IN THE UNITED STATES COURT OF FEDERAL CLAIMS
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_x
NORTHROP GRUMMAN :
CORPORATION, :
Plaintiff, : No. 97\_359C
v. : (Judge Hodges)
THE UNITED STATES, :
Defendant. :
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Washington, D.C.
Tuesday, June 16, 1998
DEPOSITION OF:
DANIEL GOLDIN,
a witness, called for examination by counsel for the
Plaintiff, pursuant to notice and agreement of
counsel, in the offices of NASA, 300 E Street,
Southwest, Washington, D.C. 20546, beginning at
approximately 2:00 p.m., before WILLIAM J. ALLEN, a
Notary Public in and for the District of Columbia,
when were present on behalf of the respective
parties:
APPEARANCES OF COUNSEL:
For the Plaintiff:
Feith & Zell, P.C.
BY: J. WILLIAM ESHELMAN, ESQUIRE
GEORGE MIRON, ESQUIRE
J. MICHAEL LITTLEJOHN, ESQUIRE
2300 M Street, Northwest
Suite 600
Washington, D.C.
(202) 293-1600
For the Defendant:
Department of Justice
BY: SHALOM BRILLIANT, ESQUIRE
Commercial Litigation Branch
Civil Division
1100 L Street, Northwest
Seventh Floor
Washington, D.C. 20530
APPEARANCES (continued)
National Aeronautics and Space Administration:
BY: DAVID GAYLE, ESQUIRE
EDWARD A. FRANKLE, ESQUIRE
300 E Street, Southwest
Washington, D.C. 20546
(202) 358-2074
Also Present:
Charles E. Taylor
Michael A. Tomasulo
Martin C. Blyseth
I N D E X
THE WITNESS: EXAMINATION BY:
Daniel Goldin Mr. Eshelman, 5
E X H I B I T S
DEPOSITION EXHIBIT NUMBER: IDENTIFIED ON PAGE:
90 6
91 6
92 9
22 53
24 59
28 68
23 107
93 120
94 123
EXHIBITS ANNEXED TO COURT COPY OF THIS DEPOSITION
TRANSCRIPT.
P R O C E E D I N G S
Whereupon,
DANIEL GOLDIN,
a witness, called for examination, having been first
duly sworn, was examined and testified as follows:
EXAMINATION BY COUNSEL
FOR THE PLAINTIFF
BY MR. ESHELMAN:
|
Q. Good morning, Mr. Goldin. First of all I am Bill Eshelman, I'm with the lawfirm of Feith & Zell, we represent Northrop Grumman in this matter, the successor to Grumman Space Station Integration System. I would like to thank for taking the time out of your schedule to see us today. I understand you have had your deposition taken before, so I will skip the preliminaries. I asked
MR. BRILLIANT to put a copy of your resume in the record. Do you have such a copy?
MR. BRILLIANT: We have this.
MR. ESHELMAN: We will enter this as Exhibit 90. And we will skip the preliminary questions. And the reason that is Exhibit 90 is that in this matter we have been just been numbering the exhibits seriatim. (Exhibit No. 90 marked for identification.)
BY MR. ESHELMAN:
Q. First I would like to ask you if you reviewed any documents before coming here today?
A. A few.
Q. What did you review?
A. The document you wrote.
Q. Which one?
A. I don't know the name of it.
Q. The Notice of Deposition.
BY MR. ESHELMAN: Let's mark that as Exhibit 91. (Exhibit No. 91 marked for identification.)
BY MR. ESHELMAN:
Q. Is that the document?
A. No. This is not the document.
Q. What was it, do you recall?
A. Something like this (pointing).
MR. BRILLIANT: Referring to the caption.
THE WITNESS: I don't know the title of the document. But it was not this document.
BY MR. ESHELMAN:
Q. Who gave it to you?
A. My counsel.
Q. MR. FRANKLE or Mr. Gayle?
A. It was faxed to me, so I don't know, I think it came from
MR. FRANKLE.
MR. ESHELMAN: For the record did you send it to him?
MR. FRANKLE: Yes, I did.
MR. ESHELMAN: What is it?
MR. FRANKLE: A proposed declaration.
BY MR. ESHELMAN:
Q. Anything else other than that?
A. The termination and finding.
Q. Anything else?
A. Then a memo that, or a letter Renso Caporali sent me, and I don't remember the date in response that I gave to him.
Q. Anything else?
A. There was one or two more, and I don't recollect the title -- oh, yes, the correspondence from the White House to me with regard to this matter. Then there is one other document that doesn't occur to me. I think there were four or five. Again, I can't remember the fifth document.
Q. The fifth or documents that you can't recall, will you supplement the record later by telling us later?
A. Yes.
MR. ESHELMAN: Would you note that, sir?
BY MR. ESHELMAN:
Q. You noticed the correspondence from the White House to us. Has that been provided by the government?
MR. BRILLIANT: I believe it has.
MR. ESHELMAN: Do you know the date? MR. GAYLE: June 24th.
BY MR. ESHELMAN:
Q. When were you provided the proposed declaration for your review?
A. Sunday.
Q. This Sunday?
A. Yes.
MR. ESHELMAN: I now show you a document I will be marked agency Exhibit 92. (Exhibit No. 92 marked for identification.)
BY MR. ESHELMAN:
Q. I ask you if that is the document that you reviewed Sunday or between now and Sunday?
A. I didn't review it, I just skimmed through it briefly.
Q. Would you take whatever measures you need reasonable to determine if that is in fact the document?
A. Yes, it is.
Q. I understand that you were an executive with TRW prior to coming as the NASA administrator?
A. Yes.
Q. And in that capacity you were a fairly senior executive, were you not?
A. Yes.
Q. And you drafted proposals for TRW on government programs?
A. A long long time ago, yes.
Q. Were you involved in the proposal for the support services contract that ultimately became the SSEIC contract?
A. I didn't write that proposal, but it was lower down in my organization.
Q. It was in your organization?
A. Yes.
Q. My understanding is that you have a reputation as a, "Can do" manager, and at the time you came to NASA, Space Station Program was in deep trouble; is that correct?
A. NASA had very significant problems.
Q. With the Space Station?
A. The Space Station was one of multiplicity problems that NASA had.
Q. At that time, when was that?
A. April 1, 1992.
Q. What page of the NASA budget was represented, if you recall, at that time of the station program?
A. Somewhere in the order of the 7th.
Q. The 7th. And did it grow?
A. I don't remember the exact numbers. It was about two and a half billion a year. It was projected to grow. And my recollection it was to grow to about 3 and a half billion a year.
Q. And when you say a 7th of the budget is that the procurement budget or the overall budget?
A. The overall, I took about 14 or 15 and divided by two and a half and came up with a 7th.
Q. It is a big program though, without a doubt?
A. Yes.
Q. And it was in deep trouble. How many ways was it in trouble when you got here?
A. I don't know how to describe that. Too general a question.
Q. Start at the beginning. You have described cost growth. That was a problem?
A. I will put it to you this way. It went for eight years. They spent about $10 billion and not one piece of hardware was built.
Q. Eight years before you came?
A. You bet you.
Q. And it was projected to go out to 2001?
A. I don't remember at that point in time. What I do remember is it didn't have any one responsible in the contractor domain or in the government. It had loads of broken promises. In some elements it didn't work. When one analyzed them, some of the systems didn't work.
Q. Discrete systems, programmatic systems?
A. Discrete and hardware systems and software systems.
Q. Accountability. You indicated no one was responsible?
A. There was not clear lines of responsibility and accountability.
Q. What was the situation in Congress at this time with regard to this program?
MR. BRILLIANT: I object as vague. But go ahead.
THE WITNESS: Could you be a little more specific?
BY MR. ESHELMAN:
Q. Was the program going to be funded easily in the future going forward?
A. I will provide context. The Space Station had had serious trouble with the Congress before I got here for a number of years. And the Space Station has had major, I don't know how many votes on it each year since that time. It is a very tough program.
Q. You analyzed the problems with this program upon your arrival, correct?
A. When I arrived at NASA I did a tops down assessment of how this agency was performing overall. I don't have the personal capacity or the multi billion dollar agency in many many programs to personally analyze each and every thing.
Q. But the program, the Space Station Program was --
A. And what I found, we had an agency across all programs with a 77 percent cost growth.
Q. And --
A. That was a cost growth of the programs.
Q. Was that an annual cost growth?
A. No, the projected cost growth of the program.
Q. Soup to nuts?
A. Yes. That was disturbing because it said the agency didn't do what it said it was going to do, and that was the most disconcerting factor to me. And there were many programs that fell into that category.
Q. Where was the Space Station program in that --
A. It was among the programs that had problems because they started at $8 billion, and by the time I got here it was projected to be in excess of $35 billion.
Q. In total?
A. Development.
Q. And would that put the vehicle in orbit?
A. That is development, yes.
Q. And that was only the procurement budget. It didn't include things like the shuttle budget to get it there?
A. It was the Space Station budget.
Q. Did there come a time when you made a decision as to what action should be taken?
A. I don't make all decisions. I asked for an advisory panel of preeminent Americans to review it.
Q. That was on just this program or on all programs?
A. In this case, on this program, on the Space Station. I had a whole series of panels looking at a variety of things, at the planet earth, people looking at the space science program. I had a variety of studies that were commissioned. And there was a panel that was asked, the advisory committee on the Space Station. And I asked them to review it.
Q. And this panel was chaired by who?
A. Brad Parkinson, Dr. Parkinson is my recollection from Stanford. I will have to check that.
Q. Is that the Vest?
A. Oh, yes, Chuck Vest, Dr. Vest, yes.
Q. I believe you had selected several very, very top level people to work at this, and Vest was the last, correct? On this panel?
A. I don't remember the sequence of events.
Q. As a matter of fact, it was Vest who gave you the desired result?
A. There was not any desired result. He was asked to review the Space Station program and make recommendations.
Q. He made recommendations?
A. Yes.
Q. What did you do with those recommendations?
A. I have to go back.
Q. Just to the best of your recollection.
A. I believe he also reported to the vice-president, and I have a little confusion in my mind about the lines of authority of the Vest panel. And I just don't -- there was some relationship to the vice-president and the White House, and I don't remember the exact reporting chains. Because I do know the information came to me and the information went to the White House.
Q. And did it go to Dr. Gibbons at the White House?
A. I believe so, yes.
Q. Did you have to coordinate whatever action you ultimately took with the White House?
A. I was given directions by the White House in response to the Vest panel.
Q. Would those directions be from Dr. Gibbons?
A. Yes. And I also believe I got directions from the President too.
Q. At this time we are talking about the Clinton or Bush administration?
A. Clinton.
Q. This would place it in 1993?
A. Yes. My recollection is sometime late spring early summer of '93.
Q. Did you take any action or initiate any action with regard to Space Station prior to receiving these recommendations?
A. I don't recollect any other than to make sure that there was a process in place with some integrity.
Q. Do you recall the recommendations that the Vest panel made?
A. I can go through some of them.
Q. Let's do that.
A. Eliminate layers of management. Select a single prime contractor. Select a single NASA center to be the lead. Get more efficient. Reduce civil service and contractor head count.
