<DOC>
[DOCID: f:yk9939x.wais]
DOUGLAS R. RUSHFORD TRUCKING
September 22, 2000
YORK 99-39-M
FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION
OFFICE OF ADMINISTRATIVE LAW JUDGES
2 SKYLINE, Suite 1000
5203 LEESBURG PIKE
FALLS CHURCH, VIRGINIA 22041
September 22, 2000
SECRETARY OF LABOR, : CIVIL PENALTY PROCEEDING
MINE SAFETY AND HEALTH :
ADMINISTRATION (MSHA), : Docket No. YORK 99-39-M
Petitioner : A. C. No. 30-02851-05504
v. :
: Seymour Road Pit
DOUGLAS R. RUSHFORD TRUCKING, :
Respondent :
DECISION
Appearances: Suzanne Demitrio, Esq., Office of the Solicitor,
U.S. Department of Labor, New York, New York, for
Petitioner;
Thomas M. Murnane, Esq., Stafford, Trombley, Owens
& Curtin, PC, Plattsburgh, New York for
Respondent.
Before: Judge Melick
This civil penalty proceeding under the Federal Mine Safety
and Health Act of 1977, 30 U.S.C. � 801, et seq., the "Act," is
before me upon remand by the Commission for reconsideration of
the $3,000.00 civil penalty imposed on Douglas R. Rushford
Trucking (Rushford) for its violation of the standard at 30
C.F.R. � 56.14104(b)(2). Pursuant to the remand, hearings were
held on August 24, 2000, to take supplemental evidence on issues
not previously litigated.
Background
Rushford operates the Seymour Road Pit in Clinton County,
New York. On August 28, 1998, when Rushford employee Nile Arnold
attempted to inflate a tire on a fuel truck, the wheel rim
exploded and struck Arnold in the head. At the time, Arnold was
not using a stand-off inflation device nor was there such a
device available on the mine site. On August 30, 1998, Arnold
died as a result of the injuries he sustained. After conducting
an investigation, the Department of Labor's Mine Safety and
Health Administration (MSHA) charged Rushford with violating 30
C.F.R. � 56.14104(b)(2). That standard requires that stand-off
inflation devices be used "to prevent injuries from wheel rims
during tire inflation." Following hearings the violation was
sustained as well as the associated "significant and substantial"
and "unwarrantable failure" findings and Rushford was ordered to
pay a civil penalty of $3,000.00.
On review before the Commission the Secretary presented a
new theory not previously raised in her pleadings or at trial,
that she failed to conduct inspections at the subject mine during
relevant times because of Rushford's failure to file quarterly
reports and that therefore Rushford's lack of a history of
violations could not properly be considered as a mitigating
factor in the penalty assessment. The Commission accepted review
of the Secretary's new theory and remanded the issue for further
proceedings. But See Section 113(d)(2)(A)(iii) of the Act;
Commission Rule 70(d), 29 C.F.R. � 2700.70(d); Beech Fork
Processing, Inc., 14 FMSHRC 1316, (August 1992); Shamrock Coal
Co., 14 FMSHRC 1300 (August 1992). Within the constraints of the
Commission's directive however, the record was accordingly
reopened and additional evidentiary hearings held to enable the
Secretary to produce evidence on this issue not previously
litigated. The Commission also requested further explanation
regarding application of the "Section 110(i)" criteria.
