[Federal Register Volume 62, Number 14 (Wednesday, January 22, 1997)]
[Notices]
[Pages 3314-3316]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-1488]


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NUCLEAR REGULATORY COMMISSION
[Docket No. 999-90004, General License Pursuant to Part 110, EA 96-342]


NDC Systems, Irwindale, California; Confirmatory Order Modifying 
License (Effective Immediately)

I

    NDC Systems (NDC or Licensee) has been granted a General License 
pursuant to the provisions of 10 CFR 110.19, 110.20, and 110.23. The 
General License authorizes the Licensee to export licensed material in 
accordance with the provisions contained therein.

II

    Based on the NRC's investigation conducted from April 12 through

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August 28, 1996, at NDC's facility in Irwindale, California, and a 
predecisional enforcement conference held on October 23, 1996, the NRC 
has concluded that a violation of NRC requirements occurred. The 
violation involved the willful failure to comply with export 
requirements (10 CFR 110.50) in that packaging of certain gauging 
devices containing americium-241 (Am-241) was not in accordance with 
Department of Transportation (DOT) requirements.
    The Commission's regulations in 10 CFR 110.50(a) and 10 CFR 71.5(a) 
require NDC, as a general licensee, to comply with the applicable DOT 
requirements in 49 CFR Parts 170 through 189. Prior to November 1, 
1995, DOT requirements in 49 CFR Sections 171.11(d), 171.12(d), 
173.422, 173.423, 173.431, and 173.475 required shippers to ensure that 
radioactive materials are packaged properly, with Type A packaging 
required for packages containing materials having total activity 
greater than 80 millicuries, and packages containing materials having 
total activity equal to or less than 80 millicuries being excepted from 
this requirement. Prior to November 1, 1995, however, NDC systems 
delivered gauging devices containing 150 millicuries of americium-241 
sources for transport by air to foreign countries in excepted 
packaging, not in Type A packaging.
    NDC representatives stated that the circumstances surrounding the 
failure to comply with DOT requirements began around 1989 with the 
practice of improperly labeling gauges that were going to certain 
countries. Gauges going to certain countries were purposefully 
mislabeled to reflect a lower activity of 25 mCi, even though NDC 
personnel knew that the gauges contained 150 mCi. (This occurred after 
Amersham, the manufacturer of the sources, began shipping to NDC 150 
mCi cylinder sources rather than 25 mCi disk sources.) Since the lower 
activity was within the DOT limit for excepted packaging, NDC personnel 
improperly packaged the mislabeled gauges in excepted packaging rather 
than the required Type A packaging. Thus, NDC shipping personnel were 
packaging and sending gauges going to certain countries in excepted 
packaging, while the same model gauges, with the same sources, were 
shipped to other countries in Type A packaging. However, NDC personnel 
stated that they did not realize they were violating DOT requirements.
    Some NDC personnel stated that they raised concerns about the 
practice of mislabeling the gauge to senior NDC management on a number 
of occasions. Although NDC senior management agreed the practice was 
improper, NDC personnel were instructed to continue the practice 
despite their concerns. At the conference, NDC senior management stated 
that it condoned this inappropriate practice with the rationalization 
that it would be a temporary practice until the devices were registered 
in those certain countries. All involved NDC personnel stated that 
there was no discussion of mispackaging the devices which was the 
natural consequence of the mislabeling. Due to NDC senior management's 
admitted ``sloppy'' practices and total lack of oversight, NDC senior 
management inadequately evaluated the mislabeling concern and did not 
consider that the mislabeling would result in mispackaging. Thus, the 
NRC has concluded that this violation was willful based, at least, on 
the careless disregard by senior NDC management of applicable 
requirements.
    NDC stated that the root causes of the violation are: (1) a lack of 
management oversight of the NDC shipping program to ensure compliance 
with DOT regulations and (2) a lack of a thorough understanding of 
applicable DOT regulations.
    During the October 23 predecisional enforcement conference, NDC 
proposed various corrective actions that it had taken and planned to 
take to preclude recurrence of this violation and future DOT 
violations. In later discussions with NDC, the corrective actions were 
enhanced to address specific NRC concerns.

III

    By letter dated November 21, 1996, the NRC described to the 
Licensee the NRC's understanding of the Licensee's modified corrective 
actions. The Licensee subsequently consented to issuing this Order with 
the conditions, as described in Section IV below, in a letter signed on 
November 29, 1996. The Licensee further agreed that this Order be 
immediately effective and that its hearing rights be waived. The NRC 
has reviewed the above conditions and concludes that implementation of 
these actions would provide enhanced assurance that sufficient 
resources will be applied to the radiation safety program, and that the 
program will be conducted safely and in accordance with NRC 
requirements.
    I find that the Licensee's commitments as set forth in Section IV 
are acceptable and necessary, and conclude that with these commitments 
the public health and safety are reasonably assured. In view of the 
foregoing, I have determined that the public health and safety require 
that the Licensee's commitments in its November 29, 1996, letter, be 
confirmed by this Order. Based on the above and on the Licensee's 
consent, this Order is immediately effective upon issuance.

