<DOC>
[DOCID: f:weva95149.wais]
CAPITOL CEMENT CORPORATION
August 18, 1999
WEVA 95-194-M
FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION
1730 K STREET NW, 6TH FLOOR
WASHINGTON, D.C. 20006
August 18, 1999
SECRETARY OF LABOR, :
MINE SAFETY AND HEALTH :
ADMINISTRATION (MSHA) : Docket Nos. WEVA 95-194-M
: WEVA 95-221-M
v. : WEVA 95-321-M
:
CAPITOL CEMENT CORPORATION :
BEFORE: Jordan, Chairman; Marks, Riley, Verheggen, and Beatty,
Commissioners
DECISION
BY: Jordan, Chairman; Marks and Beatty, Commissioners
These civil penalty proceedings, arising under the
Federal Mine Safety and Health Act of 1977, 30 U.S.C. � 801
et seq. (1994) ("Mine Act" or "Act"), raise the issues of
whether Administrative Law Judge Gary Melick denied due
process to Capitol Cement Corporation ("Capitol") by
conducting a hearing in which a witness asserted the Fifth
Amendment privilege against self-incrimination,[1] whether
the judge properly concluded that violations of 30 C.F.R.
�� 56.12016[2] and 56.15005[3] by Capitol resulted from its
unwarrantable failure to comply with the standards, and
whether the negligence of two supervisors is imputable to
Capitol for civil penalty purposes. 19 FMSHRC 531 (Mar. 1997)
(ALJ). For the reasons that follow, we reject Capitol's due
process claim and affirm the judge's findings of unwarrantable
failure and his penalty assessments.
I.
Factual and Procedural Background
This case involves two citations and a withdrawal order
arising from two separate accidents at Capitol's Martinsburg
Plant in Berkeley County, West Virginia. The Martinsburg
Plant operates a limestone quarry and crushing facility and
a cement manufacturing facility. Tr. 16-17.
A. Bonfili's Accident
On October 21, 1994, shift supervisor Gregory Bonfili was
injured when he contacted the energized rail, or "hot rail," of
an overhead crane while responding to a safety concern of the
crane operator, Charlie Cook. 19 FMSHRC at 533. The rail
provides 480-volt alternating current electrical power to the
crane, which is used to move materials inside a 600-foot long,
80-foot wide, and 75-foot high storage building. Id. The crane
runs across the building on a "craneway," under which the hot
rail is located. Id.; Tr. 76. The height of the crane is
adjustable and varies according to the amount of material below
the crane. Id. At the time of the accident, the crane was
suspended approximately 60 feet above the ground. 19 FMSHRC at
533. The crane is operated onboard and is usually accessed by
one of several boarding platforms along the craneway, which have
guardrails to protect against falling. Id.; Tr. 77, 160. The
craneway also has a 3-foot-wide walkway, which does not have a
guardrail but has a cable to which persons can tie off safety
belts. 19 FMSHRC at 533; Tr. 77-78, 160-61. The crane can be
deenergized in three ways: a circuit breaker onboard the crane
deenergizes the crane only; a circuit breaker on the third floor
of the building (which, at the time of the accident, was one
level below the crane) deenergizes the crane and the rail; and a
circuit breaker on the ground floor of the building deenergizes
the entire section, including the crane and rail. 19 FMSHRC at
533; Tr. 78-79, 120.
Responding to Cook's concern that the crane was shaking,
Bonfili boarded the crane and rode back and forth along the
craneway to observe the crane's movement. 19 FMSHRC at 533, 534;
Tr. 79. Bonfili then directed Cook to deenergize the crane and,
without deenergizing the rail or wearing a safety belt, Bonfili
went onto the craneway to examine the structure. 19 FMSHRC at
533. During the examination, Bonfili reached over the side and
contacted the hot rail. Id.; Tr. 20, 79. In order to deenergize
the rail, Cook ran along the craneway for a distance of
approximately 40 feet and down a stairway to the circuit breaker
located on the third floor of the building. 19 FMSHRC at 533;
Tr. 154. Bonfili received severe burns to his forearm. 19
FMSHRC at 533; Tr. 20.
**FOOTNOTES**
[1]: The Fifth Amendment to the United States
Constitution provides that no person "shall be compelled in
any criminal case to be a witness against himself." U.S.
Const. amend. V.
[2]: Section 56.12016 states, in part:
Electrically powered equipment shall be
deenergized before mechanical work is done on
such equipment. Power switches shall be
locked out or other measures taken which
shall prevent the equipment from being
energized without the knowledge of the
individuals working on it.
[3]: Section 56.15005 states, in part:
Safety belts and lines shall be worn
when persons work where there is danger of
falling . . . .
Following the accident, Edward Skvarch, an inspector
with the Department of Labor's Mine Safety and Health
Administration ("MSHA"), conducted an accident investigation
and, pursuant to section 104(a) of the Mine Act, 30 U.S.C.
� 814(a), issued Capitol Citation No. 4294023 alleging a
significant and substantial ("S&S")[4] violation of section
56.12016 for Bonfili's failure to deenergize equipment before
doing mechanical work and Order No. 4294024 alleging an S&S
violation of section 56.15005 for Bonfili's failure to wear a
safety belt when working where there is danger of falling.
19 FMSHRC at 532-33; Gov't Exs. 1 & 2. Both the citation and
order were later modified to allege unwarrantable failure to
comply with the standards under section 104(d)(1) of the Mine
Act, 30 U.S.C. � 814(d)(1). Id. The Secretary of Labor
subsequently proposed civil penalty assessments of $5,000 and
$2,500, respectively, for the alleged violations and Capitol
challenged the proposed assessments.
B. Lozano's Accident
On March 15, 1995, shift supervisor Arthur Lozano was
injured when he got caught in a conveyor belt while attempting
to align, or "train," the belt. 19 FMSHRC at 536. Lozano
removed the safety guard from the belt's head pulley, and
directed general laborer Jeff Miller, who was working nearby,
to observe him, stating: "Come here, I want to show you a
trick." Id.; Tr. 47, 121, 129, 143. Then, with Miller standing
a few feet away, Lozano held a roll of duct tape and, with his
hands between the energized head pulley and the belt, touched
the tape to the head pulley where it proceeded to unroll. 19
FMSHRC at 536; Tr. 143-44. When Lozano tried to tear the tape,
however, it did not tear and he was pulled into the head pulley.
19 FMSHRC at 536; Tr. 144. Miller went to deenergize the belt,
hollering to another employee standing beside the power switch
who turned it off. Id. Lozano sustained injuries to his hand
and arm. 19 FMSHRC at 536; Tr. 32, 144.
Subsequently, while conducting a regular inspection,
Inspector Skvarch learned of the accident. 19 FMSHRC at 536;
Tr. 31-32. As the result of an accident investigation,
Inspector Skvarch issued Capitol Citation No. 4294714,
pursuant to section 104(d)(1) of the Mine Act, alleging an
S&S and unwarrantable violation of section 56.12016 for
Lozano's failure to deenergize equipment before doing
mechanical work. 19 FMSHRC at 536; Gov't Ex. 3. The
Secretary proposed a civil penalty assessment of $3,000 for
the alleged violation and Capitol challenged the proposed
assessment.
C. Judge's Decision
On October 26, 1995, prior to the hearing, Capitol filed
a motion to stay Docket Nos. WEVA 95-194-M and WEVA 95-221-M
until possible criminal charges against Bonfili were
resolved. On October 27, 1995, the judge stayed those
dockets pending MSHA's completion of its related criminal
investigation. On August 7, 1996, the judge lifted the stay
in the two dockets involving Bonfili, as well Docket No.
WEVA 95-321-M. On October 15, 1996, Capitol filed a motion
to dismiss all three dockets based, in part, on MSHA's delay
in bringing a criminal case against Bonfili or its failure
to state that it would not do so, and its expectation that
Bonfili would assert his Fifth Amendment privilege against
self-incrimination if called to testify. On October 16,
1996, the judge denied the motion. On October 30, 1996, the
judge conducted the hearing, at which Bonfili asserted his
Fifth Amendment privilege. Tr. 95-97. Capitol's counsel
then stated "we object for having to go forward at this
time," asserting that Bonfili's testimony would assist it in
defending the case. Tr. 97. We construe this objection as
a renewed motion for a further stay of the hearing.
However, after the judge learned that Capitol could provide
other witnesses who could testify to what Bonfili had told
them about the accident, and who could testify that Capitol
had trained Bonfili, he implicitly overruled the objection.