Evaluation of the Civil Penalty Criteria
Section 110(i) of the Act requires that "in assessing civil
monetary penalties, the Commission shall consider" the following
criteria: (1) the operator's history of previous violations, (2)
the appropriateness of such penalty to the size of the business
of the operator charged, (3) whether the operator was negligent,
(4) the effect on the operator's ability to continue in business,
(5) the gravity of the violation, and (6) the demonstrated good
faith of the person charged in attempting to achieve rapid
compliance after notification of a violation. Analysis of the
evidence in this case relevant to the above criteria follows
hereafter:
Operators' History of Previous Violations
At the initial hearings, the Secretary introduced into
evidence a document entitled "R-17-Assessed Violation History
Report-Detailed Violation Listing" (Gov't Exh. No. 6). That
report was offered by the Secretary to represent Rushford's
history of violations for the period August 28, 1996, through
August 27, 1998, and reflected that no violations had been
committed during the stated period. The Secretary acknowledges
that, because of its age, a July 2, 1988,
11 year-old violation (Gov't Exh. No. 12) should not be
considered as part of Rushford's history for purposes of these
proceedings. At no time, either in her pleadings, at hearings or
in her post-hearing brief did the Secretary even suggest that her
evidence in this regard was not credible or should be given less
than full weight. In the initial decision in this case,
significant reliance and weight was accordingly placed upon the
Secretary's own uncontradicted evidence showing the absence of
any history of violations.
On review before this Commission, the Secretary, for the
first time argued, and the Commission agreed, that her own
evidence of Rushford's lack of a history of violations could not
properly be considered as a mitigating factor for a penalty
assessment if that lack of history was due to the company's
failure to meet a reporting requirement. While the legal
authority for this argument has never been disclosed it
presumably arises under the doctrine of equitable estoppel. On
review the Secretary argued that since Rushford admittedly did
not file quarterly reports with MSHA between 1993 and 1998, as
required under 30 C.F.R. � 50.30, she was not aware that
Rushford's mine was active during this period.
In her initial brief following remand the Secretary argued
that if a mine that is categorized as "closed" by MSHA, files a
quarterly report the mine is recategorized as an "open" or
"active" mine in MSHA's database. According to the Secretary,
when that database is thus amended the mine is returned to the
list of "active" mines required to be inspected by MSHA.
The credible evidence shows however that the facts are
different from those argued before this Commission. The credible
evidence shows that MSHA had incorrectly through its own fault
listed the Seymour Road Pit in its records as "closed." It is
undisputed that on May 13, 1993, Rushford provided to MSHA
inspector Phil Freese, at that inspector's request, a written
notice that the subject mine was "open" (Gov't Exh. No. 9).
According to the credible testimony of Rushford bookkeeper Mary
Pelke, Inspector Freese told her that MSHA had "closed" the
Seymour Road Pit on their records in error and that Freese asked
her to prepare the notice so that he could correct MSHA's records
and confirm that the mine was "open" and continuing to operate.
MSHA Field Office supervisor, Carl Onder, testified at the
hearings on remand that this notice was sufficient to inform MSHA
that the Seymour Road Pit was indeed an "open" mine. It is
indeed undisputed that the mine had in fact continued to be
"open" and operating during the entire period 1993 through 1998.
It is clear therefore that MSHA's failure to have classified this
mine as "open" was its own error and not Rushford's.
MSHA supervisor Onder testified that the MSHA Denver Office
maintains a "mine reference list" of all mines that are "open."
According to Onder, the source of this information is the mine
operator himself (Tr. 32-33). The mine operator notifies the
MSHA field office which notifies the MSHA District office which,
in turn, notifies the Denver office (Tr. 33). The Denver office
maintains the master list for the entire country. Each quarter,
mines that are listed as "open" on the MSHA master list are sent
Quarterly Mine Employment and Coal Production Report (quarterly
report) forms (Gov't Remand Exh. No. 1). In this way each "open"
mine is reminded by MSHA each quarter of the need to file its
quarterly report.
In this case then, since Rushford did properly report itself
as "open" and indeed had never reported itself as "closed," it
should have continued to receive the quarterly report forms from
MSHA, thereby notifying Rushford of the need to file its
quarterly reports. It was therefore also MSHA's error that
caused MSHA's cessation of mailing quarterly report forms to
Rushford. Indeed Rushford bookeeper Mary Pelke testified that
when she stopped receiving those blank quarterly report forms
from MSHA, she assumed it was not necessary to file such reports.
