Secretary of Labor v. Mike Morgan Industrial, LLC

Plain-English summary

Mike Morgan Industrial did not answer the Secretary's penalty petition because it contacted MSHA and waited for a response, even though the petition directed it to answer the Commission within 30 days. The company then missed the ALJ's show-cause order because the email went to a spam folder. It did not explain how often it checked the spam folder or when it discovered the order. It also filed its reopening motion more than three months after the show-cause order without giving enough dates to evaluate that delay. The Commission found no good cause and denied reopening.

Decision snapshot

• Cited authority: 30 U.S.C. §§ 823(d)(1) and 823(d)(2)(A)(i)
• Outcome: The request to reopen the final default order was denied.
• Key point: Waiting for MSHA, failing to monitor spam, and omitting the timeline of a delayed reopening request do not establish excusable neglect.

Full text (FMSHRC public release)

FEDERAL
MINE SAFETY AND HEALTH REVIEW COMMISSION

1331
PENNSYLVANIA AVE., N.W., SUITE 520N

WASHINGTON,
DC 20004-1710

SECRETARY
OF LABOR,

MINE
SAFETY AND HEALTH

ADMINISTRATION
(MSHA)

v.

MIKE
MORGAN INDUSTRIAL, LLC

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Docket
No. CENT 2023-0244

A.C.
No. 03-02065-581176

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BEFORE: Jordan,
Chair; Baker and Marvit, Commissioners

ORDER

BY THE COMMISSION:

This matter arises under the Federal Mine
Safety and Health Act of 1977, 30 U.S.C. § 801 et seq. (2018) (“Mine Act”). On February
21, 2024, the Commission received from Mike Morgan Industrial, LLC (“MMI”) a
motion seeking to reopen a penalty assessment proceeding and relieve it from
the Default Order entered against it.

On November 13, 2023, the Chief
Administrative Law Judge issued an Order to Show Cause in response to MMI’s
perceived failure to answer the Secretary of Labor’s Petition for Assessment of
Civil Penalty dated September 12, 2023. By its terms, the Order to Show Cause
was deemed a Default Order on December 14, 2023, when it appeared that the
operator had not filed an answer within 30 days.

MMI asserts that it contacted the Mine
Safety and Health Administration (“MSHA”) on September 19 to discuss the Penalty
Petition and received no response.[1]
MMI subsequently conducted a “routine check” on MSHA’s Mine Data Retrieval
System and discovered that the proposed penalty had become final. Upon further
investigation, the operator located the Default Order in a spam email folder.[2]

The
Secretary opposes the request to reopen. She represents that full payment for
the relevant penalties was received on March 13, 2024, and asserts that the
motion should therefore be dismissed. She further claims that the operator has
failed to establish good cause to reopen or adequately justify its failure to
timely respond to either the Penalty Petition or Default Order.

The Judge’s jurisdiction in this matter
terminated when the default occurred. 29 C.F.R.

§ 2700.69(b). Under the Mine Act and the Commission’s procedural rules, relief
from a Judge’s decision may be sought by filing a petition for discretionary
review within 30 days of its issuance. 30 U.S.C. § 823(d)(2)(A)(i); 29 C.F.R. §
2700.70(a). If the Commission does not direct review within 40 days of a
decision’s issuance, it becomes a final decision of the Commission. 30 U.S.C. §
823(d)(1). Consequently, the Judge’s order here has become a final decision of
the Commission.

In evaluating requests to reopen final
orders, the Commission has found guidance in Rule 60(b) of the Federal Rules of
Civil Procedure under which the Commission may relieve a party from a final
order of the Commission on the basis of mistake, inadvertence, excusable
neglect, or other reason justifying relief. See 29 C.F.R. § 2700.1(b)
(“the Commission and its Judges shall be guided so far as practicable by the
Federal Rules of Civil Procedure”); Jim Walter Res., Inc., 15 FMSHRC
782, 786-89 (May 1993). We have observed that default is a harsh remedy and
that, if the defaulting party can make a showing of good cause for a failure to
timely respond, the case may be reopened and appropriate proceedings on the
merits will be permitted. See Coal Prep. Servs., Inc., 17 FMSHRC 1529,
1530 (Sept. 1995).

An operator seeking to reopen a final
penalty bears the burden of showing that it is entitled to such relief, through
a detailed explanation of its failure to answer the Secretary’s petition or
respond to the Chief Judge’s Order to Show Cause. See, e.g., Buzzi
Unicem USA, 45 FMSHRC 1015, 1016 (Dec. 2023); Essroc Cement Corp.,
40 FMSHRC 1147, 1148-49 (Aug. 2018). However, we have held that explanations
which reflect an inadequate internal processing system do not establish good
cause to reopen a final penalty. See, e.g., Revelation Energy, LLC,
40 FMSHRC 375, 376 (Mar. 2018); Oak Grove Res., LLC, 33 FMSHRC 103, 104
(Feb. 2011).

