FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

OFFICE OF ADMINISTRATIVE LAW JUDGES

1331 Pennsylvania Avenue, NW, Suite 520N

WASHINGTON, DC 20004-1710

May 7, 2013

ORDER DENYING MOTIONS TO DISMISS

Before:Judge Tureck

These three cases are proceedings under § 110(c) of the Federal Mine Safety and Health Act of 1977, 30 U.S.C. § 820 (“ Mine Act”). The Respondents, through counsel, have moved to dismiss the respective petitions for assessment of civil penalty brought against them by the Secretary of Labor. The Secretary opposes the motions. For the reasons set forth below, the motions to dismiss are denied.

According to Respondents’ motions to dismiss, which are substantively identical in most respects, on August 27, 2009, a Kentucky-Tennessee Clay Company (“K-T Clay”) employee was cleaning the inside of a rail car when another rail car struck the car in which the K-T Clay employee was working. Resp’t Mot. 1. The impact knocked the employee down and bruised his lower back. Resp’t Mot. at 2. 

The Mine Safety and Health Administration (“MSHA”) investigated the accident on September 1, 2009, and issued a citation against K-T Clay on September 4, 2009. The citation alleged that “[t]he management of the company was allowing persons to work inside the rail tank cars without having a second person tend the lifeline.” Id.; Ex. 2. MSHA also commenced a § 110(c) investigation to determine if penalties should be sought against any director, officer or agent of K-T Clay. Resp’t Mot. at 2.

Ronald Colson was employed by K-T Clay as its Safety Environmental Director on August 27, 2009. He retired from K-T Clay’s employ in October, 2010. MSHA issued a petition for a penalty assessment of $3,200 against him on February 28, 2012, almost two and a half years after the citation to K-T Clay was issued.

Christopher Brinson is the production manager at K-T Clay, the position he held at the time of the accident. MSHA issued a petition for a penalty assessment of $2,900 against him on February 28, 2012.

Gerald Hastings is employed as the Senior Engineering Manager at K-T Clay. On August 27, 2009, he was filling in as the Kaolin Operations Manager. MSHA issued a petition for penalty assessment of $2,800 against him on February 29, 2012. 

The Respondents, in their motions to dismiss, argue that the § 110(c) cases against them should be dismissed on the ground that the penalty assessments were untimely. Specifically, the Respondents argue that: (1) the Mine Act requires that penalties be assessed within a “reasonable time”; (2) ALJs have held that the Administrative Procedure Act requires timely agency action in § 110(c) cases; (3) the Secretary’s own Program Policy Manual defines timely assessments as occurring within 18 months of the issuance of a citation or order; (4) an ALJ may vacate a citation if a penalty is not assessed within a reasonable time; (5) MSHA did not issue a penalty assessment against them within a reasonable time; (6) there was no adequate cause for the delay in assessing the penalties; (7) Respondents are prejudiced by the delay; and (8) public policy concerns favor dismissal.

The Secretary, in response, argues that: (1) MSHA issued its assessments against the Respondents within a reasonable time; (2) there is adequate cause for the alleged unreasonable delay; (3) the Secretary is entitled to Chevron deference; (4) the Secretary of Labor v. Twentymile Coal Company precludes dismissal of this case; and (5) the Respondents have been unable to show actual prejudice.

The Secretary concludes his response to the motions to dismiss by stating that “the Commission does not have the authority to dismiss this case for failure to comply with the timeliness requirements set forth in Section 105(a) of the Act.” Sec’y Resp. at 9. No authority is cited for this audacious statement, and none is known to me. Nevertheless, for the reasons set out below, Respondents’ motions to dismiss the above-captioned cases are denied.

