FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

601 NEW JERSEY AVENUE, NW

SUITE 9500

WASHINGTON, DC 20001

November 22, 2011

BEFORE: Jordan, Chairman; Duffy, Young, Cohen, and Nakamura, Commissioners

ORDER

BY: Duffy, Young, Cohen, and Nakamura, Commissioners

            This matter arises under the Federal Mine Safety and Health Act of 1977, 30 U.S.C. § 801 et seq. (2006) (“Mine Act”). On September 16, 2009, and October 18, 2010, the Commission received requests to reopen a penalty assessment issued to Drum Sand & Gravel, Inc. (“Drum”) that had become a final order of the Commission pursuant to section 105(a) of the Mine Act, 30 U.S.C. § 815(a).

            Under section 105(a) of the Mine Act, an operator who wishes to contest a proposed penalty must notify the Secretary of Labor no later than 30 days after receiving the proposed penalty assessment. If the operator fails to notify the Secretary, the proposed penalty assessment is deemed a final order of the Commission. 30 U.S.C. § 815(a).

            We have held, however, that in appropriate circumstances, we possess jurisdiction to reopen uncontested assessments that have become final Commission orders under section 105(a). Jim Walter Res., Inc., 15 FMSHRC 782, 786-89 (May 1993) (“JWR”). In evaluating requests to reopen final section 105(a) orders, the Commission has found guidance in Rule 60(b) of the Federal Rules of Civil Procedure under which, for example, a party could be entitled to relief from a final order of the Commission on the basis of mistake, inadvertence or excusable neglect. See 29 C.F.R. § 2700.1(b) (“the Commission and its Judges shall be guided so far as practicable by the Federal Rules of Civil Procedure”); JWR, 15 FMSHRC at 787. Under Rule 60(b), any motion for relief must be made within a reasonable time, and in the case of mistake, inadvertence, or excusable neglect, not more than one year after the order was entered. J S Sand & Gravel, Inc., 26 FMSHRC 795, 796 (Oct. 2004). We have also observed that default is a harsh remedy and that, if the defaulting party can make a showing of good cause for a failure to timely respond, the case may be reopened and appropriate proceedings on the merits permitted. See Coal Prep. Servs., Inc., 17 FMSHRC 1529, 1530 (Sept. 1995).

            On June 9, 2009, the Department of Labor’s Mine Safety and Health Administration (“MSHA”) issued Proposed Assessment No. 000187135 to Drum. The Commission received Drum’s first request to reopen on September 16, 2009. In the request Drum did not address any attempt on its part to file a contest of the proposed penalty assessment but merely stated why it wished to contest various citations. Drum attached copies of the citations it wished to contest to its request to reopen.

            The Secretary opposed the request. She noted that MSHA’s records show that the proposed assessment was delivered on June 16, 2009, and became a final order of the Commission on July 16, 2009. The Secretary argued that the operator failed to explain why the contest form was not timely filed.

            On January 25, 2010, the Commission issued an order denying without prejudice Drum’s first request to reopen on the basis that the operator failed to provide an explanation for why it failed to timely contest the proposed penalty assessment, and the request was not based on any of the grounds for relief set forth in Rule 60(b). Drum Sand & Gravel, Inc., 32 FMSHRC 37, 39 (Jan. 2010). The Commission instructed the operator that if it submitted another request to reopen, it must establish good cause for not contesting the proposed penalties within 30 days from the date it received the assessment from MSHA. Id. at n.1. We stated in part that Drum should include “a full description of the facts supporting its claim of ‘good cause,’ including how the mistake or other problem prevented Drum from responding within the time limits,” and that it should also submit copies of supporting documents with its request to reopen. Id.

            On October 18, 2010, the Commission received a second motion to reopen from Drum. In the motion, Drum stated that it timely contested the penalty assessment, although it received correspondence from MSHA stating that the Secretary did not receive the contest until July 28, 2009, after the proposed assessment had become a final Commission order. Drum attached to its second request a copy of its contest, correspondence from MSHA stating that the operator’s contest was late, a copy of the proposed assessment form indicating which citations Drum wishes to contest, and MSHA records.

            On November 3, 2010, the Commission received the Secretary’s opposition to Drum’s second request. The Secretary states that she opposes Drum’s request to reopen for the same reasons she opposed the first request to reopen. The Secretary contends that in its second request, the operator provides no additional facts and documents, and that the operator has failed to provide a full description supporting its claim of good cause and to provide documents supporting that claim. The Secretary states that MSHA’s records reveal that the operator’s contest was post-marked July 20, 2009, four days after the proposed assessment became a final order. She notes further that there was a significant delay in the filing of the operator’s second request. The Secretary attached a copy of the envelope post-marked July 20, 2009, to her opposition.

