Secretary of Labor v. United Taconite, LLC

Plain-English summary

United Taconite's proposed assessment became final after an employee failed to deliver it to the safety director before the 30-day contest deadline. The company mailed a contest for four citations two days after the deadline, and the Secretary did not oppose reopening or allege bad faith. The Commission rejected the company's separate argument that service by mail extended the statutory contest period by five days. It found that the prompt contest showed a good-faith intent to challenge the four citations. The Commission reopened that part of the assessment and remanded it, while leaving the remainder as a final order.

Decision snapshot

• Cited authority: 29 C.F.R. §§ 2700.1(b) and 2700.8(b); 30 U.S.C. § 815(a)
• Outcome: Citation Nos. 9385814, 9385817, 9385818, and 9385819 were reopened and remanded; the rest of the assessment remained final.
• Key point: A contest mailed two days late supported reopening when it demonstrated good faith and the Secretary did not oppose relief.

Full text (FMSHRC public release)

FEDERAL MINE SAFETY AND HEALTH REVIEW
COMMISSION

1331
PENNSYLVANIA AVENUE, NW, SUITE 520N

WASHINGTON,
D.C. 20004-1710

SECRETARY OF
LABOR,                             :        

MINE SAFETY AND HEALTH                   :    

ADMINISTRATION (MSHA)                      :         Docket No. LAKE 2020-0014-M

:         A.C. No. 21-03404-493313

v.                                              
:        

:

UNITED TACONITE, LLC                                     :   

BEFORE: Traynor, Chair; Althen and Rajkovich, Commis s io n ers

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 October 29, 2019, the Commission received from United
Taconite, LLC (“United Taconite”) a request 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”); Jim Walter Res., Inc ., 15 FMSHRC
782, 786-89 (May 1993). 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 will be permitted. See Coal Prep. Servs., Inc ., 17 FMSHRC 1529,
1530 (Sept. 1995).

The proposed assessment was
delivered to the operator on June 17, 2019 and became a final order on July 17,
2019. The total penalty for all the violations in the assessment was $27,380. [1]

The operator primarily seeks to
reopen this matter on the basis that the employee who received the proposed assessment
failed to deliver it to Bryan Baird, the safety director in charge of handling
proposed assessments. The operator claims that Baird did not become aware of the
proposed assessment until July 19, 2019, two days after the proposed assessment
had become a final order. The operator mailed a contest notice later the same day
for four citations: Citation Nos. 9385814, 9385817, 9385818 and 9385819. The
contest notice was received by MSHA on July 22, five days after the proposed assessment
had become a final order. [2]

MSHA sent a letter dated July 29,
2019 informing the operator that its contest was late and that the proposed assessment
had become a final order. The letter was sent to the address of the operator’s
counsel. However, the operator’s counsel allegedly moved to a new office in
July 2019 and therefore claims not to have received the mailed letter. It is
unclear why the mailed letter was not forwarded to counsel’s new address.

Subsequently, on August 14, 2019,
MSHA deposited the operator’s check of $10,775.  MSHA applied part of this
check to Citation Nos. 9385817 and 9385819, which had been listed in the
operator’s untimely contest, while the remainder of the check was applied to
Citation No. 9385812. In an email, the operator claimed that MSHA incorrectly
applied this payment to the wrong citations. The operator maintains that the
payment of $10,775 was intended to be applied to the remainder of the penalty assessment
besides the citations listed in its contest (the remainder of the assessment
was $10,775).

On September 12, 2019, the operator
received a delinquency notice, dated September 3, and the operator’s counsel
immediately contacted MSHA. On that same day, MSHA sent the operator’s counsel a
copy of the July 29 letter via email. As set forth above, the operator’s
counsel claims that it became aware of the letter only after receiving the
emailed copy on September 12.  

The operator also claims that MSHA
erred in determining that its contest was late. 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, and if the operator fails
to do so, the proposed assessment becomes a final order of the Commission. 30
U.S.C. § 815(a). Despite this, the operator claims that 29 C.F.R. § 2700.8(b)
extends the deadline for filing contests by five days when MSHA serves an
assessment by a method of delivery other than same day

service.

However, the Commission has
conclusively rejected the argument that 29 C.F.R. § 2700.8(b) applies to
contests of proposed assessments. Bucyrus Field Svcs. Inc., 31 FMSHRC
1029, 1030 at n.1 (Sept. 2009). Therefore, it is unnecessary to further
consider this issue.

In this case, we must consider
whether the operator demonstrated that it acted in good faith, and whether the
Secretary opposes the motion or alleges that the operator acted in bad faith. Noranda
Alumina, LLC, 39 FMSHRC 441, 444 (Mar. 2017). Here, the operator’s good
faith intent to timely contest the penalty is demonstrated by the fact that its
contest was mailed on July 19, just two days after the assessment became a final
order. Moreover, the Secretary does not oppose the motion or allege that the
operator acted in bad faith.

Having reviewed United Taconite’s request and the Secretary’s
response, we conclude that, i n the
interest of justice, the part of the assessment relating to Citation
Nos. 9385814, 9385817, 9385818 and 9385819 should be reopened. The remainder of
the assessment will remain as a final order. Accordingly,
this case is remanded 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.

/s/ Arthur R.
Traynor, III

Arthur R.
Traynor, III, Chair     

/s/ William I.
Althen

William I. Althen,
Commissioner

/s/ Marco M. Rajkovich,
Jr.

Marco M. Rajkovich, Jr., Commissioner

Distribution (e-mail):

Patrick W. Dennison

Fisher & Phillips LLP

Six PPG Place, Suite 830

Pittsburgh, PA 15222

[email protected]

John M. McCracken, Esq.

Office of the Solicitor

Division of Mine Safety and Health

U.S. Department of Labor

201 12th Street South, Suite 401

Arlington, VA 22202-5452

[email protected]

Archith Ramkumar, Esq.

Office of the Solicitor

U.S. Department of Labor

201 12th Street South, Suite 401

Arlington, VA 22202

[email protected]

April Nelson, Esq.

Office of the Solicitor

U.S. Department of Labor

201 12th Street South, Suite 401

Arlington, VA 22202-5452

[email protected]

Chief Administrative Law Judge Glynn F. Voisin

Federal Mine Safety & Health Review Commission

1331 Pennsylvania Avenue, NW, Suite 520N

Washington, DC 20004-1710

[email protected]

Melanie Garris

Office of Civil Penalty Compliance

Mine Safety and Health Administration

U.S. Department of Labor

201 12th Street South, Suite 401

Arlington, VA 22202-5452

[email protected]

[1]
The operator’s motion to reopen erroneously states that the proposed assessment
was delivered on July 17, 2019, and erroneously lists the total penalty for the
proposed assessment as $24,917.

[2]
The total penalty for the four citations listed in the contest was $16,605. The
total penalty for the remaining violations in the proposed assessment was
$10,775 (27,380 - 16,605 = 10,775).