Secretary of Labor v. Peabody Midwest Mining, LLC and Secretary of Labor v. Michael Butler, employed by Peabody Midwest Mining, LLC

Read the official release (fmshrc.gov)

Plain-English summary

A contractor's drill breached old mine workings at Peabody Midwest Mining's Francisco Mine and released methane that repeatedly registered above five percent. Mine manager Michael Butler allowed six miners to continue pulling drill rods with the drill energized for at least 30 minutes despite the high readings. Judge David P. Simonton affirmed two orders requiring electrical de-energization and an end to other work, finding both violations significant and substantial and caused by unwarrantable failure. He also held Butler personally liable for knowingly allowing those conditions. A third order for missing a weekly permissibility examination was affirmed as significant and substantial but modified from an unwarrantable-failure order to a section 104(a) citation. Peabody was assessed $96,000 and Butler $6,000, and the Commission later affirmed the reviewed methane-work findings and penalties.

Decision snapshot

• Cited standards: 30 C.F.R. §§ 75.323(c)(2)(ii), 75.323(c)(2)(iii), and 75.512-2; 30 U.S.C. § 820(c)
• Outcome: Two methane orders were affirmed, the examination order was modified to a section 104(a) citation, Peabody was assessed $96,000, and Michael Butler was assessed $6,000.
• Subsequent review: The Commission affirmed the reviewed methane-work orders, personal liability, and related penalties in lake-2019-0023-commission.
• Key point: Continuing energized drilling and other work amid repeated explosive-range methane readings supported unwarrantable-failure findings and personal liability.

Full text (FMSHRC public release)

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

OFFICE OF ADMINISTRATIVE
LAW JUDGES

721 19 th ST.
SUITE 443

DENVER, CO 80202-2500

TELEPHONE: 303-844-5266
/ FAX: 303-844-5268

SECRETARY OF LABOR,

MINE SAFETY AND HEALTH      

ADMINISTRATION (MSHA),

Petitioner,

v.

PEABODY MIDWEST MINING, LLC,

Respondent.

SECRETARY OF LABOR,

MINE SAFETY AND HEALTH      

ADMINISTRATION (MSHA),

Petitioner,

v.

MICHAEL BUTLER, employed by PEABODY MIDWEST MINING, LLC,

Respondent.

CIVIL PENALTY PROCEEDINGS

Docket No. LAKE 2019-0023

A.C. No. 12-02295-474164

Docket No. LAKE 2019-0122

A.C. No. 12-02295-478356

Docket No. LAKE 2019-0361

A.C. No. 12-02295-497867 A

Mine: Francisco Underground
Pit

DECISION AND
ORDER

Appearances:              Barbara
M. Villalobos, U.S. Department of Labor, Office of the Solicitor, 230 S.
Dearborn St., 8 th Floor, Chicago, IL 60604

R.
Henry Moore, Fisher & Phillips, LLP, Six PPG Place, Suite 830, Pittsburgh,
PA 15222

Before:             Judge Simonton

I.          
INTRODUCTION

These cases are
before me upon petitions for assessment of civil penalties filed by the
Secretary of Labor pursuant to sections 105(d) and 110(c) of the Federal Mine
Safety and Health Act of 1977, 30 U.S.C. §§ 815(d) and 820(c) (“the Act”). [1]
 In dispute are three section 104(d)(1) orders issued to Peabody Midwest
Mining, LLC (“Peabody”) and two companion section 110(c) penalty assessments
issued to Michael Butler (“Butler”), alleging his personal liability as an
agent of Peabody.

The parties
presented testimony and documentary evidence at a hearing held in Evansville,
Indiana on March 3-4, 2020. The Secretary presented testimony from REI drill
operator Robert Ferrin, MSHA inspector Keith Duncan, MSHA special investigator
Phillip Stanley, and MSHA inspector Chris Persinger. Peabody presented
testimony from hourly miner John Stevens, maintenance foremen Brad Cary,
production supervisor James Ford, mine manager Michael Butler, general manager
Brad Rigsby, maintenance manager Charles Lyons, and maintenance supervisor
Michael Trueblood. The parties each filed post-hearing briefs.

II.          
FINDINGS OF FACT

Peabody operates
the Francisco Underground Mine (“Francisco”), a coal mine located in Gibson
County, Indiana. Jt. Stip. 2. In July 2018, Peabody employed a contractor, REI
Drilling, to conduct horizontal longhole drilling in the “0” return entry for
Unit 3. Jt. Stip. 19. The drilling was performed in order to identify old works
in close proximity that might be intersected when the continuous miner on Unit
3 advanced. Id . This exploratory drilling is safer to do ahead of mining
activity so that a barrier may be established, and the operator can be
confident that abandoned workings are not too close to new ones. Tr. 398. Prior
to July 2018, horizontal drilling had taken place three times before at
Francisco, and in each of those instances, drilling was conducted without
encountering old works. Jt. Stips. 21, 22. On July 23, 2018, however, the drill
intersected old works, causing methane gas to leak into the mine. Jt. Stip. 26;
Tr. 36, 261. This incident led to the issuance of the violations at issue in
these matters.

A.     The Drill
Encounters Old Mine Works

At about 9:00
p.m. on July 22, 2018, REI drill operator Robert Ferrin and his assigned
helper, Peabody employee John Stevens, arrived at the drill site in the 0 entry
between crosscuts 65 and 66. Jt. Stip. 25; Tr. 248. As they worked, Ferrin
operated the drill and Stevens worked at Ferrin’s direction, loading the drill rods.
Tr. 33, 249. After drilling for several hours, the drill hit a void at
approximately 1:49 a.m. on July 23, 2018. Jt. Stip. 26. The drill rods jumped
forward much faster than normal, and air began to exit the borehole at
significant pressure. Tr. 34-35, 250; Jt. Stip. 26. The sound of the air
escaping was very loud. Tr. 53, 290.

Stevens
immediately went to the phone to call the tracker, and asked the tracker to
contact mine manager Michael Butler and inform him that he was needed at the
drill site. Tr. 254. He provided no other information to the tracker. Tr. 254. Stevens’
spotter—the methane detector on his person—showed elevated methane levels “just
moments” after the drill encountered the void, and the level went up to “over
range,” which indicates greater than 5% methane concentration. Tr. 253, 261. He
could not recall whether his spotter went off before or after calling the
tracker. Tr. 254. Butler received the call to go to the drill site at
approximately 1:50 a.m. Tr. 376.

Stevens returned
to the drill, and Ferrin, having realized that they had “punched into the old
works,” told Stevens to engage the blowout preventer (“BOP”). Tr. 50, 252. The
BOP is a device that seals the hole and contains the methane behind the wall to
stop it from entering the drill site. Tr. 50, 60. In Ferrin’s experience in
other methane inundation incidents, the BOP has successfully contained the
escaping gas. Tr. 63. In this instance, however, the pressure buildup was so
great that the gas began to come out the rib itself, so Ferrin told Stevens to
stop engaging the BOP. Tr. 61, 65, 252. Ferrin did this because he did not want
to blow out the drill casing, which would have caused him to lose all control over
the escaping gas. Tr. 61-63.

Ferrin then directed
Stevens to begin pulling out drill rods so that they could install a plug. Tr.
35, 51, 253. This was no small task, as the rods are approximately 10 feet each
in length, and the drill had drilled in about 900 feet. Tr. 50. The drill rods
needed to be removed in order for the hole to be plugged, so that a “packer”
could be pushed into the hole and form a plug. Tr. 51, 73. Stevens’ spotter
continued to alarm throughout the time that they were pulling rods. Tr. 262. Ferrin’s
spotter went over range during the methane inundation as well. Tr. 43.

