[Federal Register Volume 89, Number 109 (Wednesday, June 5, 2024)]
[Notices]
[Pages 48197-48201]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-12255]
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NUCLEAR REGULATORY COMMISSION
[Docket No. 99902109; EA-2023-105; NRC-2024-0103]
In the Matter of Mistras Group, Inc.; Confirmatory Order
AGENCY: Nuclear Regulatory Commission.
ACTION: Notice; issuance.
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SUMMARY: The U.S. Nuclear Regulatory Commission (NRC) issued a
Confirmatory Order to Mistras Group, Inc. (Mistras) to document
commitments made as part of a settlement agreement between the NRC and
Mistras following an alternative dispute resolution mediation session
held on March 21, 2024. The mediation addressed an apparent violation
involving the falsification by two Mistras employees of certificates of
calibration for non-destructive test equipment that was used at nuclear
power plants. Mistras has committed to corrective actions in the
following areas: safety culture and safety conscious work environment,
quality assurance program, audits, and training. The Confirmatory Order
became effective upon issuance.
DATES: The Confirmatory Order was issued on May 22, 2024.
ADDRESSES: Please refer to Docket ID NRC-2024-0103 when contacting the
NRC about the availability of information regarding this document. You
may obtain publicly available information related to this document
using any of the following methods:
Federal Rulemaking Website: Go to https://www.regulations.gov and search for Docket ID NRC-2024-0103. Address
questions about Docket IDs in Regulations.gov to Stacy Schumann;
telephone: 301-415-0624; email: [email protected]. For technical
questions, contact the individual listed in the FOR FURTHER INFORMATION
CONTACT section of this document.
NRC's Agencywide Documents Access and Management System
(ADAMS): You may obtain publicly available documents online in the
ADAMS Public Documents collection at https://www.nrc.gov/reading-rm/adams.html. To begin the search, select ``Begin Web-based ADAMS
Search.'' For problems with ADAMS, please contact the NRC's Public
Document Room (PDR) reference staff at 1-800-397-4209, at 301-415-4737,
or by email to [email protected]. The Mistras Confirmatory Order is
available in ADAMS under Accession No. ML24116A294.
NRC's PDR: The PDR, where you may examine and order copies
of publicly available documents, is open by appointment. To make an
appointment to visit the PDR, please send an email to
[email protected] or call 1-800-397-4209 or 301-415-4737, between 8
a.m. and 4 p.m. eastern time (ET), Monday through Friday, except
Federal holidays.
FOR FURTHER INFORMATION CONTACT: David Jones, Office of Enforcement,
U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001,
telephone: 301-287-9525; email: [email protected].
SUPPLEMENTARY INFORMATION: The text of the order is attached.
Dated: May 30, 2024.
For the Nuclear Regulatory Commission.
June Cai,
Deputy Director, Office of Enforcement.
Attachment--Mistras Services--Confirmatory Order
United States of America
Nuclear Regulatory Commission
In the Matter of: Mistras Group, Inc, EA-23-105.
[[Page 48198]]
Confirmatory Order
Effective Upon Issuance
I
Mistras Group, LLC. (Mistras) performs activities such as testing
of heavy lifting equipment at nuclear power plants licensed by the U.S.
Nuclear Regulatory Commission (NRC or Commission). Mistras, as
specified in purchase orders and contracts with NRC licensees, is
required to implement Appendix B, ``Quality Assurance Criteria for
Nuclear Power Plants and Fuel Reprocessing Plants,'' of Part 50,
``Domestic Licensing of Production and Utilization Facilities,'' to
Title 10 of the Code of Federal Regulations (10 CFR). Mistras' non-
destructive testing (NDT) service includes usage of an Acoustic
Emission (AE) Data Acquisition System to examine the structural
integrity of cranes used for lifting components such as reactor vessel
heads and reactor vessel internals at many NRC licensee sites.
This Confirmatory Order (CO) is the result of an agreement reached
during an Alternative Dispute Resolution (ADR) mediation session
conducted on March 21, 2024, in Rockville, Maryland, to address one
apparent violation.
