Creative Gold, Inc.

Plain-English summary

After certified-mail attempts were returned, OSHA sent two citations by FedEx to Creative Gold's new Brooklyn address, where someone at the shared entrance signed for them. The judge held that service was reasonably calculated to provide notice and that receipt occurred on the delivery date, regardless of whether the signer was Creative Gold's employee. The company's inadequate mail handling and its counsel's failure to identify the filing deadline did not establish excusable neglect. The late notice of contest was dismissed and both citations were affirmed in all respects.

Decision snapshot

• Cited standard(s): No specific OSHA standard numbers are identified in this procedural decision.
• Outcome: Rule 60(b) relief was denied, the late notice of contest was dismissed, and both citations were affirmed.
• Key point: An employer cannot postpone receipt of an OSHA citation by relying on inadequate mail procedures at a shared business address.

Full text (OSHRC public release)

SECRETARY OF LABOR,

            Complainant,

    v.                                   OSHRC DOCKET NOS. 02-1560 & 02-1561

CREATIVE GOLD, INC.,

            Respondent.

APPEARANCES:
Donyell M. Thompson, Esquire David Gronbach, Esquire
U.S. Department of Labor Smith, Buss & Jacobs, LLP
New York, New York Yonkers, New York
For the Complainant. For the Respondent.

BEFORE: Chief Judge Irving Sommer

                              DECISION AND ORDER


   This proceeding is before the Occupational Safety and Health Review Commission

(“the Commission”) pursuant to section 10 of the Occupational Safety and Health Act of
1970, 29 U.S.C. § 651 et seq. (“the Act”). The Secretary of Labor (“the Secretary”) filed a
motion to dismiss as untimely the notice of contest (“NOC”) of Respondent, Creative Gold,
Inc. Respondent filed an opposition to the motion and a cross-motion to dismiss the citations
issued by the Secretary. A hearing in this matter was held on January 23, 2003. Both parties
have filed post-hearing briefs.
Background
The Occupational Safety and Health Administration (“OSHA”) conducted two
inspections of Respondent, a jewelry manufacturing business, in the fall of 2001; the first
was from September 12 through October 22, 2001, and the second was on September 20,
2001. Both inspections took place at Respondent’s work site in Newark, New Jersey, and
each inspection resulted in the issuance of a Citation and Notification of Penalty (“Citation”).
OSHA issued the Citation from the second inspection on December 19, 2001, and mailed it
to the company’s Newark address by certified mail, return receipt requested, on December
31, 2001, but the Citation came back unclaimed.1 OSHA issued the Citation from the first
inspection on January 23, 2002, and, because the other Citation had been returned, mailed
both Citations in one envelope by certified mail, return receipt requested, on January 24,
2002, to the company’s new address in Brooklyn, New York.2 The Citations were returned
to OSHA, and, on February 25, 2002, OSHA sent the Citations in one envelope by FedEx to
Respondent’s Brooklyn address. Based on the FedEx delivery report, the Citations were
delivered to Respondent’s Brooklyn address on February 27, 2002, and a “G. Ramey” signed
for the envelope containing the Citations.3 (Tr. 5-13, 21-34, 39-44; Exhs. C-1, C-3, C-7-8,
C-10).
Section 10(a) of the Occupational Safety and Health Act of 1970, 29 U.S.C. § 651 et
seq. (“the Act”), requires an employer to notify the Secretary of the intent to contest a citation
within 15 working days of receipt, and the failure to file a timely NOC results in the citation
becoming a final order of the Commission by operation of law. In view of the delivery date
of February 27, 2002, the NOC filing period here ended on March 20, 2002. No NOC was
filed by that date, but Respondent’s counsel sent a letter to OSHA on M arch 26, 2002. The
letter stated that various conversations had taken place between Respondent’s counsel and
OSHA from March 15 to 22, 2002, that Respondent had vacated the Newark premises at the
end of 2001, and that the company had abated the alleged violations and had no prior record
with OSHA. The letter also stated that the company had contested the proposed penalties