IV

    Accordingly, pursuant to sections 81, 161b, 161i, 161o, 182 and 186 
of the Atomic Energy Act of 1954, as amended, and the Commission's 
regulations in 10 CFR 2.202 and 10 CFR Part 110, IT IS HEREBY ORDERED, 
EFFECTIVE IMMEDIATELY, THAT NDC'S GENERAL LICENSE PURSUANT TO 10 CFR 
PART 110 IS MODIFIED AS FOLLOWS:
    A. NDC shall retain the services of an independent individual or 
organization (consultant) to perform two audits of the Licensee's 
activities conducted under the general license, and shall provide the 
NRC with reports of the audits' findings as described in Provisions D 
and E below. The audits shall include, but are not limited to:
    (1) Review of export activities, including NDC's compliance with 
Department of Transportation (DOT) regulations;
    (2) discussion and interviews with NDC employees to verify that 
employees understand DOT regulations as they relate to NDC's shipping 
activities and to verify the effectiveness of NDC's corrective actions 
to the violation identified in the Order;
    (3) discussion and interviews with NDC employees to verify that NDC 
employees have been adequately trained on and understand NDC's 
procedures and policies for raising safety concerns and for seeking 
guidance related to NRC-licensed activities; and
    (4) discussion and interviews with NDC employees to determine 
whether employees have concerns about NDC's policies or procedures for 
raising safety issues and for seeking guidance.
    B. Within 30 days of the date of the Order, NDC shall submit to the 
NRC, for NRC review and approval, the name and qualifications of the 
consultant it proposes to use in conducting these audits. The 
consultant shall be independent of the Licensee's organization and 
shall be experienced in performing evaluations of NRC or Agreement 
State licensee programs with respect to implementation of the 
Department of Transportation (DOT) regulations.
    C. Prior to supervising or performing any shipping activities, and 
no later than 60 days after the date of the Order, NDC will provide 
formal classroom training consistent with the training requirements of 
49 CFR Part 172 Subpart H. All individuals who are

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involved in shipping activities, the Shipping Supervisor and Operations 
Manager, and the individual or individuals with responsibility for 
oversight of the radiation safety program, are subject to this 
commitment. For the purpose of the Order, shipping activities include 
tasks such as packaging, labeling, and completion of appropriate 
transportation documents.
    D. Within 60 days of the date of NRC's approval of a consultant, 
NDC shall provide the NRC with a copy of the first audit report, 
including a description of actions taken and planned in response to any 
recommendations, comments, or findings in the audit report. 
Alternatively, if NDC does not believe any specific recommendation 
should be adopted or an audit finding should not be addressed, NDC will 
provide justification for its position to the NRC.
    E. Within 12-18 months of the date of the Order, NDC shall provide 
the NRC with a copy of the second audit report, including a description 
of actions taken and planned in response to any recommendations, 
comments, or findings in the audit report. Alternatively, if NDC does 
not believe any specific recommendation should be adopted or an audit 
finding should not be addressed, NDC will provide justification for its 
position to the NRC. If NDC chooses to use a different auditor for this 
audit, NDC shall submit the qualifications of the auditor to the NRC 
for approval prior to conducting the audit.
    F. For the purpose of the Order, NDC shall send the audits and its 
responses, and the qualifications of the auditor, to the Director, 
Division of Nuclear Material Safety, NRC Region IV, 611 Ryan Plaza 
Drive, Suite 400, Arlington, Texas 76011, and a copy to Chief, 
Materials Branch, NRC WCFO, 1450 Maria Lane, Walnut Creek, California 
94596-5368.
    The Regional Administrator, Region IV, may relax or rescind, in 
writing, any of the above conditions upon a showing by the Licensee of 
good cause.

V

    Any person adversely affected by this Confirmatory Order, other 
than the Licensee, may request a hearing within 20 days of its 
issuance. 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. Any request for a hearing 
shall be submitted to the Secretary, U.S. Nuclear Regulatory 
Commission, ATTN: Chief, Docketing and Service Section, Washington, 
D.C. 20555. Copies also shall be sent to the Director, Office of 
Enforcement, U.S. Nuclear Regulatory Commission, Washington, D.C. 
20555, to the Assistant General Counsel for Hearings and Enforcement at 
the same address, to the Regional Administrator, NRC Region IV, 611 
Ryan Plaza Drive, Suite 400, Arlington, Texas 76011, and to the 
Licensee. If such a person requests a hearing, that person shall set 
forth with particularity the manner in which his interest is adversely 
affected by this Order and shall address the criteria set forth in 10 
CFR 2.714(d).
    If a hearing is requested by a person whose interest is adversely 
affected, the Commission will issue an Order designating the time and 
place of any hearing. If a hearing is held, the issue to be considered 
at such hearing shall be whether this Confirmatory Order should be 
sustained.
    In the absence of any request for hearing, or written approval of 
an extension of time in which to request a hearing, the provisions 
specified in Section IV above shall be final 20 days from the date of 
this Order without further order or proceedings. If an extension of 
time for requesting a hearing has been approved, the provisions 
specified in Section IV shall be final when the extension expires if a 
hearing request has not been received. AN ANSWER OR A REQUEST FOR 
HEARING SHALL NOT STAY THE IMMEDIATE EFFECTIVENESS OF THIS ORDER.

    Dated at Rockville, Maryland this 13th day of January 1997.

    For the Nuclear Regulatory Commission.
James Lieberman,
Director, Office of Enforcement
[FR Doc. 97-1488 Filed 1-21-97; 8:45 am]
BILLING CODE 7590-01-P