II
On October 22, 2021, the NRC's Office of Investigations (OI) opened
an investigation (OI Case No. 1-2022-003) at Mistras' Trainer,
Pennsylvania facility. The investigation, which was completed on
October 19, 2022, and supplemented on May 9, 2023, evaluated whether a
former Director of Advanced Services and a former NDT engineer engaged
in deliberate misconduct by falsifying certificates of calibration for
AE equipment that was used to perform inspections of heavy lifting
equipment for safety-related components at nuclear power plants.
Based on the conclusions of the investigation, the NRC's Office of
Nuclear Reactor Regulation, Division of Reactor Oversight, Quality
Assurance Vendor Inspection Branch, issued an apparent violation that
was documented in an NRC letter, dated December 7, 2023 (Agencywide
Documents Access and Management System (ADAMS) Accession No.
ML23340A106).
The apparent violation of 10 CFR 50.5, ``Deliberate misconduct,''
stated that from approximately 2011 until 2021, Mistras (a contractor)
knowingly provided services related to licensees' activities in 10 CFR
part 50 and deliberately submitted to licensees information that the
person submitting the information knew to be incomplete or inaccurate
in some respect material to the NRC. Specifically, Mistras maintained
falsified records documenting the calibration of test equipment used at
nuclear power plants. On multiple occasions, two Mistras employees
created falsified documents to conceal Mistras' failure to calibrate
the AE Data Acquisition Systems on an annual basis, as specified by the
equipment manufacturer. These falsified documents, including
certificates of calibration, were submitted to NRC licensees as part of
AE test reports on multiple occasions between approximately 2011 and
2021.
Additionally, the apparent violation stated that the Mistras AE
test reports provided by Mistras to licensees (which included the
falsified certificates of calibration) are material to the NRC. The
test reports concerned AE systems that were used in activities
affecting quality (e.g., AE systems were used by NRC licensees to
examine the structural integrity of cranes used for lifting components
such as reactor vessel heads and reactor vessel internals), and the
test reports are quality assurance records in accordance with Appendix
B, Criterion XVII, ``Quality Assurance Records,'' to 10 CFR part 50,
which provide evidence that licensees are in compliance with NRC
regulations.
When issuing the apparent violation, the NRC provided Mistras an
opportunity to attend a pre-decisional enforcement conference or
participate in an ADR mediation session to resolve this concern. In
response, Mistras requested the use of the NRC's ADR process. On March
21, 2024, the NRC and Mistras conducted an ADR session mediated by a
professional mediator, arranged through Cornell University's Scheinman
Institute on Conflict Resolution. The ADR process is one in which a
neutral mediator, with no decision-making authority, assists the
parties in reaching an agreement to resolve any differences regarding
the dispute. This Confirmatory Order is issued pursuant to the
agreement reached during the ADR process.
III
NRC and Mistras reached a preliminary settlement agreement during a
full-day mediation session that was conducted on March 21, 2024. The
elements of the agreement include the following:
1. In recognition of the prompt and corrective actions taken in
response to the apparent violation, as documented in this CO and
discussed at the ADR, Mistras is not required to provide a written
response in accordance with 10 CFR 2.201. Corrective actions completed
by Mistras prior to the mediation session include, but are not limited
to, the following:
a. Individuals responsible for the fraudulent records had their
employment terminated.
b. AE instruments were properly calibrated by Physical Acoustics,
the manufacturer of the equipment.
c. Developed a web[hyphen]based training course for all employees,
which included an introduction by the company's Chief Executive
Officer, to speak about the importance of promoting a culture of
ethics, and how any deliberate misconduct has consequences, including
loss of employment and imprisonment.
d. Local and Corporate Quality Departments reviewed procedures,
records, and equipment.
e. AE procedures and forms were adopted into the Corporate Document
Center, as formal quality assurance records.
f. AE test equipment was added to the measuring and test equipment
(M&TE) recall system.
g. AE program procedures and work instructions were revised to
clarify the calibration verification instructions and to identify
future calibration requirements.