The methane
detector on the drill causes the drill to shut down when methane reaches a
concentration level of two percent. Tr. 43-44, 70, 364. During this incident,
the methane level at the drill site fluctuated. Tr. 43-44, 70, 119-120, 264. Therefore,
after each time the drill kicked power off due to elevated methane levels, the
methane level diminished to a point where Ferrin was able to restart the drill
and continue working. Tr. 44. Both Ferrin and Stevens agreed that the drill
shut down and was restarted a total of two or three times during this
inundation before the drill was de-energized and the mine evacuated. Tr. 44,
100, 349.

B.     Mine
Manager Michael Butler Arrives at the Drill Site

Minutes after
Stevens called the tracker, at approximately 1:53 or 1:55 a.m., Butler arrived
at the drill site. Tr. 101, 335-36, 376-77. He brought maintenance foreman Brad
Cary with him, since at that point he thought there might be a problem with the
drill. Tr. 276, 335; Jt. Stip. 27. Cary stayed back, near the drill tender
approximately 10 feet from the drill, and Butler continued walking down toward
the drill. Tr. 286. Butler met up with Stevens just inby the drill tender, and
Stevens informed him that they had drilled into old works and that Steven’s
spotter was reading over range. Tr. 336-337, 368-69. Butler then walked up to
the drill to speak with Ferrin. Tr. 337. Butler leaned in to ask Ferrin a few
questions, and as he leaned over the drill, Butler’s own spotter went off. Tr.

338. He looked at it and saw that it was over range. Tr. 338. At hearing, Cary
     could not recall whether his spotter ever alarmed near the drill tender. Tr.
     277, 294.

Ferrin told
Butler that they had breached old works, and Butler asked him what the
procedure was because Butler knew “nothing about that drill.” Tr. 38, 339. Ferrin
told him that they had to pull out the drill rods and plug the hole. Tr. 339. Butler
thought that sounded like a wise thing to do, and figured that if something was
“off,” they would have already had an explosion by the time he arrived at the
drill site. Tr. 345-46. Ferrin had made the decision to pull rods prior to Butler's
arrival, but testified that the decision to continue pulling the rods and
attempt to plug the hole was “kind of discussed between everybody,” including
Butler, once Butler had arrived at the drill site. Tr. 44-45.

Butler then went
to the phone and called the tracker. Tr. 340. He told the tracker what was
going on and informed him that he needed to “make some phone calls and get some
people out of bed.” Tr. 340. After calling the tracker, Butler told Cary to
return to Unit 3, kill power on the Unit 3 equipment, and evacuate the miners
on the unit. Tr. 290, 340, 347. Unit 3 was inby the drill site in close
proximity, and, according to Butler, evacuating the miners on the unit was a
“no-brainer.” Tr. 340, 383.

Once back at Unit
3, Cary found production supervisor James Ford, and told Ford that the drill
had hit a void and that they needed to evacuate. Tr. 278, 317. They ensured
that the equipment was backed out and power was killed, and then conducted a
head count and sent the miners outside. Tr. 278, 317. Once everyone on the unit
had evacuated, Ford went over to the drill site. Tr. 317. Cary stayed at Unit 3
and killed power on the back of the power center, which shut down power to everything
on the unit. Tr. 279, 291-92. Butler had specifically told Cary not to kill
power to the power center that provided power to the drill, so he only shut off
power to the unit. Tr. 292. He then also went back to the drill site. Tr. 279.

Ford initially approached
the drill site by coming up crosscut 65, outby the drill, but his spotter
alarmed and went over range. Tr. 326. He then retraced his steps and approached
the site by traveling up crosscut 66, inby the drill. Tr. 326-27. When Ford arrived
at the drill site, Butler told him to go get some curtains to ventilate toward
the drill. Tr. 318. He went back to the unit to retrieve the curtains, and then
hung two curtains in order to provide more air flow to the drill site. Tr.
318-21; Ex. R-A-2. He also opened a man door for additional ventilation. Tr. 321.

When Cary
returned to the drill site after shutting down the power to Unit 3, he was
accompanied by mechanic Jesse Mitchell. Tr. 292. At this point, only Ferrin,
Stevens, Butler, Cary, Ford and Mitchell remained underground. Tr. 293; Ex.
S-10B. When Cary approached the drill site, he saw that Butler was on the phone.
Tr. 282.

C.     General
Manager Brad Rigsby Orders the Miners to Stop Work and Evacuate

Above ground, by
this point, Francisco’s general manager Brad Rigsby had been contacted. The
tracker called Rigsby at his home and informed him that the drill had
intersected an old mine and that gas was coming out of the hole. Tr. 400. Rigsby
did not have any information about methane levels, but he had “enough”
information to instruct the tracker that they needed to cease operations on
Unit 3 right away and get ready to pull out. Tr. 400-01. Rigsby then left his
home and headed to the mine. Tr. 401. On his way in, Rigsby made calls to mine
personnel and to MSHA district manager Ron Burns. Tr. 401-02. Rigsby told Burns
what the tracking office had told him, and Burns told Rigsby that they needed
to evacuate. Tr. 402. Rigsby interpreted Burns’ instruction in their initial
conversation as a directive to evacuate the “affected area,” which Rigsby
believed was “the split going into Unit 3.” On a later call between Rigsby and
Burns, Burns clarified that they were to evacuate the entire mine, not only
Unit 3. Tr. 402.

When he arrived
at the mine, Rigsby called Butler, who was still at the drill site. Tr. 403-04,

414. Butler did not relay any methane levels, but he did inform Rigsby that
     they were getting ready to insert the packer in the hole. Tr. 404-05, 415. The
     drill rods had all been removed, the plug had been inserted in the casing, and
     they had just started to push it into the hole. Tr. 350. Prior to this
     conversation with Butler, Rigsby was not aware that any work was occurring at
     the drill site. Tr. 417-18. As soon as he learned of that activity, and still
     without knowing any methane levels, Rigsby told Butler to stop, just let the
     hole “bleed,” and come out of the mine. Tr. 415.

After Butler got
off the phone with Rigsby, he briefly spoke with Cary and told him to go kill
power to the drill. Tr. 298-99, 347. Cary and Mitchell went together to
de-energize the drill. Tr. 280-81. They went to the roadway and killed power at
the vacuum breaker and put a lock on it. Tr. 280. Then, they went back to the
drill and Butler informed them that they were going to evacuate. Tr. 282. When Ford
finished hanging the curtains, the others were evacuating. Tr. 321-22.

When the miners
finally evacuated, there was still air coming out of the hole. Tr. 363. The six
miners left in the mine evacuated at the same time. Tr. 293. On their way out
of the mine, Cary killed power at another vacuum breaker and then, once out of
the mine, he put a lock on the substation which “killed all power on the rim.” Tr.

282. Ford and Butler were the last people to exit the mine. Tr. 324. Ford’s
     notes indicate that he evacuated at 3:00 a.m. Ex. R-H. Tracking records
     indicate that both Butler and Ford left the drill site at 3:11 a.m. and arrived
     at the surface at 4:28 a.m. Ex. S-8; Tr. 106-107.

