[Federal Register Volume 63, Number 28 (Wednesday, February 11, 1998)]
[Notices]
[Pages 6967-6968]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-3433]
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NUCLEAR REGULATORY COMMISSION
[Docket No. 030-20644; License No. 37-21428-01; EA 95-025]
Power Inspection, Inc., Wexford, PA; Order Imposing Civil
Monetary Penalty
I
Power Inspection, Inc., (PI or Licensee) is the holder of NRC
Materials License No. 37-21428-01 issued by the Nuclear Regulatory
Commission (NRC or Commission). The license authorizes the Licensee to
possess sealed radioactive sources and to utilize those sources to
conduct industrial radiography in accordance with the conditions
specified therein. The license expired on January 31, 1994.
II
An NRC inspection of the Licensee's activities was conducted on
December 2-3, 1993, and a subsequent NRC investigation was conducted
from March 9 through December 22, 1994. The results of the inspection
and investigation indicated that the Licensee had not conducted its
activities in compliance with NRC requirements. A written Notice of
Violation and Proposed Imposition of Civil Penalty (Notice) was served
upon the Licensee by letter dated February 18, 1997. The Notice states
the nature of the violations, the provisions of NRC requirements that
the Licensee had violated, and the amount of the civil penalties
proposed for the violations.
Two officers of the Licensee responded to the Notice in letters
dated May 13, 1997, October 28, 1997, and January 6, 1998. The
officers' responses did not deny the violations and proposed no reason
for mitigating the civil penalties; rather, each officer maintained
that he was not responsible for the violations and each officer
proposed that the other officer should be held responsible for the
violations and associated civil penalties.
III
After consideration of the Licensee's responses and the statements
of fact, explanation, and arguments for liability of the civil
penalties contained therein, the NRC staff has determined, as set forth
in the Appendix to this Order, that the violations occurred as stated
and that the penalties proposed for the violations designated in the
Notice should be imposed.
IV
In view of the foregoing and pursuant to Section 234 of the Atomic
Energy Act of 1954, as amended (Act), 42 U.S.C. 2282, and 10 CFR 2.205,
it is hereby ordered that:
The Licensee pay a civil penalty in the amount of $40,000 within
30 days of the date of this Order, by check, draft, money order, or
electronic transfer, payable to the Treasurer of the United States
and mailed to Mr. James Lieberman, Director, Office of Enforcement,
U.S. Nuclear Regulatory Commission, One White Flint North, 11555
Rockville Pike, Rockville, MD 20852-2738.
V
The Licensee may request a hearing within 30 days of the date of
this Order. Where good cause is shown, consideration will be given to
extending the time to request a hearing. A request for extension of
time must be made in writing to the Director, Office of Enforcement,
U.S. Nuclear Regulatory Commission, Washington, D.C. 20555, and include
a statement of good cause for the extension. A request for a hearing
should be clearly marked as a ``Request for an Enforcement Hearing''
and shall be addressed to the Director, Office of Enforcement, U.S.
Nuclear Regulatory Commission, Washington, D.C. 20555, with a copy to
the Commission's Document Control Desk, Washington, D.C. 20555. Copies
also shall be sent to the Assistant General Counsel for Hearings and
Enforcement at the same address and to the Regional Administrator, NRC
Region I, 475 Allendale Road, King of Prussia, PA 19406-1415.
If a hearing is requested, the Commission will issue an Order
designating the time and place of the hearing. If the Licensee fails to
request a hearing within 30 days of the date of this Order (or if
written approval of an extension of time in which to request a hearing
has not been granted), the provisions of this Order shall be effective
without further proceedings. If payment has not been made by that time,
the matter may be referred to the Attorney General for collection.
In the event the Licensee requests a hearing as provided above, the
issue to be considered at such hearing shall be:
(a) Whether the Licensee was in violation of the Commission's
requirements as set forth in the Notice referenced in Section II above;
and
(b) Whether, on the basis of the violations described in the NRC's
Notice, this Order should be sustained.
Dated at Rockville, Maryland this 3rd day of February 1998.
For the Nuclear Regulatory Commission.
Ashok C. Thadani,
Acting Deputy Executive Director for Regulatory Effectiveness.
