United States District Court, D. New Jersey
OPINION AND ORDER
B. CLARK, III UNITED STATES MAGISTRATE JUDGE
MATTER comes before the Court on a motion by
Third-Party and Crossclaim Defendant and Counterclaim
Plaintiff Consolidated Edison Company of New York, Inc.
(“Con Edison”) for the entry of a protective
order preventing Defendants and Third-Party Plaintiffs
Newport Associates and Development Company and Newport
Associates Phase I Developers Limited Partnership
(collectively “Newport”) from obtaining certain
discovery [Dkt. No. 145]. Newport opposes Con Edison's
motion [Dkt. No. 157]. For the reasons set forth below, Con
Edison's motion for a protective order is GRANTED
in part and DENIED in part.
Edison delivers electricity to approximately nine million
people throughout a 604-square mile service area in New York.
Dkt. No. 145-5, Declaration of Vernon Schaefer at ¶ 3.
This electricity is transmitted and distributed, in part,
through approximately 95, 000 miles of underground cable.
Id. There are two main types of cables that are
insulated and cooled with a non-toxic synthetic oil called
dielectric fluid. Id. at ¶ 6. The first type of
cable is a “self-contained, fluid filled feeder”
in which the fluid is self-contained within the feeder cable
and is cooled by heat transfer to the surrounding
environment. Id. The second type is a
“high-pressure, fluid filled feeder”
(“HPFF”) which is highly pressurized and can be
cooled with circulation through the pipe via an external
cooling plant. Id. Con Edison owns 209 HPFF feeders
that collectively span approximately 576 miles and
collectively contain more than 8 million gallons of
dielectric fluid. Id. at ¶ 6.
issue in this matter is a pair of high-voltage transmission
feeders known as the B3402 (the “B Line”) and the
C3403 (the “C Line”) (collectively “the
Cables”). Id. at ¶ 8. Plaintiff Public
Service Electric and Gas Company (“PSE&G”)
and Con Edison (collectively “the Utilities”)
jointly own and operate the Cables. Id. at ¶ 9.
The Cables, which are each approximately 7 miles long,
connect Con Edison's Farragut substation in Brooklyn, New
York to PSE&G's Hudson and Marion switchyards in New
Jersey. Id. Beginning in New Jersey, the
Cables run underground in PSE&G's service area from
the Hudson and Marion switchyards east to the Jersey City
waterfront at the Newport Marina, then continue east, buried
directly in the riverbed, across the Hudson River to
Manhattan. Id. at ¶ 11. Next, the Cables run
underground across Manhattan to the East River, then continue
east through a utility tunnel that crosses under the East
River into Brooklyn where they again run underground and
extend to the Farragut substation. Id.
Utilities were each responsible for constructing and
maintaining the sections of the Cables in their respective
service areas. Id. at ¶ 12. However, Con Edison
was responsible for constructing the entire section of the
Cables running underwater across the Hudson River (“the
Hudson River Section”). Id. The steel pipes
for the Cables were installed by Con Edison in a fifteen-foot
deep trench dredged beneath the Hudson River in 1972.
Id. at ¶¶ 13-14. The B Line was put into
service in 1972 and the C Line was put into service in 1982.
Id. at ¶ 13. The Hudson River Section is
approximately 1 mile in length and extends from the Newport
Marina in Jersey City to Pier 25 in Manhattan. Id.
at ¶ 14. The sections of pipe which house the Cables as
they cross the Hudson River Section in a S-shaped path are
coated externally with coal tar wrap, encased in a
one-inch-thick cement jacket, and joined by welded couplers.
Id. at ¶ 15.
the Cables also cross the East River (“the East River
Section”), the design and construction of the Hudson
River Section differs significantly from that of the East
River Section. Id. at ¶ 20. Rather than being
buried in the riverbed, when the Cables cross the East River
Section, they pass through a utility tunnel that existed at
the time the Cables were installed. Id. Because the
pipes in the East River Section run through the utility
tunnel, they are constructed and maintained differently than
those in the Hudson River Section, which are exposed to a
marine environment. Id. at ¶ 20-21.
owns the land in and around the Newport Marina in Jersey
City, including the Sixth Street Pier (“the
Pier”), and the underwater lands adjacent to the Pier.
The Cables pass over Newport's portion of the riverbed.
On January 1, 1987, Newport and PSE&G entered into an
easement agreement (“the Easement”). The Easement
runs parallel to the Pier and is approximately 30 feet wide.
October 3, 2016, a leak of dielectric fluid into the Hudson
River by the Newport Marina was discovered. PSE&G and Con
Edison dispatched structural engineers, electrical engineers,
and divers to the Newport Marina to investigate and repair
the leak and clean the site. In mid-October 2016, divers
discovered “enormous concrete segments, rip-rap, and
other debris (including boulders, brick, and asphalt) resting
on the riverbed within PSE&G's 30 foot-wide Easement
area.” Dkt. No. 40, PSE&G Amended Complaint at
¶ 6. According to PSE&G, the debris discovered by
the divers on the riverbed resulted from prior collapses of
the Pier, which was “crumbling and dangerous.”
