remember the four that you self-

25 nominated yourself for? Either you do or you don't.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

361

1 A I don't. I don't remember specifically.

2 Q Okay. And did you ask Mr. Bastyr to nominate you for

3 two?

4 A Yes.

5 Q And would it be your choice of two jobs or would it

6 be his choice of two jobs?

7 A My choice to say these are the jobs that I want you

8 to apply for me.

9 Q All right. And to nominate you for?

10 A To nominate, yes, sorry.

11 Q What were those two positions, if you recall?

12 A I gave him like four to five options on different

13 disciplines. So, if he's going to ECOS, each discipline has

14 many jobs within that screen. So, for example, let's say

15 transmission and distribution.

16 Q Well, how many did you give him?

17 A Okay, about five.

18 Q You gave him about five.

19 A HR which was at nuclear.

20 Q I didn't ask you what they were.

21 A Okay. All right.

22 Q But they were from different areas?

23 A Different areas.

24 Q Outside of SES?

25 A Outside of it.

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

362

1 Q Outside of Q&A?

2 A Outside of the Q&A.

3 Q All right. But still within the company?

4 A Still within the company.

5 Q Did you give him a document that indicated you wanted

6 to go into business services internal audit?

7 A No.

8 Q Did you discuss with anybody at this time your desire

9 to go into internal audit at what would become Exelon Business

10 Services?

11 A I never even knew that they have internal audit in

12 business services or what business services meant.

13 Q Were any of the four or five that you self-nominated

14 yourself for, were they in any way related to internal audit?

15 A No.

16 Q I didn't hear you.

17 A No.

18 Q Because you didn't know about internal audit?

19 A Yes.

20 Q All right. And this is the second quarter of the

21 year 2000?

22 A Yes.

23 Q Did you lead the U.S. Tool and Die the whole time

24 U.S. Tool and Die was audited?

25 A Yes. I was the lead auditor and I believe five, six

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

363

1 utilities, they joined me. And I went down and talked to one

2 of the managers at Dresden, Mr. Tripkin, and I asked him to

3 give me two best welding experts that he has.

4 Q Out at the plant site?

5 A Out of the plant site.

6 Q So, how big was the audit team?

7 A I would say close to about ten. But not full time.

8 Q How many outside agencies knew about this audit as

9 you're conducting it?

10 A I would say all the DSQG members knew about it.

11 Q And DSQG means?

12 A Dry storage quality group, one of the entities of the

13 NUPIC, the utilities involved in the dry cask.

14 Q If you know, did those people consider this audit

15 critical?

16 A Of course.

17 Q Why?

18 A Because there was industry issues about the welding

19 issues of U.S. Tool and Die and also design deficiencies of

20 Holtec which impacted the fabrication.

21 Q All right. Did anything unusual occur when you were

22 at Holtec?

23 A Yes.

24 Q What?

25 A I was, on the first day we were doing the audit, I

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

364

1 highlighted that I found, I reviewed the NRC reports and the

2 other NUPIC reports that they did not find any problems and I

3 came up with two, a couple of significant problems. The next

4 day, I received a phone call from Mr. Tom Joyce's office.

5 Q Now, again, Tom Joyce is Mr. Bastyr's boss?

6 A Yes.

7 Q All right.

8 A And Tom Joyce directly reports to Mr. Helwig.

9 Q All right.

10 A I received a phone call that you're going to be going

11 to Philadelphia from Pittsburgh, since you are in Pennsylvania,

12 to go to see Mr. Honorio Padron.

13 Q Can you spell that for the court reporter's purposes?

14 A P-a-d-r-o-n.

15 Q And the first name is?

16 A Honorio is H-o-n-o-r-i-o.

17 Q And who is Honorio Padron?

18 A He was the president of the BSC, Business Services

19 Corporation.

20 Q Did you ever hear of his name before?

21 A He was just, was recently hired about a month ago.

22 Q Wait. You heard his name before? Can you answer the

23 question?

24 A Yes. I heard his name before.

25 Q All right. And in what context did you hear the

Free State Reporting, Inc.
Free State Reporting, Inc.

 

 

 

 

 

 

365

1 name?

2 A They were advertising th