D.     The Hole
is Plugged on July 24, 2018

The hole was
plugged the next day, on the evening of July 24, 2018. Jt. Stip. 28. Ferrin
again operated the drill. Tr. 54, 72. Also present were state mine inspector
Steve Riley and MSHA inspector Chris Persinger. Tr. 356, 379. Even then, air
was still loudly rushing out of the hole. Tr. 72, 379-80, 469. Butler testified
that he also went to the drill site that night, and he heard someone’s spotter
beeping. Tr. 355. However, Persinger took seven methane readings while he was
at the drill site, both inby and outby the drill, and all were less than one
percent. Tr. 465-68, 470. None of the readings were taken standing next to the
drill. Tr. 471. Persinger testified that he never heard anyone’s spotter alarm,
and if he had, he would have “shut everything off.” Tr. 468, 474.

The plug was
placed approximately 400 or 500 feet inside the hole. Tr. 64. More than 600
feet of cementitious grout was applied, and the hole “was dead at that point.” Tr.

411. The abatement was completed by the morning of July 25, 2018. Tr. 420.

E.     The
Permissibility Exam

The July 2018
drilling project at Francisco began on July 11, almost two weeks before the
methane inundation incident. Jt. Stip. 24. On that date, before the drill was
put into service, Peabody conducted a permissibility examination of the drill. Tr.
129-130. The purpose of a permissibility exam is to examine the electrical
components of the equipment to ensure that the equipment is safe and does not
present an ignition hazard. Tr. 435. Though the drill belongs to the
contractor, REI Drilling, Peabody is responsible for conducing permissibility
exams, and they are supposed to be conducted on a weekly basis. Tr. 134, 426,

454. During the July 11 exam, Peabody discovered that the “sniffer head,” or
     methane sensor, on the drill was in need of replacement. Tr. 129-30; Ex. S-7,
     p. 2. It was replaced and the drill went into service. Tr. 130.

No additional
permissibility exams were reported for the drill equipment between July 11 and
the July 23 incident. Tr. 429; Ex. S-7. An exam was conducted on July 24
following the breach into old works on July 23. Ex. S-7, p. 7. During that
exam, Francisco maintenance supervisor Michael Trueblood and foreman Robert
Ewers identified six issues with the drill. Tr. 446-52; Ex. S-7, p. 7. They
corrected all the issues, and Trueblood testified at hearing that none of the
issues they identified were of serious concern in terms of their potential for
causing an explosion. Tr. 455-56.

F.      Violations

MSHA inspector
Keith Duncan conducted an investigation of the July 23, 2018 incident. On
August 16, 2018, he issued Order Nos. 9106663, 9106664, and 9106665 to Peabody.
Jt. Stips. 9, 10, 11. Following a special investigation, MSHA also proposed
penalties against Butler, requesting that the Commission hold him personally
liable under section 110(c) of the Mine Act for his role in the violations
alleged in Order Nos. 9106663 and 9106664. Jt. Stip. 18, Pet. for Assessment of
Civ. Penalty at 2 (Sept. 13, 2019).

III.          
DISPOSITION

A.     Order
No. 9106663

1. The Violation

In any
enforcement action, the Secretary bears the burden of proving an alleged
violation by a preponderance of the evidence. RAG Cumberland Resource Corp.,
22 FMSHRC 1066, 1070 (Sep. 2000). The Secretary may sometimes establish a
violation by inference, but only when the inference is inherently reasonable
and there is a rational connection between the evidentiary facts and the conclusion
inferred. Mid-Continent Resources , 6 FMSHRC 1132, 1138 (May 1984).

In Order No.
9106663, the Secretary alleges that Peabody violated section 75.323(c)(2)(ii)
of MSHA’s health and safety regulations, which mandates that

[w]hen 1.5 percent
or more methane is present in a return air split between the last working place
on a working section and where the split of air meets another split of air, or
the location where the split is used to ventilate seals or worked-out areas—

. . . .

[o]ther than
intrinsically safe AMS, equipment in the affected area shall be deenergized,
electric power shall be disconnected at the power source, and other mechanized
equipment shall be shut off.

30 C.F.R. § 75.323(c)(2)(ii). In Order
No. 9106663, Inspector Duncan reported that the drill at Francisco remained
energized for 35 minutes in the midst of a methane inundation on July 23, 2018,
that resulted in methane concentrations ranging from 1.5% to over 5% in the
area. Ex. S-2. Given the risk of combustion, Duncan found that the violation
created a reasonable likelihood that a fatal injury would occur, and that this
risk affected 10 miners.   Id .

It is clear the
drill remained energized despite methane levels exceeding 1.5 percent. The
overwhelming weight of the evidence presented at hearing supports this
conclusion. The drill, which is designed to shut down when methane
concentration reaches two percent, shut itself off two or three times,
indicating that it had indeed been operating in violation of the standard when
methane levels were between 1.5% and 2%. Tr. 70, 264. Ferrin also admitted that
his spotter detected methane levels that were over range (greater than 5
percent) at some point during the inundation, and yet he continued to use the
drill to plug the hole. Tr. 43. Ferrin’s helper, Stevens, who was tasked with pulling
rods at the drill site, also testified that his spotter alarmed and went over range.
Tr. 262. He reset it several times and yet the readings went over range again
within a minute throughout the time that the miners unloaded drill rods out of
the bore hole. Tr. 262.

Butler arrived
at the drill site around 1:55 a.m. and oversaw the drill’s continued operation.
Tr. 107-08, 376. He immediately learned from Stevens that the drill had
encountered old mine works. Tr. 336. When speaking with Stevens, Butler learned
that Stevens’ spotter had a reading of over range. Tr. 370-71. Butler then leaned
over the drill to talk to Ferrin, and Butler’s own spotter went off, registering
yet another methane reading that exceeded the device’s detection range. Tr.
370-71. The data presented by the Secretary shows that the methane readings on
Butler’s spotter were consistently over range. Ex. S-9A. Butler was therefore
almost immediately on notice that methane levels near the drill were
unacceptably high. As mine manager, Butler had the authority to shut down the
drill that night. Tr. 366. He failed to do so, even after seeing several
indications that methane concentrations in the mine were in excess of 1.5%. In
sum, Peabody continued to work with energized electrical equipment when methane
levels exceeded 1.5%, and thus the fact of violation is proven.

The inspector’s
gravity findings were reasonable, given the risk presented by the methane
inundation. Inspector Duncan testified that a fatal injury could be expected
because methane levels at various times exceeded five percent and therefore
presented a major combustion risk. Tr. 122. This is supported by methane
spotter logs and other information in the record. See Exs. S-9A, S-9B,
and S-9C. Methane combustion could have easily caused a mine explosion, and
history counsels that such explosions are often deadly. Tr. 123. According to
Duncan’s experience, the presence of oxygen, high levels of methane, and an
ignition source (the energized drill) made the risk of combustion reasonably
likely. Tr. 122. Finally, Duncan testified that the explosion risk affected at
least 10 miners who were underground at the time, which is supported by the
record. Tr. 167-68, 315-16, 333, 353.

Accordingly, I
find that the Secretary has satisfied his burden in proving the fact of
violation and the gravity determination for Order No. 9106663.

2. Significant and Substantial

The Secretary
also alleges that this violation is significant and substantial. A violation is
significant and substantial (S&S) “if based upon the particular facts
surrounding the violation there exists a reasonable likelihood that the hazard
contributed to will result in an injury or illness of a reasonably serious
nature.” Cement Division, National Gypsum Co., 3 FMSHRC 822, 825 (Apr.
1981).