However, in spite of MSHA's own negligence, according to the
undisputed evidence, if Rushford had continued to file the
required quarterly reports whether it was listed as "open" or
"closed" on the Denver office master list, eventually the MSHA
field office would have been notified of the need to conduct an
inspection. Thus, regardless of the lack of intent or serious
negligence on the part of Rushford in failing to file the
quarterly reports, according to the Commission's holding,
Rushford's lack of a history of violations cannot be considered
as a mitigating factor in the assessment of a penalty. The
increase in penalty herein reflects that holding.
It should also be noted that the Secretary acknowledges that
her allegations that Rushford committed at least 20 paperwork
violations for failing to file quarterly reports should not be
considered as part of Rushford's prior history. Those alleged
violations have never been cited nor litigated. The Secretary is
correct in acknowledging that such allegations should not be
considered herein in determining a history of "violations."
The Appropriateness of the Penalty to the Size of the Business of
the Operator Charged
It is generally accepted that within the framework of this
criterion and with the other criteria being equal, a small size
mine operator should not pay as large a penalty as a medium or
large size operator. In other words the penalty should be
proportionate to the size of the operator. It has been
stipulated that indeed this operator is small in size.
The credible record shows that Rushford typically had only
three employees working in the mine only one day a week in mining
activity. The record also shows that Rushford and, its employees
performed significant non-mining activity such as pipe laying,
asphalt paving and hauling -- activities that were subject to
OSHA not MSHA jurisdiction. The Secretary acknowledges that such
non-mining activity should not be considered when evaluating the
size of a mine operator. I find that the operator was therefore
very small in size with intermittent mining activity.
Significant weight has been placed upon this factor in assessing
the civil penalty in this proceeding. [1]
Whether the Operator was Negligent
The findings below that the instant violation was the result
of high negligence and gross negligence are not disputed by the
Secretary. While these findings are warranted under the facts of
this case I have also noted that such negligence was the result
of Douglas Rushford's self- imposed ignorance of the requirements
of the cited standard rather than any intentional non-compliance.
It is therefore at least arguable that the violation was in fact
not the result of unwarrantable failure. I have also noted that
although Rushford's facilities had previously been inspected by
MSHA there is no evidence that Rushford had previously been cited
for failure to comply with the instant standard or with
comparable OSHA standards. While these factors certainly do not
excuse the violation they nevertheless warrant, and were given,
due consideration in determining the appropriate civil penalty
herein.
The Effect on the Operator's Ability to Continue in Business
Rushford acknowledges in its brief on remand that even a
penalty as large as that proposed by the Secretary, i.e.,
$25,000.00, would not cause it to cease operations - - but only
claims that it would create hardship to its operation. It
contends that the imposition of a "greater penalty" would affect
its "ability to operate." In light of these admissions and the
absence of specific proof that the penalties herein would indeed
affect its ability to continue in business, it is presumed that
there would be no such adverse affect . See Sellersburg Stone
Co., 5 FMSHRC 287 (March 1983), aff'd, 736 F.2d 1147 (7th Cir.
1984).
The Gravity of the Violation
It was stated in this regard in the decision below as
follows:
The failure to use a wheel cage or other
restraining device or a stand-off inflation device
under the circumstances of this case resulted in
Arnold's fatal injuries. There can be no question on
the facts of this case that the violation was therefore
"significant and substantial."
The violation herein was therefore one that not only was
reasonably likely to cause reasonably serious injuries but in
fact was found to have caused fatal injuries. The question, in
effect, raised by the Commission on remand is whether such a
violation causing a fatality should be characterized as of
"low," "medium," or "high" gravity. As suggested by the
Commission, without such a finding, a decision lacks the
precision necessary for appellate review. Accordingly my finding
is that the violation herein, which admittedly caused the death
of Nile Arnold, was of high gravity.
The Demonstrated Good Faith of the Person Charged in Attempting
to Achieve Rapid Compliance after Notification of a Violation
The Secretary has acknowledged that the operator
demonstrated good faith in achieving rapid compliance after
notification of the violation herein (Tr. 412, 418). The record
shows that the citation at issue was terminated on September 24,
1998, after the operator obtained a stand-off inflation device
and posted signs at the shop and pit requiring employees to use
the device when inflating tires. (Gov't Exh. No. 5). These
factors were given considerable weight in assessing the civil
penalty herein.