Id. at ¶¶ 1-2. On November 1, 2016,
Newport informed the Utilities that it would not permit
further work to investigate and repair the leak on the Pier
or in the marina basin until engineers could agree to a pier
stabilization plan. Id. at ¶ 26. On November 4,
2017, the United States Army Corp of Engineers issued a
letter to Newport stating that it had been notified by the
United States Coast Guard that portions of the Pier had
eroded, which could result in further debris being discharged
into the river, and ordering Newport to immediately carry out
the removal of the debris and rehabilitate the stability of
the Pier. Id. at ¶ 39. On November 10, 2016,
the Coast Guard issued an order directing PSE&G to
“utilize all necessary resources to locate and secure
the source of the discharge, ” stop the leak, remove
the fluid, and monitor the spill. Id. at Ex. 10.
November 17, 2016, the Coast Guard issued an order to Newport
directing it to “remove submerged debris on top of, and
in the vicinity of, the [E]asement and adjacent pier
structure to facilitate locating and securing the source of
the discharge.” Id. at Ex. 11. In late
November, Newport submitted its proposed plans to
“shore up” the Pier to Unified
Command. Id. at ¶ 44. Although
Newport's initial stabilization plan was rejected due to
concerns that Newport's proposed stabilization method
would not allow for the removal of enough debris to allow
access to the Cables, the parties eventually reached an
agreement on a stabilization plan, and on March 21, 2017, the
Cables were de-energized to permit Newport's contractors
to begin to clear a portion of the Easement area. Dkt. No.
101, Con Edison Amended Counterclaims at ¶ 19.
May 2017, following Newport's partial clearing of the
Easement area, the Cables were re-energized and the leak
search and repair efforts were reinitiated. Id. at
¶ 22. The Cables were “systematically uncovered in
the riverbed and exposed in 10-foot sections, and divers
inspected each section looking for visual evidence of
dielectric fluid emanating from [the Cables] or other
damage.” Id. at ¶ 23. The divers were
unable to see any visual evidence of the leak and therefore
unable to discover its location or source. Id. at
¶ 24. Between July 12 and July 17, 2017, the Cables were
again de-energized and further tests were performed.
Id. Based on the results of the tests, the B Line
was identified as the likely source of the leak. Id.
No problems with the C Line were identified. Id. On
or about July 19, 2017, divers located the leak in the B
Line. Id. at ¶ 25. The leak was located in a
section of the B Line owned and operated by PSE&G in the
Easement area in the Newport Marina. Id. On August
13, 2017, a permanent clamp was placed on the B Line to
prevent any further leakage. Id. On or about January
11, 2018, PSE&G notified Con Edison that it intended to
unilaterally retire the B Line and C Line. Id. at
¶ 28. Both the B Line and C Line have been out of
service since mid-January 2018, and despite Con Edison's
wishes to the contrary, PSE&G has not re-energized the
Cables. Id. at ¶¶ 32-34.
Utilities maintain that the leak was caused by Newport's
failure to properly maintain the Pier. This failure, the
Utilities allege, has resulted in “at least two
catastrophic partial collapses” of the Pier in 2008 and
2009 and “caused over two hundred tons of concrete
slabs and other debris to fall” onto the Cables. Dkt.
No. 158, Con Edison Counterclaim at ¶ 3. The Utilities
further claim that Newport improperly failed to disclose the
“decrepit state” of the Pier which obstructed the
Utilities' efforts to respond to the Spill, prolonging
the discovery and repair of the leak, and resulting in an
increased cost to the Utilities. Id.
Newport claims that the leak was caused by the Cables'
flawed design and the Utilities' “reckless”
failure to maintain, repair, and protect the Cables since
their installation. Dkt. No. 98, Newport Counterclaim and
Third-Party Complaint at ¶ 3. Specifically, Newport
alleges that the leak was caused by a welding flaw, known as
a lack-of-fusion defect. Id. at ¶ 46. The
allegedly defective weld is located on an irregularly-spaced
coupler. Id. at ¶ 47. According to Newport,
when the pipes for the Cables were installed, pairs of
20-foot segments of pipe were welded together to form 40-foot
segments, and as a result, the pipes have regularly-spaced
welds every 20 feet. Id. The defective weld,
however, is one of three irregularly-spaced couplers, which
were not included in the written plans for the Cables and
appear to have been installed after a piece of pipe was
“cut out” and replaced. Id. at
¶¶ 47-48. In addition to the irregularly-spaced
coupler, Newport alleges that the Cables have inadequate
pressure sensors which can only identify
“extraordinarily large” leaks and claims that the
Utilities failed to consistently install the 6-foot
protective layer of crushed stone as required by the permits
allowing for the construction and installation of the Cables.
Id. at ¶¶ 28-29. As to the maintenance of
the Cables, Newport claims the Cables have
“significantly deteriorated” and that the
Utilities have failed to properly carry out any regular
maintenance or repairs. Id. at ¶¶ 38, 42.
Edison filed the present motion in response to what it claims
are “wildly disproportionate” and irrelevant
discovery requests served by Newport. Dkt. No. 145 at p. 1.
Newport opposes Con Edison's motion and contends the
“targeted discovery” it seeks is “highly
relevant” to determining the cause of the leak. Dkt.
No. 157 at p. 1.
Rule of Civil Procedure 26 governs the scope of discovery in
federal litigation and provides that:
Parties may obtain discovery regarding any nonprivileged
matter that is relevant to any party's claim or defense
and proportional to the needs of the case, considering the
importance of the issues at stake in the action, the amount
in controversy, the parties' relative access to relevant
information, the parties' resources, the importance of
the discovery in resolving the issues, and whether the burden
or expense of the proposed discovery outweighs its ...