Appendix--Evaluation and Conclusions
On February 18, 1997, a Notice of Violation and Proposed
Imposition of Civil Penalty (Notice) in the amount of $40,000 was
issued to Power Inspection, Inc., (PI or Licensee) for violations
identified during an NRC inspection conducted on December 2-3, 1993,
and a subsequent investigation was conducted from March 9 through
December 22, 1994. Two officers of the Licensee responded to the
Notice in letters dated May 13, 1997, October 28, 1997, and January
6, 1998. The officers' responses did not deny
[[Page 6968]]
the violations and proposed no reason for mitigating the civil
penalties; rather, each officer maintained that he was not
responsible for the violations and each officer proposed that the
other officer should be held responsible for the violations and
associated civil penalties.
Summary of the Licensee's Responses Concerning Liability and
Responsibility for the Violations
1. PI's Response Dated May 13, 1997 (Submitted by Mr. Chambers,
PI's Secretary/Treasurer): Mr. Chambers protested the proposed civil
penalties arguing that he is neither the owner nor President of PI,
and that his involvement with PI was strictly as an investor. In
addition, Mr. Chambers maintained that he did not take part in the
day-to-day operations of PI and that Mr. Kumar, President and major
stockholder of PI, is fully responsible for the violations. Mr.
Chambers subsequently provided the NRC a copy of ``Stock Restriction
and Purchase Agreement'' among PI, Mr. Chambers, and Mr. Kumar as
evidence that his involvement was strictly as an investor.
2. PI's Responses Dated October 28, 1997, and January 6, 1998
(Submitted by Mr. Kumar, PI's President): Mr. Kumar's responses
submitted by Mr. Manifesto, Mr. Kumar's counsel, argued that Mr.
Chambers was the secretary/treasurer of PI during the relevant time
period and that PI was owned jointly by Mr. Kumar and Mr. Chambers.
Mr. Kumar further argued that Mr. Chambers had total control of the
bank account of the corporation, and had equal financial control
over all financial matters, as evidenced by the fact that no payment
in excess of $1,000.00 could be made without Mr. Chambers'
signature. In addition, Mr. Kumar maintained that: (1) Mr. Chambers
served not only as an officer, but also on the Board of Directors of
PI; and (2) after Mr. Kumar severed his relation with PI in August
1994, Mr. Chambers maintained all of the assets of PI, including
bank accounts and equipment.
NRC Evaluation of the Licensee's Responses
The Licensee's arguments, as set forth above, do not provide a
basis under the NRC's Enforcement Policy for mitigation or remission
of the civil penalties. As to the question of responsibility, PI
must pay the civil penalty in accordance with this Order. The
Licensee's arguments do not relieve Mr. Chambers or Mr. Kumar of
their responsibilities for ensuring that PI pays the civil penalty.
Both Mr. Chambers and Mr. Kumar were part-owners and corporate
officers of PI during the time period when the violations of NRC
requirements occurred.
Therefore, after careful consideration of the responses, the NRC
has determined that neither Mr. Chambers nor Mr. Kumar provided an
adequate basis for the NRC to conclude that they should not be
responsible for ensuring payment of the civil penalties by PI
concerning its violations of NRC requirements. The NRC's
determination is based on the fact that:
Mr. Chambers served as an officer, and on the Board of
Directors, of PI during the relevant time period; Mr. Chambers had
control of all personnel matters during the relevant time period;
Mr. Chambers had total financial control of PI; and Mr. Chambers
maintained all of PI's assets, including bank accounts and equipment
after PI became defunct.
Mr. Kumar was the President of PI during the relevant
time period; Mr. Kumar is the last known President of Power
Inspection as noted in a July 16, 1996 ``Stock Restriction and
Purchase Agreement''; Mr. Kumar is currently listed as the Chief
Executive Officer of PI on the Pennsylvania Department of State
Corporate/Limited Partnership records; and Mr. Kumar is currently
listed as the Chief Executive Officer/President of PI on the Dunn &
Bradstreet listing.
NRC Conclusion
The NRC has considered all of the arguments the Licensee made
and concluded that the Licensee has not provided an adequate basis
for mitigation of the proposed civil penalties. In addition, the NRC
has concluded that Mr. Chambers and Mr. Kumar are responsible for
ensuring payment of the civil penalties by PI concerning its
violations of NRC requirements. Consequently, the civil penalties in
the amount of $40,000 should be imposed by order.
[FR Doc. 98-3433 Filed 2-10-98; 8:45 am]
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