Tr. 97-98 (directing Capitol to "[g]o ahead"). On February
28, 1997, the judge held oral argument to clarify the legal
theories presented by the parties in their post-hearing
briefs.[5]
In his decision dated March 7, 1997, the judge noted
that Capitol did not dispute the S&S violations but contested
the unwarrantable failure allegations and the proposed
penalties. 19 FMSHRC at 534. The judge concluded that all
three violations resulted from Capitol's unwarrantable
failure to comply with the standards. Id. at 534, 537.
Regarding Bonfili's violation of section 56.12016, the judge
found that, based on Capitol's training records, it was
reasonable to infer that Bonfili knew that deenergizing the
crane alone would not also deenergize the rail. Id. at 534.
He further found that Bonfili failed to lock out any of the
power sources. Id. The judge determined that the violation
was obvious, extremely dangerous, and committed by a shift
supervisor who is held to a high standard of care. Id.
Regarding Bonfili's violation of section 56.15005, the judge
found that, again based on Capitol's training records, it
was reasonable to infer that Bonfili knew that failing to
use a safety belt was a violation. Id. In assessing civil
penalties for the violations, the judge imputed Bonfili's
negligence to Capitol, determining that the defense
established in Nacco Mining Co., 3 FMSHRC 848 (Apr. 1981),
was inapplicable because Bonfili not only placed himself at
risk of injury, but also exposed Cook to risk. Id. at 534-
35. The judge found that by running along the craneway to
deenergize the rail, Cook was exposed to the hazard of
falling and suffering potentially fatal injuries. Id. at
535. He also inferred that, had Bonfili fallen off the
craneway, Cook could have attempted to rescue him, thereby
exposing himself to a falling hazard with potentially fatal
consequences. Id. However, the judge found that Capitol's
conscientious hiring practices, training program, and safety
rules were mitigating circumstances. Id. at 535. Thus, the
judge assessed civil penalties of $2,500 and $1,250. Id.
With regard to Lozano's violation of section 56.12016,
the judge found that "it shows reckless disregard to do what
[Lozano] did here." Id. at 537. The judge determined that
the violation was obvious, dangerous, and committed by a
shift supervisor who is held to a high standard of care.
Id. In assessing the civil penalty for the violation, the
judge imputed Lozano's negligence to Capitol, determining
that the Nacco defense was inapplicable based on an
inference that, had Lozano become further entangled in the
belt, Miller might have attempted to rescue him, exposing
himself to the hazard of the moving belt and suffering
potentially serious injuries. Id. However, the judge found
that Capitol's conscientious hiring practices, training
program, and safety rules were mitigating circumstances.
Id. Thus, the judge assessed a civil penalty of $1,600.
Id. The Commission granted the petition for discretionary
review subsequently filed by Capitol challenging these
determinations.
II.
Disposition
A. Due Process
Capitol argues that the judge denied it due process by
requiring it to go forward after Bonfili asserted the Fifth
Amendment privilege and refused to testify. PDR at 11-13;
Reply Br. at 2-5. The Secretary responds that, although
Bonfili asserted the Fifth Amendment privilege, the judge did
not violate Capitol's due process rights by conducting the
hearing. S. Br. at 9-12.
The Due Process Clause of the Fifth Amendment guarantees
that no person shall "be deprived of life, liberty, or property,
without due process of law." U.S. Const. amend. V. The
fundamental requirement of procedural due process is the
opportunity to be heard "at a meaningful time and in a
meaningful manner" appropriate to the nature of the case.
Mathews v. Eldridge, 424 U.S. 319, 333 (1976); Boddie v.
Connecticut, 401 U.S. 371, 378 (1971); Goldberg v. Kelly, 397
U.S. 254, 267 (1970) (quoting Armstrong v. Manzo, 380 U.S. 545,
552 (1965)). The timing and manner of the hearing depend upon
"appropriate accommodation of the competing interests involved."
Logan v. Zimmerman Brush Co., 455 U.S. 422, 434 (1982) (quoting
Goss v. Lopez, 419 U.S. 565, 579 (1975)).
While a judge may stay a civil proceeding pending the
outcome of a parallel criminal prosecution, such action is not
required by the Constitution. SEC v. Dresser Indus., Inc., 628
F.2d 1368, 1375 (D.C. Cir.), cert. denied, 449 U.S. 993 (1980).
See generally United States v. Kordel, 397 U.S. 1 (1970). In
Kordel, the Supreme Court rejected the defendants' claim that
the use of the civil discovery process in a Food and Drug
Administration proceeding to compel answers to interrogatories
that could be used to build the prosecution's case in a parallel
criminal proceeding was so unfair as to require reversal of the
criminal convictions. The Court recognized the "[i]t would
stultify enforcement of federal law to require a government
agency . . . invariably to choose either to forgo recommendation
of a criminal prosecution once it seeks civil relief, or to
defer civil proceedings pending the ultimate outcome of a
criminal trial." 397 U.S. at 11 (footnote omitted).
Capitol has not cited any case in which a court or agency
was found to have violated the Due Process Clause by declining
to stay a civil proceeding despite the anticipated assertion of
the privilege against self-incrimination by a prospective witness.
In the absence of circumstances "in which the nature of the
proceedings demonstrably prejudices substantial rights of the
investigated party or of the government," parallel proceedings
should not be prohibited. Dresser, 628 F.2d at 1377 (citing
Kordel, 397 U.S. at 11-13).
The decision whether to stay a civil proceeding until
completion of a criminal prosecution is within the judge's
discretion, and review of that decision is generally based on an
inquiry as to whether it constituted an abuse of discretion.
Buck Creek Coal Inc., 17 FMSHRC 500, 503 (Apr. 1995). Here,
however, Capitol has raised a due process challenge to the
judge's decision to lift the stay. As in Buck Creek, where the
operator argued that a blanket stay denied it due process (17
FMSHRC at 501), we apply the test for abuse of discretion, as
the relevant factors for this analysis are almost identical to
those used by courts in applying a due process analysis to
determine whether the granting or lifting of a stay was proper.
See, e.g., Keating v. Office of Thrift Supervision, 45 F.3d 322
(9th Cir. 1995).[6] For both claims, "[i]n essence, the test
is one of balancing equities." See In re Phillips, Beckwith &
Hall, 896 F. Supp. 553, 558 (E.D. Va. 1995).
In Buck Creek, the Commission set forth the following
factors that are appropriate for consideration in determining
whether a request for stay based on possible criminal
prosecution should be granted:
(1) the commonality of evidence in the civil
and criminal matters (see Peden v. United
States, 512 F.2d 1099, 1103 (Ct. Cl. 1975),
civil proceedings properly stayed if they
"churn over the same evidentiary material" as
the criminal case); (2) the timing of the
stay request (see Campbell v. Eastland, 307
F.2d 478, 487-88 (5th Cir. 1962), cert.
denied, 371 U.S. 955 (1963), imminence of
indictment favors limiting scope of discovery
or staying proceedings); (3) prejudice to the
litigants (see Peden, 512 F.2d at 1103-04,
failure to show prejudice undercuts claim
that stay was improper; Campbell, 307 F.2d at
487-88, discovery that prejudices criminal
matter may be restricted); (4) the efficient
use of agency resources (see Molinaro, 889
F.2d at 903, including among stay factors
"efficient use of judicial resources" in case
involving defendant's request for stay); and
(5) the public interest (see Scotia [Coal
Mining Co., 2 FMSHRC 633, 635 (Mar. 1980)],
noting "the public interest in the
expeditious resolution of penalty cases").
17 FMSHRC at 503.
Applying these criteria in this case, we conclude that
the judge did not abuse his discretion. In deciding to lift
the stay order and conduct the hearing, he properly
accommodated the competing interests involved by evaluating
the prejudice to Capitol that would result from going forward
without Bonfili's testimony, versus the adverse impact on the
public interest that would result from further delay. See
Keating, 45 F.3d at 326 (public interest in a speedy resolution
of the case and the agency's concern for efficient
administration would have been hampered if proceeding had been
stayed). The record indicates that these civil penalty
proceedings were stayed for almost a year. In denying
Capitol's pre-hearing motion to dismiss, the judge stated
that "due to the age of these cases, a further continuance
is inappropriate." Unpublished Order dated Oct. 16, 1996.