The test
associated with S&S violations has undergone a decades-long process of
refinement. See, e.g., id .; Mathies Coal Co. , 6 FMSHRC 1, 3-4
(Jan. 1984); Newtown Energy, Inc., 38 FMSHRC 2033, 2037 (Aug. 2016). Under
the Commission’s most recent articulation of this test, in order to establish
that a violation of a mandatory safety standard is S&S, the Secretary of
Labor must prove: (1) the underlying violation of a mandatory safety standard;
(2) the violation was reasonably likely to cause the occurrence of the discrete
safety hazard against which the standard is directed; (3) the occurrence of
that hazard would be reasonably likely to cause an injury; and (4) there would
be a reasonable likelihood that the injury in question would be of a reasonably
serious nature. Peabody Midwest Mining, LLC , 42 FMSHRC 379, 383 (June
2020).

The Peabody Midwest
test—which imposes a greater burden on the Secretary than previous versions of
the S&S standard—did not exist at the time that this case was heard. The
Secretary argued vigorously in his brief that a more lenient standard ought to be
applied. See Sec’y Br. at 17-21. Notwithstanding the Secretary’s
argument, I must apply the Peabody Midwest test as the most current,
controlling precedent regarding the S&S threshold. I have not asked for
supplemental briefing because I find that the Secretary has satisfied his
burden of proving S&S even under the stricter Peabody Midwest
standard.

The Secretary
has clearly proven the underlying violation of 30 C.F.R. § 75.323(c)(2)(ii). This
section of the MSHA regulation aims to avoid mine explosions caused by the
ignition of subsurface methane. When issuing this regulation, MSHA recognized:

Methane is the most
dangerous gas encountered by miners working underground. When the level of
methane reaches 5.0 percent it is explosive. Section 75.323 generally
establishes action levels below this lower explosive limit to permit
appropriate actions to be taken by mine operators in order to prevent an
explosion.

Safety Standards for Underground
Coal Mine Ventilation, 61 Fed. Reg. 9777 (Mar. 11, 1996) (to be codified at 30
C.F.R. pt. 75). I find the first prong of the Peabody Midwest test has
been met by the Secretary.

In order to
satisfy prong 2 of the test for S&S, the Secretary must prove that the
violation was reasonably likely to cause an explosion. The Secretary has met
this burden. He has offered uncontroverted proof that, at times, the
concentration of methane at the drill site exceeded five percent. Tr. 43, 255, 370-71;
Exs. S-9A, S-9B, S-9C. This is the level of methane accumulation that the
regulation sought to avoid. A methane concentration of five percent is
combustible and, in the presence of an ignition source like an energized drill,
is reasonably likely to cause the sort of explosion that the ventilation rule
is directed against. Prongs 3 and 4 of the test are also satisfied, given the
serious injury that is reasonably likely in the event of a mine explosion. Accordingly,
the Secretary has successfully shown that the violation described in Order No. 9106663
was significant and substantial.

3. Negligence and Unwarrantable Failure

Based on his
observations, the inspector designated the violation as high negligence and as
an unwarrantable failure to comply with the mandatory standard. An operator is
negligent when it violates its duty of care to avoid violations of mandatory
safety standards. A.H. Smith Stone Co ., 5 FMSHRC 13, 15 (Jan. 1983). To
determine whether the operator has met its duty of care, the Commission
considers “what actions a reasonably prudent person who is familiar with the
mining industry, the relevant facts, and the protective purpose of the regulation
would have taken under the same circumstances.” Leeco, Inc. , 38 FMSHRC
1634, 1637 (July 2016). A judge is not required to apply or even consider the
definitions of negligence found in 30 C.F.R. § 100.3. Id .; Mach
Mining LLC v. Sec'y of Labor , 809 F.3d 1259, 1263-64 (D.C. Cir. 2016).

The term
“unwarrantable failure” arises in section 104(d) of the Mine Act, describing
serious misconduct that triggers the issuance of a citation under that section.
30 U.S.C. § 814(d). The Commission has defined unwarrantable failure as
“aggravated conduct constituting more than ordinary negligence.” Emery
Mining Corporation , 9 FMSHRC 1997, 2001 (Dec. 1987). The conduct that
qualifies as unwarrantable failure is often characterized as “reckless
disregard,” “intentional misconduct,” “indifference,” or a “serious lack of
reasonable care.” Martin County Coal Corp ., 28 FMSHRC 247 (May 2006)
(citing Emery , 9 FMSHRC at 2001).

While these
descriptors are helpful guideposts, the inquiry of whether conduct is “aggravated”
is ultimately a holistic analysis of both aggravating and mitigating
circumstances. Such circumstances include (1) the extent of the violative
condition, (2) the length of time it has existed, (3) whether the violation
posed a high risk of danger, (4) whether the violation was obvious, (5) the
operator's knowledge of the existence of the violation, (6) the operator's
efforts in abating the violative condition, and (7) whether the operator had
been placed on notice that greater efforts were necessary for compliance. Brody
Mining, LLC , 37 FMSHRC 1687, 1691 (Aug. 2015).

a.      
Extent of the Violative Condition

The first factor
to consider is the extent of the violative condition. The extensiveness of a
violation is determined by examining “the extent of the affected area as it
existed at the time” and “the number of persons affected by the violation.” Dawes
Rigging & Crane Rental , 36 FMSHRC 3075, 3079-80 (Dec. 2014).

Here, the
Secretary has proven that dangerous methane levels existed at the drill site,
but there is very little indication of elevated methane levels in other parts
of the mine. Inspector Duncan testified that he believed James Ford’s spotter
went over range upwind of the tender, but Special Investigator Stanley
testified as to his belief that Ford’s spotter exceeded its range when he was
only slightly outby the drill. Tr. 113, 225. The remaining spotter data tends
to indicate that the unlawful methane conditions were concentrated around the
drill. The Secretary has therefore only proven by a preponderance of the
evidence that a limited physical area (the area near the drill) was affected by
the methane accumulation.

I also must take
into account the number of persons affected by the violation. Initially, up to 60
underground miners were exposed to the potential for a calamitous mine
explosion. Tr. 123. However, Michael Butler gave orders to evacuate most of
those miners very quickly after the old works were breached. Tr. 340. After the
evacuation of Unit 3, the number of miners affected by the violation was
drastically lower. The Secretary never conclusively proved how many people remained
in the mine post-evacuation outside of Butler, Cary, Ford, Stevens, Ferrin and
Mitchell.

I take the
initial risk to 60 miners very seriously. However, as soon as Butler became
aware of the methane inundation and initial over range methane levels, he did
order the evacuation of Unit 3 where most of the miners were located. The fact
remains though that no less than six miners were allowed to remain in the drill
area where the methane levels were known to be at or above combustible levels
for a period of time while the drill remained energized. While the Secretary
proved only a limited physical extent of the methane accumulation, the violation
was still extensive insofar as it affected initially dozens of nearby miners
and for a longer period of time no less than six miners in the drill area where
methane concentrations were unacceptably high, at or above combustible levels. All
told the extensiveness factor weighs in favor of a finding of unwarrantable
failure.

b.     
Duration of the Violative Condition

The Commission
has highlighted the duration of the violative condition as a “necessary
element” of the unwarrantable failure analysis. IO Coal Co ., 31 FMSHRC
1346, 1352 (Dec. 2009). A duration of seconds or minutes often mitigates the
severity of the violation. See, e.g., Dawes Rigging , 36 FMSHRC at 3080. However,
when a hazardous condition is “readily distinguishable from other types of
danger due to [its] high degree of danger [and] its obvious nature,” the brief
duration of the hazard will not militate against a finding of unwarrantable
failure. Knight Hawk Coal, LLC , 38 FMSHRC 2361 (Sep. 2016) (quoting Midwest
Material Co ., 19 FMSHRC 30, 36 (Jan. 1997)) (internal quotations omitted).