     1
     Both Citations show the inspection site as “48-50 Main Street, Newark, NJ 07105,” but the

Citation issued on December 19, and the envelope it was mailed in, show the company’s address as
“48-58 Main Street, Newark, NJ 07105.” See C-1, C-7, C-10. The record indicates the latter address
was provided to OSHA during the inspection, and C-6, a letter to OSHA from Respondent’s counsel,
would seem to verify that this was in fact the company’s address in Newark. (Tr. 7, 44).
2
OSHA learned the company had relocated to Brooklyn, New York, and the Citations were
thus sent to 1425 37th Street, Brooklyn, New York 11218, the new address. (Tr. 41-44). While the
envelope shows a mailing date of January 24, 2001, it is clear from C-8, the OSHA diary sheet
relating to this matter, and the record in general, that the Citations were mailed on January 24, 2002.
3
The motion to dismiss and exhibits attached thereto indicated the delivery date was February
26, 2002. However, the Secretary’s response to Respondent’s opposition clarified that while delivery
was attempted on February 26, the actual delivery date was February 27, 2002. See also C-3.
during the earlier communications, that counsel had advised its client that OSHA might
consider a reduced penalty to settle the Citations, and that counsel anticipated a response
from its client after the Passover holiday. Because Respondent had not submitted an NOC
letter before the end of the filing period, OSHA sent letters to the company on April 24,
2002, advising that the penalties were due.4 On September 10, 2002, Respondent’s counsel
mailed to the Commission a letter requesting that the company be given the opportunity to
file a “late contest of the penalties assessed.” The letter repeated many of the statements
made in the March 26 letter and indicated that although negotiations had taken place a
settlement had not been reached and OSHA had subsequently advised that the NOC filing
period had lapsed. The Secretary filed her motion to dismiss on October 1, 2002, and
Respondent filed its opposition and cross-motion on October 11, 2002.5 As noted above, a
hearing was held in this matter on January 23, 2003, and the parties have filed post-hearing
briefs. (Tr. 13-20, 30-31, 36-37; Exhs. C-4-6, C-9).
Discussion
The record plainly shows that Respondent did not file an NOC by the end of the 15-
day period following the delivery of the Citations. Respondent contends, however, that the
service of the Citations was improper. Respondent also contends the Secretary has not met
her burden of proving the date it received the Citations, in that the person who signed for
them did not have the authority to do so. Finally, Respondent contends its letter of March 26,
2002, was an NOC and was filed within 15 working days of its actual receipt of the Citations.
The Secretary contends that the service of the Citations was proper. She also contends that
she did not consider the March 26 letter an NOC and that, even if it was, it was not filed
within 15 working days of the delivery date of the Citations.
As to Respondent’s first contention, section 10(a) of the Act states that the Secretary
“shall ... notify the employer by certified mail of the [citation and] penalty....” However, the