Additionally, in overruling Capitol's objection at the
hearing, the judge considered the fact that Capitol could
provide other witnesses to testify regarding what Bonfili had
told them about the accident and the training that Capitol
had provided to Bonfili.[7] Tr. 97-98. In fact, Capitol
provided four such witnesses (Gess, Tr. 70-81; Wolschleger,
Tr. 100-10; Cottrell, Tr. 119-21, 123-25; Alexander, Tr.
127-28, 131-34, 136).[8] Thus, Capitol has not convinced us
that its inability to question Bonfili resulted in substantial
prejudice.
Although the judge did not address the other Buck Creek
factors, the record discloses that only one of the three
remaining factors, the timing of the stay request, comes into
play here, and that factor supports the judge's lifting of the
stay.[9] The Secretary represented that there had been no
criminal investigation into the matter and, thus, it had not
been referred to the U.S. Attorney for criminal prosecution.
Tr. 93; see also Oral Arg. Tr. 35. This reduced the need for
a reimposition of the stay. See Dresser, 628 F.2d at 1375-76
(need for stay was reduced because no indictment had been
returned).
The basis for Bonfili's invocation of the privilege against
self-incrimination was the possibility of criminal prosecution
absent a grant of immunity from the U.S. Attorney. See Tr. 93;
Oral Arg. Tr. 37-38. A stay continued on this basis alone, as
the operator essentially requests, could be indefinite, as there
is presumably small likelihood that a person whom the Department
of Labor does not refer to the U.S. Attorney will nevertheless
receive a grant of immunity. As the In re Phillips court noted,
staying a civil case until there is no threat of criminal
prosecution is problematic because "it is sometimes difficult to
tell when, if ever, the possibility of criminal prosecution has
passed." 896 F. Supp. at 557 n.4.
Based on the foregoing, we conclude that Capitol was
afforded a meaningful opportunity to confront the evidence that
was presented against it in this case and, therefore, was not
denied due process. In light of the public interest in the
expeditious resolution of penalty cases, and Capitol's ability
to provide other witnesses to testify regarding what Bonfili
had told them about the accident and Capitol's training of
Bonfili, we conclude that the judge did not abuse his discretion
in declining to stay the case further and conducting the hearing
although Bonfili asserted the Fifth Amendment privilege.
B. Unwarrantable Failure
Capitol argues that substantial evidence does not support
the judge's determination that Bonfili's conduct was
unwarrantable. PDR at 14-17; Reply Br. at 5-7. It asserts that
the judge imposed a strict liability standard for unwarrantable
failure violations committed by supervisory personnel. PDR at
17-19; Reply Br. at 7-8. The Secretary responds that substantial
evidence supports the judge's determination and that he did not
impose a strict liability standard for supervisors. S. Br. at
13-19.
The unwarrantable failure terminology is taken from section
104(d) of the Mine Act, 30 U.S.C. � 814(d), and refers to more
serious conduct by an operator in connection with a violation.
In Emery Mining Corp., 9 FMSHRC 1997 (Dec. 1987), the Commission
determined that unwarrantable failure is aggravated conduct
constituting more than ordinary negligence. Id. at 2001.
Unwarrantable failure is characterized by such conduct as
"reckless disregard," "intentional misconduct," "indifference,"
or a "serious lack of reasonable care." Id. at 2003-04;
Rochester & Pittsburgh Coal Co., 13 FMSHRC 189, 194 (Feb. 1991)
("R&P"); see also Buck Creek Coal, Inc. v. FMSHRC, 52 F.3d 133,
136 (7th Cir. 1995) (approving Commission's unwarrantable failure
test). The Commission has recognized that a number of factors
are relevant in determining whether a violation is the result of
an operator's unwarrantable failure, such as the extensiveness of
the violative condition, the length of time that it has existed,
the operator's efforts to eliminate the violative condition,[10]
and whether the operator has been placed on notice that greater
efforts are necessary for compliance. Mullins & Sons Coal Co.,
16 FMSHRC 192, 195 (Feb. 1994); Peabody Coal Co., 14 FMSHRC 1258,
1261 (Aug. 1992). The Commission has also considered whether the
violative condition is obvious or poses a high degree of danger.
Midwest Material Co., 19 FMSHRC 30, 34-35 (Jan. 1997) (finding
foreman's negligent conduct in the face of an obvious and
dangerous hazard indicates a "serious lack of reasonable care");
BethEnergy Mines, Inc., 14 FMSHRC 1232, 1243-44 (Aug. 1992)
(finding unwarrantable failure where unsaddled beams "presented a
danger" to miners entering area); Warren Steen Constr., Inc., 14
FMSHRC 1125, 1129 (July 1992) (finding violation aggravated and
unwarrantable based on "common knowledge that power lines are
hazardous, and . . . that precautions are required when working
near power lines with heavy equipment"); Quinland Coals, Inc., 10
FMSHRC 705, 709 (June 1988) (finding unwarrantable failure where
roof conditions were "highly dangerous"); Kitt Energy Corp., 6
FMSHRC 1596, 1603 (July 1984) (conspicuous nature of the
violative condition supports unwarrantable failure finding).
We conclude that substantial evidence[11] supports the
judge's determination that Bonfili's failure to deenergize the
rail and wear a safety belt constituted aggravated conduct. We
agree with the judge that both violations were obvious and
dangerous. 19 FMSHRC at 534. The record contains ample evidence
that Bonfili had been trained to deenergize and lock out the
crane and wearing a safety belt while working on the crane rails.
Tr. 65-73, 75, 100-07, 115-18, 136; C. Exs. 5, 6, 10. It is
undisputed that, despite his training, Bonfili began working on
the craneway after directing Cook to deenergize the crane only
and failing to lock out any of the power sources to the crane.
19 FMSHRC at 534. In addition, it is undisputed that Bonfili
failed to wear a safety belt while working on the craneway, where
there was a danger of falling. Id. Based on evidence that
Bonfili had received safety training, we conclude that the judge
reasonably inferred that Bonfili knew that deenergizing the crane
alone would not also deenergize the rail, and that Bonfili knew
that the failure to use a safety belt was dangerous. 19 FMSHRC
at 534.[12] The Commission has emphasized that inferences drawn
by a judge are "permissible provided they are inherently
reasonable and there is a logical and rational connection between
the evidentiary facts and the ultimate fact inferred." Mid-
Continent, 6 FMSHRC at 1138. Accordingly, we conclude that the
obviousness of Bonfili's violations and the high degree of danger
posed support the judge's unwarrantable failure finding.
In addition, the judge properly recognized that a high
standard of care was required of Bonfili, who was a shift
supervisor. 19 FMSHRC at 534 (citing Midwest Materials, 19
FMSHRC at 35 ("a foreman . . . is held to a high standard of
care")). The Mine Act places primary responsibility for
maintaining safe and healthful working conditions in mines on
operators, with the assistance of their miners. 30 U.S.C. �
801(e). "Managers and supervisors in high positions must set an
example for all supervisory and non-supervisory miners working
under their direction. Such responsibility not only affirms
management's commitment to safety but also, because of the
authority of the manager, discourages other personnel from
exercising less than reasonable care." Wilmot Mining Co., 9
FMSHRC 684, 688 (Apr. 1987). As a supervisor, Bonfili had been
entrusted with augmented safety responsibility and was obligated
to act as a role model for Cook, a subordinate, who was watching
him. Thus, we conclude that, as a supervisor, Bonfili's failure
to deenergize the rail and wear a safety belt in the face of
obvious and dangerous hazards further supports the judge's
unwarrantable failure finding.[13]
It is well established that a supervisor's violative
conduct, which occurs within the scope of his employment, may be
imputed to the operator for unwarrantable failure purposes. R&P,
13 FMSHRC at 194-97. Here, Bonfili was acting as Capitol's agent
when responding to Cook's safety concern. Citing Nacco, 3 FMSHRC
at 849-50, Capitol asks the Commission to vacate the Secretary's
unwarrantable failure determination in light of Capitol's
conscientiousness in providing Bonfili with safety training. PDR
at 18-22. In Nacco, the Commission declined to impute a
supervisor's negligence to the operator for the purpose of
assessing civil penalties because it had taken reasonable steps
to avoid an accident and the supervisor's conduct did not expose
other miners to risk of injury. 3 FMSHRC at 850. In this case,
the judge determined that the Nacco defense was unavailable to
mitigate Capitol's negligence for the purpose of assessing civil
penalties because Bonfili's and Lozano's violations did expose
additional miners to a risk of injury. 19 FMSHRC at 535, 537.
