Mr. ENGLISH. Not at the time of the visit, sir. That was after the appeal to ODM was referred back to me for an opinion on the case. The letter is my opinion on the case. Senator KEFAUVER. Was it referred to you for an opinion on dispersal? Mr. ENGLISH. It was referred to me for consideration of denial. Senator KEFAUVER. Mr. Dixon. Mr. DIXON. Not of Mr. English. I would like to ask some of Mr. Scaff and Mr. Boone. Mr. SCAFF. Senator, one point you referred to or asked the question of Mr. English as to whether it was the Ebasco techniques and so forth in the preparation of these that was instrumental in helping to get these large percentages. I would like to state that Ebasco assisted in the preparation of just three of these certificates. Those three were on Carolina, Louisiana, and Mississippi Power & Light. They reviewed applications on Louisiana Power & Light, Mississippi Power & Light, Pennsylvania Power & Light, and Texas Power & Light out of the 19 companies that are referred to in the subpena that was served on me. I think that is significant information I would like to add. Senator KEFAUVER. Well, the information we have as to your participation comes from Mr. Wyckoff largely. I understand now that in the getting up of the original application in these cases you were there consulting and helping, is that it? Mr. SCAFF. We were there for what? Senator KEFAUVER. In getting up the original application in these three cases you helped them in the preparation of the original appli cation. Mr. SCAFF. That is right; yes, sir. We were requested by our clients to assist in the preparation. Senator KEFAUVER. Where did you come into the others, Mr. Scaff? Mr. SCAFF. On the other four companies I referred to? Senator KEFAUVER. I mean these other 15 or 16, whatever they are. Mr. SCAFF. As I understand it, merely the filing of the applications in Washington. Senator KEFAUVER. And then after filing them you would follow up and keep in touch with them about the matter, is that it? Mr. SCAFF. That would have to be answered by our office in Washington to determine that. What I am referring to are the techniques of Ebasco in the preparation of these, and I wanted to make clear for the record how many we actually participated in. Senator KEFAUVER. Do you know anything about this Massachusetts case that we have been talking about, Mr. Scaff? Mr. SCAFF. No, sir, not in the least. Senator KEFAUVER. Can you remember, Mr. English, who it was at Ebasco that went over with you to see the Assistant Secretary of Defense? Mr. ENGLISH. I would say it was Mr. McDonald, because, as far as I know, he handles most of the Ebasco cases from Washington. Senator KEFAUVER. Mr. Scaff, you didn't list Idaho as one in which you advised in connection with the application. If I remember the testimony we have it is that some of the amendments to the application were handled or Ebasco advised in connection with the amendments. Mr. SCAFF. That was done by our Washington office, and they would have to speak for that, but as I understand it, those amendments were sent from Idaho to Washington and asked that they be filed, and that was their participation. Senator KEFAUVER. That is part of your operation just the same, isn't it? Mr. SCAFF. Yes, but it isn't part of our techniques in the preparation of the certificates. Senator KEFAUVER. You mean you were listing only those that your New York office advised with in the preparation of and you don't list the ones that were in the Washington office? Mr. SCAFF. I am talking about the preparation and not the advice. Senator KEFAUVER. What is the difference in preparation and advice? Mr. SCAFF. Well, my distinction is that you seem to include in advice the filing of these documents. I am talking about our participation in this work at the request of a client, helping them in the preparation of it and reviewing of the document. Now, that is our service. Then after that these documents are filed with the Washington agency. Senator KEFAUVER. So when 3 or 4 that you talked about were prepared, you don't include the ones that Ebasco filed and then perhaps worked on some amendment later on? Mr. SCAFF. No, sir. Senator KEFAUVER. All right. Senator Bolton-Smith, do you have any questions you want to ask? Mr. BOLTON-SMITH. No, thank you, Mr. Chairman. Senator KEFAUVER. We had a good many more questions to ask Mr. Scaff about acquisitions of certificates for certain utility companies that Ebasco did work for. Mr. Scaff had rather go on this afternoon, if we can get permission. Mr. SCAFF. It is immaterial to me, sir. Senator KEFAUVER. Well, suppose we stand in recess until 2: 30, and we will see if we can get permission, and we can advise the other Senators to be here. Our meeting this afternoon will be in room 457 instead of in this room. Mr. BOONE. May I ask you one question on the subpena? Mr. Scaff brought down some papers, and in fact, there were quite a few papers. Now, as I understand, the subpena is limited to the timing. The period element involved is what you asked Mr. English this morning, from May 3, 1955, on, that you are interested in. Mr. DIXON. We are interested in all of the records on this representation for these companies, and the general studies on this, as the subpena recites. It is quite plain, I think, sir. Mr. BOONE. It might be to you, Mr. Dixon. I am accepting your statement, but now on these papers, Senator, we have produced papers and they are a part of our files. They are working files. We would like to have permission to sit down with committee counsel, say some time next week, and do as we have done in other committee hearings, go over them and let the committee say, "I want to take a photostat of this," and we will either furnish the photostat or they can furnish it. Senator KEFAUVER. I think that is a very good way to handle it, Mr. Boone. Suppose