Secretary of Labor v. Knight Hawk Coal, LLC

Plain-English summary

Knight Hawk Coal and the Secretary proposed settling three citations by removing the significant and substantial designation from two and reducing total penalties from $7,960 to $4,590. Judge Michael G. Young accepted the explanation for one S&S removal but found insufficient factual support for removing the designation from a roof-control citation discovered after a roof fall. He held that section 110(k) requires Commission approval of contested-penalty settlements and that a settlement motion must provide facts supporting the proposed modification. He certified for interlocutory review the question whether the Secretary has unreviewable discretion to remove an S&S designation without Commission approval. The Commission later affirmed the settlement denial and remanded the case.

Decision snapshot

• Cited authority: 30 C.F.R. §§ 75.202(a), 75.220(a)(1), 2700.31(b), 2700.31(g), and 2700.76; 30 U.S.C. §§ 815(d), 820(k), and 823(d)(2)
• Outcome: The controlling legal question over S&S removal in settlement was certified for interlocutory Commission review.
• Subsequent review: The Commission later affirmed the settlement denial and remanded in lake-2021-0160-commission.
• Key point: A proposed settlement removing an S&S designation must give the judge enough facts to evaluate the modification under section 110(k).

Full text (FMSHRC public release)

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

OFFICE OF ADMINISTRATIVE
LAW JUDGES

1331 PENNSYLVANIA
AVENUE, NW, SUITE 520N

WASHINGTON, DC 20004-1710

TELEPHONE: 202 434-9987
/ FAX: 202 434-9949

SECRETARY
OF LABOR,

MINE
SAFETY AND HEALTH       

ADMINISTRATION
(MSHA),

Petitioner

v.

KNIGHT
HAWK COAL, LLC,

Respondent

CIVIL
PENALTY PROCEEDING

Docket
No. LAKE 2021-0160

A.C.
No. 11-03147-536309

Mine:
Prairie Eagle-Underground

ORDER CERTIFYING CASE FOR
INTERLOCUTORY REVIEW

Before:  Judge
Young

This
matter is before me upon a petition for assessment of civil penalty filed by
the Secretary of Labor (“Secretary”), pursuant to section 105(d) of the Federal
Mine Safety and Health Act of 1977 (“Mine Act”), 30 U.S.C. § 815(d). The
Secretary filed a Motion to Approve Settlement setting forth the factual bases
for the proposed modifications. When I disapproved the settlement, the
Secretary filed amended motions, which I disapproved based on my concerns with
the removal of a “Significant and Substantial” (“S&S”) designation.

The
Secretary now seeks interlocutory review of this proceeding, pursuant to
Commission Procedural Rule 76, 29 C.F.R. § 2700.76. I agree with the Secretary
that this interlocutory ruling involves a controlling question of law, and that
immediate review will materially advance the final disposition of this
proceeding. I certify for review this question: whether the Secretary has
unreviewable discretion to remove a “Significant and Substantial” (“S&S”) designation
from a contested citation without the Commission’s approval.

This
case was assigned to me on August 18, 2021. This docket includes three
citations issued pursuant to Section 104(a) of the Mine Act. The Secretary
submitted a motion to approve settlement on August 24, 2021, in which the Secretary
proposed removing S&S designations from two citations: Citation Nos.
9198165 and 9198038. The third citation remained unaltered. Additionally, the
motion requested a penalty reduction from $7,960.00 to $4,590.00. After review
and careful consideration, I denied approval of this settlement via
email—specifying that for Citation Nos. 9198165 and 9198038, I needed
clarification of the operator’s arguments in support of why the facts and
circumstances surrounding the conditions were not reasonably likely to
contribute to an event with the potential to cause significant injuries. The
email provided possible resolution—a detailed explanation—rather than
Commission review.

The Secretary chose to submit
subsequent motions to approve settlement on September 3, September 13, and
September 14, 2021. Although I determined that the amended explanation for the
removal of the S&S designation from Citation No. 9198165 was satisfactory,
I was not

provided with sufficient factual
support to approve such removal from Citation No. 9198038. [1]
As such, my approval of the settlement would
unfairly compromise the public interest by conceding an important issue without
reasonable justification for doing so. Therefore, I issued an order on
September 30, 2021, denying the motion to approve settlement (“Denial Order”). [2]
In order to resolve the question of law before us, the Secretary
submitted a motion for certification on November 24, 2021.