We conclude that the defense is unavailable for a different
reason - we decline to extend the Nacco defense to violations
that are the result of unwarrantable failure pursuant to section
104(d) of the Mine Act.
The Nacco defense has been applied sparingly, in narrowly
restricted circumstances. Contrary to Capitol's assertion (PDR
at 19), the Commission has never applied the Nacco defense to
allow an operator to avoid a finding of unwarrantable failure
under section 104(d). In R&P,[14] the only case decided by the
Commission in which the defense was invoked by an operator under
such circumstances, the Commission held that the misconduct of a
mine examiner, acting within the scope of his employment, was
properly imputable to the operator for the purpose of assessing
whether the operator had unwarrantably failed to comply with a
regulation. Id. at 194-97. Although the Commission found Nacco
inapplicable because the violation at issue in R&P put miners at
risk, we also noted, in dictum, that R&P had not advanced "any
convincing reasons why Nacco should be expanded to include
unwarrantable failure." Id. at 198.
The Nacco defense represents an exception to the common law
rule that a principal is liable for actions committed by an agent
acting within the scope of his apparent authority. See Ambrosia
Coal & Constr. Co., 18 FMSHRC 1552, 1561 n.12 (Sept. 1996)
(citing 3 Am. Jur. 2d Agency �� 78, 79 (1986)). As the
Commission has noted, "operators typically act in the mines only
through . . . supervisory agents." Southern Ohio Coal Co., 4
FMSHRC 1459, 1463-64 (Aug. 1982).[15] Thus, extending Nacco to
section 104(d) citations or orders could create a potentially
large loophole for operators charged with unwarrantable conduct
that could ultimately undermine the significance of that
important mechanism for deterring aggravated violations of the
Mine Act.[16] Accordingly, we will not allow the Nacco defense
where, as here, the supervisor's conduct results in an
unwarrantable violation under section 104(d) of the Mine Act,
regardless of whether that conduct exposes other miners to
risk.[17]
In conclusion, Bonfili's inexplicably reckless conduct is
the kind of "serious lack of reasonable care" that constitutes
unwarrantable failure. See Midwest Materials, 19 FMSHRC at 35-36
(experienced mine foreman's unexplained failure to follow safety
procedures was "lapse of judgement or presence of mind . . .
[which] qualifies as the type of `indifference' or `serious lack
of reasonable care' that constitutes unwarrantable failure.").
Substantial evidence supports the judge's conclusion that
Bonfili's violations resulted from an unwarrantable failure to
comply with the standards and we affirm his holding.[18]
C. Civil Penalties
Capitol argues that the Nacco defense applies to the
violations at issue. However, it appears to confine this
contention to the judge's unwarrantable failure determination,
and does not explicitly raise a claim that the judge erred in
holding that the Nacco defense was inapplicable to his
determination of Capitol's level of negligence for purposes of
his penalty assessment. See PDR at 14, 19-24; Reply Br. at 8-11.
However, to the extent Capitol's brief can be read to imply a
challenge to the judge's rejection of the Nacco defense for civil
penalty purposes, we address it. Because we hold that the Nacco
defense does not extend to cases involving unwarrantable failure
under section 104(d), it follows that the defense is unavailable
to mitigate Capitol's negligence for the purpose of assessing
penalties here.[19] We therefore find it unnecessary to pass on
whether substantial evidence supports the judge's fact-based
determination that Nacco does not apply to the violations at
issue in this case.
Finally, in determining civil penalties under the Mine Act,
the judge must make "[f]indings of fact on each of the [section
110(i)] criteria[20] [to] not only provide the operator with the
required notice as to the basis upon which it is being assessed a
particular penalty, but also provide the Commission and the
courts . . . with the necessary foundation upon which to base a
determination as to whether the penalties assessed by the judge
are appropriate, excessive, or insufficient." Sellersburg Stone
Co., 5 FMSHRC 287, 292-93 (Mar. 1983), aff'`d, 736 F.2d 1147. In
this case, the judge, while stating that he "[c]onsider[ed] all
the criteria under section 110(i) of the Act" (19 FMSHRC at 535),
only made express findings concerning the negligence and gravity
criteria. See id. at 535, 536, 537. However, there is
undisputed evidence in the record concerning the remaining
penalty criteria.[21] Therefore, in the interest of judicial
economy and based upon the circumstances presented here, we see
no need to remand the judge's penalty assessments for additional
findings. Our decision in this case should not, however, be
construed as an indication that in future cases we will not
require strict compliance by our judges with Sellersburg, and
remand when necessary for the requisite findings concerning all
of the penalty criteria.
**FOOTNOTES**
[4]: The S&S terminology is taken from section 104(d)(1) of
the Mine Act, 30 U.S.C.
� 814(d)(1), which distinguishes as more serious any violation
that "could significantly and substantially contribute to the
cause and effect of a . . . mine safety or health hazard."
[5]: On September 17, 1996, the Secretary proposed a civil
penalty assessment of $500 against Bonfili, pursuant to section
110(c) of the Mine Act, 30 U.S.C. � 820(c), alleging that he
knowingly authorized the violations. WEVA 97-5-M, Proposed
Assessment. Bonfili challenged the proposed assessment. WEVA
97-5-M, Contest of Civil Penalties. On February 10, 1997, the
Secretary filed a motion to withdraw the petition for assessment
of civil penalty. WEVA 97-5-M, Mot. to Withdraw. On February
21, 1997, Judge Melick granted the motion and dismissed the
section 110(c) case. WEVA 97-5-M, Order of Dismissal.
[6]: In Keating, the plaintiff claimed that his due process
rights were violated when the Office of Thrift Supervision
("OTS") refused to stay its civil proceeding until the conclusion
of state and federal criminal proceedings, because the pending
criminal case forced him to invoke his Fifth Amendment privilege
during the OTS hearing, depriving him of the opportunity to
present testimony on his own behalf. 45 F.3d at 324-25. The
Court found no violation of due process and no abuse of
discretion, applying the factors set out in Federal Savings &
Loan Insurance Corp. v. Molinaro, 889 F.2d 899 (9th Cir. 1989),
in which the Ninth Circuit reviewed a district court decision to
refuse to stay a civil proceeding using an abuse of discretion
analysis. Id. The Keating Court considered the extent to which
the defendant's Fifth Amendment rights were implicated, and
applied the following additional factors: "(1) the interest of
the plaintiffs in proceeding expeditiously with this litigation
or any particular aspect of it, and the potential prejudice to
plaintiffs of a delay; (2) the burden which any particular aspect
of the proceedings may impose on defendants; (3) the convenience
of the court in the management of its cases, and the efficient
use of judicial resources; (4) the interests of persons not
parties to the civil litigation; and (5) the interest of the
public in the pending civil and criminal litigation." Id. These
criteria are subsumed almost completely in the Buck Creek "abuse
of discretion" standard set forth below.
[7]: In Commission proceedings, hearsay evidence is
admissible so long as it is material and relevant. 29 C.F.R.
� 2700.63(a); REB Enterprises, Inc., 20 FMSHRC 203, 206
(Mar. 1998); Mid-Continent Resources, Inc., 6 FMSHRC 1132, 1135
(May 1984).
[8]: The judge correctly took into account the compelling
fact that other witnesses could provide the testimony that
Bonfili, because of his Fifth Amendment assertion, could not. In
United States v. Lot 5, Fox Grove, Alachua County, Florida, 23
F.3d 359 (11th Cir. 1994), for example, the court, in the context
of a forfeiture case (in which the question of staying civil
proceedings until the completion of a related criminal matter
arises frequently), held that:
Claimant's assertion that only her own
testimony could vindicate her is groundless;
other participants to the illegal acts that
gave rise to the forfeiture were available to
testify at trial. Claimant's failure to
indicate with precision why she did not use
other parties' testimony to substantiate her
defense was fatal. As a result, Claimant's
basis for a stay was nothing more than a
blanket assertion of the privilege against
self-incrimination, which . . . is an
inadequate basis for a stay.
Id. at 364.
[9]: Because there was no criminal proceeding before or at
the time of the hearing, and remote likelihood of an indictment
in the future, the factor of commonality of evidence in the civil
and criminal matters is not applicable. Similarly, the efficient
use of agency resources is irrelevant here, given the absence of
concurrent agency proceedings or anticipated judicial decisions
that might affect the administrative litigation.
[10]: In considering the operator's efforts to eliminate
the violative condition, the Commission focuses on compliance
efforts made prior to the issuance of a citation or order. Enlow
Fork Mining Co., 19 FMSHRC 5, 17 (Jan. 1997).