In the present
case, the duration of the violative condition is contested. Butler arrived at
the drill site around 1:55 a.m. Tr. 101. He claimed that he was present at the
drill site for about half an hour before ordering the drill to be deenergized. Tr.

377. The driller, Ferrin, testified that he did not recall how long the drill
     remained energized, but he told the special investigator in October 2018 that approximately
     thirty minutes elapsed between the first time the drill “kicked” and Butler’s
     directive to exit the mine. Tr. 47; Ex. S-13. Testimony and contemporaneous
     notes from James Ford, however, indicate that Ford and Butler did not exit the drill
     site until 3:00 a.m., which is about an hour after the inundation. Tr. 328; Ex.
     R-H. Similarly, tracking data for Michael Butler and John Stevens shows that they
     passed through the second west main roadway around 3:10 a.m., suggesting that they
     exited the drill site just minutes before. Ex. S-8; Tr. 105-06, 267-69. With
     all of this in mind, I find that the drill remained energized for 30-60 minutes
     after methane inundation.

However, it is
unclear whether the methane level was consistently over 1.5% for the entire
time that the drill remained energized. The methane levels did in fact fluctuate.
See, e.g ., Ex. S-9A. In addition, the nature of the methane spotters
makes it difficult to discern the actual methane level over time, because once
a spotter goes over range, it must be reset to resume its active methane
measurements. Tr. 108, 262.

The duration of
the violation remains a relevant consideration in this analysis even when the
record does not permit a conclusive finding regarding the duration of the
hazardous condition. Coal River Mining, LLC , 32 FMSHRC 82, 93 (Feb.
2010). The Secretary in the present case has proven that the drill was
energized for 30-60 minutes after Butler became aware of the elevated methane
levels. What has not been proven is the duration of specific methane levels. However,
Butler continued to allow the drill to be energized despite his knowledge that
methane levels were not only above 1.5% but reached combustible levels numerous
times during the 30-60 minute time frame. The duration factor therefore
supports a finding of unwarrantable failure.

c.      
Degree of Danger

The Commission
has found that a high degree of danger presented by a violation constitutes an
aggravating factor in support of a finding of unwarrantable failure. IO Coal ,
31 FMSHRC at 1355-56. In this case, the degree of danger was high. The drill
remained energized even while methane levels nearby exceeded five percent, creating
the conditions that could have led to combustion and a major accident. As Inspector
Duncan said, “we’re very lucky that we did not have a mine explosion that
night.” Tr. 126. The degree of danger unequivocally points toward a finding of
unwarrantable failure.

d.     
Obviousness of the Hazard

The obviousness
of a violation can be an aggravating factor in the unwarrantable failure
analysis. In some ways, methane—as an invisible and odorless gas—is a
nonobvious hazard. However, the risk of methane accumulation became obvious
when it set off at least three methane spotters and tripped the emergency
shut-off feature on the drill no less than two or three times. Tr. 43, 370-71,

378. The methane accumulation was an obvious hazard, and this militates toward
     a finding of unwarrantable failure.

e.      
Operator’s Knowledge of the Violation

The operator’s
knowledge of the existence of the violative condition is also relevant.  The
knowledge of a corporate agent may fairly be imputed to the mine operator. See
Va. Crews Coal Co ., 15 FMSHRC 2103, 2106 (Oct. 1993) (citing Rochester
& Pittsburgh Coal Co ., 13 FMSHRC 189, 194-98 (Feb. 1991)). In this
case, various members of Peabody management possessed different levels of
knowledge regarding the violative condition. The mine’s general manager, Brad
Rigsby, testified that he did not know about the elevated methane levels until
after he had already directed that the mine be evacuated. Tr. 404-05. Michael
Butler, on the other hand, knew of multiple methane spotters going over range. Tr.
370-71. He also knew that the drill’s emergency shut-off had been triggered. Tr.

378. Nevertheless, Butler allowed the drill to remain energized and went so far
     as to direct that the power to the drill be maintained when other power was being
     shut off in light of the hazard. I therefore find that Butler did have
     knowledge of the violative condition and that, as mine manager, his knowledge
     may be imputed to the operator. [2] See Va.
     Crews Coal Co ., 15 FMSHRC at 2106. Accordingly, the operator’s knowledge is
     an aggravating factor that supports a finding of unwarrantable failure.

f.      
Abatement Efforts

Another relevant
factor is whether the operator took action to abate the violative condition
before the issuance of the citation or order. When an operator has been put on
notice of a problem, “the level of priority that the operator places on
addressing the problem is a factor properly considered in the unwarrantable
failure analysis.” Jim Walter Resources, Inc. , 19 FMSHRC 480, 487 (Mar.
1997).

I find that Respondent’s
abatement efforts weigh heavily against a finding of unwarrantable failure. Peabody
kept the drill energized for one reason: to stanch the stream of methane infiltrating
the mine. The evidence presented at hearing by both parties demonstrates that
Respondent acted in good faith to address the hazard that was created when the
drill hit the old works. There is no indication in the record that Respondent
ignored the dangerous condition; rather, its miners worked diligently in an
attempt to fill the borehole and eliminate the hazard.

Respondent took
additional measures to abate the dangerous conditions when it organized an
effort to increase ventilation at the drill site. Michael Butler instructed
James Ford to hang curtains that would increase the flow of oxygenated air
towards the drill, and Ford obliged by hanging curtains at the No. 1 entries to
crosscuts 66 and 67. Tr. 233; 318-20. Ford also opened a man door at crosscut
67 to increase the airflow to the drill. Tr. 321. Further, John Stevens
testified that he also installed curtains to help ventilate the area and reduce
the methane concentration at the drill site. Tr. 255. These efforts were
intended to abate the hazardous methane levels and to keep miners safe in the
wake of the inundation. Given this response by the operator and its miners, I
find that the abatement efforts constitute a major mitigating factor that weighs
in favor of Respondent and against a finding of unwarrantable failure.

g.     
Notice to the Operator that Greater Efforts Were Necessary

Finally, when an
operator has previously committed similar violations, those violations are relevant
to an unwarrantable failure determination to the extent that they give the
operator notice that greater efforts are necessary for compliance with a safety
standard. Brody Mining, 37 FMSHRC at 1691. The Secretary has not
presented any evidence of previous violations, and therefore this factor does
not affect the unwarrantable failure analysis.

h.     
Conclusion

I find that the preponderance
of the evidence supports a finding of high negligence for Order No. 9106663. By
showing that the operator knew or should have known that the methane
concentration exceeded 1.5%, the Secretary has successfully proven that the
operator’s lack of care rises above the level of ordinary negligence. Peabody
might have acted in good faith to address the source of the methane, but no
prudent operator would have believed that it was reasonable to continue
powering the drill in a persistently high-methane environment in light of
MSHA’s safety standards.