DISCUSSION

Section 105(a) of the Act provides that “[i]f, after an inspection or investigation, the Secretary issues a citation or order under section 104, he shall, within a reasonable time after the termination of such inspection or investigation, notify the operator . . . of the civil penalty proposed to be assessed . . . for the violation cited . . . .” (Emphasis added.) Section 110(c) is silent regarding when an individual respondent must be notified of a proposed penalty assessment. However, since penalty assessments against individuals brought under § 110(c) arise from the same inspections as penalty assessments against operators, it would logically follow that the reasonable time requirement of § 105(a) should apply to penalty assessments brought under § 110(c). Consistent with this rationale, the “reasonable time” requirement has been held to apply to § 110(c) cases by Commission administrative law judges. See, e.g., Reasor, 34 FMSHRC 943 (April 2012) (ALJ); Wayne Jones, 20 FMSHRC 1267 (Nov. 1998)(ALJ); James Lee Hancock, 17 FMSHRC 1671 (Sept. 1995) (ALJ). Moreover, none of the parties here dispute the application of § 105(c)’s “reasonable time” standard to these § 110(c) cases. Accordingly, the issue to be decided here is whether the filing of the petitions for the assessment of penalties against the three Respondents were issued within a reasonable time.

I

            The primary issue on which the parties focused was whether the almost two and a half year period between the issuance of the citation to K-T Clay and the notices of proposed assessed penalties served on the parties constituted a “reasonable time.” In this regard, the Respondents spent virtually all of their motions to dismiss arguing that these actions were precluded because under § 105(a), proposed penalty assessments must be issued within a “reasonable time” after a citation or order is issued; this requirement applies to cases brought under § 110(c); and the two and a half years between the issuance of the citation to K-T Clay and the notices of assessed penalties was unreasonable. The Secretary focused on this aspect of the case as well, primarily relying on Salt Lake County Road Department, 3 FMSHRC 1714 (July 1981), to support his position.

Alternatively, the Secretary argues that there was no unreasonable delay, contending that whether the proposed assessed penalties were issued within a reasonable time should be measured from the date the special investigation conducted pursuant to § 110(c) ended, not from the date the citation was issued to K-T Clay. The Secretary points out that the parties here received their respective proposed penalty assessments on February 28 and 29, 2012, and the special investigations concluded on February 17, 2012, when the matters were referred to MSHA’s Office of Assessments. Sec’y Resp. at 4. The notices of proposed assessed penalties were issued to Colson and Brinson on February 28, 2012, and to Hastings on February 29, 2012. If the Secretary’s position is accepted, then the notices of proposed assessed penalties were issued within two weeks after the investigation ended, which clearly would have been within a reasonable time.

In Secretary of Labor v. Twentymile Coal Co., 411 F.3d 256 (D.C.Cir. 2005), a case involving “serious, but non-fatal, head injuries . . .”, the court held that the requirement in § 105(a) that notices of proposed penalty assessments be issued “within a reasonable time” does not start running when the underlying citation or order is issued. Id. at 261. The court stated that the period cannot start running “before the mine had an opportunity to respond to the order,” since one of the factors to be considered in assessing a penalty against a respondent is how the mine abated the citation. Id. at 262. Instead, the court held that the period starts running when MSHA completes its investigation. The court gave deference to the Secretary’s position in that litigation that the investigation ended when an accident investigation report was issued. Id. at 261.

Applying the D.C. Circuit’s decision in Twentymile to this case, it is the date the special investigation ended rather than the date the citation to K-T Clay was issued from which “reasonable time” is to be measured. Further, I must give deference to the Secretary’s contention that the special investigation ended on February 17, 2012. As was pointed out above, the notices of proposed assessed penalties were issued on February 28 and 29, 2012. Accordingly, there was no delay at all in the issuance of the notices of proposed assessed penalties, and they were issued within a reasonable time.

Therefore, the Respondents’ motions to dismiss these penalty proceedings are denied.

II

Alternatively, assuming, arguendo, that “reasonable time” should be measured from the issuance of the citation, the motion to dismiss would still be denied.  

The Senate Committee that drafted the Mine Act commented on the Secretary's statutory responsibility to act “within a reasonable time”and noted that “there may be circumstances, although rare, when prompt proposal of a penalty may not be possible, and the Committee does not expect that the failure to propose a penalty with promptness shall vitiate any proposed penalty proceeding.” S. Rep. No. 95-181, 95th Cong., 1st Sess. 34 (1977), reprinted in Senate Subcommittee on Labor, Committee on Human Resources, 95th Cong., 2d Sess., Legislative History of the Federal Mine Safety and Health Act of 1977, at 622 (1978).