   4
     Although both letters state that the Citations were delivered on February 26, 2002, the record

establishes that the Citations were delivered on February 27, 2002. See footnote 3.
5
The Secretary’s motion to consolidate the two cases was granted on October 16, 2002.
Commission has held that the test for proper service of a citation is “whether the service is
reasonably calculated to provide an employer with knowledge of the citation and notification
of proposed penalty and an opportunity to determine whether to abate or contest.” B.J.
Hughes, Inc., 7 BNA OSHC 1471, 1474 (No. 76-2165, 1979). See also Henry C. Beck Co.,
8 BNA OSHC 1395, 1398-99 (No. 11864, 1980); NYNEX, 18 BNA OSHC 1944, 1947 (No.
95-1671, 1999). The Commission has also held the date of receipt should generally be the
date an employee signs for the mailing at the work site address to which the Secretary
directed the citation; this is so because the Secretary cannot control who signs for the
mailing, even by naming a specific individual at the site, or when the mailing actually reaches
the proper company employee. Henry C. Beck Co., 8 BNA OSHC at 1399. Finally, the
Commission has held that an employer should not be allowed to claim a later receipt date by
showing that the person in charge of the site did not sign for the citation and that when the
mailing is accepted at the site where a company employee is in charge, the employer has
effectively received the required notice; in so holding, the Commission noted that any other
rule would allow an employer whose internal mail-handling procedures were inadequate to
delay receipt of a citation. Id.
The record shows that OSHA mailed the first-issued Citation by certified mail on
December 31, 2001, to the address the company had given the OSHA compliance officer
(“CO”); however, the Citation was returned to OSHA unclaimed. OSHA next mailed out
both Citations by certified mail in one envelope on January 24, 2002, to Respondent’s
Brooklyn address, the CO having learned from an interview with an employee that the
company had relocated, but the Citations were again returned to OSHA.6 OSHA then sent

   6
    As Respondent notes, the OSHA assistant area director testified at the hearing that each

Citation was mailed out separately by certified mail and that, after they came back, they were then
sent by FedEx in one envelope. (Tr. 8-12, 21-30). However, based on the record as a whole, I
conclude that the Citations were sent as set out above. My conclusion is supported by C-8, the diary
sheet, which indicates that both Citations were mailed out together on January 24, 2002 and that they
were also sent together by FedEx on February 25, 2002. My conclusion is also supported by C-10,
the envelopes that were returned to OSHA; the return receipt card attached to the envelope mailed
(continued...)
both of the Citations by FedEx in one envelope to the Brooklyn address, on February 25,
2002.7 FedEx attempted delivery on February 26, 2002, but the business was closed due to
a holiday, and FedEx thus delivered the Citations the next day. (Tr. 5-13, 21-34, 39-44; Exhs.
C-3, C-8-10). See also Exh. B to Secretary’s motion.
In support of its position that service of the Citations was improper, Respondent
presented Mordy Jalas, the owner and manager of the business. M r. Jalas testified that his
company downsized and moved from Newark to Brooklyn at the end of 2001. He further
testified that his business received packages every day and that there was a receptionist at the
entrance of the Brooklyn address; however, there were two other businesses at the same
address that used the same entrance and he had had problems with packages being lost or
stolen, and he therefore had an agreement with UPS, the carrier he used, that only he had the
authority to sign for packages delivered to his company. 8 Mr. Jalas said that he was an
Orthodox Jew, that his business had been closed on February 26 and 27, 2002, because of
the Jewish holiday of Purim, and that while someone could have been in the building on
February 27, 2002, he had not been there and had not signed for the FedEx package
containing the Citations.9 He also said that he did not have an employee named “G. Ramey,”
that someone from one of the other companies must have signed for the Citations, and that
although he was not sure when he actually received them he thought that it had been

   6
     (...continued)