[11]: When reviewing an administrative law judge's factual
determinations, the Commission is bound by the terms of the Mine
Act to apply the substantial evidence test. 30 U.S.C.
� 823(d)(2)(A)(ii)(I). "Substantial evidence" means "`such
relevant evidence as a reasonable mind might accept as adequate
to support [the judge's] conclusion.'" Rochester & Pittsburgh
Coal Co., 11 FMSHRC 2159, 2163 (Nov. 1989) (quoting Consolidated
Edison Co. v. NLRB, 305 U.S. 197, 229 (1938)).
[12]: We disagree with Capitol that the judge drew negative
inferences based on Bonfili's assertion of the Fifth Amendment
privilege against self-incrimination. PDR at 17; Reply Br. at 7.
At the post-hearing oral argument, the judge expressly found it
inappropriate to make a negative inference based on Bonfili's
refusal to testify (Oral Arg. Tr. 50) and, in his decision, the
judge did not mention Bonfili's assertion of privilege.
[13]: Commissioner Verheggen criticizes us for focusing on
the obvious and dangerous nature of Bonfili's violations and his
status as a supervisor, and not relying on the extent of the
violative condition, the length of time that it had existed,
whether the operator had been placed on notice that greater
efforts were necessary for compliance, and the operator's efforts
in abating the violative condition. Slip op. at 16-17.
Consistent with Commission precedent on unwarrantable failure, we
apply only those factors that are relevant to the facts of this
case. See Lafarge Constr. Materials, 20 FMSHRC 1140, 1147 (Oct.
1998) (holding that for violations involving high danger of which
a foreman should have been aware, other factors may be less
relevant).
[14]: R&P involved two withdrawal orders issued pursuant to
section 104(d)(2) of the Mine Act, 30 U.S.C. � 814(d)(2),
alleging S&S and unwarrantable violations of 30 C.F.R. � 75.305,
a mandatory underground coal mine safety standard requiring
weekly examinations for hazardous conditions in specified areas
of mines. 13 FMSHRC at 189-91.
[15]: Of course, not all actions of a supervisor may be
imputed to an operator, notwithstanding Commissioner Verheggen's
concern that an employer's conduct might now be deemed
unwarrantable "[n]o matter how unforeseeable, irrational, or
`inexplicably reckless' a supervisor's actions might be." Slip
op. at 18 (citation omitted). In his dissent, Commissioner
Verheggen raises a hypothetical involving a violation stemming
from a supervisor's suicide. Id. He suggests that, as a result
of our decision, this violation would be impossible to defend
against a charge of unwarrantable failure. Id. The dissent is
wrong. Consistent with R&P, the operator in such a case could
defend on the grounds that the supervisor's actions were outside
the scope of his employment. R&P, 13 FMSHRC at 196. As a
leading commentator has explained, "[i]f [the employee] has no
intention, not even in part, to perform any service for the
employer, but intends only to further a personal end, his act is
not within the scope of the employment." W. Page Keeton et al.,
Prosser and Keeton on the Law of Torts � 70, at 503 (5th ed.
1984) (footnote omitted).
[16]: Commissioner Verheggen suggests that, as a result of
our refusal to extend the Nacco defense to violations that are
the result of unwarrantable failure, operators may perceive a
disincentive to take extra precautions in training miners if such
precautions cannot be used to prove their lack of recklessness.
Slip op. at 19. This view supposes that operators only train
their employees in order to avoid liability, and not to avoid
injuries and accidents.
[17]: We are troubled by a doctrine that exonerates an
operator from responsibility for the negligent conduct of a
supervisor who endangers only himself. It suggests that
protecting the safety of supervisory personnel is a less
significant concern under the Mine Act. But under section 3(g)
of the Mine Act, 30 U.S.C. � 802(g), supervisors as well as rank-
and-file employees may be "miners," whose safety and health is a
preeminent statutory concern. In our view, it makes little sense
to resolve the question of whether a supervisor's negligent
conduct is properly imputable to an operator based on the
fortuity of whether such conduct also exposes other miners to the
risk of injury.
[18]: Contrary to the suggestion of Commissioner Verheggen
(slip op. at 18), we are not adopting a presumption of
unwarrantable failure in this case.
[19]: We disagree with Commissioner Verheggen's suggestion
that we have "overturn[ed] Nacco as it formerly applied to
penalties assessed for unwarrantable violations." Slip op. at
22. As indicated above, there is no reported decision in which
the Commission has applied Nacco to reduce the penalty assessed
for an unwarrantable violation.
[20]: Section 110(i) of the Mine Act provides in pertinent
part:
The Commission shall have authority to
assess all civil penalties provided in this
Act. In assessing civil monetary penalties,
the Commission shall consider [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.
30 U.S.C. � 820(i).
[21]: Based on undisputed evidence in the record, we find
that Capitol was a medium size operator with a total annual
tonnage of 495,885 production tons and 354,287 tons for this
mine. Tr. 54-57; Gov't Ex. 5. We also find that in the 3 years
preceding the issuance of the most recent citation at issue,
Capitol had been charged with 88 violations. Tr. 54; Gov't Ex.
4. With respect to Capitol's good faith in attempting to achieve
rapid compliance, we find that on October 25, 1994, the same date
the relevant citation and order were issued, Bonfili, while still
hospitalized, was reinstructed on the appropriate procedures for
locking out and de-energizing equipment and the need to wear a
safety belt and line in appropriate circumstances. Tr. 80; Gov't
Exs. 1 at 1, 2 at 1. In addition, the judge found that Capitol
gave Bonfili a 5-day suspension and written warning for his
violations of its safety rules, and advised him that future
violations of safety rules would lead to more progressive
discipline, including discharge. 19 FMSHRC at 535; Tr. 10-11.
We also find that Lozano was reinstructed on the need to lock out
equipment 5 minutes after his accident (Gov't Ex. 3 at 1), and
that Capitol gave him a 3-day suspension for violating its safety
rules. 19 FMSHRC at 537; Tr. 12. Finally, although there was no
evidence introduced concerning the "ability to continue in
business" criterion, it is well established that in the absence
of proof that the imposition of authorized penalties would
adversely affect an operator's ability to continue in business,
the Commission presumes that no such adverse effect would occur.
Spurlock Mining Co., 16 FMSHRC 697, 700 (Apr. 1994); Sellersburg,
5 FMSHRC at 294.
III.
Conclusion
For the foregoing reasons, we reject Capitol's due process
claim and affirm the judge's findings of unwarrantable failure
and his penalty assessments.
Mary Lu Jordan, Chairman
Marc Lincoln Marks, Commissioner
Robert H. Beatty, Jr. Commissioner
Commissioner Verheggen, concurring in part and dissenting
in part:
I concur with Part II.A of the majority opinion. I
disagree, however, with the majority's conclusion that the
judge properly found that Capitol Cement's violations of
sections 56.12016 and 56.15005 were unwarrantable. To the
contrary, I find the judge's unwarrantable failure analysis
deficient as a matter of law, and I would vacate and remand
the matter to him accordingly, including instructions to
reconsider his penalty assessment based on any new findings
regarding the operator's negligence. I would also vacate
and remand all three of the judge's penalty assessments
because he failed to properly consider the factors listed in
section 110(i) of the Mine Act. I also disagree with the
majority's holding that the Nacco defense cannot be asserted
at all in a case involving an unwarrantable failure violation,
and find that the judge properly considered the defense when
assessing the three penalties. I find, however, that the
judge's application of the defense is not clearly articulated
and appears to lack record support. I would thus remand the
penalty assessments for the judge to reconsider and more fully
explain.
I therefore dissent from Parts II.B and II.C of the
majority's opinion.
A. Unwarrantable Failure
In Part II.B of their decision, the majority "decline[s]
to extend the Nacco defense to violations that are the result
of unwarrantable failure." Slip op. at 11. The Nacco defense
essentially shields an operator, under limited circumstances,
from having its agent's negligence imputed to it for purposes
of assessing a penalty. In one sense, I agree with the
majority: as I explain further below, I do not believe that an
operator should be able to assert a Nacco defense as an absolute
bar to liability for an unwarrantable failure to comply with
the Mine Act. But I strongly disagree with the effect of the
majority's decision, which is essentially to bar judges from
considering evidence on each of the Nacco elements (i.e.,
reasonable steps taken to avoid a particular class of accident
and whether the violative conduct at issue exposed other miners
to any risk of injury) in determining whether an operator's
conduct is unwarrantable. Indeed, since this is precisely
what the judge did, I find his unwarrantable failure analysis
legally flawed. He failed to consider all the relevant facts
and circumstances relating to the level of Capitol's negligence,
which I find not only contrary to Commission precedent, but
inequitable as well.