h. Notification letters were written and distributed to notify
applicable nuclear power plants of the nonconformance associated with
their equipment.
i. An interim report and a final 10 CFR part 21 report were
submitted to the NRC.
j. Mistras developed or revised the following procedures:
i. Revised procedure 100-QC-006, ``Contract Review & Project
Planning'' to ensure that ``Nuclear Projects'' are submitted to the
Nuclear Projects Division for review.
ii. Revised procedure 100-QC-007, ``Project Execution.''
iii. Developed procedure 100-QC-007.1, ``Nuclear Projects'' which
defined the Nuclear Projects Division.
iv. Revised procedure 100-QC-014 ``Internal Audits'' to require
additional oversight of Nuclear Projects by requiring an annual audit
by an outside, independent Lead Auditor.
v. Planned revision of 100-QC-017 ``Control of Nonconforming
Items.''
vi. Revised procedure 100-QC-017.1, ``Reporting of Defects and
Noncompliance in Accordance with 10 CFR part 21 and 10 CFR 50.55(e),''
Revision 6, dated October 9, 2023, which incorporates appropriate
evaluation criteria consistent with guidance provided in Nuclear Energy
Institute (NEI) 14-09, ``Guidelines for Implementation of 10 CFR part
21
[[Page 48199]]
Reporting of Defects and Noncompliance.''
2. Mistras agreed upon future actions in the following areas (see
Section V for details):
a. Safety Culture and Safety Conscious Work Environment.
b. Quality Assurance Program.
c. Audit.
d. Quality Assurance Program Training for Employees Involved in
Nuclear Safety-Related Activities.
3. The NRC considers the corrective actions and commitments
delineated above to be appropriately prompt and comprehensive to
address the causes which resulted in the apparent violation identified
in NRC's December 7, 2023, letter.
4. In consideration of the commitments delineated above and
described in Section V below, the NRC agrees not to assess a civil
penalty and refrain from issuing a notice of violation for all matters
discussed in the NRC's choice letter dated December 7, 2023 (EA-23-
105).
5. The NRC and Mistras agree that the above elements will be
incorporated into a Confirmatory Order which will also describe the
apparent violation.
6. The Confirmatory Order is an escalated enforcement action in
accordance with the NRC Enforcement Policy.
7. In the event of the sale of Mistras Services division, which
services commercial nuclear facilities, to another entity, the terms
and conditions set forth hereunder shall continue to apply to the new
entity and accordingly survive any transfer of ownership.
8. The Director, Office of Enforcement, may, in writing, relax,
rescind, or withdraw any of the above conditions upon demonstration by
Mistras or its successors of good cause.
Based on the completed (and planned) actions described above, and
the commitments described in Section V below, the NRC agrees to not
pursue any further enforcement action based on the apparent violation
identified in NRC's December 7, 2023, letter (see Section I).
On May 15, 2024, Mistras consented to issuing this Confirmatory
Order with the commitments, as described in Section V below. Mistras
further agreed that this Confirmatory Order is to be effective upon
issuance, the agreement memorialized in this Confirmatory Order settles
the matter between the parties, and Mistras has waived its right to a
hearing.
IV
I find that the actions completed or planned by Mistras, as
described in Section III above, combined with the commitments as set
forth in Section V, are acceptable and necessary, and conclude that
public health and safety are reasonably assured with these completed
actions and commitments. In view of the foregoing, I have determined
that public health and safety require that Mistras' commitments be
confirmed by this Order. Based on the above and Mistras' consent, this
Confirmatory Order is effective upon issuance.