Q. With regard to the single center recommendation, was there any concern expressed about going to a single center on major program after the Challenger incident by your staff or the committee?
A. The committee recommendation was very clear, very clear. In fact the recommendations from all involved were very clear about going to the single center.
Q. Was there ever -- did anyone express a concern based on the implication that a single center in the Challenger incident?
A. I don't understand the relevance.
Q. The Vest Committee that would be the spring of '92 they gave you these recommendations?
A. I would assume about spring. I can't remember when they started them.
MR. BRILLIANT: Did you say '92 or '93?
BY MR. ESHELMAN: I misspoke. 1993.
THE WITNESS: It was probably spring of '93.
BY MR. ESHELMAN:
Q. So what did you do next with the these recommendations on this program?
A. I set up -- I asked that a process be set up.
Q. Who did you ask?
A. Inside NASA
Q. Who did you ask?
A. To deal these recommendations and make specific proposals on how we ought to proceed.
Q. Was redesign one of those recommendations?
A. I am trying -- I don't remember whether the redesign was completed at that point in time or was going on at that point in time, I just don't remember.
Q. Did you initiate the redesign?
A. I think the redesign was initiated at the request of the White House in the spring of '92 or no, late winter of '93.
Q. So that would be Dr. Gibbons then?
A. Yes.
Q. And this process that you initiated based on the recommendations --
A. It was initiated at the request of the White House.
Q. You may have administratively --
A. No, I just want to be clear in the communication. I didn't initiate it, it was initiated at the request of the White House.
Q. And it became the SRT, shuttle redesign team. Is that the process you are referring to?
A. A team was put in place to redesign the space station.
Q. Who was in charge of that?
A. I am not sure I remember who.
Q. Was Bryan O'Conner in charge of it at this point?
A. I think so. That is about six or seven years ago, but I think so.
Q. Did you have staff dedicated to working that issue, that White House direction at that time?
A. I think a number of people on my staff were trying to be supportive and respond to it, yes.
Q. Did you have at least in the military what we called an action officer for this program?
A. Well, I think there was a leader of the Space Station redesign team, and then there were some specific tasks that got assigned to different people to do and support the redesign team.
Q. And they would be hard line responsibility to whoever was in charge of the redesign team?
A. I am also trying to remember -- there was another person involved and I can't remember who that was. I will think about it as --
Q. If you recall feel free because I am trying to work myself through this as well. You have an executive assistant, correct?
A. Yes.
Q. Did you have an executive assistant in 1992 '93 time period?
A. I had an executive assistant at all times since I have been here with the exception of overlap periods where there was an exchange of people.
Q. How long do you generally keep an executive assistant?
A. Anywhere between six months to two years.
Q. To your knowledge do you use executive assistants in a manner different or distinct from any other administrator?
A. I don't know what my predecessors did.
Q. How do you use an executive assistant?
A. They keep track of my schedule, the phone calls that come in, the correspondence I have to sign each day, the actions I have to take. They tell me in the morning where I have to go, and they generally travel with me when I travel, which is a lot. They are the communication center. They keep me in touch with people.
Q. They are the eyes and ears of the administrator basically?
A. Yes.
Q. Do they track or tickle the staff with projects they give the staff?
A. If there is an action item in certain circumstances if they are not back in time they will go find out where it is.
Q. Is there a formal tickler file you maintain they use?
A. No.
Q. Is it something that they maintain personally?
A. Each one has a different style. I am a delegator. I expect results. I don't care how they do it.
Q. Which is why they brought you in to fix this program, isn't it?
A. Why they brought me, I don't know. I am here. And they didn't bring me in to fix the space station program.
Q. And this was the agency?
A. Yes.
Q. And this was a big piece of the agency?
A. This was a piece.
Q. $3 billion a year is a nice budget?
MR. BRILLIANT: Is that a question?
MR. ESHELMAN: Yes.
BY MR. ESHELMAN:
Q. That is a pretty good sized program?
A. The Space Shuttle program is bigger than the space station program. The earth science program is a very large program, very important program. The space science program is a very large important program. The aeronautics is a very large important program. So I can't discriminate. That Space Station is more important than anything else.
Q. It is just a good sized program and it does relate to the others, doesn't it?
A. It is a good sized program that relates to a number of other good sized programs in NASA
Q. In fact, the shuttle budget includes launches to get the Space Station in orbit, doesn't it?
A. The space shuttle includes launches for space science, earth science, for life science, micro gravity science and space station.
Q. And the Space Station itself was the laboratory for a lot of that science, isn't it?
A. It is not up there.
Q. When it gets there it will be though?
A. We have had 50 or 60 flights since I have been here. None of which delivered anything to the Space Station.
Q. I understand, but it will be a major laboratory for sciences?
A. For sciences. But it will be one of many laboratories.
Q. Well, we veered off a little bit and I want to come back. I am tracking toward what Judge Hodges wants to ask, but I think it is helpful to have the context.
A. That is fine.
Q. At the direction of the White House you initiated this process of implementing the recommendations of this committee, the Vest panel?
A. Yes.
Q. And did I understand you to say that that was, that was the entity that became the SRT, the shuttle redesign team?
A. I am confused by your choice of terms. I just want to, first you said shuttle redesign team.
Q. I meant space, I am sorry.
A. I think that the Space Station redesign was pretty much complete by the time the Vest panel made its recommendations. In terms of concept, in terms of modules. And that is why I am confused by your question.
Q. I appreciate the clarifications. Do you know how that redesign was initiated? Was that initiated before you came to the agency?
A. No. Again, the redesign was initiated at the request of the White House, because they were concerned that the fiscal year budget which they were preparing at the time for fiscal '94 -- you do '94 in '93 -- that there was significant budget cuts for NAS
A. And to address those budget cuts they wanted to see a significant reduction in the cost of the Space Station, and they wanted it -- in fact they wanted it to do more for less. And they wanted it to be more efficient. That is what kicked off the redesign of the Space Station, to meet a budget constraint that NASA had.
Q. And that was initiated then by Dr. Gibbons?
A. I don't remember who that correspondence was from.
Q. But it was out of his office or the office he eventually occupied?
A. I don't know.
Q. How did that come together with the SRT? Where did the SRT fit in?
A. The Space Station redesign team was a response to the request to redesign the Space Station. Then the Space Station redesign team went into place, and it was in parallel with the on going space station activities: And then when the recommendations all came together, the two got integrated and it became the international space station project, and it is the timing I don't remember. But the thought was to have a parallel team here looking at the redesign to meet the needs of the budget constraints for NASA. And at the same time we had gone through studies of cutting the budgets of the other areas too, earth science was cut and it was not -- it was restructured. So there were a number of things going on in parallel. But it was felt that it would be disruptive to the ongoing efforts so this would go on and when a decision was made there were a number of options and the President selected the options, I didn't. It was felt that when the directions came and decisions were made, the redesign team would be -- the recommendations of the redesign team would be merged into the basic program and the basic program would proceed. And that's why I was confused by your question.
Q. What was the extent of the budget cuts that the agency was attempting to respond to at this point?
A. Very large, very large. I think the agency was looking at an overall budget cut on the order of 20 percent.
Q. And how much was allocated to the station?
A. I don't remember that. But I do know the budget was supposed to come down, not go up. And my recollection the Space Station was two and a half billion a year going to three and a half billion a year, so it caused some monumental things that had to change with the Space Station.
Q. So you were out of phase significantly?
A. And I remember a directive we had that we would only have $2.1 billion a year flat, not like a normal development regular program. So that was a very tough cut.
Q. And was that an OMB directed driven program?
A. I don't remember.
Q. Who did the congressional liaison on that budget if you recall. Was it NASA itself or did the White House run it?
A. I don't understand what you mean.
Q. When you went to pitch a budget or when the agency pitched a budget during the '93 time frame for fiscal '94, were you making your pitch at OMB or on the Hill?
A. It depends. Anything pertaining to the fiscal '94 budget is embargoed by the administration. I mean this is standard operating policy until the president announces his budget, usually the end of the first year of the new month.
Q. New calendar year?
A. Right. So details of the budget are usually not shared. There are things that are shared with the Congress, and those things allowed to share with the Congress, I went up to the Hill and briefed the members on the Hill or my staff briefed them.
Q. But always with White House coordination?
A. Again, I don't know what you mean by coordination.
Q. I mean did you tell the White House when to go to the Hill to brief?
A. As I delegated to my subordinates, the White House delegated to me. There were a given set of rules that were agreed to. So long as we lived within those rules we didn't have to constantly communicate with them. And occasionally the White House directly briefed the Hill too. And occasionally we briefed the Hill together.
Q. And who was principally in charge of driving that process? Was it you or was it the opposite sides of that knowledge, outside the House, OMB?
A. I would say the line shares of the briefings were carried out by NASA
Q. Among the recommendation that you listed earlier, you list -- I am interested -- you mentioned the layers in the program. And I am referring to the Space Station program. And you also mentioned single prime?
A. Yes.
Q. I wanted to take those one at a time. First is the layers. What was the issue with the layers in that program at that time?
A. Very simply put we had an oxymoron. We had four prime contractors and four lead centers. Actually it was three prime contractors, three lead centers, we had an integrating support contractor, we had some organization with the integrating support contractor, we had a program office in Washington, and no one seemed to have authority to do anything.
Q. The program office was Reston?
A. No, the program office was Washington NASA headquarters.
Q. That was Level 1?
A. Oh, God, I was afraid you would ask that. I don't remember what Level 1, 2 and 3 is.
Q. What was Reston?
A. Reston was the integrating support contract.
Q. When you say you had three prime contractors, you are referring to hardware?
A. There were three prime contractors. There was a contractor at Houston, McDonald Douglas, and they built a whole bunch of things. There was a contractor Boeing at Huntsville, and they built a variety of things,. And there was a third contractor, Rocket Dyne. And who did they report to.
Q. Lewis?
A. Lewis, correct. And they all built hardware for each other. It is not as though they built, one built a pitcher and one built a glass, and one poured the water in the pitcher. It was almost impossible to figure out who was doing what. There were unbelievable numbers of meetings and there was layer upon layer of interaction. That is why we went for eight years and didn't get any hardware built.
Q. So the single prime would address this how?
A. And the government was performing the integration role, no one was responsible for the integrated Space Station except for the U.S. Government. So no responsibility or accountability on the part of any contractor. The objective was to get a single prime contractor, and it was to be a single prime contractor to be totally responsible for the analytical and physical integration of the hardware and responsible for following that hardware through, even in orbit. That is my recollection.