In Salt Lake County, supra, the Commission established a two-part test for determining whether a case should be dismissed when the 45 day deadline for the Secretary to file a petition for the assessment of a penalty with the Commission, as is required by 29 C.F.R. § 29.2700.28(a), was violated. The case held that the Secretary bears the initial burden of establishing that there was adequate cause for the late filing of the notice of the proposed penalty petition. If that burden is met, the Respondent must show actual prejudice due to the late filing. Id. at 1716. Recently, in Long Branch Energy, 34 FMSHRC 1984 (Aug. 2012), the Commission stated that adequate cause should be found to exist when the Secretary provides a non-frivolous explanation for the delay. Id. at 1991. Once the Secretary meets this burden, an operator must show at least some actual prejudice from the delay. Id. Mere allegations of potential prejudice or inherent prejudice should be rejected. Id. If prejudice is proven, the judge must weigh the prejudice caused by the delay against the public interest in upholding the enforcement purpose of the Mine Act. Id. Commission enforcement of the filing time limits is a secondary consideration to the primary purpose of ensuring prompt enforcement of the Act’s penalty scheme. Id. at 1990.

Salt Lake County and Long Branch do not concern the period to notify respondents of proposed penalties under § 105(a) of the Mine Act. See Salt Lake County, at 1715; Long Branch, at 1985. Nevertheless, these decisions are applicable here because they concern the length of time it is reasonable to permit the Secretary to delay an action and the legal standard to apply in making this analysis, the precise issue these cases raise. In Salt Lake County, the petition for the assessment of the civil penalty was filed with the Commission two months late; in Long Branch, the seven penalty petitions were filed from 7-1/2 to 11 months late. Id.              

The only citation issued in connection with these three § 110(c) cases is the September 4, 2009 citation issued to K-T Clay. Therefore, assuming the clock started running when the citation issued, the reasonable time requirement for notifying the Respondents of the proposed penalties began on September 4, 2009. From September 4, 2009, it took until February 29, 2012 - almost two and a half years - for MSHA to complete its investigations and issue the penalty assessments. Sec’y Resp. at 1. The question to be addressed is whether taking close to two and a half years to complete the investigations was reasonable.

MSHA’s Program Policy Manual (“PPM”) provides information regarding what is considered a “reasonable time” for assessing civil penalties under § 110(c):

Investigative timeframes have been established to help ensure the timely assessment of civil penalties against corporate directors, officers, and agents. Normally, such assessments will be issued within 18 months from the date of issuance of the subject citation or order. However, if the 18 month timeframe is exceeded, TCIO will review the case and decide whether to refer it to the Office of Special Assessments for penalty proposal. In such cases, the referral memorandum to the Office of Special Assessments will be signed by the Administrator.

I MSHA, U.S. Dep’t of Labor, Program Policy Manual, § 110 (1996). Although the PPM is not binding on the Secretary, it does show MSHA’s expectation regarding how long it should take to complete a §110(c) investigation from the issuance of a citation or order. By taking two and a half years instead of 18 months, MSHA failed to meet its own standard for a timely investigation in these cases.

The Secretary argues that there is adequate cause for why MSHA took two and a half years to complete its special investigations and issue the proposed penalty assessments against the Respondents. Specifically, MSHA has enhanced its enforcement efforts over the past five years, including increasing the number of inspectors employed nationally, which has caused the number of citations issued to rise substantially. Sec’y Resp. at 3; Long Branch at 1994. The rate at which operators contest these citations has also increased. Id. Thus, MSHA is now evaluating and processing civil penalties for an “unprecedented number of violations.” Sec’y Resp. at 3. That MSHA’s workload has dramatically increased in recent years was the basis for the Commission’s holding in Long Branch that adequate cause for the delay in that case was established. Long Branch at 1995. The Secretary further argues that taking two and a half years to complete an investigation is reasonable given the number of citations that MSHA must process, the need for a deliberate and careful investigation in § 110(c) investigations, and that this investigation involves three management employees and relates to an injury. Id. at 4.