Similarly, after
careful consideration of the aggravating and mitigating factors, I find that
the violation clearly and persuasively constitutes an unwarrantable failure. Peabody
ignored an extensive, obvious, and extremely dangerous hazard despite having knowledge
of the violation. The mine manager knew about methane accumulations that
exceeded five percent and that, therefore, put 60 underground miners at risk of
a mine explosion. He should have immediately deenergized the drill as required
by law, and his failure to do so was unwarrantable. I recognize that Peabody
acted in good faith to address the source of the hazard—as its miners are
trained to do in other contexts—and that this selfless conduct may be seen as
laudable. However, “the first priority and concern of all in the coal or other
mining industry must be the health and safety of its most precious resource[,] the
miner,” 30 U.S.C. § 801(a), and keeping the drill energized in the high-methane
environment constituted an unacceptable risk to miner safety. Accordingly, I
affirm the Secretary’s finding of unwarrantable failure for Order No. 9106663.

B.     Order
No. 9106664

1. The
   Violation

In Order No.
9106664, the Secretary alleges that Peabody violated section 75.323(c)(2)(iii)
of MSHA’s mine safety and health regulations. In pertinent part, section
75.323(c) states:

(1) When 1.0 percent or more methane is present in a return
air split between the last working place on a working section and where that
split of air meets another split of air, or the location at which the split is
used to ventilate seals or worked-out areas changes or adjustments shall be
made at once to the ventilation system to reduce the concentration of methane
in the return air to less than 1.0 percent.

(2) When 1.5 percent or more methane is present in a return
air split between the last working place on a working section and where that
split of air meets another split of air, or the location where the split is
used to ventilate seals or worked-out areas

.
. . .

(iii)
No other work shall be permitted in the affected area until the methane
concentration in the return air is less than 1.0 percent .

30 C.F.R. § 75.323(c) (emphasis
added). The inspector reported that mine management “knowingly and willfully
allowed work other than ventilation corrections to be performed for
approximately 15 minutes” even though methane detectors sensed concentrations
of greater than five percent methane. Ex. S-3. Inspector Duncan again found
that the violation created a reasonable likelihood that a fatal injury would
occur, and that this risk affected 10 miners.

I have made my
findings regarding the elevated methane levels above. See Section A, supra .
Mine management was consistently aware of methane levels that exceeded five
percent, well above the level that triggers mandatory work stoppage under this
regulation. Methane levels between 5% and 15% are explosive. Tr. 101. Nonetheless,
mine management permitted miners to continue pulling rods and attempting to
plug the borehole for approximately half an hour, if not longer. Tr. 377.

Respondent
argues that its response to the mine inundation did not violate section
75.323(c)(2)(iii) because management did not permit the type of “other work”
that is contemplated in the regulation. Peabody interprets the regulation to
allow work to “change or adjust the ventilation system”—even if the methane
concentration exceeds 1.5%—and to forbid any “other work” from continuing. Resp.
Br. at 19. Based on this interpretation, Peabody argues that the efforts to
plug the borehole constituted ventilation control and therefore were not
forbidden by the regulation.

But the miners
were not merely conducting ventilation control. By attempting to plug the
borehole, the miners engaged in remedial actions that sought to address the
source of the methane. These actions, while perhaps admirable, constitute the
sort of “other work” forbidden by section 75.323(c)(2)(iii). MSHA has made
clear that efforts to investigate and address the source of the methane
accumulation must be secondary to the critical actions that are immediately
necessary to protect miner safety in the face of a mine inundation:

Other commenters
thought that the standard, as proposed, would cause hasty, ill-advised changes
to be made and would prohibit an investigation into the cause or source of the
methane problem which could result in phased-in corrections. MSHA agrees that
operators should seek long term solutions and should fully investigate the
cause or source of methane accumulations. Investigation and long term
corrections are not prohibited by the rule. However, the final rule does
require that certain actions be undertaken at once to correct the short term or
acute safety hazards resulting from accumulations of methane .

Safety Standards for Underground
Coal Mine Ventilation, 61 Fed. Reg. 9778 (Mar. 11, 1996) (to be codified at 30
C.F.R. pt. 75) (emphasis added). Miners should have been evacuated “at once”
when management saw consistent methane readings over 1.5%. Id . Getting
miners to safety must be the priority, and then the operator can determine the
best way to address the methane source.

With regard to
gravity, the Secretary has proven that there was a high risk of methane
combustion and miner fatality given the mix of high methane levels, oxygen, and
ignition source, and given the continued presence of miners underground due to Respondent’s
inaction. I therefore find that the Secretary has satisfied his burden in
proving the fact of violation and the gravity determination for Order No.
9106664.

2. Significant
   and Substantial

The mine
inspector designated this violation as S&S, and I find that this
designation is proper. First, the Secretary has proven the fact of violation. Second,
the mine operator’s decision to permit work to continue in the mine was
reasonably likely to cause the safety hazard that the regulation was designed
to address. Section 75.323(c)(2)(iii) aims to reduce the risk that miners will
be harmed or killed by a mine explosion. The presence of the miners underground
and their continued work drilling and pulling rods amid a methane inundation
made it reasonably likely that those miners would face a mine explosion. Third,
a mine explosion is reasonably likely to cause injury. Finally, injuries
following a mine explosion are reasonably likely to be serious in nature, if
not deadly. Therefore, the Secretary has borne his burden of proving that the
violation was significant and substantial.

3. Negligence
   and Unwarrantable Failure

The factors at
play in the unwarrantable failure analysis for this order are very similar to
those discussed above for Order No. 9106663. [3]
First, I find that the extent of the violative condition is an aggravating factor
due to the risk presented initially to 60 miners and then at least six miners
for a longer period of time. Second, the duration of the violation is an
aggravating factor given that the Secretary has proven that work continued for 30-60
minutes after Butler became aware of the elevated methane levels. Third, the
hazard is dangerous given the combustion risks of methane, and this factor
points toward a finding of unwarrantable failure. Fourth, the hazard was
obvious in light of the methane sensors on the drill and on personal spotters,
and the obviousness is an aggravating factor. Fifth, the operator had knowledge
of the violative condition since Michael Butler knew about the elevated methane
levels. This knowledge is an aggravating factor. Sixth, Respondent’s efforts to
abate the hazard—including its efforts to plug the borehole and to ventilate
the area—weigh against a finding of unwarrantable failure. Finally, the Secretary
has not shown any previous history of violation.

I again find
that the violation constitutes high negligence and unwarrantable failure on the
part of the operator. A prudent operator would not have permitted miners to
continue working while methane spotters blared and showed over-range readings. Furthermore,
just as with Order No. 9106663, the factors at play in the unwarrantable
failure analysis tend to aggravate (rather than mitigate) the severity of the
violation. Peabody permitted non-ventilation work to continue in an explosive
methane environment, despite its knowledge of the high methane levels. The
company repeatedly ignored obvious signs of the dangerous condition. To protect
its miners, Peabody should have responded swiftly and decisively to follow the
law and put a stop to the work that persisted underground. Accordingly, the
Secretary has satisfied his burden in showing that Peabody’s actions constitute
an unwarrantable failure to comply with section 75.323(c)(2)(iii).

C.     110(c)
Case Against Michael Butler

The Secretary
also seeks to hold mine manager Michael Butler liable for his conduct in
connection with the two violations discussed above. Section 110(c) of the Mine
Act provides that when a corporate operator violates a mandatory safety
standard or order under the Act, “any director, officer, or agent of such
corporation who knowingly authorized, ordered, or carried out such violation .
. . shall be subject to . . . civil penalties.” 30 U.S.C. § 820(c). The
Commission’s precedent elucidates a test for whether an agent of the mine can
be individually liable: liability attaches when the agent (1) knew or had
reason to know of the violative condition, (2) was in a position to remedy the
condition, and (3) failed to act to correct the condition. See Northshore
Mining Co., 43 FMSHRC __, slip op. at 8 (Jan 21, 2021); Oak Grove
Resources, LLC , 38 FMSHRC 1273, 1281 (June 2016); Kenny Richardson ,
3 FMSHRC 8, 16 (Jan. 1981).