Q. As opposed to the government bearing that responsibility?
A. Yes.
Q. And in effect then that single prime would take over the function that NASA technically had at the time you took over this agency?
A. To a degree. But there were no clean relationships. I wish I could tell you it was that clean. There were no clean relationships anywhere in the organization. I could not get a clean response from my team looking into this as to who was responsible for what.
Q. So after this recommendation came for a single prime, what did you do?
A. Well, we got a series of recommendations. It was not a single prime. It was a series of five or six or seven recommendations, and I asked the team to take a look at it and make a recommendation on how to follow the instructions we got from the White House.
Q. And when did you do that? Was it after the Vest Committee's recommendations?
A. The Vest committee recommendations were vetted and it was after that I recollect we got our direction through the White House.
Q. Which would put it sometime in the spring of '93?
A. I presume so.
Q. The date of the Vest committee I don't have.
A. Neither do I.
Q. Let me see if I have a document that responds to that.
BY MR. ESHELMAN:
Q. While he is looking at that to put it in context, you asked -- you had it vetted. Was that by your staff?
A. Yes.
Q. Do you recall who did that?
A. Oh, hold it. No. It was reviewed by a number of people. Some inside NASA, some in the administration. I keep saying White House, I should say administration. And some outside review called in to look at it too.
Q. But the office of science and technology would be the focal point for the administration, would it not, other than NASA?
A. But it is not just limited to the office of science and technology policy.
Q. Who else would, in the administration would have a piece of that?
A. There are a whole variety of people involved. But organizations is not people, OMB certainly reviewed it. There were different staff people from different departments in the administration that reviewed it, and I recollect a number of outside reviews were requested.
Q. By whom?
A. By the administration to take a look at it too.
Q. Just for your information, I am told the final report of the Vest Committee was June 10, 1993. So if that is the case, then this would be the point, June of '93 when you initiated this vetting process?
A. I didn't initiate the vetting process. The process was initiated in a number of areas within NASA. I asked it be reviewed. But it was also reviewed inside the administration.
Q. I should have said y'all? What fell out the other end of that?
A. A set of recommendations. And again I don't remember all of them. There was a process on how to proceed.
Q. Who did you give the authority to do this vetting to?
A. I don't remember.
Q. Or responsibility?
A. I don't remember.
Q. Would it have been Bryan O'Conner?
A. It could have been, but I don't know.
Q. Anyone at the SRT? Does that help?
A. No.
Q. George Abbey?
A. I know he was involved. I don't know who let it, but certainly George Abbey was involved.
Q. At this time what was his position?
A. I don't know his title. But he sat in the office right next to me. I don't know that he had a title.
Q. What did he do?
A. He was an adviser to me.
Q. With regard to the Space Station program?
A. With regard to NASA
Q. Did you give him any tasks with regard to the Space Station program?
A. I think he may have been the chief of staff, but I don't know if we ever called him that. I don't remember.
Q. Jack Daily?
A. Jack Daily was the ADA, the assistant deputy administrator.
Q. And his primary function was what?
A. The NASA institution. And I believe at this time he was also the acting deputy administrator.
Q. And would he be the person to coordinate the press?
A. The press?
Q. The press. The public affairs, would that come under his responsibility -- you said the institution, I thought maybe PA would be under that.
A. He broadly went over the whole institution, all the different centers making sure all the systems were functioning. And I am sure he worked with the associate administrator for public affairs.
Q. Who was that?
A. You are straining me to think.
Q. Jeff Lawrence?
A. No.
Q. What was Jeffrey Lawrence's position?
A. He was associate Administrator for legislative affairs. In June of '93, I don't know who was here at the time. But later on it was Laurie Boeder. I don't know who it was. It might have been someone acting at that time.
Q. I want to go to the implementation of the recommendations. You had the recommendations vetted and I frankly don't recall what you said dropped out at the other end of that proposition. Could you --
A. I don't know I said anything.
Q. Okay, what happened?
A. I had a set recommendations process on how to proceed. And as I recollect there was a team to be formed to take a look at making recommendations on how we saw that prime contractor, how we select a single center, how we put into effect the other recommendations, and I think one of the results was a recommendation that we go with the determination and finding. I think that is what it is called, and that we put a specific team in place to look at all the possibilities and make a specific set of recommendations to me, on making those decisions.
Q. Do you remember who it was involved in that process?
A. No.
Q. At all?
A. No, sir.
Q. Given the June date, June of '93 date for the Vest report, all this occurred after the June date; is that correct?
A. I believe so. I can't pick up specific dates at this time.
Q. Did anything occur to implement, even similar recommendations prior to the Vest recommendations?
A. I don't recollect that.
Q. As you described the recommendation to go with the D&F as you put it, why would -- do you know why that recommendation was made? Did they give a rationale for that?
A. Again, going back a little bit, I think the object was if we went with full and open competition, it would take a long time. The prime players in the full and open competition would probably be the companies involved in building Space Station. And that it seemed that would not be a situation that was in the best interest of the taxpayers.
Q. Why not? I don't want to get into the area -- was that your thought that it would not be in the best interest?
A. You asked me the question, what was the recommendation? I am answering the question what the recommendation was.
Q. I understand that. Now my question goes to at that time was that also your thought?
A. At some point in time. After it was presented and before the announcement was made I agreed with it.
Q. After it was -- after what?
A. After it was presented, the recommendation was presented to me.
Q. Oh, the recommendation?
A. I took some time to think about it.
Q. And you came to the conclusion?
A. That I agreed with the recommendations.
Q. Did you undertake to implement the recommendation?
A. Yes. As I pointed out there were a team of people who went off and made recommendations on the specifics of implementing it.
Q. And was that Bryan O'Conner's team?
A. I think so. But I can't be sure.
Q. When you say specifics --
A. To select who would be the single prime contractor. What would be the single NASA center.
Q. So it would be the specifics or the process?
A. Yes.
Q. And do you recall when they came back with that?
A. I would just guess about a month later.
Q. Now, you had said -- you made a reference to the existence of contractors.
A. Maybe a couple of months later. Sometime in the summer. I don't know when, but sometime in the summer.
Q. You had indicated -- you made a reference to the existing contract, so I want to go back to that for a moment. I may have misheard you, I am not trying to spin this. You had, you said competition among the existing contractors.
A. There would be, other contractors might have bid, but we certainly would have expected the existing contractors.
Q. In an open competition?
A. Yes, to bid.
Q. But as I understand what you said, the competition would be somewhat limited, correct?
A. No, I did not say that.
Q. You did not?
A. I did not say that.
Q. Under the D&F?
A. No, No, not under the D&F. I said there was a choice of having an open competition or a D&F.
Q. I am talking about the D&F. I may have misunderstood, but didn't you contemplate competition even under the D&F of some sort?
A. I don't know what you are getting at. D&F, the government makes it just a determination, a sole determination.
Q. And what was to be done with the Freedom contractors, the Space Station program existing contractors, in this process?
A. The team was going to take a look at the four contractors and see which contractor in their mind, would have the best possibility of carrying out the contract in the most efficient manner, the prime contractor.
Q. And did the team take such a look?
A. Yes.
Q. And what was the result?
A. Their recommendation as I recollect it, and that is happening, is Boeing as a prime contractor and NASA/Johnson as the center, designated center.
Q. And they established a uniform criteria for evaluation of contractors?
A. I don't know that they did that, they just took a look and made an assessment with the best information they had and they made a recommendation to me.
Q. And you made the decision?
A. They made the recommendation and then I concurred with their recommendation.
Q. So you personally made the decision in effect?
A. I concurred with their recommendation, yes.
Q. And do you recall when you did that?
A. No. It was the summer of '93.
Q. I want to direct your attention now to July of 1993. That is the period just after the Vest committees's recommendation and before the selection of the single prime contractor. During that period the Space Station program was continuing, was it not?
A. Yes. Because there were a lot of people doing a lot of things, and it was felt again this parallel approach ought to be kept in place until we knew what the outcome was, and then merge it.
Q. Was it at that time did you feel as though the accomplishments of the Space Station program that were proceeding in parallel with these decisions and process would be useful to the ultimate program or be wasted?
A. The up side was that clearly some of it would be useful and some of it would not. The down side was that some would not, but the greater portion would be useful.
Q. You said earlier the redesign concept had been completed previously.
A. What I said, my recollection is the conceptual part of the redesign process was completed and the main goal of the redesign was to select one of three configurations, and I don't remember which was which, configuration A, configuration B, configuration C. So it was a conceptual construct, and then the details of all those things had to be worked out.
Q. Ultimately it did become Alpha, the A selection, correct?
A. It was not C. Because C was a radical redesign. A was closest to Space Station Freedom and B was a bit farther way. So I think it was A.
Q. So then the largest -- of the three it would appear that whatever work had been done on the Freedom aspect of the program would be useful.
A. Some of it. Not all of it. Certainly not the way it was being managed.
Q. Certainly on those elements that were common?
A. Specific elements. But there was a recognition that there would be breakage. But given pluses and minuses, even though breakages, it was felt going this route would be certainly more prudent with the taxpayers money than stopping, going for a year, and then ramping it back up. It was recognition of breakage, but it certainly would be much less than stopping and starting again.
Q. When you say breakage, you are referring to the historical knowledge built up --
A. No, I am talking about working on things we would not have to work on. Having more people working on things than were necessary to be done. There were teams of people who sat in endless meetings talking to each other. That was one of the major problems of this program. They talked. They didn't work. They were at work, but they were not making accomplishments because there was such an incredible communication problem among the elements of that program.
Q. So is there any institutional knowledge worth saving at this point, June and July?
A. Some, not all. There were whole elements that were non functional, and other elements such as building pressure vessels that were very important and very functional.
Q. Let's get to the process that you have described of how we got to a single prime contractor. Would you describe the process that you followed getting up to --
A. Again, I would like to ask you not to say that I followed. I didn't personally follow. It is very important to make that distinction and you keep saying that and I keep having problems with it.
Q. Let's say NASA followed?
A. That is acceptable.
Q. And if I slip back into it I apologize in advance. But the process of NASA followed?
A. Again, I want to provide context. I'm the administrator of NASA, not the program manager of the station. And the whole line of questioning, the way the questions are being worded has me as the person running everything on the Space Station. And I just want for the record to be very clear that that was not my role.
Q. I understand that. You were, however, the central point of accountability for NASA, so that's why I tend to make that connection.
A. Well, so is the President of the United States. And so is the chairman of Northrop Grumman.
Q. The process that NASA followed, would you describe it for me, please?
A. I think the team took a look at the strengths and weaknesses, the experience of the various contractors to see who they felt had the best chance of meeting the goals set up for the redesign and restructuring of the program.