Thus, the relevant question now is whether the Secretary has met the burden to show that there was an adequate cause for taking two and a half years to issue the penalty petitions against the Respondents. As stated above, the Secretary offered several reasons for the undue delay. First, § 110(c) cases are similar to criminal investigations since they have higher stakes than a regular § 105(a) civil penalty petition. They affect individual rights and may lead to civil money penalties, fines, or criminal prosecution. However, I would argue that § 110(c) are no more important - may even be less important - in achieving the Mine Act’s overall goal of mine safety than cases brought against operators. Second, the Secretary contends that the investigation in this case may have been complicated because an injury occurred and at least three agents needed to be investigated. Id. at 4. But no evidence was presented to support this contention.

Third, the Secretary argues that the increase in citations issued over the past five years and the resulting increase in the number of contests by operators naturally has expanded the burden upon the offices involved in a special investigation.            Although it is hard to comprehend why the Secretary has set up such a cumbersome procedure for determining whether penalties should be assessed against individuals, there is no doubt that MSHA’s workload has dramatically increased in recent years. I take judicial notice that the total number of citations and orders issued by MSHA to both coal and non-metal mines increased 49 percent from calender year 2002 to calendar year 2011. In addition, the total number of citations and orders issued by MSHA to both coal and non-metal mines increased 13 percent from calendar year 2006 to calendar year 2011. Id. Although this data shows that there was an increase in citations and orders in 2009, it is unclear whether this increase in citations and orders also led to a direct increase in § 110(c) special investigations. The Secretary did not explain whether this occurred in his Response nor if the number of employees working on § 110(c) cases was reduced to handle the influx of other work. Nevertheless, it is clear that MSHA’s workload has gone up dramatically in recent years.

The delay of two and a half years was significant, and may be near the breaking point for what should be considered acceptable delay. In this respect, it should be noted that the longest delay in Long Branch was 11 months, although it should be kept in mind that the deadline which was not met in that case was only 45 days. Missing a 45 day deadline by about 335 days may be more significant than missing an amorphous “reasonable time” deadline by two and a half years. In any event, courts have been reluctant to dismiss cases involving non-jurisdictional deadlines when important public rights are at stake. For example, Brock v. Pierce County, 476 U.S. 253 (1986), concerned a requirement under the Comprehensive Employment and Training Act that the Secretary of Labor issue a final determination within 120 days of receiving a complaint that funds were being misused. Id. at 255-56. The Secretary failed to make two final determinations within the requisite 120 day period; as in these three cases, the Secretary took two and a half years to make those determinations. Therefore, the respondent county argued that it could not be ordered to repay the allegedly misspent funds. Id. at 257. However, the Supreme Court held that Congress did not intend to impose a jurisdictional limitation on the Secretary’s enforcement powers by the 120 day provision. The Court opined that it would be “most reluctant to conclude that every failure of an agency to observe a procedural requirement voids subsequent agency action, especially when important public rights are at stake. When, as here, there are less drastic remedies available for failure to meet a statutory deadline, courts should not assume that Congress intended the agency to lose its power to act.” Id. at 260. The D.C. Circuit cited this case in Twentymile in holding that the Secretary’s delay was not unreasonable. Twentymile at 261-62.

The Secretary’s action in Brock, which the Court allowed to stand, was a dispute solely about a relatively small amount of money under two grants (less than $500,000) and, accordingly, limited public interest. The three cases at issue here concern protecting the health and safety of miners, a matter of great public interest. That the Court allowed the actions brought by the Secretary in Brock to stand leads to the conclusion that the Secretary’s actions against Hastings, Colson and Brinson should not be dismissed just for missing a procedural deadline, even if missing that deadline resulted in a two and a half year delay.

Moreover, as discussed by the Commission in Long Branch, there is a presumption that the Secretary’s agents generally act in good faith to uphold the timely enforcement of penalties assessed under the Act. Long Branch at 1991 n. 11 (quoting Kalvar Corp. v. United States, 543 F.2d 1298, 1299 (Ct. Cl. 1976)). The presumption can be rebutted through evidence that the delay was willful or a result of intentional misconduct or bad faith. Id. The Respondents have not presented any such evidence.