V
Accordingly, pursuant to Sections 104b, 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 50, as applicable, it is
hereby ordered, effective upon issuance, that:
1. Safety Culture and Safety Conscious Work Environment
a. Mistras will maintain a clear and enforceable policy (e.g., code
of conduct) for safety culture and safety conscious work environment
(SCWE).
b. Within 60 days of the issuance of this Confirmatory Order,
Mistras will review its policy for safety culture and SCWE for
consistency with the NRC's May 2011 Safety Culture Policy Statement and
associated traits, the NRC's May 1996 Safety Conscious Work Environment
Policy Statement, and the NRC's Regulatory Issue Summary 2005-18,
``Guidance for Establishing and Maintaining a Safety Conscious Work
Environment.'' Mistras will document the results of this review.
c. Within 90 days of the issuance of this Confirmatory Order,
Mistras will communicate to its employees its policy for safety culture
and SCWE, if any changes are made based on the results of the review
from Condition 1.b.
d. Mistras will provide indoctrination and annual refresher
training on Mistras' policy for safety culture and SCWE. Mistras will
maintain a record of the individuals receiving training and the date of
the training.
e. Mistras will conduct a survey to assess the effectiveness of
Mistras' policy for safety culture and SCWE taking into consideration
the May 2011 NRC Safety Culture Policy Statement and associated traits
on a periodic basis with a minimum frequency of two years.
2. Quality Assurance Program.
a. Within 90 days of the issuance of this Confirmatory Order,
Mistras will review, revise as necessary, and implement its Quality
Manual and implementing procedures to ensure that they are compliant
with Appendix B, ``Quality Assurance Criteria for Nuclear Power Plants
and Fuel Reprocessing Plants,'' to Title 10 of the Code of Federal
Regulations (10 CFR) Part 50, ``Domestic Licensing off Production and
Utilization Facilities.'' At a minimum, the Quality Manual will address
the following criteria within Appendix B to 10 CFR part 50:
i. Criterion I, ``Organization''
ii. Criterion II, ``Quality Assurance Program''
iii. Criterion IV, ``Procurement Document Control''
iv. Criterion V, ``Instructions, Procedures, and Drawings''
v. Criterion VII, ``Control of Purchased Material, Equipment, and
Services,''
vi. Criterion IX, ``Control of Special Processes,''
vii. Criterion XII, ``Control of Measuring and Test Equipment,''
viii. Criterion XV, ``Nonconforming Materials, Parts, and Components,''
ix. Criterion XVI, ``Corrective Actions''
x. Criterion XVII, ``Quality Assurance Records,''
xi. Criterion XVIII, ``Audits''
b. Mistras will maintain the Quality Manual and implementing
procedures to ensure that they remain compliant with Appendix B to 10
CFR part 50.
3. Audits.
a. Within 1 year of the issuance of this Confirmatory Order,
Mistras will have a comprehensive audit performed of its Nuclear
Quality Assurance Program, including the in-house and in-field
activities affecting quality. This audit shall be performed by an
independent, contracted entity that is knowledgeable in Appendix B to
10 CFR part 50 and 10 CFR part 21.
b. Within 60 days of the completion of Condition 3.a, Mistras will
submit to the NRC the audit report(s) and Mistras' written response to
the audit report. Mistras' written response will either address how it
will implement each recommendation and corrective actions of the audit
report, including a proposed timeline; or provide an explanation and
justification for why each recommendation and corrective action will
not be implemented.
c. Thereafter, on a periodicity to not exceed three years, Mistras
shall have a comprehensive audit performed of its Nuclear Quality
Assurance Program as described in Condition 3.a of this Order. Mistras
shall maintain records of the audit report as well as its written
response that documents its implementation of the report's
recommendations and corrective actions, or provides an explanation and
justification for why any recommendation and corrective action was not
implemented.
d. Mistras will perform comprehensive audits to verify compliance
with all aspects of its
[[Page 48200]]
Nuclear Quality Assurance Program, including the in-house and in-field
activities affecting quality, and assess its effectiveness, on an
annual basis. The audits shall be performed in accordance with written
procedures or check lists by appropriately trained personnel not having
direct responsibilities in the areas being audited. Audit results shall
be documented and reviewed by management having responsibility in the
area audited. Follow up action, including reaudit of deficient areas,
shall be taken where indicated.