on December 31, 2001, reflects the inspection number for the first-issued Citation, while the return
receipt card attached to the envelope mailed on January 24, 2002, reflects both inspection numbers.
7
The FedEx envelope and the first-issued Citation were directed to Mordy Jalas at Creative
Gold, while the Citations sent in January 2002 were directed simply to Creative Gold. See C-3, C-10.
8
Mr. Jalas indicated that many of the packages he received contained gold jewelry and that,
according to his agreement with UPS, if someone else had signed for a package and he did not
receive it, UPS reimbursed him for the loss. (Tr. 48-51).
9
Mr. Jalas noted that the other two businesses were “not Jewish.” (Tr. 50).
sometime in March shortly before the NOC deadline.10 Mr. Jalas indicated that he sent the
Citations promptly to his attorney, who said that he would take care of them. (Tr. 45-59).
Based on the foregoing, I conclude that the Secretary’s service of the Citations was
proper. The Secretary attempted to serve the Citations by certified mail and, when that was
unsuccessful, sent the Citations by FedEx. Although Respondent objects to the service, the
Secretary cannot be faulted for Respondent’s apparent failures to pick up the certified
mailings and to notify the U.S. Postal Service of its move to Brooklyn.11 The Secretary
likewise cannot be faulted for using FedEx, under the circumstances, and Respondent’s
assertion that she should have resorted to the service set out in Federal Rule of Civil
Procedure 4 is rejected.12 See NYNEX, 18 BNA OSHC 1967, 1970 at n.8 (No. 95-1671,
1999). I further conclude that the date of receipt of the Citations was February 27, 2002. Mr.
Jalas testified that the individual who signed for the Citations was not his employee and that
he did not receive the Citations until sometime in March. However, these reasons, in view
of the above Commission precedent, are insufficient to allow Respondent to claim a later
receipt date, particularly since the record indicates that the company’s mail-handling
procedures were inadequate. I note first Mr. Jalas’ testimony that the Citations were found
in the receptionist’s office a week or two after they were delivered. (Tr. 53-56). I note also
Mr. Jalas’ testimony indicating that this was not an unusual situation when he returned to his
business after an absence. (Tr. 53-56). Finally, I note that, even if the person who signed for
the Citations was not Respondent’s employee, the company should have had adequate

   10
     Mr. Jalas said the Citations were found in the receptionist’s office a week or two after they

were delivered; he also said there could be a great deal of mail in the receptionist’s office when he
returned after an absence and that mail could be there without his realizing it had come. (Tr. 53-56).
11
Mr. Jalas admitted that he never notified OSHA of the move. (Tr. 53). Further, while C-6
advised OSHA the company was no longer at the Newark address, it did not give the new address.
12
Also rejected is Respondent’s assertion that the Secretary’s service deprived it of due
process. NYNEX, 18 BNA OSHC at 1970-71.
procedures in place to ensure the receipt and proper routing of important documents. 13 Based
on the record, Respondent’s contentions with respect to the service and date of receipt of the
Citations are rejected, and the rejection of these contentions makes it unnecessary to address
the company’s further contention that the March 26, 2002 letter was an NOC.
Respondent’s final contention is that, even if its NOC was untimely, the late filing
should be accepted under Federal Rule of Civil Procedure 60(b) (“Rule 60(b)”). Commission
precedent is well settled that an untimely NOC may be accepted where the delay in filing was
due to deception on the Secretary’s part or her failure to follow proper procedures. A late
filing may also be excused if the final order was entered as a result of “mistake, inadvertence,
surprise or excusable neglect” or “any other reason justifying relief, including mitigating
circumstances such as absence, illness or a disability that would prevent a party from
protecting its interests.” See Branciforte Builders, Inc., 9 BNA OSHC 2113 (No. 80-1920,
1981); see also Rule 60(b). However, the Commission has held that “a business must
maintain orderly procedures for handling important documents” and that when the lack of
such procedures results in an untimely NOC the late filing will be deemed to be simple
negligence and not excusable neglect. Louisiana-Pacific Corp., 13 BNA OSHC 2020 (No.
86-1266, 1989). The Commission has also held that the OSHA citation plainly states the
requirement to file an NOC within the prescribed period and that an employer “must bear the
burden of its own lack of diligence in failing to carefully read and act upon the information
contained in the citations.” Roy Kay, Inc., 13 BNA OSHC 2021, 2022 (No. 88-1748, 1989);
Acrom Constr. Serv., Inc., 15 BNA OSHC 1123, 1126 (No. 88-2291, 1991). Finally, the
Commission has held that ignorance of procedural rules does not constitute “excusable
neglect” and that mere carelessness or negligence does not justify relief. Acrom Constr. Serv.,