When Michael
Butler arrived at the drill site, he faced a cacophony of alarming methane
spotters and the loud rush of mine gases inundating the site. Butler testified that
he knew of at least two spotters that reached an over-range methane reading,
signaling methane accumulation of at least five percent. Tr. 370-71. One of
those spotters was on his own person. Tr. 370-71. Nevertheless, Butler actively
oversaw continued operation of the energized drill and the continued work of the
miners as they attempted to plug the borehole. Butler therefore knew or had
reason to know of the violative condition. Butler also testified that he was in
a position to shut down the drill and evacuate the miners “if [he] felt that
was needed.” Tr. 366. Finally, the overwhelming weight of the evidence demonstrates
that, despite his knowledge of the methane levels and his authority to stop
work, Butler allowed the drill to remain energized and permitted six miners
including himself to continue working for at least half an hour in elevated
methane conditions. That constitutes a failure to correct or remedy the violative
condition. Therefore, I find that Butler is individually liable for the
violations in Orders Nos. 9106663 and 9106664.

D.     Order
No. 9106665

1. The
   Violation

Finally, the
Secretary alleges that Peabody violated section 75.512–2 of MSHA’s mine safety
regulations, which states that “examinations and tests required by § 75.512
shall be made at least weekly” and that “[p]ermissible equipment shall be examined
to see that it is in permissible condition.” 30 C.F.R. § 75.512–2. Mine
operators must examine “[a]ll electrical equipment” and must remove equipment
from service if the operator finds a “potentially dangerous condition.” 30
C.F.R. § 75.512. Order No. 9106665 alleges:

The operator failed
to perform a weekly permissibility examination on the horizontal drill (serial

81134/2008800) located in the 2nd West Main at crosscut 65-66 for the week of 7/15/2018

thru 7/21/2018 according to permissibility records provided by the mine
operator. Five permissibility deficiencies were found on 7/24/2018 which were
not recorded on 7/11/2018. These permissibility deficiencies existed at the
time of the accident on 7/23/2018 and the reasonable likelihood exist[s] that
they would cause a methane ignition.

Ex. S-4. The inspector found that
the condition was reasonably likely to cause an injury that could be expected
to be fatal for 10 miners. Id . He marked the negligence as high and
determined that the violation was S&S. Id .

There is no
dispute that Peabody failed to conduct a permissibility examination on the
drill between July 11 and July 24. Resp. Br. at 32. The Secretary introduced
records and testimony showing that Respondent failed to carry out a permissibility
exam on the drill for the week of July 15-21. Ex. S-7; Tr. 129. Peabody’s maintenance
manager also testified to this effect. Tr. 430, 439. Accordingly, I find that no
exam took place during the week in question, which constitutes a violation of section
75.512–2.

The Secretary’s gravity
determination is also supported by the record. The permissibility examination,
designed to alert mine operators as to electrical issues with equipment, is an
important safeguard that helps to ensure that electrical components are not spark
risks in a high-methane environment. The operator’s failure to conduct this
exam subjected miners to reasonable risk that an electrical malfunction would
cause a fatal injury when they hit the old works and the mine was inundated by
methane-rich gases. No less than 60 individuals were affected by this risk. The
Secretary has satisfied his burden in showing the fact of violation and the
gravity by a preponderance of the evidence.

2. Significant
   and Substantial

The Secretary
has also satisfied his burden in showing that the violation was S&S. First,
he has proven the fact of violation as just discussed. Second, he has shown
that the violation was reasonably likely to cause the occurrence of the
discrete safety hazard that the standard is designed to address. Regular
examinations are “of fundamental importance in assuring a safe working
environment underground,” and the inspector attested that permissibility exams in
particular are meant to discover electrical issues that could spark a fire or
even an explosion. Buck Creek Coal Company, Inc. , 17 FMSHRC 8, 15 (Jan.
1995); Tr. 132. Failing to conduct this exam before sending the equipment
underground to drill near old mine works was therefore reasonably likely to
cause the safety hazard that the regulation is directed against. Third, a fire
or mine explosion would be reasonably likely to cause injury. Finally, an
injury that follows a mine fire is reasonably likely to be serious. The
Secretary has carried his burden in proving that the violation of section
75.512–2 is S&S.

3. Negligence
   and Unwarrantable Failure

The inspector
found that Order No. 9106665 involved high negligence and an unwarrantable
failure on the part of the mine operator.

a.       Extent
of the Violative Condition

The Secretary
alleges that Peabody failed to examine the drill. The extent of the operator’s
oversight is therefore limited to a single piece of equipment. At the same
time, the operator’s failure to inspect the drill put no less than 60 miners at
risk when the mine was inundated by methane and the drill lacked proper
electrical inspection. These are both relevant considerations under
extensiveness analysis. However, the Commission warns against using this factor
as a proxy for the danger or obviousness of the hazard, counseling instead to
focus on “the scope or magnitude of a violation.” Eastern Associated Coal
Corp. , 32 FMSHRC 1189, 1195 (Oct. 2010). I find that the scope of Peabody’s
violation was limited to its examination of one piece of equipment among
hundreds, and accordingly this factor does not support a finding of
unwarrantable failure.

b.     
Duration of the Violative Condition

The Secretary
has proven that no permissibility examination occurred on the drill between
July 11 and July 24. The violation itself, however, is for failure to conduct
an exam during the week of July 15-21. Therefore, the violative condition arose
on July 22 and only existed for two days. Furthermore, Respondent accurately
notes that it is possible for thirteen days to pass between properly conducted
permissibility exams under the regulation. The thirteen days that transpired
between examinations here is therefore not wholly unreasonable. Given these
factors, I find that the short duration of the violative condition is a
mitigating factor that weighs in Respondent’s favor.

c.      
Degree of Danger

The discrete
hazard at issue in this case is a mine explosion and fire. The drill at issue
was used to perform exploratory mining near old works, actually breached the old
mine, and caused an inundation of methane gas. The lack of a proper
permissibility examination therefore presented great danger to the miners
underground at that time, and this factor points toward a finding of
unwarrantable failure.

d.     
Obviousness of the Hazard

The hazard presented
by the absence of a permissibility examination was not immediately obvious. Peabody
kept records indicating the dates that such examinations occurred, which should
have helped it notice the issue. However, Respondent also notes that a lapse of
thirteen days between exams is sometimes proper, so the issue was not readily
obvious. The Secretary has not presented any other evidence indicating that the
hazard was particularly obvious. Accordingly, I find that the obviousness of
the hazard is a mitigating factor in the unwarrantable failure analysis.

e.      
Operator’s Knowledge of the Violation

Respondent
argues that its failure to perform the permissibility exam was due to a
miscommunication among its miners. Resp. Br. at 32. Peabody’s maintenance
manager testified that David Justen, the supervisor of one of the crews tasked
with conducting permissibility exams, was told by one of his crew members that
the drill had indeed been inspected. Tr. 429-32, 439-40. Justen then relayed
this information to mine management. Tr. 429. Clearly, someone along this chain
of communication was mistaken because the exam was never done. However, the
weight of the evidence supports Respondent’s claim that the error was
inadvertent and was based on a miscommunication among its employees. The
Secretary has therefore failed to show that Respondent had knowledge of the violation,
and this factor mitigates against a finding of unwarrantable failure.