4. Quality Assurance Program Training for Employees Involved in
Nuclear Safety-Related Activities.
a. Within 60 days of the issuance of this Confirmatory Order,
Mistras will create and deliver to its employees a statement from
senior Mistras management highlighting the meaning of a nuclear
worker's signature, the regulatory and legal significance of a
signature, and the importance of ensuring activities affecting quality
are accomplished in accordance with Mistras policies and procedures.
b. Within 180 days of the issuance of this Confirmatory Order,
Mistras will ensure that it has training that addresses:
i. Compliance with 10 CFR 50.5 and 10 CFR 50.9 that:
1. Emphasizes the importance of complete and accurate information
for all required records, correspondence, and communications with the
NRC and its licensees.
2. Emphasizes individual accountability and clearly expresses that
willful or deliberate failures to comply with regulations, orders, or
contractual requirements could result in significant individual
enforcement action by the NRC or Department of Justice.
3. Reinforces that if any individual recognizes a non-compliance,
they will immediately report the observation of the non-compliance to
management.
ii. Compliance with Mistras Quality Manual and implementing
procedures. This training shall encompass changes resulting from
Condition 1 of this Order.
c. Within 1 year of the issuance of this Confirmatory Order,
training prescribed in Condition 4.a and 4.b shall be presented to all
Mistras employees involved in nuclear safety-related activities;
thereafter, the training shall be presented annually.
d. The training developed in Condition 4.b of this Section shall be
reviewed and updated, as needed, at a frequency not to exceed 24
months.
5. In the event of the sale of Mistras Services division, which
services commercial nuclear facilities, to another entity, the terms
and conditions set forth hereunder shall continue to apply to the new
entity and accordingly survive any transfer of ownership.
6. The Director, Office of Enforcement, may, in writing, relax,
rescind, or withdraw any of the above conditions upon demonstration by
Mistras or its successors of good cause.
VI
In accordance with 10 CFR 2.202 and 10 CFR 2.309, any person
adversely affected by this CO, other than Mistras, may request a
hearing within 30 calendar days of the date of issuance of this CO.
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, DC 20555, and include a statement of
good cause for the extension.
All documents filed in NRC adjudicatory proceedings, including a
request for hearing and petition for leave to intervene (petition), any
motion or other document filed in the proceeding prior to the
submission of a petition, and documents filed by interested
governmental entities that request to participate under 10 CFR
2.315(c), must be filed in accordance with the NRC's E-Filing rule (72
FR 49139; August 28, 2007, as amended at 77 FR 46562; August 3, 2012).
The E-Filing process requires participants to submit and serve all
adjudicatory documents over the internet, or in some cases to mail
copies on electronic storage media. Detailed guidance on making
electronic submissions may be found in the Guidance for Electronic
Submissions to the NRC and on the NRC website at https://www.nrc.gov/site-help/e-submittals.html. Participants may not submit paper copies
of their filings unless they seek an exemption in accordance with the
procedures described below.
To comply with the procedural requirements of E-Filing, at least 10
days prior to the filing deadline, the participant should contact the
Office of the Secretary by email at [email protected], or by
telephone at 301-415-1677, to (1) request a digital identification (ID)
certificate, which allows the participant (or its counsel or
representative) to digitally sign submissions and access the E-Filing
system for any proceeding in which it is participating; and (2) advise
the Secretary that the participant will be submitting a petition or
other adjudicatory document (even in instances in which the
participant, or its counsel or representative, already holds an NRC-
issued digital ID certificate). Based upon this information, the
Secretary will establish an electronic docket for the hearing in this
proceeding if the Secretary has not already established an electronic
docket.