during the recess here today that you and Mr. Scaff go over with counsel and minority counsel the records you have brought and see if you have brought what they want and what they asked for, and then we would be very happy to have you go over the exhibits so that photostats can be made of the ones that we want. Mr. BOONE. You know we were served with the subpena yesterday, which was pretty short notice, but we think we are going to do a pretty good job for you. Senator KEFAUVER. We appreciate your cooperation. During the recess if you will go over the exhibits with counsel we will appreciate it. We will stand in recess until 2: 30 subject to getting permission to sit this afternoon. Mr. ENGLISH. Will you require my presence this afternoon? Senator KEFAUVER. I don't believe so this afternoon, Mr. English, unless you find something in this matter that you want to give further explanation of. Mr. ENGLISH. I will have to check this. These are ODM reports. I will have to check with them. I have no way to check them against our files. Senator KEFAUVER. You check them and let us know. We will recess now. (Whereupon, at 12: 35 p. m., the subcommittee recessed to reconvene at the call of the chairman.) RAPID AMORTIZATION IN REGULATED INDUSTRIES TUESDAY, JULY 2, 1957 UNITED STATES SENATE, SUBCOMMITTEE ON ANTITRUST AND MONOPOLY Washington, D. C. The subcommittee met, pursuant to recess, at 10: 10 a. m., in room 315, Senate Office Building, Senator Estes Kefauver presiding. Present: Senators Kefauver (presiding) and O'Mahoney. Also present: Paul Rand Dixon, counsel and staff director; Dr. John M. Blair, chief economist; Philip Layton and George Clifford, attorneys; Ray Cole, investigator; Peter Chumbris, counsel for the minority; Carlile Bolton-Smith, counsel for Senator Wiley. Senator KEFAUVER. The committee will come to order. Mr. Scaff and Mr. Boone, we appreciate your coming back down from New York. We are sorry we could not get through the other day. When we left the other day, Mr. Boone, we gave you a list which was taken by Mr. Garrett, the head of the Division of Corporate Regulation of the SEC, from the public record you had made of the companies that Ebasco had done some work for as of the time given on the list. The names of the companies were put in the record. We asked you to take the statistical information which had been furnished by Mr. Garrett and check it over with your client, Ebasco, and see if you had any exceptions to any companies on the list. STATEMENT OF H. H. SCAFF, VICE PRESIDENT, EBASCO SERVICES, INC.; ACCOMPANIED BY JAMES E. BOONE, COUNSEL Mr. BOONE. Senator, we took that exhibit, and we compared it with the data assembled by the SEC staff relating to the SEC exhibit which Mr. Garrett kindly handed to us. And you will recall we were asked to look at the services listed. Now, those services were available as shown, and the billings for the services which were rendered appear to be accurate. There is one exception which I call Mr. Garrett's attention to. I notice he is here this morning. I think, Mr. Garrett, there is, maybe, a transposition of figures there in the Carolina figure, but it does not change you can do whatever you care about that. Senator O'MAHONEY. May I interrupt, off the record? (Discussion off the record.) 831 Senator KEFAUVER. Well, Mr. Boone Mr. BOONE. I had not completed that statement, Senator Kefauver. Senator KEFAUVER. All right. Mr. BOONE. Now, we do call attention to the fact-and I know Mr. Garrett would agree with me-that-well, I do not like to put words in Mr. Garrett's mouth. I just call attention to the fact that 87 percent of these billings were for engineering and construction service rendered in helping the clients carry forward major construction programs to meet rapidly expanding needs for electric power. Now, as to the exhibit itself, Senator, I take it Senator KEFAUVER. Mr. Boone, the amount that is listed for engineering and construction services is separated from the consulting and other technical services on the list. Mr. BOONE. That is correct, Senator. I do not want to draw any unfair inference whatever. Now, on the exhibit itself, I think I said all I need to say about the SEC hearings, and I made my position-I tried to the other day-clear. And I have nothing more to say as to whether this is proper to go in at this time. But I have made my observations, Senator, on this exhibit. Senator KEFAUVER. As I understand it, you do find that this is an accurate transposition of the information you have given in the public record to the SEC? Mr. BOONE. Senator, with what I said-and they are very minor yes. Senator KEFAUVER. All right. This will be Mr. BOONE. Do you want me to go into the other things you asked me for? Senator KEFAUVER. No; I want to make this a part of the record, with your explanation about it. (The document referred to may be found in the Appendix on p. 1127). Senator KEFAUVER. All right. Anything else, Mr. Boone? Mr. BOONE. Yes. You will recall, Senator, that I promised to make available to the committee the Bond & Share plan, the orders of the Commission, and the orders of the district court, sir. Senator KEFAUVER. Yes. All right. What would be the best order to put in the record the other things that we asked you for, Mr. Boone? Mr. BOONE. I think if Mr. Dixon will just follow them right down there he will see just briefly. Or I am willing to say myself if you want me to. Senator KEFAUVER. The final comprehensive plan of Electric Bond & Share Co.; the findings and opinion of the Commission approving the plan under section 11 (e). Is that correct? Mr. BOONE. Yes. Senator KEFAUVER. And the order of the United States District Court for the Southern District of New York in the matter of Electric Bond & Share, civil action Mr. BOONE. I suggest Mr. Dixon check that date because there are two orders. |