Secretary of Labor v. P&K Stone, LLC

Plain-English summary

MSHA mailed P&K Stone's assessment to its Chico, Texas address of record, but the Postal Service returned it because forwarding had expired. P&K updated its address 24 days after the failed delivery, before receiving a delinquency notice, and moved to reopen within 30 days of that notice. The majority found mistake or excusable neglect, reopened the assessment, and remanded it despite the Secretary's opposition. Commissioner Marvit concurred on different grounds, reasoning that attempted delivery was not receipt under section 105(a), so the assessment never became final.

Decision snapshot

• Cited authority: 30 U.S.C. § 815(a)
• Outcome: The assessment was returned to the litigation track and remanded for penalty proceedings.
• Key point: A prompt address update and prompt motion supported relief after an assessment was returned undelivered.

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.

P&K
STONE, LLC               

Docket
No. CENT 2024-0295

A.C.
No. 41-05110-596692

BEFORE: 
Jordan, Chair; Baker, and Marvit, Commissioners

ORDER

BY: Jordan, Chair,
and Baker, Commissioner

This
matter arises under the Federal Mine Safety and Health Act of 1977, 30 U.S.C. §
801 et seq. (2018) (“Mine Act”). On July 26, 2024, the Commission received from
P&K Stone, LLC (“P&K”) a motion seeking to reopen a penalty assessment
that had become a final order of the Commission pursuant to section 105(a) of
the Mine Act, 30 U.S.C. § 815(a).

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

We
have held, however, that in appropriate circumstances, we possess jurisdiction to reopen uncontested
assessments that have become final Commission orders under section 105(a). Jim
Walter Res., Inc., 15 FMSHRC 782, 786-89 (May 1993) (“ JWR ”). In
evaluating requests to reopen final 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”); JWR ,
15 FMSHRC at 787. We have also observed that default is a harsh remedy and
that, if the defaulting party can make a showing of good cause for a failure to timely respond, the case may be
reopened and appropriate proceedings on the merits permitted. See Coal Prep.
Servs., Inc., 17 FMSHRC 1529, 1530 (Sept. 1995).

Records
of the Department of Labor’s Mine Safety and Health Administration (“MSHA”)
indicate that on April 12, 2024, the U.S. Postal Service attempted delivery of
the proposed penalty assessment, but the assessment was marked “forward
expired” and returned to MSHA. The proposed assessment became a final order of
the Commission on May 13, 2024. On June 27, 2024, MSHA sent P&K a
delinquency letter. In July 2024, MSHA received a partial payment in the amount
of $5,237 from P&K.

P&K
requests that the Commission reopen the final orders associated with five
citations set forth in the proposed assessment [1]
because it did not have the opportunity to file a timely contest due to an “error
in delivery.” It explains that after the inspection involving the citations
closed on February 13, 2024, the proposed assessment was not delivered to the
mine. Rather, on July 11, 2024, the proposed assessment arrived at P&K’s
main office located in McKinney, Texas. The operator submits that prior to the
arrival in July, P&K did not receive any other correspondence from MSHA
indicating that the operator was delinquent or that the penalties had become
final orders.

The
Secretary opposes the motion to reopen. She explains that on April 4, 2024,
MSHA sent the assessment to P&K’s address of record, located in Chico,
Texas. On April 12, 2024, the U.S. Post Office attempted delivery but returned
the assessment to MSHA because there was no change of address on file. The
Secretary states that P&K filed a new address of record on May 6, 2024,
indicating that its new address is in McKinney, Texas, and that the operator
received the delinquency notice at this new address. The Secretary asserts that
there was no “error in delivery” because MSHA delivered mail to the operator’s
address of record. She further argues that P&K failed to adequately explain
the fundamental issue of why the proposed assessment was not deliverable to its
address of record.

The Commission has held that “[m]otions to
reopen received within 30 days of an operator's receipt of its first notice
from MSHA that it has failed to timely file a notice of contest will be
presumptively considered as having been filed within a reasonable amount of
time.” Highland Mining Co ., 31 FMSHRC 1313, 1316-17 (Nov. 2009). Here,
the motion to reopen was filed within 30 days of the operator’s receipt of the
delinquency notice. Thus, the motion to reopen was filed in a reasonable amount
of time.