Q. Now, you had a meeting in July of '93 with the CEOs and the existing Space Station programs, do you recall the meeting?
A. I recollect the meeting, I have a difficult time recollecting the exact time. But I know it was the summer of '93.
Q. Was it a personal decision to call these CEOs or a NASA decision to call the CEOs?
A. I think that came out of the process recommendations that the team had made. That is my recollection.
Q. And was there a rationale attached to that recommendation?
A. Yes. And my recollection is this, that there had been discussions with lower level managers and executives of the companies, and the team felt that it would be important to have the chief executive officers of the companies in a room to understand the directions that we were going. And also to get a sense from them if they felt we were going in the right direction.
Q. Were there goals set for this meeting?
A. Could you be more specific? What do you mean by that.
Q. What did NASA hope to accomplish by the meeting?
A. It was the next step in a communication process because the communications were less than complete. Individual members from the corporations had different thoughts on how things ought to be. There was still the sense that there were four teams. There was still the sense that these four teams would continue to debate. And there was not a general consensus on the part of the team that looked at it that felt that, as a result they felt we should call in the CEOs and make sure everyone understood all of the things going on. And we had a sense of what they thought.
Q. At the time you called in the CEOs -- well, actually you did call the CEOs in personally?
A. I did make the calls to the CEOs.
Q. Did you have a staff officer work that up for you? Or did you do it yourself?
MR. BRILLIANT: Work that up? That is a vague --
BY MR. ESHELMAN:
Q. Work up the calls to the CEOs?
A. I generally get recommendations from my staff that is a rough road map that they ask me to follow. Sometimes I follow it and sometimes I don't. Sometimes I will have a full speech prepared and I will toss it out and speak extemporaneously. But I always ask my staff to prepare up a set of notes for me. So I don't think the circumstances were different than anything else.
MR. ESHELMAN: This is already marked as Exhibit 22. (Exhibit No. 22 marked for identification.)
BY MR. ESHELMAN:
Q. I show you an exhibit marked previously as Exhibit 22. And I ask you to take a moment to review it. And a after that review, tell me if this is the work up for this meeting?
A. I don't use the term work up.
Q. What term do you use?
A. I generally use the suggested talking points.
Q. That will work for me. Mr. Goldin, before looking at this, can you tell me when you last saw this document before today?
MR. BRILLIANT: I don't know his testimony was that he saw it before today.
BY MR. ESHELMAN:
Q. If you saw it?
A. I don't know if I looked at this one specifically.
Q. I recognize that is a copy --
A. This looks like the things we have been talking about, this looks like the things.
Q. Just for your information, the Bates numbers at the bottom indicate that it came from the government that was provided to us by the agency. Do these appear to be those forms?
MR. BRILLIANT: For the record, Exhibit 22 is several different documents.
THE WITNESS: Yes, there are a couple of documents here, and I don't even know what the documents behind are.
BY MR. ESHELMAN:
Q. This is the form provided by the government. Let's look at the last page, Bates number 2096. And then just above that 2095 is listed Invitees. 204 is talking points for Space Station?
A. That I recognize (pointing).
Q. That is page 2089?
A. That was the budget problem.
Q. So that is accurate, that document?
A. I don't know if it is accurate. I am saying the budget was cut. I don't know it was accurate. Oh, this is fiscal '95.
Q. Look at the last page. Note there is a handwritten note at the upper top right corner. Do you see that?
A. Yes.
Q. Would you please take a moment and read it?
A. I can't because it is cut off on my piece of paper here.
Q. It appears to say, "Dan, this discusses the novate, I think novation -- of our primes to be directed subcontractors. Please refer questions to us, and it appears to be Ed"?
A. I see it.
Q. Do you recall that note?
A. No.
Q. At all, you have no recollection?
A. No.
Q. Let's go over to 2095, which is the next one back. These are the four primes on the Space Station program?
A. Correct. And I recollect these are the four people I called.
Q. And did you call them from this list?
A. I don't know, but I recollect these are the four people I called.
Q. Let's look at 2094. This is a script you used for those calls, isn't it?
A. Let me again correct. I usually get talking points. Sometimes I follow, sometimes I don't. Sometimes I get scripts that sometimes I follow and sometimes I throw away. So these -- it says talking points for Space Station and CEOs.
Q. Do they fairly describe the substance of what you covered --
A. Let me read it. (Brief pause in the proceedings.)
THE WITNESS: I don't remember the details, but this looks like this could be some of the suggested talking points. It looks reasonable.
BY MR. ESHELMAN:
Q. Do you recall that meeting, the July 22nd meeting, the CEO meeting?
A. I remember we had a meeting here at NASA headquarters. I don't remember the date.
Q. With these four men?
A. There were other people there, and I don't remember who was with them.
Q. From NASA?
A. No, I think they came with one other person or two other people, and I don't know who they came with. I can't recollect. There were a lot of people in the room. There were some people from NASA in the room, and more than these four people, but I don't remember who they were.
Q. Was Mr. Blyseth from Grumman in the room, do you recall that?
A. No.
Q. Was your executive assistant with you then?
A. I don't remember.
Q. Bryan O'Conner was there?
A. I remember the four CEOs, I don't remember who else was in the room. I remember Ed Frankle was in the room. (Brief pause in proceedings).
THE WITNESS: And then I remembered that Ed Frankle was there.
BY MR. ESHELMAN:
Q. The four CEOs in attendance were Dr. Caporali from Grumman?
A. Yes .
Q. Well, they were the people listed here?
A. Yes, in 2095. I am certain those four people were there.
Q. Do you recall if Mr. King from Boeing was there?
A. I don't recollect that.
Q. And I believe you have already said you don't recall if Ms. Garman was there?
A. I don't recollect. Oh, that was my executive. Sue Garman.
Q. She was there?
A. I don't recollect. But she probably would have been there because she normally goes to meetings where I am, but I don't have a picture in my mind of her being in the room.
MR. ESHELMAN: I show you this already marked as Exhibit 24. (Exhibit No. 24 marked for identification.)
THE WITNESS: I just want to come back to this document to clarify.
BY MR. ESHELMAN:
Q. That is Exhibit 22?
A. Yes.
Q. We will get back to that.
A. Because I only recollect the first few pages here. Some of the other pages are things that I just don't recollect. It says talking papers, talking paper, and my sense is that the talking paper goes up to 2084. I don't know what the rest of this stuff is, I didn't look at it.
Q. Maybe this is as good a time as any to discuss the talking paper before we go to Exhibit 24. The first point bullet under station redesign team recommendations page 79, 2079, that is consistent with the process that was recommended by this group, correct?
A. Yes. I think this came in our directives.
Q. From where?
A. From the administration.
Q. Dr. Gibbons?
A. I believe so. I think it may have been.
Q. And then the next major head under Vest Committee is also consistent, isn't it?
A. Yes.
Q. And go to the next page.
A. Oh, yes, there it is.
Q. That is the White House direction that is consistent with what you were describing?
A. Yes. I don't remember all details, but I think that conveys the spirit of it.
Q. Now, up to this point, this page and a half here, do you recall whether you covered this with the CEOs at that meeting?
A. I don't remember details, but conceptually I think I talked about it. I have been trying to replay the videotape in my head, and it is just a hard time for me, but I think that these points probably would cover it, but I can't vouch for that.
Q. Let's go to the next major head and the subbullet Contractor Recommendations. That budget references contractor visits to the redesign team and the Vest visits to participating contractors?
A. Yes.
Q. And these are the expressions here. Did you cover these at the CEO meeting?
A. I don't remember this. But I won't deny that I could have.
Q. Are they accurate, do you think, based on your recollection of the time when you covered them, whether you covered them at that meeting or not?
MR. BRILLIANT: The question is a little vague and ambiguous.
BY MR. ESHELMAN:
Q. I think he can answer it.
A. I am having trouble with the first dashes here, the first item here A strong willingness to work together. There was stresses and strains at the time that I recollect, down in the organizations.
Q. You mean among the CEOs?
A. No, down in the organizations.
Q. What kind of stresses?
A. There was uncertainty on the part of some of the people.
Q. About what?
A. About what the outcome was going to be. The lower you go the more personal it becomes. And there was anxiety. And at some level I think there was a strong willingness to work together. But there was dissension among people involved, as in any large complicated activity. So as a blanket statement of the tens of thousands of people and all the contractors, all uniformly up and down signed up to this, I think that may be an over statement in the words --
Q. At least at the managerial level before prime signed up to it?
A. Again, I am not sure it was 100 percent unanimity. There never is 100 percent consensus. And that is why I am having trouble answering it. I know that is what the piece of paper said, and you asked me what do I think? And on that point I am not sure that there was a 100 percent unanimity even among the senior management. There was a consensus, yes. But not 100 percent agreement. If I had to write it down on the piece of paper I would say, "There is a strong consensus" but not a hundred percent agreement.
Q. When by "worked together," would you -- how do you mean worked together when you say there is a consensus that they would work together?
A. To work together for the common good of the American people, not for the specific needs of a company or a subelement in that company.
Q. What about the program. They worked together for the benefit of program?
A. When I say the good of the program, I mean it is not the program that is important, it is the taxpayers that pay for the program that is important. And as with every large program there is always things get down to individual needs and concerns. And there was some who were not comfortable with that. But they were the minority, not the majority, but they were there.
Q. Who were they?
A. Spread out among NASA, among the various NASA centers, they were spread out among the various contractors.
Q. Among the CEOs, however, were there any who expressed a willingness or an unwillingness to work?
A. Among the CEOs, I believe they gave me a sense that they were willing to work together.
Q. At least at that top level?
A. At that top level.
Q. So they were on board with your vision process?
A. Again, it is not my vision.
Q. Well, NASA's vision. They are on board with NASA's process?
A. Process. Because it was a directive from the administration. It was a recommendation of the Vest panel. Remember, I talked about that process, so all were involved. And I believe in discussions the CEOs gave a sense that they would like to work together to the benefit of the program and the American tax payer.
Q. What was the alternative that they had, however?
A. They could have chosen not to.
Q. That would in likelihood have scuttled the entire program, would it not?
A. It would have been a distinct possibility. But not a guarantee. It certainly would have caused problems.
Q. There was a budget vote immediately before this meeting in the House, was there not?
A. Oh, boy, I do not know that. We have so many votes on those appropriations in the House and Senate, I can't even remember last year let alone five years. We probably have six or seven votes a year on each of our programs. I just don't have that recollection.
Q. In any event, you do have a recollection that the vote was tight regardless of how tight, it was tight?
A. There were a couple of votes. One vote was very tight, the other votes we had more of a majority. There was a famous vote where we won by one vote. I don't know which one that was.