Here, MMI asserts that it initially failed
to answer to the Secretary’s petition because it had contacted MSHA and was
awaiting a response. However, the petition clearly explains that an answer must
be filed with the Commission within 30 days. It is an operator’s responsibility
to fully read any information provided by the Secretary in connection with a
proposed penalty. See Stone Zone, 41 FMSHRC 272, 275 (June 2019).

MMI asserts that it subsequently failed to
respond to the Show Cause Order because the order went to a spam folder, and
was not discovered until a routine check of MSHA’s Mine Data Retrieval System. MMI
does not explain how often these routine checks occur, or whether a separate
mechanism is in place for routine checks of the spam folder. Failure to adequately
monitor one’s spam folder indicates an inadequate or unreliable internal
processing system, and does not constitute good cause for a failure to timely
respond. See Trevino v. City of Fort Worth, 944 F.3d 567, 571-72 (the
fact that court communications were sent to a spam email folder “does not
constitute excusable neglect under Rule 60(b)”); Double Bonus Coal Co., 32
FMSHRC 1155, 1156-57 (Sept. 2010) (finding an inadequate processing system
where an operator overlooked certified mail as junk mail).

Additionally, an operator who files a
motion to reopen more than 30 days after receiving notification of its failure
to respond must also explain its delay in requesting relief. Highland Mining
Co., 31 FMSHRC 1313, 1316-17 (Nov. 2009). Here, MMI filed its motion more
than three months after the Judge issued a Show Cause Order notifying the
operator of its failure to respond to the Secretary’s petition. MMI explains
that it discovered the order in its spam folder some time later, after a routine
check of the Mine Data Retrieval System. However, MMI does not state when that routine
check occurred, how soon afterwards the order was discovered, or how soon after
discovery the motion was filed. Accordingly, we cannot determine how long MMI waited
to file its motion to reopen after learning of its failure to respond, or
whether that delay was reasonable.

Having reviewed MMI’s request and the
Secretary’s response, we conclude that the operator failed to establish good
cause for reopening the captioned proceedings. Accordingly, MMI’s request to
reopen is denied.

/s/
Mary Lu Jordan

Mary
Lu Jordan, Chair

/s/ Timothy J. Baker

Timothy J. Baker, Commissioner

/s/ Moshe Z. Marvit

Moshe Z. Marvit, Commissioner

Distribution:

Keith
Crofford

Mike
Morgan Industrial, LLC

10450
US-280

Westover,
AL 35147

[email protected]

Maria
C. Rich-DoByns

Mine
Safety and Health Administration

U.S.
Department of Labor

1100
Commerce Street Room 462

Dallas,
TX 75242

[email protected]

April
Nelson, Esq.

Associate
Solicitor

Office
of the Solicitor

U.S.
Department of Labor

Division
of Mine Safety and Health

201
12th Street South, Suite 401

Arlington,
VA 22202

[email protected]

Emily
Toler Scott, Esq.

Counsel
for Appellate Litigation

Office
of the Solicitor

U.S.
Department of Labor

Division
of Mine Safety and Health

201
12th Street South, Suite 401

Arlington,
VA 22202

[email protected]

Melanie
Garris

USDOL/MSHA, OAASEI/CPCO

201 12th Street South, Suite 401

Arlington, VA 22202

[email protected]

Chief
Administrative Law Judge Glynn F. Voisin

Office
of the Chief Administrarive Law Judge

Federal Mine Safety Health Review Commission

1331 Pennsylvania Avenue, NW Suite 520N

Washington, DC 20004-1710

[email protected]

[1] Specifically, MMI
states that it contacted MSHA on September 19, 2023 to discuss the “Commission
order associated with [the penalty assessment].” As of that date, the
Commission had not issued any orders in this matter. The only logical inference
is that MMI is referring to the Secretary’s Petition for Assessment of Civil
Penalty issued one week previously.

[2] MMI states that the
change in the status of the penalty assessment “occurred without any
notification.” MMI concedes it received an email copy of the Chief Judge’s
Order to Show Cause and Order of Default, which clearly explained that the
penalty would become final if no response was received. MMI was notified that
the assessment would become final on December 14, 2023. As explained below, the
fact that the emailed Order was routed to a spam folder does not establish good
cause for MMI’s failure to respond. Arguably, MMI’s statement could be
interpreted as a claim of improper service. See 29 C.F.R. 2700.66(a). However,
for the reasons below, we find any potential service issue insufficient to
justify reopening in light of MMI’s actual notification, failure to adequately
explain its delay in moving to reopen, indications of an inadequate or
unreliable system, and payment of the assessment.