A movant’s good faith is relevant in
determining whether the movant has demonstrated good cause to reopen a final
assessment. See,
e.g., Rockwell Mining, LLC , 45 FMSHRC 743, 745 (Aug. 2023) (reopening where
movant acted in good faith by timely filing its request to reopen); Brand
Indus. Svcs, LLC , 46 FMSHRC 431 (July 2024) (relying upon operator’s good
faith in determining whether to reopen when operator took prompt ameliorative
action). We
note that the operator filed its change of address form with MSHA on May 6,
well before it received the delinquency notice. In fact, the operator filed its
change of address form only 24 days after MSHA attempted delivery of the
assessment to the operator’s prior address.

Having
reviewed P&K’s request and the Secretary’s
response, we find that the operator’s failure to timely contest the
assessment was the result of mistake or excusable neglect. In the interest of justice, we hereby reopen this
matter and remand it to the Chief Administrative Law Judge for further
proceedings pursuant to the Mine Act and the Commission’s Procedural Rules, 29
C.F.R. Part 2700. Accordingly, consistent with Rule 28, the Secretary
shall file a petition for assessment of penalty within 45 days of the date of
this order. See 29 C.F.R. § 2700.28.

/s/ Mary Lu Jordan

Mary
Lu Jordan, Chair

/s/ Timothy J. Baker

Timothy J. Baker, Commissioner

Commissioner
Marvit, concurring :

I write to agree with the Majority in this
case for the reasons set forth below.

In Explosive Contractors , 46 FMSHRC
965 (Dec. 2024), I dissented and explained that Congress did not grant the
Commission the authority to reopen final orders under section 105(a) of the
Mine Act. The Commission’s repeated invocation of Federal Rule of Civil
Procedure 60(b) cannot overcome the statutory language. However, in Belt
Tech , I explained in my concurrence that “the Act clearly states that to
become a final order of the Commission, the operator must have received the
notification from the Secretary.” 46 FMSHRC 975, 977 (Dec. 2024) (citing Hancock
Materials, Inc. , 31 FMSHRC 537 (May 2009)). Taken together, these opinions
stand for the proposition that the Commission may not reopen final orders under
its statutory grant, but an operator may proceed if it has not properly
received a proposed order.

In the instant case, as the Majority
recounts, the U.S. Post Office attempted delivery of the proposed order on
April 12, 2024 and was then returned to MSHA. Therefore, there was no actual
receipt of the notification as required under 30 U.S.C. § 815(a). While 30
C.F.R. § 100.8(a) deems service to be completed when assessments are
“delivered” to the addresses of record for representative parties, here there
was only attempted delivery. As such, in my opinion, the Commission’s order did
not become final under the language of section 105(a) on May 13, 2024. Given
then that the operator updated its address in a reasonable amount of time,
receipt of the notification occurred with the delivery of the delinquency
notice, after which the operator timely contested. Though
I believe the Commission lacks the authority to consider motions to reopen, I
concur with the Majority though I believe the Commission is not reopening the
matter.

/s/ Moshe Z.
Marvit

Moshe Z. Marvit,
Commissioner

Distribution:

Ramiro
Jimenez

Plant
Manager – Chico 1 Quarry

P&K
Stone, LLC

6030
FM1810

Chico,
TX 76431

[email protected]

Thomas
A. Paige, Esq.

Office
of the Solicitor

U.S.
Department of Labor

Division
of Mine Safety and Health

200
Constitution Avenue NW, Suite N4428

Washington,
DC 20210

[email protected]

Melanie
Garris

US
Department of Labor/MSHA

Office
of Assessments, Room N3454

200
Constitution Ave NW

Washington,
DC 20210

[email protected]

Chief
Administrative Law Judge Glynn F. Voisin

Office
of the Chief Administrative Law Judg

Federal
Mine Safety Health Review Commission

1331
Pennsylvania Avenue, NW Suite 520N

Washington,
DC 20004-1710

[email protected]

[1] The five
citations include Citations Nos. 9748506, 9748508, 9748509, 9748510, and
9784512. MSHA applied P&K’s payment of $5,237 against the penalties
associated with Citation Nos. 9748508 and 9748510. However, the penalties set
forth on the proposed assessment, excluding the penalties for five citations
that P&K intended to contest, total the amount of $5,237. We conclude that P&K’s
partial payment does not moot its contest of the penalties associated with
Citations Nos. 8748508 and 9748510 because it appears that the operator did not
intend for its payment to be applied against those penalties.