Q. But in any event, at this time you were pending the FY 94 budget?
A. In December of '93, the FY 94 budget was before the Congress for approval.
Q. Did I understand you to say that the Vest Committee recommended a noncompetitive award to a single prime?
A. I don't know that I used those words. My recollection is that the Vest Committee recommended a single prime to do the work that the United States government was doing, the four different centers were doing, headquarters were doing, the four contractors were doing, to give the complete analytical and physical integration.
Q. But it did not recommend the process?
A. I don't recollect that they did.
Q. Do you know how that process was arrived at, the noncompetitive process, the D&F process?
A. I believe I covered that. I set up a team to respond to the recommendations and they came forward with the process.
Q. Which was a recommendation for a non competitive award based on a D&F?
A. For a D&F.
Q. For non competitive D&F?
A. I don't remember the exact details, but the D&F would be the termination and funding by NAS
A. I don't remember the exact words in there, and that is why I am trying to --
Q. We will move on and I will give you a copy of the D&F. But meanwhile, I want to go on to the next bullet which was that there was a preference expressed for one contractor to be selected as a single prime. Do you see that, under the contract recommendations?
A. Again, these are talking points based upon discussions not with the CEOs but with people at lower levels.
Q. And my question to you first is, did you talk about that if you recall? If not, that is okay too.
A. I don't believe I stuck rigidly with these talking points, I talked about a variety of things. I don't know if I covered that or not, I can't validate that yes or no.
Q. Do you recall if in that room any of the CEOs disagreed with that statement? Could you get a sense?
A. I believe that the CEOs seemed positive about a single prime being selected. That is my recollection.
Q. Do you recall addressing the subject of subcontractor roles? That is the last bullet, I just jumped ahead a little.
A. No, I do not.
MR. ESHELMAN: I now show you a document previously marked as Exhibit 28. (Exhibit No. 28 marked for identification.)
THE WITNESS: Here were the rules --
BY MR. ESHELMAN:
Q. What page are you. Referring to Exhibit 28?
A. G1 0000033.
Q. And that would be numbered paragraph what?
A. No, this is, this would answer the question you asked me, and I would have to read all of it. You asked me about the process.
Q. Yes.
A. I recognize this document.
Q. And that was 33?
A. 33 through 36.
Q. That is the D&F?
A. That is --
Q. That is the D&F you submitted to Congress?
A. This looks like the determination of finding.
Q. That NASA submitted to Congress?
A. Okay.
Q. It is the D&F you submitted to Congress?
A. I believe so.
Q. Do you have any reason to believe it isn't?
A. I would have to read -- if I read every word I don't think today I could -- but my signature is here, and if there were no electronic issues made with this I would presume --
Q. And it was provided to me by the government?
A. I presume it is.
Q. Is the cover letter that accompanies it, that what you used to refer it to Congressman Hall?
A. I presume so.
Q. Did you write that cover letter?
A. I very rarely write the cover letter. It usually gets staffed and I review it.
Q. Do you recall who was responsible for staffing this?
A. No.
Q. Would your executive assistant have done that?
A. Probably not. Executive assistants usually did not draft these type of letters up.
Q. How usual would that get done?
A. It would be tasked out either by the chief of staff or the deputy administrator. And there is a process where things get signed off and there is a formal process that we have for getting documents signed. So it is reviewed by legal, by legislative affairs, by each of the concerned parties and then sent out.
Q. There is a staff summary sheet?
A. Letters are staffed before they come to me. And I just don't know who staffed this.
Q. Is there a summary sheet prepared for each one that would indicate who at each of these stops coordinated it?
A. Generally that is on the folder on the outside of the folder.
Q. Would the folder also include back up data in the form of either memoranda or source data?
A. Sometimes. But most of the time it was just a document in a folder with a cover sheet. That is the way I usually get it. Someone will come in and brief me on it. Sometimes they will bring additional documents and sometimes not.
Q. Do you recall or recollect how this letter was staffed?
A. No.
Q. Do you recall who drafted the D&F?
A. No.
Q. MR. FRANKLE, did he draft it?
A. I don't remember. I just don't.
Q. It would have staffed with him, however, would it not?
A. Legal counsel is usually involved in the review of the documents that I have to sign. I would have to go find a signature sheet to validate it. But legal counsel usually is involved in review of these documents.
Q. I know he is here today as general counsel because presumably as administrator and your lawyer he should be here. Would he be the logical person who staffed everything that required legal coordination that went to?
A. I don't know how to answer that. Because I don't make the assignments of who does what. I get the final document, there is a sheet where everyone has signed off on. I don't concern myself generally with those process details.
Q. In organization who would draft terminations and findings?
A. I don't have very many of these documents, so I don't know generally who would do it. But my recollection is that it would either be the chief of staff would -- a task has to be done the chief would sign it out, it gets assigned to someone, they draft it, each of the property codes sign off on it, and then and only then does it come to me as a finished product.
Q. At this time would it be General Daily?
A. I don't know.
Q. Mr. Abbey?
A. Could be either one of them.
Q. Or both?
A. I think it would be one or the other, or a there could have been a third person.
Q. Who was the third person?
A. I don't know. I think he was still here at the time. I think it probably was George Abbey or Jack Daily. I don't know which one it was.
Q. Let's look at the determination that is on page 0036. You will note there that you say I determined, and I am not going to read it in the entirety, that to use other than full and open competition in making Boeing the single prime contractor. Do you see that?
A. Yes.
Q. Was the direction to use a noncompetitive or other than full and open competition process from the administration or from the Vest Committee?
MR. BRILLIANT: I object to the form of the question. Assumes facts not in evidence.
THE WITNESS: I don't know.
BY MR. ESHELMAN:
Q. Where was that determination made?
A. I don't know, I would have to go back and review the directives that I got thoroughly to try and piece that together. I just don't recollect where that came from.
Q. What advantage is it to NASA to award a contract non-competitively?
A. At the time, there was an issue of, as I recollect, the president had selected option
A. Option A was going to use a significant amount of equipment that had already been under development. If we were to run a competition we would have either the team in place for, a whole year in the form that it was in, not making the progress that each one of the individuals proposals might recommend. And it was felt we would loose a year, hold the team together, and it would cost the American taxpayer more to do that than to go with the determination and finding and make a noncompetitive selection.
Q. And it would cost at least a year in terms of time?
A. Correct.
Q. And if would cost around $3 billion to the taxpayer. I don't know what the burn rate was?
A. At that time I think the burn rate was about two and a half billion dollars, to take some number. And the question is, do you ramp it up, leave it at 2.5, we were directed to come down to 2.1.
Q. By OMB?
A. It was in, I believe the directive we got. One of the directives we got -- I don't know which. But I believe it was one of the directives we got. So we had to get down to $2.1 billion a year as soon as possible. It was felt this was the most expeditious way to get there and give us the shortest time to deployment and the lowest possible cost by going through this approach.
Q. And that process that you just described as most expeditious, was developed by whom, by the administration or by NASA?
A. The determination of findings.
Q. To go the noncompetitive process?
A. I don't remember the specifics of the recommendation from the administration or the Vest Committee. So I don't know how to answer the question.
Q. But the fact is that it was a significant advantage to NASA to be able to do it this way?
A. To the American people. It is -- NASA is not an organization that dangles out there. We have to carry out the will of the President of the United States and the American people. We don't do things in our own interest. We do things in the interest of the American taxpayer.
Q. So in that context it was a significant benefit to make this selection noncompetitive?
A. It was felt it would be a benefit to the American taxpayers to make the selection noncompetitively, yes.
Q. Now, as a businessman in your former career with industry, you were aware that the four existing prime contractors had significant contract rights, correct?
A. I did not get into the depths of what each of the contracts contained. I relied upon the recommendation of my team which seemed very sound, very thorough before I signed this determination of finding, that it was in the interest of the American taxpayer to make a noncompetitive selection. And I signed this determination and finding.
Q. I am on board with you there, I have no problem with that, I understand. My point, however, is only that a contract with a value, a projected value of measured in the billions of dollars, one, in a full open free competition is a Exhibit value to a corporation, is it not.
MR. BRILLIANT: You are getting illogical. A contract is a contract. What is the question?
THE WITNESS: I carry out my job in the interest of the American people operating within legal and ethical boundaries. I believe that signing this determination and finding I was acting in the interest of the American people operating within legal and ethical bounds.
BY MR. ESHELMAN:
Q. I understand that, and I am perfectly content with that. My only question is, contracts rights are significant rights, are they not?
A. I manage this agency. In the interest of the American people and I always try and operate with legal and ethical boundaries, and if it is in the interest of the American people and within legal boundaries, I act. I spend a lot of time trying to make sure that I operate within the legal and ethical boundaries. And my team told me in making this determination and finding that I would be operating within legal and ethical boundaries in the interest of the American people.
Q. Let me just say again for the record that is not an issue, at least in my mind at all. I understand that --
A. I am not trying to be coy. I don't understand a question you are asking.
Q. I am trying to ask it in a way --
A. No.
Q. You understand that corporations pay taxes as well, correct?
A. Corporations pay taxes.
Q. So in that regard, you are also making your decision as administrator for the benefit of these same corporations?
A. I do not make decisions to benefit the corporations.
Q. To the extent they are taxpayers?
MR. BRILLIANT: You are getting argumentative and wasting time.
THE WITNESS: I make decisions in the interest of the American people not for the corporate entities. I don't make decisions for the benefit of the corporate entities, but for the benefit of the American people.
MR. ESHELMAN:
Q. I got off because when you said taxpayer it made me think of that. Let's go back to an American company that employs Americans that has a contract and the value measured in billions of dollars.
BY MR. ESHELMAN:
Q. In that contact with NASA or any agency of the government, in that context, that is a significant value to that company, is it not?
MR. BRILLIANT: You are not asking factual questions, you are getting argumentative.
MR. ESHELMAN: If you want a speaking objection, fine, but --
MR. BRILLIANT: It is not a speaking objection. It is not a question.
THE WITNESS: I want to come back and say this is a very crucial issue. NASA does not exist for the pleasure of the corporations performing for it. We are the customer representing the American people. We have a set of rules and regulations that we operate within. Always within with the interest --
BY MR. ESHELMAN:
Q. And you follow them?
A. We follow the rules to the best of our ability.
Q. And a contract with NASA, however has value to the contractor, does it not?
A. I don't understand the relevancy of that relative to the process I have to make.
Q. The relevance it is interrelated to the program. As an administrator you have four contractors who have significant contract rights with regard to the agencies, correct?
A. I would like to provide some context. If the corporations worked together as a team and performed the way they were supposed to the contracts that they signed, there would not be an enormous schedule slip. There would not be an enormous over run, and they would not be the situation we had with this station eight years and eight to ten billion dollars extended and not one piece of hardware being built. When a corporation takes on the contract, they should operate under the terms of the contract to do the intent of that contract. There was clearly a problem here. And I am trying to understand if you are asking me should I be sensitive to the needs of the corporation and trade the needs of the corporation against the needs of the American public when taking action within legal and ethical boundaries, and it is really confusing to me.