The judge's findings of unwarrantable failure are based
solely on his consideration of four factors: that Bonfili
knew or should have known that his actions were violative,
and that "[t]he violation was also obvious, extremely dangerous
and committed by a foreman held to a high standard of care."
19 FMSHRC at 534. This approach, which is endorsed by the
majority, is at odds with Commission precedent, under which
our judges must look at all the relevant facts and
circumstances of a case when determining whether a violation
is unwarrantable,[1] including the extent of the violative
condition, the length of time that it has existed, whether
the violation is obvious or poses a high degree of danger,
whether the operator has been placed on notice that greater
efforts are necessary for compliance, the operator's efforts
in abating the violative condition, and the operator's
knowledge of the existence of the violation. See Cyprus Emerald
Resources Corp., 20 FMSHRC 790, 813 (Aug. 1998); Midwest
Materials Co., 19 FMSHRC 30, 34 (Jan. 1997); Mullins & Sons
Coal Co., 16 FMSHRC 192, 195 (Feb. 1994); Peabody Coal Co.,
14 FMSHRC 1258, 1261 (Aug. 1992); Quinland Coals, Inc.,
10 FMSHRC 705, 709 (June 1988); Kitt Energy Corp., 6 FMSHRC
1596, 1603 (July 1984). It thus stands to reason that proving
the elements of a Nacco defense should not be an absolute
defense to an unwarrantable failure allegation, since this
would preclude the Commission from considering any other facts
and circumstances surrounding a particular violation.
The body of Commission law on unwarrantable failure
clearly stands for the proposition that we must consider all
facts and circumstances relevant to determining an operator's
negligence, and whether any such negligence rises to the level
of aggravated conduct, including exculpatory as well as
incriminatory evidence. Here, the operator introduced
exculpatory evidence as to (1) the extent of the violative
condition by alleging that Bonfili's actions placed no one
else in harm's way, and (2) Capitol's good faith efforts to
be in constant compliance and to avoid the sort of accident
that occurred here, as evidenced by what the judge found to
be their "responsible training program," as well as the
company's work rules and measures taken to discipline Bonfili
(19 FMSHRC at 535).
The judge failed to consider this exculpatory evidence
in his unwarrantable failure analysis, but did consider it
when he assessed penalties for the two violations committed
by Bonfili. This makes no sense. I find absurd the notion
that evidence tending to prove or disprove negligence and
aggravated conduct can somehow change character and become
relevant or not based on the statutory rubric under which it
is considered.[2] I fail to see how a company can be found
to have engaged in aggravated conduct (i.e., high negligence)
under section 104(d), but at the same time be found to have
been less negligent for purposes of assessing a penalty.
My colleagues in the majority also fail to consider all
the relevant facts and circumstances of this case in their
unwarrantable failure analysis. While they mention several
"factors" in their recitation of the law (slip op. at 9), by
their own admission they ignore the exculpatory evidence
adduced by Capitol, focussing instead exclusively on "the
obvious and dangerous nature of Bonfili's violation and his
status as a supervisor." Slip op. at 11 n.13. Cf. Lafarge
Constr. Materials, 20 FMSHRC 1140, 1156 (Oct. 1998) (Comm'r
Verheggen, dissenting) ("The majority . . . fails to apply
the Commission's traditional unwarrantable failure test.
Instead, . . . they collapse the test into a single
dispositive factor: whether a "high degree of danger [is]
posed by a violation."). In support of its approach, the
majority states, "we apply only those factors that are
relevant to the facts of this case." Slip op. at 11 n.13
(citing Lafarge). I fail to see how the exculpatory evidence
here is not relevant to determining the level of Capitol's
negligence.
Under the majority's ruling, judges will look only to
incriminatory evidence, and will be excluded from considering
exculpatory evidence capable of being pigeon-holed under the
Nacco defense. I find this result singularly inappropriate
and inequitable. The majority's holding essentially precludes
operators from mounting any defense to allegations of
unwarrantable failure based upon either of the Nacco elements.
No matter how unforeseeable, irrational, or "inexplicably
reckless" (slip op. at 13) a supervisor's actions might be,
his employer's conduct will now be characterized as
"aggravated conduct constituting more than ordinary negligence,"
"reckless disregard," "intentional misconduct," "indifference,"
or a "serious lack of reasonable care" - even if the operator
has taken every reasonable step possible to avoid such conduct
and even if the conduct imperils only the supervisor. Just
how unfair the majority's sweeping new rule is can be seen in
the simple hypothetical case of a supervisor who apparently
commits suicide in a mine in the presence of others who are
not placed at risk by the supervisor's act. Let us assume
that the supervisor electrocutes himself by intentionally
grabbing onto a live wire in violation of any number of the
Secretary's regulations, and that the operator has in effect
an extensive training program aimed specifically at avoiding
electrocution. Under the majority's new rule, if the
Secretary's allegation of unwarrantable failure in this
hypothetical case[3] came before a judge, he or she would be
precluded when ruling on this allegation from considering
evidence that the supervisor may have committed suicide, that
his act placed no one else at risk, or that the operator took
every reasonable measure to avoid such an incident. The
majority may as well announce that, henceforth, any violation
with any resemblance to my hypothetical - or even to the facts
of this case - will be considered to be presumptively
unwarrantable.
The majority raises the alarums that extending Nacco to
unwarrantable cases will "exonerate[] an operator from
responsibility for the negligent conduct of a supervisor who
endangers only himself." Slip op. at 12 n.17. The majority
is overstating its case here. Even in my hypothetical case,
the operator would be strictly liable for the supervisor's
violation, Asarco, Inc. v. FMSHRC, 868 F.2d 1195 (10th Cir.
1989), under which regime it would be well within the judge's
discretion to adjust the penalty assessed to account for the
gravity of the violation. In no way would reliance upon
Nacco evidence to mitigate an operator's unwarrantable failure
somehow "exonerate" operators or place less significance on
the safety of supervisory personnel. Instead, I do not believe
that an operator should be penalized for doing everything
within its power to avoid a particular type of accident when
such an accident unexpectedly and unforeseeably occurs due to
the irrational act of one of its agents. Indeed, I believe
that under the majority's holding, operators could
unfortunately perceive a disincentive to take extra precautions
in the training of their workers if such extra precautions
cannot be used to prove their lack of recklessness. As the
Commission stated in Nacco:
Where as here, an operator has taken
reasonable steps to avoid a particular class
of accident and the erring supervisor
unforseeably exposes only himself to risk, it
makes little enforcement sense to penalize
the operator for "negligence." Such an
approach might well discourage pursuit of a
high standard of care because regardless of
what the operator did to insure safety, a
negligence finding would automatically
result.
3 FMSHRC at 850 (emphasis added). I would regret that any
pronouncement by this Commission might discourage operators
from being as careful as Capitol apparently was in this
instance.
Nor do I find credible the majority's alarum that
"extending Nacco to section 104(d) citations or orders could
create a potentially large loophole for operators . . . that
could ultimately undermine the significance of that important
mechanism for deterring aggravated violations of the Mine Act."
Slip op. at 12. Under my approach, which would require judges
to include evidence on each of the Nacco elements in weighing
allegations of unwarrantable failure, but not to assign the
elements dispositive weight, no such loophole would be created.
But even if I were in favor of a pure Nacco defense to
unwarrantable failure, I fail to see how such a defense, which
by its very nature could be "applied sparingly, in narrowly
restricted circumstances" (slip op. at 11), could ever lead to
the dire consequences of which the majority warns. To the
contrary, I believe that their ruling, which creates in effect
a per se class of unwarrantable violations, waters down the
graduated enforcement scheme of the Mine Act under which
additional sanctions beyond strict liability are brought to
bear against operators whose conduct is aggravated. See Emery
Mining Corp., 9 FMSHRC 1997, 2001 (Dec. 1987) ("The Mine Act's
use of different terms within the same statute demonstrates
that Congress intended the different terms to censure different
types of operator conduct within a graduated enforcement
scheme."). I find this particularly true in light of
our judges' discretion to impose additional sanctions on
particularly grave violations when assessing penalties under
section 110(i) of the Act.