Information about applying for a digital ID certificate is
available on the NRC's public website at https://www.nrc.gov/site-help/e-submittals/getting-started.html. Once a participant has obtained a
digital ID certificate and a docket has been created, the participant
can then submit adjudicatory documents. Submissions must be in Portable
Document Format (PDF). Additional guidance on PDF submissions is
available on the NRC's public website at https://www.nrc.gov/site-help/electronic-sub-ref-mat.html. A filing is considered complete at the
time the document is submitted through the NRC's E-Filing system. To be
timely, an electronic filing must be submitted to the E-Filing system
no later than 11:59 p.m. Eastern Time on the due date. Upon receipt of
a transmission, the E-Filing system time-stamps the document and sends
the submitter an email notice confirming receipt of the document. The
E-Filing system also distributes an email notice that provides access
to the document to the NRC's Office of the General Counsel and any
others who have advised the Office of the Secretary that they wish to
participate in the proceeding, so that the filer need not serve the
document on those participants separately. Therefore, applicants and
other participants (or their counsel or representative) must apply for
and receive a digital ID certificate before adjudicatory documents are
filed so that they can obtain access to the documents via the E-Filing
system.
A person filing electronically using the NRC's adjudicatory E-
Filing system may seek assistance by contacting the NRC's Electronic
Filing Help Desk through the ``Contact Us'' link located on the NRC's
public website at https://www.nrc.gov/site-help/e-submittals.html, by
email to [email protected], or by a toll-free call at 1-866-672-
7640. The NRC Electronic Filing Help Desk is available between 9 a.m.
and 6 p.m., Eastern Time, Monday through Friday, excluding Federal
government holidays.
Participants who believe that they have good cause for not
submitting documents electronically must file an exemption request, in
accordance with 10 CFR 2.302(g), with their initial paper filing
stating why there is good cause for not filing electronically and
requesting authorization to continue to submit documents in paper
format. Such filings
[[Page 48201]]
must be submitted by (1) first class mail addressed to the Office of
the Secretary of the Commission, U.S. Nuclear Regulatory Commission,
Washington, DC 20555-0001, Attention: Rulemaking and Adjudications
Staff; or (2) courier, express mail, or expedited delivery service to
the Office of the Secretary, 11555 Rockville Pike, Rockville, Maryland
20852, Attention: Rulemaking and Adjudications Staff. Participants
filing adjudicatory documents in this manner are responsible for
serving the document on all other participants. Filing is considered
complete by first-class mail as of the time of deposit in the mail, or
by courier, express mail, or expedited delivery service upon depositing
the document with the provider of the service. A presiding officer,
having granted an exemption request from using E-Filing, may require a
participant or party to use E-Filing if the presiding officer
subsequently determines that the reason for granting the exemption from
use of E-Filing no longer exists.
Documents submitted in adjudicatory proceedings will appear in the
NRC's electronic hearing docket which is available to the public at
https://adams.nrc.gov/ehd, unless excluded pursuant to an order of the
Commission or the presiding officer. If you do not have an NRC-issued
digital ID certificate as described above, click ``cancel'' when the
link requests certificates and you will be automatically directed to
the NRC's electronic hearing dockets where you will be able to access
any publicly available documents in a particular hearing docket.
Participants are requested not to include personal privacy information,
such as social security numbers, home addresses, or personal phone
numbers in their filings, unless an NRC regulation or other law
requires submission of such information. For example, in some
instances, individuals provide home addresses in order to demonstrate
proximity to a facility or site. With respect to copyrighted works,
except for limited excerpts that serve the purpose of the adjudicatory
filings and would constitute a Fair Use application, participants are
requested not to include copyrighted materials in their submission.
The Commission will issue a notice or order granting or denying a
petition, designating the issues for any hearing that will be held, and
designating the Presiding Officer. A notice granting a hearing will be
published in the Federal Register and served on the parties to the
hearing.
If a person (other than Mistras) requests a hearing, that person
shall set forth with particularity the manner in which his interest is
adversely affected by this CO and shall address the criteria set forth
in 10 CFR 2.309(d) and (f). 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 hearings. If a hearing is held,
the issue to be considered at such hearing shall be whether this CO
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 V above shall be final 30 days from the date of
this CO without further order or proceedings. If an extension of time
for requesting a hearing has been approved, the provisions specified in
Section V shall be final when the extension expires if a hearing
request has not been received.
For the Nuclear Regulatory Commission.
Dated this 22 day of May 2024.
David L. Pelton,
Director, Office of Enforcement.
[FR Doc. 2024-12255 Filed 6-4-24; 8:45 am]
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