Q. Were any of these contractors in default?
A. I do not know that they were in default. But I know they had significant overruns, and the work was not getting done, and the team that had reviewed the design indicated to me that there were some significant safety problems and some significant problems with non-performance of different pieces of hardware that came together. That there was a test program that was incomplete that would not validate whether this hardware would work together in orbit. There were some very major problems with the program. That I do know.
Q. Was there any consideration given to sending out notices for failure to make progress to any of these four contractors?
A. I do not know.
Q. Who were the members of the team that you alluded to who make the recommendation for this noncompetitive process?
A. I don't remember who was on the team.
Q. Was
MR. FRANKLE on the team?
A. Either he or one of his chief legal counsels would probably have been on the team.
Q. Mr. Forbes?
A. Forbes?
Q. David Forbes?
A. I don't recollect who David Forbes is. Is he one of yours?
MR. ESHELMAN: Let the record reflect that was a yes.
MR. FRANKLE: Yes.
MR. ESHELMAN: Let's go back now to, I have got three documents in front of me, I have 28 which is the D&F.
THE WITNESS: By the way I want to go back to the D&F. The line of questioning causes me to infer that I was doing something improperly. The United States Congress gave a vehicle for noncompetitive process that it was the interest of the American taxpayer.
MR. ESHELMAN: Precisely.
THE WITNESS: And I believe we carried it out appropriately.
BY MR. ESHELMAN:
Q. I also have 22, which is this talking paper. And we were down to page 2081. Under the heading, "Why the bold approach." Do you recall making comments about a bold approach?
A. I don't remember the details, but I remember discussing some of the issues we have already talked about, and some of the issues that are on this paper, a number of which we have already talked about.
Q. The first, the marching army costs. That relates to the burn rate, doesn't it that you asserted to earlier?
A. Yes.
Q. And we also talked on --
A. The non-essential worker. It might not be needed or appropriate. I had a different term for that.
Q. That is that first sub?
A. It says we want to only do things that will be adding value to where we are going. In some cases we don't know where that is going to be because we don't have the details worked out yet.
Q. The next bullet deals with competition. Do you recall covering these matters?
A. I believe I covered some of these matters, yes.
Q. And do you recall covering loss of skilled workers?
A. I believe so.
Q. And do you recall again the resource issue in this time in context with the costs of running the competition. Did you cover that?
A. I don't think that one was important, as important as having this extremely competitive process where we are trying to sort things out because we needed the contractors to be defining things. And if they were going to be competing in effect we would be shutting this program down for a year, and then we would literally, if we wanted to retain the skills not knowing which ones we needed and didn't need, we would have to have everyone to stay. And they may not be doing productive work. That is the essence of what I believe I said.
Q. We will touch on again the disruption and inefficiency issues you raised.
A. Well, the issue again was, if we could not be working together defining this thing and we didn't know which of the work force we would need and which we would not need, and we were paying for people just sitting there not making progress, it would be terribly expensive.
MR. BRILLIANT:
MR. ESHELMAN, let me interrupt. It is after 4 o'clock. When we discussed this deposition, with the court, we indicated that Mr. Goldin had two hours available with some flexibility, if we needed to run past 4 we could do that. I don't think we have really gotten yet to the questions the court was interested in getting answers to. Do you have a projection how much more time you need.
MR. ESHELMAN: We are moving along pretty well now, I would like to keep it going.
MR. BRILLIANT: Yes, but can we get an idea of how much longer we need.
MR. ESHELMAN: Give me a couple of hours, probably put a wrap on the meeting.
MR. BRILLIANT: I don't know if we can go another couple of hours.
MR. ESHELMAN: I think we are beginning to see repetition here.
THE WITNESS: Sir, I have some hard cut offs on my calendar that I don't know --
MR. ESHELMAN: When you have to go, just tell me, I have no problem with that.
THE WITNESS: I will extend as much as I can and keep people waiting for a little while.
BY MR. ESHELMAN:
Q. You are projecting a 12 month hiatus. Do you recall discussing that?
A. I probably discussed that, yes.
Q. Maybe it will short circuit things a bit. I have here in front of you this Exhibit 24 which was provided to us by the government, Sue Garman's, a version of Sue Garman's notes of that meeting. Maybe if you would review that it would speed things up?
A. I'll be happy to. (Brief pause in the proceedings.)
THE WITNESS: Do you want me to go through the questions and answers too?
MR. ESHELMAN: Please.
THE WITNESS: I remember seeing this stuff up front.
BY MR. ESHELMAN:
Q. That is page 1 on 2 G?
A. That was not in the taking points. And that was the point I was trying to make. I have never seen Sue Garman's notes. So this is interesting. Oh, we had the Russians in here, I forgot all about that. The questions and answers are very choppy. I can't make --
MR. ESHELMAN: I had asked
MR. BRILLIANT to bring the originals of those. This is a version of them.
MR. BRILLIANT, would you please show Mr. Goldin the original?
MR. BRILLIANT: What is that?
THE WITNESS: I have not seen any of the Sue Garman notes at all.
BY MR. ESHELMAN:
Q. Let's go into these notes and first of all, there is the introductions. Does that refresh your recollection as to who on NASA side was there besides
MR. FRANKLE? Is that accurate?
A. I will accept what is on the piece of paper here. The piece of paper says it. I can't bring up an image in my mind of these people. But I will acknowledge it says so on this piece of paper.
Q. Do you recall making the statement that as described here in the middle of page 2 about the middle it says, "We are making decisions in a glass house, let's put aside our individual needs"?
A. I don't recollect that statement, no.
Q. One below it, "Cannot do a uniform cut across contractors - we must put final needs first to benefit all in the end."
MR. BRILLIANT: Let him read it.
MR. ESHELMAN: I am sorry.
THE WITNESS: I don't know if she got the context. But when I look at all, I don't look at the contractors, I look at the American people, that is my first criteria, and that would be my connotation, and I know I talked about that a numbers of times. That is the custom for this program.
BY MR. ESHELMAN:
Q. And you testified you do that convincingly, that you take legal rights seriously, correct?
A. Yes.
Q. And contract rights are legal rights, aren't they?
A. We have to obey the rules and regulations.
Q. Now, let's go down to where she says, "First, must select prime contractor to strengthen program accountability and eliminate duplication of effort." You said that, didn't you?
A. Again you are asking me to recall something I said five years ago. It must have, I must have something on the order of ten and 12 meetings a day. To recollect these things to the level of precision you are asking in termination of a specific comment is very hard for me to do.
Q. But you don't have meetings every day with the CEOs of four major aerospace companies all at one time, do you?
A. No, I don't. But I do have meetings with a number of CEOs on a number of occasions. I have meetings with presidents of countries, prime ministers, ministers of science and technology, meetings with the President of the United States. I have a lot of important meetings. Now, I don't want to say this meeting wasn't important. It clearly was. But you are asking me to recollect specific things and validate specific things I said exactly, I don't remember. I remember generally what I said. I told you generally what I said.
Q. Do you recall discussing generally an attempt the agency would make to balance the program out in the redesign?
A. We wanted this program to be efficient and there were some tough things that we had to do and we were trying to do the very best job of accomplishing the goal of getting the Space Station built.
Q. That goal would be jeopardized if any of these organizations filed any injunction action, would it not?
A. It could create a problem, yes, sir.
Q. A problem that would cause the loss of the entire program for everyone?
A. That could be an outcome.
Q. And that is the glass house metaphor, isn't it?
A. It might cause problem, yet it might not. It is a possibility. It is not a guaranteed outcome, but it would just certainly make it more difficult.
Q. And you knew these CEOs had boards of directors they were responsible to?
A. CEOs report to a Board of Directors.
Q. And they also have stockholders that they are responsible to as well?
A. Yes.
Q. And you were asking them to give up a significant set of contract rights they had, weren't you?
A. I was asking them to help the American people build the Space Station. These four corporations worked for eight years and didn't produce a single piece of flight hardware. Some of them earned significant fees during this time, satisfying their shareholders but not satisfying their customers, the American people. This is an issue that is part of my job to figure out how to satisfy the overall needs, not to satisfy the needs of an individual contractor, living within the legal constraints that we have. And you keep asking me am I worried about the contractors. I am worried that we operate within legal bounds. My job is to worry about the American people and have the contractors perform. And for four years, or for eight years we didn't have the performance that was expected when the contracts were let, and something had to be done, and the American people have some say in this too.
Q. So you recognized an interest on the part of the contractors to maintain their share of the program?
A. No. I had a sense from this meeting that these four executives wanted to figure out how we could get the Space Station built in the most expeditious matter. That is the sense that I walked away from meeting with.
Q. But at no time did you go to them and say that you wanted them to give up their contract rights in order that you could make a noncompetitive award to a single prime, did you?
A. In the discussion with the, "I" and the "we," and in the discussion we talked about the top level issues. We didn't have CEOs talking about specific contract issues. That was not a contractual meeting. We didn't have a contractual document that every one was going to sign at the end of this meeting. This was a meeting only to discuss the issues and to get a sense of what the heads of these corporations wanted to do. That was the purpose of the meeting. It was not a decision meeting, but a meeting to get a sense of what they wanted to do and what directions they wanted to go in, and my subordinates would then work the details.
Q. So you wanted their consent to a process, correct?
A. I did not want a consent. I wanted to get a sense of where they were at because I do not believe you could get a decision like that in a one hour meeting with a group of people involved.
Q. Look at Exhibit 28, if you would, please, which is the D&F and related transmittal. Let's look at the transmittal letter first. In the last paragraph of the transmittal, I mean the last sentence of the first paragraph of the transmittal letter, the third line from the bottom of that paragraph, you say, "And, with the consent of all parties concerned. Now, these parties' concerns were the four primes, were they not?
A. Yes. This is a consent future.
Q. And NASA?
A. This is a consent future.
Q. And then we go to the D&F itself, paragraph number 10, about the middle of the paragraph there you start the sentence that begins, "As a more efficient and expeditious alternative." Do you see that?
A. Yes.
Q. "NASA can select single prime from among the group of contractors with the knowledge." That is institutional knowledge, correct, in the program?
A. I believe I was referring to the four contractors that were involved in this meeting.
Q. Then the next sentence --
A. Again this is what's on the piece of paper, I am not saying now, just verifying that is on the piece of paper.
Q. Which is your determination as administrator?
A. Yes.
Q. Which you submitted to Congress on the transmittal?
A. Yes.
Q. Then you say, "Then with the consent of all parties concerned," you are referring now to the same parties?
A. Yes, with the future consent of those parties concerned, yes.
Q. Then NASA can simply novate the remaining prime contracts, that would be the other three prime contracts assuming a fourth is designated?