The Secretary's Proposed Penalty
The Commission has held that a judge's assessment of a
penalty may not "substantially diverge" from the penalty proposed
by the Secretary without sufficient explanation for that
divergence. See Unique Electric, 20 FMSHRC 119, 1123 n.4
(October 1998); Sellersburg Stone Co., 5 FMSHRC 287, 293 (March
1983). This holding necessarily presumes however that the
Secretary's penalty proposal was itself based on a reasoned
analysis of the statutory criteria and was not arbitrary and
capricious.
In this regard it is significant to note that a penalty in
this case calculated under the Secretary's objective and uniform
criteria set forth in 30 C.F.R. � 100.3, would have resulted in a
proposed penalty of $317.10. In particular, Rushford would have
been chargeable with no penalty points for its size and history
of violations, possibly the maximum 25 penalty points for
negligence, 10 penalty points for "severity," and one penalty
point for "persons potentially affected." In addition, under 30
C.F.R. � 100.3(f) a 30% reduction would have been given for good
faith abatement.
In this case, of course, the Secretary elected to waive her
uniform and objective analysis under Section 100.3 and applied a
subjective "special assessment" for which there is little or no
considered analysis. Indeed, the pleading entitled "Narrative
for Special Assessment" is basically a form letter used in
special assessment cases in which bald assertions are anonymously
made that:
MSHA has carefully evaluated the conditions cited,
the inspector's relevant information and evaluation,
and the information obtained from the Report of
Investigation. The proposed penalty reflects the
results of an objective and fair appraisal of all the
facts presented.
The Secretary was unable to furnish any information
underlying her purported penalty analysis in this case. There is
indeed no explanation for the extreme divergence between the
Secretary's objective standard civil penalty of $317.10
calculated under her Section 100.3 formula and her subjective
inadequately substantiated proposal of $25,000.00, in this case.
Without an adequate explanation for such a divergence, the
credibility of her "special assessment" is indeed jeopardized by
the appearance of arbitrariness and should not properly be
considered as a benchmark or guideline for an appropriate de novo
penalty assessment by the Commission and its judges.
In her brief on remand the Secretary also argued that the
penalty should be of an amount sufficient to make it more
economical for an operator to comply with the Act's requirements
than it would be to pay the penalties assessed and continue to
operate while not in compliance (Brief p. 2). While this
argument is outside the scope of the civil penalty criteria
considered for the penalty herein it is nevertheless addressed.
It is not disputed that the cost of the standoff inflation device
which Rushford purchased to abate the citation at issue was no
more than $60.00. A penalty of $4,000.00 is more than 66 times
this amount and is clearly sufficient to address the Secretary's
concerns in this regard. A penalty of $25,000.00 as proposed by
the Secretary is over 400 times the cost of a standoff inflation
device and is clearly disproportionate.
In any event it is apparent that the Secretary's proposed
penalty of $25,000.00, is without adequate analytical support and
is disproportionate to an appropriate consideration of the
penalty criteria as discussed herein. Accordingly such a
proposed penalty is not credible and should not be utilized as
any benchmark or guideline for evaluating an appropriate de novo
penalty assessed by the Commission or its judges.
ORDER
Douglas R. Rushford Trucking is hereby directed to pay a
civil penalty of $4,000.00 within 40 days of the date of this
decision.
Gary Melick
Administrative Law Judge
Distribution:
Suzanne Demitrio, Esq., Office of the Solicitor, U.S. Dept. of
Labor, 201 Varick St., Room 707, New York, NY 10014 (Certified
Mail)
Thomas M. Murnane, Esq., Stafford, Trombley, Owens & Curtin, PC,
One Cumberland Avenue, P.O. Box 2947, Plattsburgh, NY 12901
(Certified Mail)
/mca
**FOOTNOTES**
[1] It should also be noted, to clarify a suggestion made
in her brief on remand, that the Secretary acknowledges that an
operator's size should not be measured by its "gross profits."