I find one other aspect of the majority's opinion
particularly troubling. Although they confidently "decline to
extend the Nacco defense to violations that are the result of
unwarrantable failure" (slip op. at 11), I find no indication
in the judge's opinion that he ever actually reached, much less
analyzed this issue. Nowhere in his opinion does the judge
mention the Nacco defense in the context of analyzing the
Secretary's allegations of unwarrantable failure. Instead, he
limits his discussion of Nacco to his analysis of Capitol's
negligence, one of the six statutory factors the Commission must
weigh in assessing penalties. 19 FMSHRC at 534-35. Indeed, his
discussion of unwarrantable failure is separate and apart from
his discussion of negligence. He first states unequivocally that
"the Secretary has clearly sustained her burden of proving the
necessary aggravating circumstances to justify `unwarrantable
failure' and high negligence." Id. at 534. Only then does he
turn to addressing Capitol's assertion of the Nacco defense,
and nowhere in the ensuing discussion does he mention in any
relevant sense "unwarrantable failure" or any of the terms
normally associated with the concept, such as "aggravated
conduct constituting more than ordinary negligence," "reckless
disregard," "intentional misconduct," "indifference," or a
"serious lack of reasonable care." Id. at 534-35. I find
particularly significant that the judge, after finding that
Bonfili's actions put crane operator Cook at risk, states that
"[i]n assessing a civil penalty herein I do consider, however,
[Capitol's] training program." Id. at 535 (emphasis added).
His use of the word "however" clearly indicates that the
foregoing discussion relates to penalties, not unwarrantable
failure.
The judge did not discuss extension of the Nacco defense to
unwarrantable failure even though the issue was briefed (S. Post-
Hearing Br. at 12-13, C. Post-Hearing Br. at 14-18) and orally
argued before him (Oral Arg. Tr. at 8-16, 58-60) by both parties.
From this, one could conclude that he rejected sub silentio
Capitol's argument that the defense be extended. Insofar as he
reached such a conclusion, however, I reject it on the ground
that, as explained above, it is at odds with the Commission's
traditional approach to unwarrantable failure which considers
the totality of facts and circumstances of each case. At any
rate, I question the wisdom of using his decision as the basis
for as broad and sweeping a pronouncement as the majority makes
limiting the Nacco defense.
For the foregoing reasons, I would therefore vacate and
remand the judge's decision, and would direct him to consider
any exculpatory evidence in determining the validity of the
Secretary's allegations of unwarrantable failure as to the two
violations committed by Bonfili.
Regarding my remand, I would specifically direct the judge
to reconsider his finding rejecting Capitol's argument that
Bonfili's actions placed no one else at risk (a finding the
judge made solely in the context of determining the company's
negligence for penalty purposes). I do not believe that this
finding is sound. Only one witness (Weber) testified that
Bonfili's actions endangered more than one person; in fact, the
citations at issue show only one person affected. See Gov't Exs.
1 at 1, 2 at 1 (each noting "001" under Section 10.D, "Number of
Persons Affected"). The judge also did not address the evidence
contradicting Weber's testimony. Nor did the Secretary introduce
any evidence of any actual risk Cook encountered as a result of
Bonfili's actions. I am reluctant, however, to reverse the
judge's findings given the deferential substantial evidence
standard of review under which I must review them. I would thus
direct that he reconsider his findings and, at the very least,
explain why he apparently credited Weber even though the
overwhelming weight of the evidence appears to contradict his
testimony.
B. Penalties
In light of my disposition regarding the two violations
committed by Bonfili, I would vacate and remand the judge's
penalty assessment for reconsideration of the negligence
involved. Specifically, although the judge concluded that the
Nacco defense was inapplicable because he found that Bonfili's
violations placed others at risk (19 FMSHRC at 535), I would
direct him to reconsider this finding because, as stated above,
I believe it may not be supported by the record. I would also
direct the judge to make "findings of fact on the statutory
penalty criteria," which it is well settled "must be made."
Sellersburg Stone Co., 5 FMSHRC 287, 292 (Mar. 1983), aff'd,
736 F.2d 1147 (7th Cir. 1984). Even my colleagues concede that
the judge's penalty assessments fail to meet the requirements
of Sellersburg. Slip op. at 13-14.
I would also vacate and remand the penalty the judge
assessed for Lozano's violation of section 56.12016.[4] The
judge also concluded that the Nacco defense did not apply to
this violation because he found that Lozano's actions imperiled
others. 19 FMSHRC at 537. I find, however, that the judge
drew an unreasonable inference in finding that Lozano's actions
exposed Miller to risk of injury based on speculation that, had
Lozano become further entangled by the belt, "Miller may then
have attempted to extract Lozano from the belt thereby also
exposing himself . . . [to] potentially serious injuries." Id.
The judge based his inference on testimony given by Weber,
who as part of MSHA's accident investigation, interviewed Lozano
and Miller. Tr. 155-56. Weber testified that "[i]f Mr. Lozano
had been pulled in to the belt in a more serious manner, the
possibility that Mr. Miller may have reached up and tried to
extricate him from that pulley may have put him in a more serious
position of jeopardy himself. . . . If he had reached out and
tried to grab Mr. Lozano, he may have been pulled in too." Tr.
156-58. Weber admitted, however, that his opinion on Miller's
exposure to harm was purely speculative, and that Miller's actual
response was to notify a fellow miner to pull the emergency shut
down switch. Tr. 159-60. The judge posited a rescue attempt
under circumstances not in the record. Moreover, there is
nothing in the record to suggest that Miller would have responded
by attempting to rescue Lozano in the manner described by Weber.
Thus, I find the judge's inference that Miller might have
been injured as a result of a hypothetical rescue attempt not
rationally related to the underlying facts. I would therefore
reverse the judge's conclusion that the Nacco defense was
inapplicable here,[5] vacate the judge's penalty assessment, and
remand with instructions to apply Nacco in mitigation of
Capitol's negligence. I would also direct the judge to make the
necessary "findings of fact on the statutory penalty criteria"
which, again, he neglected to make.
Finally, I must take strong exception to the majority's
disposition of the penalties at issue in this appeal. In a
sweeping statement, the majority states:
Because we hold that the Nacco defense does
not extend to cases involving unwarrantable
failure under section 104(d), it follows that
the defense is unavailable to mitigate
Capitol's negligence for the purpose of
assessing a penalty here.
Slip op. at 13. This pronouncement goes far beyond the issue of
whether Nacco can be asserted as a defense to an allegation of
unwarrantable failure and, in one stroke, rules out any operator
from asserting Nacco as a defense to findings of high negligence
serving as the basis for any penalty assessed for an
unwarrantable violation. The majority uses this radical
departure from long standing Commission precedent as the basis
for not reaching the issue of whether substantial evidence
supports the judge's findings that the Nacco defense did not
apply to the three penalties he assessed. See id. I am deeply
troubled by the majority's holding in which they overturn Nacco
as it formerly applied to penalties assessed for unwarrantable
violations, and I find especially troubling the fact that they
announce their holding with little, if any explanation.
Theodore F. Verheggen, Commissioner
**FOOTNOTES**
[1]: See Jim Walter Resources, Inc., 21 FMSHRC 740, 745
(July 1999) (remanding case to judge for full consideration of
facts and circumstances relevant to unwarrantable failure
determination).
[2]: I note that nothing in sections 104(d) and 110(i) of
the Mine Act suggests that analyses of an operator's negligence
under each section should be somehow different, or should focus
solely on aggravating factors to the exclusion of any facts and
circumstances tending to mitigate the operator's level of
negligence. See 30 U.S.C. �� 814(d), 820(i).
[3]: It appears that the Secretary operated under a theory
similar to the one I posit here when she assigned special
investigators to probe Bonfili's accident. He was charged under
section 110(c) with intentional, aggravated misconduct for
disregarding safety standards. See slip op. at 4 n.5. Even
though the Secretary ultimately dropped this charge (id.), such
an allegation, along with the Secretary's refusal to rule out
criminal (i.e., wilful) charges from the beginning, could only
have been predicated upon a theory that Bonfili deliberately
acted to hurt himself.
[4]: The penalty assessed by the judge for Lozano's
violation of section 56.12016 gets all but lost in the majority's
opinion. I would also note in passing that I find the
Secretary's case against Capitol for this violation problematic
because it is directly at odds with the decision of the Ninth
Circuit in Phelps Dodge Corp. v. FMSHRC, 681 F.2d 1189 (9th Cir.