A. Yes.
Q. To become subcontracts to the single prime?
A. Yes.
Q. That was your determination at that time?
A. That that would happen at some point future, yes.
Q. Then we go to the determination itself which is on page 36, and you mentioned consent a third time in the last sentence. Do you see that with the consent of all parties concerned, the second line from the bottom?
A. Where are you?
Q. It starts with, "With added responsibility to manage all aspects...
A. Is that the first or last paragraph?
Q. Last paragraph, "and with the consent of all parties concerned," do you see that?
A. I see that.
Q. Now, you have referenced consent three times. Once in the transmittal to Congress, and twice in the determination and findings itself. And this is consent to a noncompetitive process, correct?
A. This is the consent to the novation. I think that is what it refers to.
Q. To the novation of what?
A. Of the contracts. Because it says the prime contractor will be selected first and then with the consent the contracts will be novated. That is what the words say.
Q. So you are referencing is a future consent?
A. Yes.
Q. And when in the future are you saying that occurred?
A. When the process gets complete. It certainly says that on this -- I don't know where to find it. Here on page 35. "As a more efficient and expeditious alternative NASA can select a single prime from among the group of contractors with the knowledge and experience necessary to minimize the time and waste that could occur during the program transition." So they selected, NASA can select. Then after that is done, "With the consent of all parties concerned, NASA can simply novate the remaining prime contracts to be subcontracted for the single prime." That is what that says to me.
Q. So that is a present ability, can select?
A. Yes. And a future novation.
Q. Consent to current one?
A. No, consented to future. That is what those words say to me.
MR. BRILLIANT: You have asked and asked that several times over and gotten the same answer every time.
THE WITNESS: Then means then after you do that then you go get the consent for novation. That is what that says to me.
BY MR. ESHELMAN:
Q. At this time had you selected the single prime?
A. What is the date on this?
Q. August 23rd.
A. I think the letter that went up said the single prime was selected. But the novation process comes after that. That is what this letter says.
Q. Same the prime was selected?
A. I believe so. I will have to go back and read this, let me see. Yes, "that it is in the public interest to use procedures other than full and open competition to select Boeing" okay, so I believe this says we selected Boeing at this point.
Q. So now is the time to get the consent for the subcontractors?
A. After that occurs then a process has to occur to go get the consent to go do that, yes, sir.
Q. So at what point in the future would NASA get this consent?
A. I don't know. That is up to the teams of people that would be working after this point. My job was to do the termination and finding, which I did.
Q. So as I understand your testimony, what you did was you went to these four CEOs and told them that you wanted to let the single prime decide what their participation in this program going forward would be?
A. I don't think I said that. I think what I said, not exactly, but the sense was, we would like to proceed forward and select a single prime contractor. That is what I think we said.
Q. On a noncompetitive basis?
A. On a noncompetitive basis.
Q. And what did you say would happen to their contracts?
A. I don't know that I discussed that in detail.
Q. Did you discuss consent with them at all?
A. That meeting was not a meeting to gain consent. That was a meeting to get a sense of where the CEOs were at because I had not talked to the CEOs about the subject. It was a meeting to get consent. If we would have had a consent form that would have been signed.
Q. The contractors, the four contractors, prime contractors regularly briefed NASA, did they not, on possible solutions to this management problem that you have identified?
A. I am not aware of the details of those briefings.
Q. You personally received such a briefing in February of 1993 from Mr. Blyseth?
A. From who?
Q. Mr. Blyseth?
A. I don't recollect.
Q. From Grumman?
A. I don't recollect. And it could be. I don't deny that people came in with ideas all the time. People came in with ideas all the time and I tried to provide the maximum amount of exposure just to make me aware. But the people that I had were in the process to make recommendations to see how to go. And just because somebody comes in and makes a presentation doesn't cast anything in concrete. But if they want to see me I try to make myself available.
Q. Look at page 3 of Exhibit 24?
MR. LITTLEJOHN: This is a document, I asked the court reporter to mark it as Exhibit 24.
BY MR. ESHELMAN:
Q. Now the fourth bullet from the bottom, do you see that, it says one prime contract with added integration responsibility, "Don't want winner loser view." Do you see that?
A. Yes.
Q. No bonus on subcontracts, only on additional management. Obviously reference to fee?
A. Yes.
Q. Welcome your ideas on fee structure, again a reference to fees?
A. Yes.
Q. Now, if one of the non-selected primes does not ultimately participate in the ongoing program after the transition period, that would make that prime a loser, would it not?
A. In your language, the object, the winner would be the American people to get the Space Station built. My job is to, with the minimum number of resources that this agency had to get the space station built and try to have a team that would do it. There are four contractors. We had eight years of four prime contractors, eight years. In eight years these four prime contractors did not work and play well together. In eight years we spent 8 to 10 billion dollars and didn't get a single piece of hardware. In order to get the Space Station built we needed all these -- we could no longer select all four to be the prime contractor. We could only select one. So if we selected one, it was my hope that they would not view that they were a loser and the contractor that got the prime contract the winner. One of the reasons, and I recollect now seeing this, is that my staff recommended that we don't give additional fee to the prime contractor on the full value of the subcontracts which are larger than their whole contracts would be so that there would be a sense that they didn't become a winner and get an undue amount of fee. That I think is what winner and loser refers to.
Q. If a CEO comes in and has a billion dollar program running for eight years, and walks out without that program and no quid pro quo, he is a loser?
MR. BRILLIANT: Objection, argumentative.
THE WITNESS: I don't consider that a loser. Sometimes one has to look at the bigger picture to meet the overall needs of the customer, the American people, to get this done. These eight contractors went for eight years --
MR. ESHELMAN: Four contractors.
THE WITNESS: Four contractors went for eight years and didn't build one piece of flight hardware and spent $10 billion. I would say that is a lot of time for these people to work together.
BY MR. ESHELMAN:
Q. Did you consider defaulting them?
A. I did not make individual suggestions myself.
Q. Did your staff recommend default?
A. My staff followed the suggestions of the Vest Panel and the administration to get rid of layers of management. And by the way, it would be impossible, inappropriate to try and maintain fixed levels of participation for each contractors because there is no way of eliminating management levels in layers of management and layers of inefficiency and causing this to occur. And all I was trying to do with these CEOs is get them to look to a higher level that the needs of the American people were crucial here.
Q. And you pointed that out that you could not keep them all whole? You pointed that out in the notes, didn't you?
A. Where does it say that in the notes? There was one purpose of this meeting to get a sense for things people to rise up and step up to solving the problem instead of going another eight years and spending another $8 billion. I ask you, is that fair to the American people?
MR. ESHELMAN: Let's look at a document we have already had marked as Exhibit 23. (Exhibit No. 23 marked for identification.)
THE WITNESS: I can answer your question now, I remember Pam McInerney being there, I now remember who she was.
BY MR. ESHELMAN:
Q. At the SRT?
A. She was at the meeting with the CEOs. Not only do I see her name, I see a picture in my head. Pam McInerney was there, as was Sue Garman, I am now remembering that.
Q. And Bryan O'Conner as well?
A. I don't recollect that, I have a problem of dredging up all this.
Q. While we are looking for that, let's go ahead. On page 4 you have, page had of Exhibit 24. You have a question in the middle of the page, a comment from Mr. Shronz, "Willing to waive any legal fights to get process on."
A. I see that.
Q. The process he is referring to is the process of noncompetitive selection of single prime; isn't that correct?
A. I have a statement here, one can only make a presumption. I can't validate that.
Q. Take a moment and look at the context. That is correct in the context?
MR. BRILLIANT: Objection. Lack of foundation for that question. The process was the selection -- are you asking which --
MR. ESHELMAN: Let me finish.
MR. BRILLIANT: Is that the question.
BY MR. ESHELMAN:
Q. Is that correct, it was the non-competitive selection of the single prime, correct?
A. I can only make a presumption, I cannot make an absolute statement.
Q. If you don't recall, you don't recall, fine. Now, he references legal fights. Do you see that in that same sentence, willing to waive any legal fights?
A. Yes.
Q. What discussion about legal fights do you recall?
A. I don't recall a discussion on legal fights.
Q. Do you recall reading anything in the press about challenges to a noncompetitive procurement by any of the four prime contractors?
A. I don't have that recollection, no.
Q. If such a challenge had been mounted at that time, it would have put the program in jeopardy, I believe was your testimony?
A. Well, let me say this, if that was the position we would have to go back and rethink how we were going to approach this. It clearly would be precipitous, but one thing I have learned in this job, every day, this job is like going out on the surf, every time I get knocked down by a wave, you stand up and think it is okay, and you stand up and another one comes. We have unbelievable problems. And when faced with what seemed to be insurmountable problems, we go back and solve them. I don't know, it certainly would have made it more difficult, but if that was the case, we would have to go back and say let's see what other ways we might have. I don't know whether we would come up with a solution, but I never give up and the NASA team never gives up. We never give up and we try to go find solutions.
Q. There would have been an impediment in the calculus?
A. It would have made the degree of difficulty higher. But it doesn't say we could not pull it off. We try to do what we think is the right thing with the knowledge we have. And then if that doesn't turn out to be feasible, then you just keep going until you do the best you can.
Q. Let's look at Exhibit 23 in front of you, and the third page down. Up at the top, the first complete arrow with a double shaft, "as we fix process, can't keep everyone whole." With a subitem, "Must fix problem in glass house and no one can cast stones." Do you see that?
A. I think I have said this about ten different ways. You can't fix a problem like this and have a nice uniform cut and you maintain work forces at the same level as each of the contracts or with some uniform cut. You have to go in and do what you need to do and you must put aside personal and corporate needs to look at the national need to get the Space Station booked.
Q. So NASA recognized that there would be a concern?
A. And I believe I openly talked about that. That we could not do it. And I just wanted to get a sense knowing that, we had nothing up our sleeves, knowing the consensus of this group to proceed to the next group.
Q. And the next step was noncompetitive selection --
A. The next step was to go into the process and get the process going.
Q. And the process was noncompetitive, correct?
A. Yes.
Q. And the authority for that was given by the D&F to Congress?
A. Yes.
Q. And in effect what you were doing --
A. Sir, I am not sure that we talked specifically about the D&F. I don't recollect that.
Q. But that is an important document that implements what you are talking about, correct?
A. Right. But I am not sure we were that far in our thinking at that point. I don't know how far along we were relative to how we would carry this out, other than the Vest panel, the administration, our own people, all agreed that we should go select a single prime. And they all agreed it would be incredibly difficult to hold competition. I don't know at what point the D&F came in, I don't know, I don't recollect.