            On November 17, 2010, the Commission received a reply to the Secretary’s opposition from Drum’s counsel. Counsel attached an affidavit by Drum’s owner, Jeff Drum, to the reply. Mr. Drum asserts that he filed a contest of Proposed Assessment No. 000187135 within ten days after receiving the proposed assessment form. Mr. Drum later contacted MSHA to determine the status of the contest and was eventually informed that the operator should file a request to reopen.

            The record reveals a conflict regarding whether Drum timely filed its contest of Proposed Assessment No. 000187135. Although Drum’s owner swears in an affidavit that he filed a contest within ten days after receiving the proposed assessment, the Secretary submitted a copy of an envelope post-marked July 20, 2009, four days after the proposed assessment became a final order. We conclude that, in these circumstances, the factual dispute should be resolved by a Commission Administrative Law Judge, who is empowered to rule on offers of proof and receive any additional evidence. See 29 C.F.R. § 2700.55.

            Accordingly, for the foregoing reasons, we hereby remand these proceedings to the Chief Administrative Law Judge for a determination of whether Drum timely contested Proposed Assessment No. 000187135. If the Judge determines that the contest was untimely, the Judge should determine whether good cause exists for Drum’s failure to timely contest the proposed assessment and whether relief from the final order should be granted.

/s/ Michael F. Duffy                                                                                     

Michael F. Duffy, Commissioner

/s/Michael G. Young

Michael G. Young, Commissioner

/s/ Robert F. Cohen, Jr.

Robert F. Cohen, Jr., Commissioner

/s/ Patrick K. Nakamura                                                                                

Patrick K. Nakamura, Commissioner

Chairman Jordan, dissenting: 

            It is undisputed that the proposed assessment in this case was delivered by Federal Express on June 16, 2009 and became a final order of the Commission on July 16, 2009. The Secretary sent Drum a delinquency letter dated September 3, 2009, and Drum filed a motion to reopen shortly thereafter, but failed to include any reason why it did not file a timely contest.

            In January 2010 the Commission issued an order denying this request for relief without prejudice. Drum Sand & Gravel, Inc., 32 FMSHRC 37, 39 (Jan. 2010). The operator waited eight months (until October 2010) before filing a second request. Notably, that submission consisted mainly of the same assertions sent in the original motion, with the addition of the unsubstantiated statement that the contest was timely, and several attachments that in no way supported this claim. One of these attachments consisted of a copy of an August 2009 letter from MSHA stating that MSHA had received the hearing request (which was mailed on July 20) on July 28, 2009 and that the penalty had therefore become a final order. This letter indicates that Drum was on notice of the default even before receiving the delinquency letter.

              In her opposition, the Secretary alleged that the MSHA payment office received a contest form from Drum postmarked July 20, 2009, four days after the proposed assessment became a final order. The Secretary included in her reply a copy of an envelope from Drum to MSHA postmarked on that date.

            In its reply, the operator submitted an affidavit in which the owner declared that he had filed the contest on time, declaring that he filed all contests “within or about ten (10) days after receipt of the same.” He also stated that he followed up with phone calls to MSHA.

            Having reviewed the documents submitted in support of the operator’s motion, and the Secretary’s opposition, I have determined that the only reasonable conclusion to draw from the record is that the contest was late. The copy of the postmarked envelope submitted by the Secretary sufficiently rebuts the operator’s generalized claim that the contest was timely filed. Accordingly, remand to the judge is not needed. See American Mine Servs., Inc., 15 FMSHRC 1830, 1834 (Sept. 1993) (where evidence supports only one conclusion, remand on that issue unnecssary). Moreover, given the assertions in the letter to the Commission from the President of Drum, received on September 16, 2009, I am even less inclined to grant relief. Thus, reopening is not appropriate here. 

            In sum, I vote to deny the operator’s request because the operator’s second motion was filed eight months after our January 2010 order issued and provided virtually no helpful information, and the Secretary’s proof that the penalty was filed late is persuasive.

                                                                                    /s/ Mary Lu Jordan

                                                                                    Mary Lu Jordan, Chairman 

Distribution:

Hunter J. Hanshaw, Esq.

Drum Sand & Gravel, Inc.

18800 Massengill Rd.

P.O. Box 196

Harrisburg, AR 72432

W. Christian Schumann, Esq.

Office of the Solicitor

U.S. Department of Labor

1100 Wilson Blvd., Room 2220

Arlington, VA 22209-2296

Melanie Garris

Office of Civil Penalty Compliance

MSHA

U.S. Dept. of Labor

1100 Wilson Blvd., 25^th Floor

Arlington, VA 22209-3939

Chief Administrative Law Judge Robert J. Lesnick

Federal Mine Safety & Health Review Commission

601 New Jersey Avenue, N. W., Suite 9500

Washington, D.C. 20001-2021