FPM Group, Ltd.

Plain-English summary

OSHA withdrew a serious compressed-gas citation against FPM Group before the case was set for hearing. FPM then sought fees and expenses under the Equal Access to Justice Act for work performed by its president and an administrative assistant. The judge held that a self-represented party is not entitled to EAJA fees and that FPM already knew this from prior litigation involving the same representative. He also found that FPM declined an offered withdrawal, filed unnecessary pleadings and frivolous claims, and unduly prolonged the proceeding. The fee-and-expense application was denied.

Decision snapshot

• Cited standard(s): 29 C.F.R. § 1910.101(b)
• Outcome: OSHA citation withdrawn; FPM's EAJA application for fees and expenses denied.
• Key point: A self-represented company cannot recover EAJA fees for its officer's time, especially when it knew the controlling rule and prolonged the case.

Full text (OSHRC public release)

                           United States of America
          OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION
                      1120 20th Street, N.W., Ninth Floor
                         Washington, DC 20036-3457

SECRETARY OF LABOR, :
Complainant, :
:
v. : OSHRC DOCKET NO. 01-2098
:
FPM GROUP, LTD., :
Respondent. :

                                 DECISION AND ORDER

   This matter is before the Occupational Safety and Health Review Commission (“the

Commission”) pursuant to section 10(c) of the Occupational Safety and Health Act of 1970, 29
U.S.C. § 651 et seq. (“the Act”). Specifically, this case is before the undersigned to determine
whether the above-named Respondent, FPM Group, Ltd. (“FPM”), is entitled to legal fees and
expenses under the Equal Access to Justice Act (“EAJA”), 5 U.S.C. § 504.
Pursuant to a complaint, the Occupational Safety and Health Administration (“OSHA”)
conducted an inspection of FPM’s facility on October 25 and 26, 2001. As a result, OSHA issued
a one-item serious citation to FPM on October 26, 2001; the citation alleged a violation of 29 C.F.R.
1910.101(b) and proposed a penalty of $875.00. FPM contested the citation, and this case was
designated for E-Z Trial pursuant to Commission Rule 203(a). However, before this matter was set
for hearing, the Secretary filed a notice of withdrawal of the citation, after which the proceeding was
dismissed. On April 19, 2002, FPM filed an application for fees and expenses under the EAJA. The
Secretary filed an answer on May 21, 2002, and FPM filed a reply on June 3, 2002.
Background
FPM is an engineering consulting business located in Ronkonkoma, New York. Gary Molnar,
FPM’s president and a licensed professional engineer, has been FPM’s representative throughout this
proceeding. After the citation was issued, Mr. Molnar had an informal conference with an official
of the OSHA office that issued the citation. The conference did not result in a settlement, and Mr.
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Molnar filed a notice of contest (“NOC”) on November 19, 2001.1 In the four-page NOC, FPM
contested not only the citation but also OSHA’s failure to “prosecute a false complaint” and its
“wrongful abuse of power.” FPM also claimed damages caused by OSHA’s “wrongful acts.”
On December 13, 2001, the Secretary filed a motion for an extension of time to file her
complaint, stating the subject case had been designated as appropriate for settlement and that more
time was necessary to attempt to amicably resolve the matter. On December 14, 2001, Mr. Molnar
moved for sanctions, noting that the request for an extension had not been filed within the required
20 days and that the Secretary should be found in default and the case against FPM dismissed. Mr.
Molnar further noted that FPM intended to file suit against the Secretary whether the case was
dismissed or not. The Secretary filed a response opposing the motion on December 19, 2001, and
on December 21, 2001, FPM’s motion was denied and the case was assigned to E-Z Trial.
On January 15, 2002, the Secretary sent a stipulation of withdrawal to Mr. Molnar. On
January 21, 2002, FPM filed a “counterclaim” of 11 pages and 10 exhibits; the counterclaim
essentially reiterated the claims in the NOC and set out two more, that is, OSHA’s “wrongful
diversion of funds” and “negligence for failure to use qualified personnel.” On January 25, 2002,
FPM filed a motion to discontinue E-Z Trial and proceed under conventional procedures, giving as
reasons the need for document requests, interrogatories and depositions, six or more witnesses,
including experts, and four to five days of hearings.2 On February 11, 2002, the Secretary filed a
notice of withdrawal of the citation. On February 12, 2002, FPM filed a response, acknowledging
the notice of withdrawal but stating that it did not desire to withdraw its counterclaim. I dismissed
the proceeding on February 25, 2002. As noted above, FPM filed its EAJA application on April 19,
2002, after which the Secretary filed an answer and FPM filed a reply.