I.          
The
Standard for Approval of Proposed Settlements

The
Secretary relies on the Commission’s decisions in Mechanicsville Concrete,
Inc. and American Aggregates of Michigan, Inc. as support for his contention that he need only depend on his
discretion when vacating S&S designations . S. Mot. ¶ 6(C)(2); Am.
Aggregates of Mich., Inc. , 42 FMSHRC 570, 576–79 (Aug. 2020) (citing Mechanicsville
Concrete, Inc. , 18 FMSHRC 877, 879–89 (June 1996)). However, Mechanicsville and American Aggregates do not
confer sole discretion upon the Secretary or limit the evaluation of the
Commission under section 110(k) of the Mine Act. The Secretary made a
S&S designation and now intends to modify it. He cannot rely solely on
discretion, but must provide sufficient factual support. See 29 C.F.R.
§ 2700.31(b)(1) (requiring “facts in support of the penalty agreed to by
the parties”); see also Am. Coal Co. , 38 FMSHRC 1972, 1981 (Aug. 2016)
(“ AmCoal I ”); Black Beauty Coal Co. , 34 FMSHRC 1856, 1856 (Aug.
2012).

The
unreviewable discretion asserted by the Secretary is contrary to the Mine Act’s
requirement that the Commission approve all settlements. See 29 C.F.R. §
2700.31(g) (“Any order by the Judge approving a settlement shall set forth the
reasons for approval and shall be supported by the record.”). While the
Secretary retains prosecutorial discretion at the citation and petition stage,
Commission Judges have the authority to review proposed compromises. 30 C.F.R.
§ 2700.31(b) (“A motion to approve a penalty settlement shall include for
each violation  . . . facts in support of the penalty agreed
to by the parties.”) (emphasis added). Rule 31 enables Judges to review
proposed penalties under section 110(k) of the Mine Act, which provides, “No
proposed penalty which has been contested before the Commission under section
105(a) shall be compromised, mitigated, or settled except with the approval of
the Commission.” 30 U.S.C. §   820(k).

The Secretary argued in AmCoal I that enforcement agencies are
generally presumed to have unreviewable discretion to settle enforcement
actions, and that section 110(k) does not provide meaningful or substantive
standards sufficient to limit the Secretary’s prosecutorial discretion as
applied to settlement agreements. 38 FMSHRC at 1974–75 (citing as support the
“Heckler Test” established in Heckler v. Chaney , 470 U.S. 821, 834
(1985)). The Commission has expressly rejected, and the text and structure of
the Mine Act refutes, this argument. Id. at 1979–81. As the Commission
held in AmCoal I , Congress charged the Commission with the
administration of section 110(k), which explicitly grants the Commission the
authority to approve settlements and limits the Secretary’s authority to reduce
contested penalties. As the Commission noted, the assessment of civil penalties
under the Mine Act has not been committed to the Secretary by law, but was
instead expressly and clearly delegated to the Commission. Id. The
Commission has employed a meaningful abuse of discretion standard—discussed in
detail below—under which the Secretary is required to provide facts in support
of settlement. This requirement may only be deemed inappropriate if it is
unreasonable or inconsistent with the Mine Act—and it is not.

A.    
The Secretary's
cited authority does not confer the discretion asserted.

The
Secretary’s reliance on Mechanicsville is misplaced. Mechanicsville is
irrelevant to this proceeding because it relies upon the Commission’s
decision in RBK Construction, Inc., 15 FMSHRC 2099, 2101 (Oct.
1993), which in turn relied upon the U.S. Supreme Court’s decision in Cuyahoga
Valley Railway Co. v. United Transportation Union , 474 U.S. 3, 6–7 (1985).
In contrast to the case at hand, RBK Construction did not involve a
settlement, and the Court in Cuyahoga Valley grounded its decision on
the statutory scheme of the Occupational Safety and Health Act, which—unlike
section 110(k) of the Mine Act—does not require the Occupational Safety and
Health Review Commission to approve settlements.