Q. Had any one of these contractors been selected at this time as the single prime?
A. At the time of the meeting?
Q. At the time of the CEO meeting?
A. Absolutely not.
Q. Had the single prime job been offered to any of these contractors before this meeting?
A. I have no recollection or any knowledge that that was the case, certainly at my level. And I don't know of any of my team that did that.
Q. Mr. Abbey?
A. I have no knowledge he did that. I can't imagine.
Q. Mr. Daily?
A. I just do not have any knowledge because the process was not in place and we are a process driven organization.
Q. So it was your sense coming out of this meeting that these contractors agreed to surrender their billion dollar plus programs?
A. No. That was not my sense. It was my sense that these four CEOs felt that there was a real national need to figure out how to work together openly knowing that we could not assure anyone that they would be the prime contractor. Hopefully knowing we could not uniformly impact each of the companies, and they give us a sense they wanted to proceed forward with the process, but no formal commitment to it. Only a sense. That is my understanding coming out of the meeting. And that is distinctly different than what you said to me.
Q. You need that consent, however to eliminate the one major factor that could torpedo the program, correct?
A. No. We did not have a consent meeting. We did not have a consent meeting. We had a meeting where we discussed issues and NASA and the administrator wanted to get a sense from the contractors that they understand how we got from where we are to here, did they understand the criticality and the importance of this program to the American people, and were they willing to enter into a process where we could get to a single prime contractor, and were they willing to enter into a process to put the national needs above the corporate interests. And I had a sense from them this was the case, but it was not a binding contractual meeting.
Q. But you told them that they would become subcontractors, didn't you?
A. I don't believe those were the words that were said. Although I can't validate it, I just looked at the words over here.
Q. Which exhibit are you talking about?
A. Exhibit 24.
Q. That is the version of Sue Garman's notes?
A. Yes. And it says here, "Other current primes could be directed subcontracts," it doesn't say would be. Now, that is what it says, I don't know what I said. And I would say that I can't imagine that I would go make a commitment at a meeting that was not a commitment meeting.
Q. Does it make a difference if it had been, "Will become prime contractors" in your mind?
A. I don't have a recollection of what I said on it. I just do not. This was five years ago.
Q. Look at page 5 on that same exhibit, please, and you will see a comment that is ascribed to MR. FRANKLE at the bottom, sandwiched by two comments by you. MR. FRANKLE says, "After prime selection, other current contracts would be novated, three way negotiation, some outstanding issues could be taken out as part of negotiations" so forth and so on. Do you see that?
A. Yes.
Q. Do you recollect that exchange?
A. No. I acknowledge the notes on this piece of paper.
Q. Do you acknowledge it makes a difference whether those notes say it could be, would be, will be?
A. No, because this was not a consensus meeting. It was not a meeting where we signed a contract. Not a meeting where we formally took notes and everyone signed the notes at the end of the meeting.
Q. Have you been either in industry or as administrator of NASA in a contact where the administrator CEO level final contracts are signed and negotiated?
A. No.
Q. That is because they don't happen there, do they had?
A. Contracts are carried out by the performing organization.
Q. You make top level agreements, correct?
MR. BRILLIANT: I object to the form of the question.
THE WITNESS: I will tell you the best of my recollection is determination and finding is the only time, from the time I've administrator that I made such a decision. I don't know of any other circumstance where I have done that, this determination and finding.
MR. ESHELMAN: Made a process decision.
THE WITNESS: I generally don't get even involved in process in most cases.
BY MR. ESHELMAN:
Q. In this instance though you did?
A. I made a process decision, yes.
Q. And you represented to Congress you did that with the consent of the four CEOs?
MR. BRILLIANT: Objection.
THE WITNESS: No, I did not. In my letter to the Congress, in this letter it says, we will select a prime contractor and then we will seek to get consent to novate the contracts. Item number 10 on page 35.
Q. Talking now about the D&F?
A. Yes.
Q. Which is Exhibit 28?
A. Yes. It says, "A more efficient and expeditious alternative, NASA can select a single prime from among the group of contractors with the knowledge and experience necessary to minimize the time and ways that could occur during program transition." Then after that decision is made then, "With the consent all parties concerned NASA can simply novate the remaining prime contract to become subcontracts to the single prime." Therefore the choice of words in that meeting doesn't make a difference because in this determination and finding, I tell the Congress that after we select the prime contractors which was clearly way after the meeting, then we could concede consent. That is why in my mind I firmly believe that was not a consent meeting, and these are my words on this pace of paper.
MR. BRILLIANT: I am going to state an objection. You are entitled to ask questions, but not to ask the same thing over an over again until you get the answer you want. There is a series of questions that have been asked numerous ways, and we have been doing this for the past 20 minutes to a half hour. You are not entitled to do that. I think we ought to move on.
THE WITNESS: I just want to say unequivocally for the record, I did not view that as a consent meeting. My determination and finding in item number 10 clearly established that the consent would occur after the selection of the prime contractor which occurred after that meeting. That is my position.
MR. ESHELMAN: I am going to show you an exhibit we have asked to be marked as Exhibit 93. (Exhibit No. 93 marked for identification.)
BY MR. ESHELMAN:
Q. This is dated August 17, 1993, a NASA press release by Mark Hess. Do you know Mark Hess?
A. Yes.
Q. What is his position?
A. I think he is working out at NASA Goddard in some capacity in public affairs.
Q. But he was in charge of press for this particular process?
A. At this point in time it is my recollection that Mark Hess worked in the office of public affairs. And he covered human space flight account in public affairs. That is my recollection.
Q. Look at page 704, it is page 3 of the price release at the top. The first paragraph says, "Non-selected space station prime contractors -- Grumman Aerospace Corporation, McDonald Douglas Corporation and Roketdyne Division. Rockwell International -- have agreed to become novated subcontractors to Boeing." Do you see that?
A. I see that.
Q. Is that incorrect?
A. I did not prepare this press release.
Q. Is it an incorrect statement?
A. At this point in time, I can't validate to you whether that was true or not true. But what I can say is with certainty that any consent to novation occurred after the selection of the prime contract in my recollection.
Q. Let's look at the fifth paragraph down at the top of that page, "Non-selected contractors will continue to be responsible as subcontractors to Boeing for a specific hardware development responsibilities and for supporting the prime and sustaining engineering activities. Their contracts will be modified to reflect the redesigned space station configuration. In addition, they will provide integration support to the prime." Is that a correct statement?
MR. BRILLIANT: I object to the form.
THE WITNESS: I did not write this press release, and I don't know the time context here.
BY MR. ESHELMAN:
Q. August 17, 1993 is the date on the press release. Is that a correct statement?
A. I don't know.
Q. Let's look at the last paragraph before the end, there is a quotation here attributed to you. "I have the utmost confidence in this outstanding group of contractors. Together under Boeing's leadership they will deliver a Space Station which is so vital to carrying out the mission of this agency. I know they will succeed because the CEOs of these three companies told me they will make this work" and so forth. That quote, that is your language, correct?
A. Sometimes when press releases get written up, the staff writes it. I don't physically write it. I don't recollect how this got put together and it could have been at this point in time they may have told me that.
Q. Isn't it true that press releases on this program had to be approved by the White House?
A. I don't know.
Q. Let's go back to Exhibit 22. Actually I am not going to go in?
MR. ESHELMAN: I am going to show you a document now that we received from the government which is now marked as Exhibit 94. (Exhibit No. 94 marked for identification.)
BY MR. ESHELMAN:
Q. It has a note slip on it from
MR. FRANKLE dated August 18, 1993. Do you see that. It appears to be Q and A's relative to the Space Station?
A. Yes.
Q. Let's go over to question 9. What happens to the work package in Grumman contract? Do you see that question? In the answer it says that the Grumman contract at Reston will be novated to Boeing the new single prime contractor. While the novation itself will not affect the size of these efforts, all the current prime contracts will be produced in transition?
A. Could I just read to myself, it is hard to follow you. Honest to God I don't know what these words mean, "while the novation will not affect the size of these efforts, all the prime contractors will be reduced" I don't know what that means.
Q. Look at the cover of the memo, Mr. Frankle's cover, 1582 the last four of the transmittal.
A. Yes.
Q. He says there that, "It relates to the impact"?
A. Where are you?
Q. It relates to the impact of the decision on the NASA centers. Do you see that?
A. Yes.
Q. Does that clarify what this sentence beginning with While the novation?
A. No, because the English doesn't make sense, "While the novation will not affect the size of these efforts, all the current prime contractors will be reduced in the configuration," I don't know how you will says size or the efforts won't change but the effort be reduced. You know, sometimes when people write things it is less than perfect and I don't understand what they were trying to accomplish here.
Q. The copy that we got of this document has a lack of clarity on page 1582. It looks like it says Dan, it could also say Dave. Do you know who that would be?
A. No, I don't.
Q. Do you know who wrote these questions and answers?
A. No.
Q. Do you know where in your organization this would normally be produced?
A. They could be produced anywhere within the organization.
Q. Could they have been produced in the law department?
A. I would be surprised they were, but I don't know.
MR. ESHELMAN: Why don't we take a two-minute break. (Brief pause in proceedings).
MR. ESHELMAN: On the record. Mr. Goldin --
THE WITNESS: I can go another 15 minutes and then --
MR. ESHELMAN: The concern I have, we have enough, this is a preliminary short session. I don't want to get into something and have it cut off. I know you mentioned working until 11 o'clock tonight. So we will bring this to a close and pick up these other matters later. Thank you very much for attending today.
(Thereupon, at 5:00 p.m., the deposition was adjourned.)
CERTIFICATE OF DEPONENT
I hereby certify that I have read the foregoing Pages 5 through 126 of my deposition testimony taken in this proceeding and with the exception of changes and/or corrections, if any, find them to be a true and correct transcription thereof.
__________________________
Daniel Goldin
__________________________
DATE
CERTIFICATE OF NOTARY PUBLIC
Subscribed and sworn to before me this the
____________ day of _________________________ , 1998.
__________________________
NOTARY PUBLIC IN AND FOR
My commission expires:
CERTIFICATE OF NOTARY PUBLIC
I, WILLIAM J. ALLEN, the officer before whom the foregoing proceeding occurred, Pages 5 through 126, do hereby certify that the witness therein was duly sworn; that the testimony of said witness was taken by me and thereafter reduced tothis typewritten transcript under my supervision; that said transcript is a true record of the testimony given by said witness; that I am neither counsel for, related to, nor employed by any of the parties to the proceeding; and, further, that I am not a relative or an employee of any attorney or counsel employed by the parties thereto, nor financially nor otherwise interested in the outcome of the proceeding, or any action involved therewith.
Witness my Signature and Seal:
My commission expires:
May 14, 2002
WILLIAM J. ALLEN
Notary Public in and
for the District of Columbia