   1
     On page 3 of her notice of withdrawal, dated February 11, 2002, the Secretary asserts that

at the informal conference, Mr. Molnar represented that the cited condition had been abated, after
which the OSHA official offered to reclassify the alleged violation as “other” and to delete the
penalty. The Secretary further asserts that Mr. Molnar declined the offer and said that he wanted to
take the case to court “as a matter of principle.” On pages 1-2 of his response to the notice of
withdrawal, dated February 12, 2002, Mr. Molnar denies these assertions.
2
Mr. Molnar did not mention the Secretary’s offered stipulation of withdrawal in either his
counterclaim or his motion to discontinue E-T Trial.
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                                         Discussion
   The Commission’s EAJA provisions provide for the award of attorney or agent fees and other

expenses to eligible individuals and entities who have prevailed over the Secretary in an adversary
adjudication before the Commission, unless the Secretary’s position was substantially justified or
special circumstances make an award unjust.3 See Commission Rule 101. The Secretary evidently
does not dispute that FPM is an “eligible applicant” for EAJA purposes or that FPM is the prevailing
party in this matter.4 However, the Secretary does dispute that FPM is entitled to an EAJA award.
As the Secretary points out, Gary Molnar, the president of FPM, has represented FPM on a
pro se basis throughout this proceeding. As the Secretary also points out, although the Commission’s
procedural rules allow an authorized officer or agent to represent a company, the courts of appeals
have uniformly held that parties that represent themselves are not entitled to fees under the EAJA.
See Kooritzky v. Herman, 178 F.3d 1315, 1320-21 (D.C. Cir. 1999), cert. denied, 528 U.S. 1160
(2000); Fanning, Phillips and Molnar v. West, 160 F.3d 717, 721-22 (Fed. Cir. 1998); SEC v.
Waterhouse, 41 F.3d 805, 808 (2d Cir. 1994); Celeste v. Sullivan, 988 F.2d 1069, 1070 (11th Cir.
1992); Demarest v. Manspeaker, 948 F.2d 655, 656 (10th Cir. 1991); Merrell v. Block, 809 F.2d 639,
641-42 (9th Cir. 1987); Crooker v. EPA, 763 F.2d 16, 17 (1st Cir. 1985). Finally, the Secretary
points out that FPM was well aware of this fact before OSHA issued the citation in this matter
because FPM was formerly Fanning, Phillips and Molnar and Mr. Molnar represented that company
in the above-noted case in the Court of Appeals for the Federal Circuit.5 Based on the cases cited by
the Secretary, I find that FPM is not entitled to fees under the EAJA for the time that Mr. Molnar and
his administrative assistant expended in this matter.

   3
       The Commission’s EAJA provisions essentially mirror those of the EAJA.
   4
    Exhibits to FPM’s application represent that FPM has under 500 employees and a net worth

of under $7 million. See Exhibits 5-6 to FPM’s application. See also Commission Rule 105(b)-(c).
5
FPM’s letterhead specifically states that it was “formerly Fanning, Phillips and Molnar,” and
Exhibit 6, FPM’s net worth exhibit, shows Fanning, Phillips and Molnar to be a related company of
FPM. Moreover, in Fanning, Phillips and Molnar v. West, 160 F.3d at 719, the text therein
establishes that Gary Molnar represented the company in that case. The Supreme Court denied Mr.
Molnar’s pro se motion to direct the Clerk of the Court to file a petition for a writ of certiorari.
Fanning, Phillips and Molnar v. West, 526 U.S. 1015 (1999).
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   I further find that FPM is not entitled to its expenses in this matter. FPM failed to mention

any of the above-noted cases in its application, which are clearly decisive here. Most significantly,
FPM failed to disclose its participation in Fanning, Phillips and Molnar v. West, 160 F.3d 717,
wherein the court plainly stated that the EAJA was not intended to compensate a party for its
personal absence from its business in prosecuting its claim.6 Id. at 722. FPM thus knew it was not
entitled to an award of fees and nonetheless filed an EAJA application, which, in my opinion, is a
special circumstance that makes any award in this matter unjust. See Commission Rule 106(b). FPM
also declined the Secretary’s offered stipulation of withdrawal, and it filed unnecessary pleadings
and made a number of what can only be termed frivolous claims, which leads me to conclude that
FPM unduly protracted the proceeding such that denial of an award is appropriate. Id.
For the foregoing reasons, FPM’s application for fees and expenses under the EAJA is
DENIED.7 So ORDERED.

                                                           /s/
                                                   Irving Sommer
                                                   Chief Judge

Date: 17 JUNE 2002
Washington, D.C.

   6
     In its reply, FPM finally addressed Fanning, Phillips and Molnar, first asserting that the case

was not applicable and then suggesting that it was wrongly decided. FPM’s reply did not address any
of the other cases the Secretary cited, which, along with Fanning, Phillips and Molnar, are clearly
controlling precedent on the issue at bar that the Commission is bound to follow. The other
arguments set out in FPM’s reply have been considered and found to be without merit.
7
Although the reasons set out supra are sufficient to dispose of this matter, I agree with the
Secretary that FPM’s claim for time expended before the citation was issued was improper. See
Central Brass Mfg. Co., 14 BNA OSHC 1904, 1906 (Nos. 86-978 & 86-1610, 1990). I also agree
that the number of hours claimed was excessive, that the hourly rate Mr. Molnar sought was too high
because it was over the statutory maximum, and that the FedEx expenses were unnecessary because
FPM could simply have mailed its filings. Finally, I agree with the Secretary that FPM was not
entitled to the cost of the claimed engineering report because FPM did not demonstrate that the
report was necessary for the preparation of its case. See Commission Rule 107(d).