The Respondents urge that I dismiss these cases, and cite to cases where other administrative law judges have dismissed § 110(c) cases for failure to file a penalty petition in a timely manner. Resp’t Mot. at 6. However, the ALJ decisions cited by the Respondents occurred during the 1990s and early 2000s, when MSHA was not facing the large influx of violations and associated contests it is facing at this time. Further, the cases relied on by Respondents are distinguishable. In Doyal Morgan et al, 20 FMSHRC 38 (Jan. 1998)(ALJ), the § 110(c) proceedings were dismissed by the judge because the Solicitor failed to give detailed information with respect to what transpired to cause a 22 month delay. In Raymond P. Ernst, 18 FMSHRC 1674 (Sept. 1996)(ALJ), the § 110(c) action was dismissed based on the failure of the Secretary to explain the cause of the delay beyond providing general and vague reasons.

Here, in contrast, the Secretary has provided more than a pro forma explanation regarding what occurred to cause the delay in the special investigations. Furthermore, dismissal, in the absence of prejudice, is a harsh remedy that may prevent the Secretary from adequately enforcing his standards to protect miners’ health and safety under the statutory scheme of the Mine Act. Consequently, I conclude that the delay at issue here, while regrettable, was adequately explained by the unusual circumstances that existed during the relevant time period.

Since I find that the Secretary has shown adequate cause for the undue delay, I must now evaluate whether the Respondents have suffered actual prejudice due to this delay. The Commission has provided guidance that prejudice means more than “a danger of prejudice.” Long Branch at 7. The prejudice must, instead, be “real and substantial and demonstrated by a specific showing by the [Respondent].” Id. The Respondents argue that the delay is fundamentally unfair and that public policy concerns warrant dismissal. Resp’t Mot. at 8, 10-11. But delay is fundamentally unfair only if it results in prejudice to the affected parties; and, as the cases discussed above indicate, public policy concerns argue against dismissal.

Hastings points out he that was moved from his temporary position as Kaolin Operations Manager back to his original position as Engineering Manager, and was relocated from the city where the accident occurred to another city. Hasting’s Mot. at 9. He contends that due to these changes in position and work site his memory and knowledge of the day-to-day activities will have faded with time. Id. 8-9. I fail to see how either of these changes will prejudice his defense of the allegations against him. For one thing, Hastings has not explained how the 50 or so miles between Monticello and Sandersville creates a significant impediment to presenting his defense. Further, it is not apparent why changing jobs sometime after the incident in question should have an impact on Hastings’s memory of what occurred that day, and he provides no explanation for this contention. Colson argues that since he is retired and has not worked with the regulations and standards for one and a half years he does not have the same command of the subject matter as he would have absent the inordinate delay. Colson’s Mot. at 9-10. But this is a purely hypothetical argument, not proof of actual prejudice. Brinson does not point to any specific factors leading to prejudice, only the general contention that the delay in his case is per se prejudicial. This is not the proof of prejudice the cases demand.

Although it is possible that the Respondents’ knowledge of the events of August 27, 2009 have faded somewhat in the more than three years since the incident, it is not uncommon for litigation to occur several years after the events at issue. None of the Respondents here have alleged anything other than a hypothetical fading of memory, and I will not infer prejudice from the passage of time alone. Thus, the Respondents have not demonstrated actual prejudice due to the delay in issuing the petitions for assessment of penalties. Accordingly, the motions to dismiss these proceedings are denied. 

ORDER

IT IS ORDERED that the motions to dismiss are DENIED.

/s/ Jeffrey Tureck

Jeffrey Tureck

Administrative Law Judge

Distribution (Certified Mail):

Rolesia Butler Dancy, Esq., Office of the Solicitor, U.S. Department of Labor, 61 Forsyth Street, Suite 7T10, Atlanta, GA 30303

Willa B. Perlmutter, Esq., Crowell & Moring, LLP, 1001 Pennsylvania Ave., NW, Washington, DC 20004.

Karen L. Johnston, Esq., Jackson Kelly, 1099 18^th Street, Suite 2150, Denver, CO 80202.

Jason M. Nutzman, Esq., Dinsmore & Shohl, 900 Lee Street, Suite 600, Charleston, WV 25301.