1982). Cf. James Ray, 20 FMSHRC 1014, 1024-26 (Sept. 1998). The
underlying violation is not, however, at issue in this appeal.
[5]: The judge essentially held that Capitol established
the other Nacco element when he found "absence of negligence in
Lozano's hiring, the operator's training program, and the fact
that Lozano was disciplined." 19 FMSHRC at 537.
Commissioner Riley, dissenting:
I write separately in order to comment on due process
questions that yet linger over this case. The question of
whether Capitol Cement should have had to go forward to put
on its case without Bonfili as a witness is inextricably
linked with the granting and subsequent lifting of a stay of
the proceeding during the supposed pendency of a criminal
investigation.
As the majority states, the question of granting or
lifting a stay under such circumstances is within the sound
discretion of the judge whose decision on such matters is to
be reviewed for abuse of discretion. Drawn from several
court cases - SEC v. Dresser Industries, Inc., 628 F.2d 1368,
1375 (D.C. Cir. 1980), U.S. v. Kordel, 397 U.S. 1 (1970),
Keating v. Office of Thrift Supervision, 45 F.3d 322 (9th
Cir. 1995), In re Phillips, Beckwith & Hall, 896 F. Supp. 553,
558 (E.D. VA 1995) and others - the applicable test for
determining whether a request for a stay based on possible
criminal prosecution should be granted (or lifted) was set
out by the Commission in Buck Creek Coal, Inc., 17 FMSHRC
500, 503 (Apr. 1995), and contains a comprehensive list of
factors the judge must consider:
(1) the commonality of evidence in
the civil and criminal matters (see
Peden v. United States, 512 F.2d
1099, 1103 (Ct Cl. 1975), civil
proceedings properly stayed if they
"churn over the same evidentiary
material" as the criminal case);
(2) the timing of the stay request
(see Campbell v. Eastland, 307 F.2d
478, 487-88 (5th Cir. 1962), cert
denied, 371 U.S. 955 (1963),
imminence of the indictment favors
limiting scope of discovery or
staying proceedings); (3) prejudice
to the litigants (see Peden, 512
F.2d at 1103-04, failure to show
prejudice undercuts claim that stay
was improper; Campbell, 307 F.2d at
487-88, discovery that prejudices
criminal matter may be restricted);
(4) the efficient use of agency
resources (see Molinaro, 889 F.2d
at 903, including among stay
factors "efficient use of judicial
resources" in case involving
defendant's request for stay); and
(5) the public interest (see
Scotia, 2 FMSHRC at 635, noting
"the public interest in the
expeditious resolution of penalty
cases").
On the question as to whether the judge complied with
the Buck Creek factors, the majority states,
[A]pplying these criteria in this
case, we conclude that the judge
did not abuse his discretion.
Slip op. at 7.
I commend my colleagues for at least wanting to apply the
Buck Creek factors, although to what they applied them remains
a mystery, because it is abundantly clear from the record that
the judge made no such attempt when he granted the stay.
Upon the unopposed motion of the
Respondent further proceedings in the
captioned cases are hereby stayed pending the
completion by the Secretary of a related
criminal investigation. The Secretary is
directed to report to the undersigned in
writing regarding the status of the related
investigation on December 1, 1995, and on the
first day of each month thereafter.
Unpublished Order dated Oct. 27, 1995 (complete text). The
only factor the judge appears to have applied to the request
for a stay is expediency in granting it.
With respect to lifting the stay, the majority is more
explicit in justifying the judges actions under the Buck Creek
criteria:
In deciding to lift the stay order
and conduct the hearing, he
properly accommodated the competing
interests involved by evaluating
the prejudice to Capitol that would
result from going forward without
Bonfili's testimony, versus the
adverse impact on the public
interest that would result from
further delay.
Slip op. at 7.
How did the judge "properly accommodate [] the competing
interests?" How did he "evaluat[e] the prejudice to Capitol?"
How did he consider the "public interest that would result from
further delay?" How, in other words did the judge apply the Buck
Creek factors to assure due process for Capitol? He did it all
in a single sentence:
The Stay Orders previously issued in these
cases are hereby
lifted.
Unpublished Order Lifting Stay/Notice of Hearing
and Prehearing Order dated Aug. 7, 1996.
It is possible the judge improvidently granted the stay
in the first place. Having made no attempt to apply the
Buck Creek factors, the judge made no further requests for
information from the parties to supplement the minimal amount
of detail presented by the petitioner. It is not even clear
from the record that there ever was a criminal investigation.
The nature of the accident in which Bonfili was severely
injured, an inadvertent act that, according to the experienced
inspector who wrote the citation, put only himself at risk, is
hardly the type of situation that warrants investment of
precious MSHA resources on a section 110(c) special
investigation of a corporate officer "who knowingly authorized,
ordered or carried out such violation." 30 U.S.C. � 820(c).
The obviousness of this reasoning is borne out by the fact that
such charges were eventually dropped before trial. That MSHA
would squander even more scarce agency resources on a section
110(d) criminal investigation of Bonfili for a "wilful"
violation does not seem credible, given that agency's usual
efficient allocation of assets. Since any "wilful" criminal
charge would have had to be predicated on a bizarre legal
theory that Bonfili deliberately intended to maim or kill
himself, I find it hard to believe that MSHA wasted any time,
money or personnel on such a questionable errand. Buck Creek
obligated the judge to inquire into the commonality of evidence,
the timing of the stay request, prejudice to litigants, the
efficient use of agency resources and of course the public
interest. 17 FMSHRC at 503. Had he done so, the judge may
well have determined that no serious effort to bring criminal
charges against Bonfili was ever initiated and thus there was
no need for the stay requested by Capitol Cement. Since no
such scrutiny was ever applied to the request for a stay
there is no record to review on appeal to determine whether
the judge abused his discretion in granting the stay. When
a judge's action is arbitrary, unsupported by record evidence
and unexplained, it ought not to be upheld.
Once the judge granted the stay, whether or not it
was improvidently granted, he was under an equal obligation
to apply the Buck Creek factors before lifting the stay. Upon
granting the stay, the judge lent the mantel of governmental
authority to what may have been mere suspicion on the part of
the petitioner. Even if an abortive criminal investigation
had inexplicably been ordered, the judge's Buck Creek scrutiny
would likely have forced the investigating agency to reassess
the wisdom of that decision once it was forced to justify the
impact of the criminal investigation on the civil proceeding
by disclosing "the commonality of evidence" to the judge.
Because this was not done before the stay was granted, the
unverified criminal investigation became an operable fact in
the matrix of the case, necessitating Capitol Cement's
invocation of due process rights.
Unable to review the judge's stay order because it was
not included in Capitol's petition for discretionary review,
I have to assume, as the majority does, that the stay
was justified and properly granted. See 30 U.S.C.
� 823(d)(2)(A)(iii). Thus Capitol's due process rights could
only be protected if the judge properly applied Buck Creek to
insure that Capitol would fairly be able to put on an adequate
defense without Bonfili as a witness. The document upon which
Capitol had to rely in determining if its due process rights
had been fairly considered was the single sentence offered by
the judge in lifting the stay. Without question, the judge's
order falls far short of the Commission's standard for
procedural due process set out in Buck Creek. As to the
question of whether I have elevated form over substance, it
is worthwhile to note that many countries make much more
grandiose constitutional promises of rights and entitlements
than our venerable Constitution. What we have that many do
not is the means to exercise our rights. That means is
procedural due process.
Accordingly, I would vacate the judge's decision and
remand for the judge to reconsider whether the stay order
should be lifted based upon his application and analysis of
the factors set forth in Buck Creek, 17 FMSHRC at 503. See
Peabody Coal Co., 17 FMSHRC 508, 512 (Apr. 1995) (vacating
and remanding for application of correct legal standard);
Energy West Mining Co., 15 FMSHRC 1836, 1839-40 (Sept. 1993)
(same).
James C. Riley, Commissioner
Distribution
E.E. Mathews, III, Esq.
McGuire Woods, Battle & Boothe LLP
One James Center
901 East Cary Street
Richmond, VA 23219-4030
Cheryl C. Blair-Kijewski, Esq.
Sheila Cronan, Esq.
U.S. Department of Labor
Office of the Solicitor
4015 Wilson Boulevard, Suite 400
Arlington, VA 22203
Administrative Law Judge Gary Melick
Federal Mine Safety and Health Review Commission
Office of the Administrative Law Judges
2 Skyline, 10th Floor
5203 Leesburg Pike
Falls Church, VA 22041