[Federal Register Volume 61, Number 100 (Wednesday, May 22, 1996)]
[Notices]
[Pages 25694-25696]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-12810]



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NUCLEAR REGULATORY COMMISSION

[Docket No. 030-30266, License No. 30-23697-01E, EA 96-170]


Innovative Weaponry, Inc., Albuquerque, New Mexico; Confirmatory 
Order Modifying License (Effective Immediately)

I

    Innovative Weaponry, Inc. of Nevada, (IWI or Licensee) is the 
holder of NRC License No. 30-23697-01E issued by the Nuclear Regulatory 
Commission (NRC or Commission) pursuant to 10 CFR Part 30. The license 
authorizes the Licensee to distribute byproduct material (i.e., 
tritium) in gunsights as specified in the license. The license was 
transferred from IWI of New Mexico to IWI of Nevada on April 3, 1995. 
Although due to expire on June 30, 1993, the license has remained 
active based on a timely renewal application.

II

    Based on its review of the results of an NRC investigation 
conducted from May 9, 1995, through March 22, 1996, the NRC identified 
the following apparent violations of IWI's license conditions: (1) IWI 
distributed tritium in gunsights not approved by the NRC and not 
specifically authorized on the license; and (2) IWI distributed tritium 
sources obtained from a manufacturer not authorized on the license. In 
addition, as indicated in a letter issued to IWI on April 17, 1996, it 
appeared that the violations were committed by the President and 
Executive Vice President of the company.
    These apparent violations and the concern that they were committed 
by the President and Executive Vice President were discussed with IWI 
representatives at a predecisional enforcement conference in Rockville, 
Maryland on April 23, 1996. The Licensee admitted that violations had 
occurred but denied that there was any intent to commit the violations. 
Notwithstanding the Licensee's position on intent, the NRC is concerned 
that the violations resulted from a lack of effective action to assure 
compliance with license requirements, despite IWI officials being aware 
that the NRC license contained limitations on what could and could not 
be distributed.

III

    As a result of the NRC investigation, the NRC staff questioned 
whether it should have the requisite reasonable assurance that IWI will 
comply with agency requirements. At the predecisional enforcement 
conference and a meeting on the same date to discuss license amendment 
issues, the Licensee voluntarily committed to actions to address the 
NRC's concerns about its ability to conduct its activities in 
compliance with the license and applicable NRC requirements. The 
Licensee offered to develop the following plans and to submit them to 
the NRC for approval: (1) a training plan to assure that all IWI 
employees, including management, understand the

[[Page 25695]]

NRC license and applicable NRC requirements; (2) an audit plan to 
assure compliance with requirements to be implemented by a third-party, 
independent auditor; and (3) development of written procedures to 
maintain accountability, control, and security of materials authorized 
by the NRC for distribution. The NRC has concluded that implementation 
of these commitments, which are described in more detail below, would 
provide the necessary assurance that licensed activities will be in 
compliance with NRC requirements in the future.
    I find that the Licensee's commitments set forth at the 
predecisional enforcement conference and licensing meetings conducted 
on April 23, 1996, are acceptable and necessary and conclude that with 
these commitments the public health, safety and interest are reasonably 
assured. In a telephone call on May 8, 1996, with Mr. James 
Tourtellotte, the Licensee's attorney, the Licensee agreed to this 
action. I have also determined, based on the Licensee's consent and on 
the significance of the conduct described above, that the public health 
and safety require that this Order be immediately effective.

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 30, IT IS HEREBY ORDERED, 
EFFECTIVE IMMEDIATELY, THAT LICENSE NO. 30-23697-01E IS MODIFIED AS 
FOLLOWS:
    1. The Licensee shall submit for NRC approval, within 30 days of 
the issuance of this Order, a training plan designed to assure that all 
IWI employees, including management, who are involved in activities 
that may affect compliance with the NRC license are familiar with the 
conditions and restrictions contained in the license, as well as with 
all other applicable NRC requirements. The training plan also shall 
provide for training in accountability, control, and security of 
licensed material in gunsights authorized by the NRC for distribution 
to persons exempt from licensing. The training plan shall provide for 
initial training of all existing employees, including management, 
within 30 days of the issuance of this Order, training for new 
employees, including management, prior to their working with licensed 
materials, and annual refresher training thereafter.
    2.a. The Licensee shall submit for NRC approval, within 30 days of 
the date of this Order, the name and qualifications of an independent 
auditor or auditors whom the Licensee proposes to conduct the audits 
described below and who are capable of conducting such audits to assure 
compliance with all NRC license conditions and requirements.
    b. The Licensee shall submit for NRC approval, within 30 days of 
the NRC's approval of the above auditor, an audit plan which shall 
provide for periodic audits to assure compliance with all NRC license 
conditions and requirements. The audit plan shall provide for an 
initial audit, followed by quarterly audits for a 1-year period, and 
semi-annual audits thereafter. The audit plan shall provide for audit 
reports to be issued to the Licensee and the NRC at the same time 
within 30 days of the completion of each audit. The audit report shall 
contain findings on the Licensee's state of compliance with NRC 
requirements and recommendations to achieve compliance if deficiencies 
are noted. The plan shall provide for the Licensee to respond in 
writing to all audit findings within 30 days of each audit report, with 
a copy to the NRC. The response shall state the actions taken by the 
licensee to address audit recommendations with which the Licensee 
agrees. For those recommendations that the Licensee disputes, the 
Licensee shall provide the basis for dispute and any other action 
taken.
    3. The Licensee shall develop and implement, within 30 days of the 
issuance of this Order, written procedures designed to maintain 
inventory and accountability of gunsights with sources authorized by 
the NRC for distribution to persons exempt from licensing.
    4. Upon approval of the actions required under items 1 and 2.a 
above, items 1 and 2.b shall be implemented until relaxed by the 
Regional Administrator, Region IV.
    5. Requests for approval of the auditor, audit plan, training plan, 
and for changes of the approved auditor, changes to the audit plan, and 
to reports required to be submitted, shall be submitted to the Regional 
Administrator, Region IV, with a copy to the Director, Office of 
Nuclear Materials Safety and Safeguards.
    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.
    Pursuant to 10 CFR 2.202(c)(2)(i), any person other than the 
Licensee, adversely affected by the Order, may, in addition to 
demanding a hearing, at the time the answer is filed or sooner, move 
the presiding officer to set aside the immediate effectiveness of the 
Order on the ground that the Order, including the need for immediate 
effectiveness, is not based on adequate evidence but on mere suspicion, 
unfounded allegations, or error.
    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.

    For the Nuclear Regulatory Commission.


[[Page 25696]]


    Dated at Rockville, Maryland this 15th day of May 1996.
James Lieberman,
Director, Office of Enforcement.
[FR Doc. 96-12810 Filed 5-21-96; 8:45 am]
BILLING CODE 7590-01-P