   13
      Despite the agreement that Mr. Jalas said he had with UPS, there was no evidence of

similar agreements with other carriers, and I reject Respondent’s suggestion that Mr. Jalas’
agreement was with the U.S. Postal Service. (Tr. 48-51). Regardless, Respondent may not claim a
later date of receipt of the Citations by asserting that either the carrier or OSHA was somehow at
fault.
Inc., 15 BNA OSHC 1123, 1126 (No. 88-2291, 1991); Keefe Earth Boring Co., 14 BNA
OSHC 2187, 2192 (No. 88-2521, 1991).
In view of my findings set out supra, it appears that the late filing in this case was due
in part to Respondent’s inadequate mail-handling procedures. It further appears that the
untimely NOC was also due to the failure of Respondent’s counsel to ascertain the NOC
filing deadline and to file a written NOC by that date. Mr. Jalas testified that he received the
Citations shortly before the end of the NOC filing period and that he sent them promptly to
his attorney, who said he would take care of them. (Tr. 53-56). In addition, C-5 and C-6
indicate that Respondent’s counsel had received the Citations by at least March 15, 2002,
since, according to the letters, he had various conversations with OSHA from that date to
March 22, 2002, and had advised OSHA orally that Respondent was contesting the
penalties.14 Despite these conversations, however, Respondent’s counsel was evidently not
aware of the NOC filing deadline until after writing his letter of March 26, 2002. See C-5,
page 2. Moreover, notwithstanding its various assertions in this regard, Respondent
introduced no evidence to establish that its counsel was somehow misled during the
conversations with OSHA about the need to file a written NOC within 15 days of the date
of receipt of the Citations.15
It is Respondent’s burden to show that it is entitled to Rule 60(b) relief, and, in light
of the evidence of record, Respondent has failed to demonstrate that the untimely filing in
this case was caused by the Secretary’s deception or failure to follow proper procedures or
to “any other reason justifying relief.” I am sympathetic to Respondent’s plight in this matter,

   14
      Although the Secretary disputes that Respondent’s counsel ever called the OSHA office,

it would appear that he did, based on the March 15, 2002 entry on C-8; otherwise, OSHA would
likely not have had the name and number of Respondent’s counsel. Thus, for purposes of the Rule
60(b) discussion, I find that the conversations indicated in C-5 and C-6 occurred.
15
Respondent’s assertions in this regard are specifically rejected, including its suggestion that
OSHA led it to believe that a settlement would be reached and that a formal NOC was not required.
Also rejected is Respondent’s assertion that the Secretary’s failure to follow proper procedures, i.e.,
not forwarding the March 26, 2002 letter to the Commission and not filing a complaint in this matter,
merit dismissal of the Citations.
and I have considered the statements in the letters from Respondent’s counsel that the
company had never been cited before, that the cited conditions were all abated, and that the
company cannot remain in business if it must pay the proposed penalties. However, I am
constrained to follow Commission precedent, and, on the basis of that precedent, set out
supra, and in view of the circumstances of this case, Respondent is not entitled to Rule 60(b)
relief.16 The Secretary’s motion to dismiss is accordingly GRANTED, and the Citations are
AFFIRMED in all respects.
So ORDERED.

                                                 /s/
                                                 Irving Sommer
                                                 Chief Judge

Date: April 3, 2003
Washington, D.C.

    16
     In deciding this case, I am aware of the Second’s Circuit’s decision that the Commission

has no authority to accept a late-filed NOC pursuant to Rule 60(b). Chao v. Russell P. Le Frois
Builder, 291 F.3d 219 (2d Cir. 2002) (“Le Frois”). I am also aware that this case could be appealed
to the Second Circuit. However, it is unlikely Respondent would do so, in view of the Le Frois
decision, and, for this reason, I have decided this matter pursuant to Rule 60(b). See HRH Constr.,
19 BNA OSHC 2042, 2044-45 (No. 99-1614, 2002). Regardless, the end result for Respondent is
the same whether this case is decided under Commission precedent or the Le Frois decision.