f.      
Abatement Efforts

An operator’s
abatement efforts are a relevant consideration in the unwarrantable failure
analysis, but only where the operator has been placed on notice of the
violative condition. Respondent did act promptly to address the issue once the
inspector issued an order, but post-citation efforts are not relevant to the
determination of whether the operator engaged in aggravated conduct. See
Enlow Fork Mining Co. , 19 FMSHRC 5, 17 (Jan. 1997). Peabody did not receive
notice of the violative condition until the inspector’s issuance of the order,
and therefore this factor does not affect the unwarrantable failure inquiry.

g.     
Notice to the Operator that Greater Efforts Were Necessary

The Secretary’s
Exhibit 1 indicates that Respondent had been cited regarding its permissibility
examinations over twenty times in the two years prior to this incident. Ex.
S-1. Even though it appears that only one of those violations concerned the
precise regulation at issue here, Peabody should have been on notice that
greater efforts were necessary to ensure that permissibility exams were
properly conducted and recorded. This final factor is therefore aggravating and
weighs in favor of an unwarrantable failure finding.

h.      Conclusion

A preponderance
of the evidence supports a finding that Peabody was highly negligent. Clearly, Peabody’s
miners relied on the weekly maintenance and examination of the equipment. Michael
Butler testified at hearing that he felt comfortable operating the drill in the
high-methane environment in part because he “knew that permissibility was good”
on that piece of equipment. Tr. 386. However, the permissibility exam was not
current, and miners were left operating non-permissible equipment underground
during a methane inundation. Peabody also should have known from past citations
that greater efforts were necessary to conduct and record permissibility
examinations properly. Given these circumstances, a prudent operator with
knowledge of the mining industry, the relevant facts, and the protective
purpose of the regulation would have implemented more rigorous examination and
recording protocols to ensure that equipment is permissible before it is
deployed underground. See Leeco , 38 FMSHRC at 1637. The Secretary has
thus satisfied his burden in showing high negligence.

However,
Peabody’s failure to follow the regulation was not unwarrantable. There is no
evidence that Peabody’s management knew about the lapsed examination. Rather,
due to a miscommunication, management mistakenly believed that the exam had
been conducted. The exam was only a few days out-of-date—not weeks or months—and
only one piece of equipment was affected. Altogether, the mitigating factors
outweigh the aggravating factors here. The Secretary has therefore failed to
prove that this violation constituted unwarrantable failure, and this 104(d)(1)
order accordingly becomes a 104(a) citation.

IV.          
PENALTY

It is well
established that Commission administrative law judges have the authority to
assess civil penalties de novo for violations of the Mine Act. Sellersburg
Stone Company , 5 FMSHRC 287, 291 (Mar. 1983). The Act requires that in
assessing civil monetary penalties, the Commission ALJ shall consider the six
statutory penalty criteria:

(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).

A.     Peabody’s
Penalty

For Order Nos.
9106663 and 9106664, the Secretary proposed a penalty of $45,455.00 for each
violation. Peabody is a large operator, and the proposed penalty would not
impair its ability to stay in business. See Jt. Stip. 6. MSHA cited
Peabody for 494 violations in the fifteen-month period preceding this incident.
Ex. S-1. No citations during that period, however, were issued for violating
section 75.323(c). Ex. S-1. With regard to gravity, each of these two
violations was proven to be S&S. Peabody was also highly negligent, but I
must note that Peabody worked to abate the hazard and swiftly evacuated Unit 3
instead of allowing mining to continue underground following the inundation. The
operator also showed good faith by cooperating with MSHA after notification of
the violation. After careful consideration of the penalty criteria, I assess a
penalty of $38,000 for each violation, resulting in a total of $76,000 for
Orders No. 9106663 and 9106664.

For Order No.
9106665, which is now a 104(a) citation in light of my findings above, the
Secretary proposed a regularly assessed penalty of $45,455.00. The gravity here
is again high. Peabody does have a history of previous violations that relate
to permissibility examinations, but its history of violating this particular
regulation is less extensive. Further, while Peabody was negligent in its
failure to conduct the exam, its negligence did not rise to the level of
unwarrantable failure as in the other orders. Finally, once alerted to the
violation, Peabody immediately conducted the permissibility exam. In light of
Peabody’s quick response and the lack of an unwarrantable failure designation, I
find that a penalty of $20,000 is appropriate for this violation.

B.     Michael
Butler’s Penalty

The Secretary
has proposed that Butler pay a penalty of $7,800.00 for knowingly authorizing
or carrying out violations of 30 C.F.R. §§ 75.323(c)(2)(ii) and
75.323(c)(2)(iii) as an agent of the mine. The parties have stipulated that the
proposed penalties would not affect Butler’s personal financial obligations. Jt.
Stip. 8. Butler did act knowingly, and the gravity of each violation was high. However,
the Secretary has not introduced any evidence that Butler has been responsible
for such violations in the past. Butler also acted in good faith to abate the
hazard, and he cooperated with MSHA personnel to address the violation and the
hazard once the personnel arrived at the scene. I find that Butler’s actions
warrant a penalty of $3,000 for each violation, resulting in a total penalty of
$6,000.

V.          
ORDER

It is hereby ORDERED
that Orders Nos. 9106663 and 9106664 are AFFIRMED . Order No. 9106665
is hereby MODIFIED from a section 104(d)(1) order to a section 104(a)
citation and as otherwise set forth above. The section 110(c) liability of
Michael Butler is AFFIRMED . Peabody Midwest Mining, LLC is hereby ORDERED
to pay the Secretary of Labor the total sum of $96,000.00 within 30 days of
this decision. [4] Michael
Butler is ORDERED to pay a civil penalty of $6,000.00 within 30 days of
this decision.

/s/
David P. Simonton

David P. Simonton

Administrative Law Judge

Distribution: (Email [5] )

Barbara M. Villalobos, U.S. Department of Labor. Office of
the Solicitor, 230 S. Dearborn St., Room 844, Chicago IL 60604 ( [email protected] )

R. Henry Moore, Fisher & Phillips, LLP, Six PPG Place,
Suite 830, Pittsburgh, PA 15222 ( [email protected] )

[1] In this decision, the joint stipulations, transcript,
the Secretary’s exhibits, and Respondent’s exhibits are abbreviated as “Jt.
Stip.,” “Tr.,” “Ex. S-#,” and “Ex. R-#,” respectively.

[2] See infra ,
Section C, for additional discussion about Michael Butler’s knowledge of the
violation.

[3] To the extent
they are applicable, I incorporate my earlier findings into this analysis.

[4] Please pay
penalties electronically at Pay.Gov, a service of the U.S. Department of the
Treasury, at https://www.pay.gov/public/form/start/67564508 .
Alternatively, send payment (check or money order) to: U.S. Department of
Treasury, Mine Safety and Health Administration

P.O.
Box 790390, St. Louis, MO 63179-0390. Please include Docket and A.C. Numbers.

[5] For the
foreseeable future, Federal Mine Safety and Health Review Commission (FMSHRC)
notices, decisions, and orders will be sent only through electronic mail. Because
FMSHRC will not be monitoring incoming physical mail or faxes, parties are
encouraged to submit all filings through the agency’s electronic filing system.
If you are not able to file through our electronic filing system, please send
an email copy and we will file it for you.