Even
if the cited authority was relevant to a case which has been contested before
the Commission under section 105(a), an important distinction between this
proceeding and Mechanicsville renders it inapplicable. The present case
involves a proposal to eliminate an S&S designation, while the
Commission in Mechanicsville held that an ALJ may not add an
S&S designation on his or her own initiative. Mechanicsville Concrete,
Inc. , 18 FMSHRC at 880, 882. These important distinctions between this case
and Mechanicsville render this authority irrelevant to this case.

The Secretary’s reliance on American
Aggregates is also misplaced. In this case, the Commission vacated a
Judge’s decision to deny a settlement motion because the Judge ignored
information that was relevant to the reasonableness of the settlement under the
AmCoal criteria. 42 FMSHRC at 577, 581. This information included
several facts that were relevant to, and plausibly supported, a decrease in
gravity and negligence, and the removal of the S&S designation. The
Commission only reversed the Judge’s denial of the settlement, and the included
removal of the S&S designation, because of the Judge’s failure to consider
the significant factual support provided.

B.    
The
Secretary must provide substantive, relevant facts in support of modifying
violations in a motion to approve settlement.

The
Commission has consistently required its judges to consider facts that are both
substantive and relevant to proposed modifications before a motion to approve
settlement may be granted. The facts provided must enable a plausible inference
that the violation at issue can be justly compromised. In the case at hand, the
facts provided must permit an inference that facts might be established at
hearing that could result in the violation in question not being affirmed as
S&S. [3]

1. The
   Commission has consistently required Judges to consider substantive, relevant
   facts in support of settlement.

No
definition of the term “relevant” has been provided by the Commission to date. However,
Black’s Law Dictionary defines the term “relevant” as “[l]ogically connected
and tending to prove or disprove a matter in issue; having appreciable
probative value — that is, rationally tending to persuade people of the
probability or possibility of some alleged fact.” See Relevant , Black’s Law Dictionary (10th ed. 2014) . The Federal Rules of Evidence defines
“relevant” as a contention that “has any tendency to make a fact more or less
probable than it would be without the evidence and the fact is of consequence
in determining the action.” Fed. R. Evid. § 401.

In
Solar Sources Mining, LLC , the Commission approved a denied settlement based
on a Judge’s failure to consider the facts submitted in support of settlement. 41
FMSHRC 594, 605, 606 (Sept. 2019). The Commission held that the Judge erred in
concluding that the parties presented no facts to support settlement, when the
parties “actually presented relevant facts,” including the non-applicability of
the standard. See 41 FMSHRC at 601. [4]

In addition to relevant facts, the
Commission has consistently recognized that
Judges must consider
substantive evidence, defined as “[e]vidence
offered to help establish a fact at issue , ”
in order to approve or deny settlement motions. Substantive Evidence , Black’s Law Dictionary (10th ed. 2014 ).
In AmCoal I, the
Commission rejected the Secretary’s “boilerplate referencing” of “professional
judgment” and enforcement value “in lieu of the substantive factual support
traditionally provided to justify a penalty reduction.” AmCoal I , 38
FMSHRC at 1973–74. Another Am. Coal Co. case was denied settlement by a
split Commission because of a lack of facts, and was approved by the disapproving
Commissioners only upon submission of additional facts. See 40 FMSHRC 765,
766 n.1 (June 2018); Am. Joint Mot. Approve Settlement Agreement, Docket No.
LAKE 2009-0035, at 8–10 (May 18, 2018).

The
Commission discussed the proper substantive evidence requirement for modifying
individual citations in Hopedale Mining , 42 FMSHRC 589 (Aug. 2020). In Hopedale ,
the Commission held that a Judge’s denial of a settlement constitutes an abuse
of discretion when the agreed-upon facts supplied by the parties satisfy the
standard for approval established in AmCoal I . Although judges need not engage
in fact-finding, weighing conflicting evidence, or making credibility
determinations, the majority stressed that this holding does not restrict
judges by limiting their ability to “probe gaps or inconsistencies in the
explanation offered in support of a settlement motion.” Id. at 595; see
also Solar Sources Mining LLC , 41 FMSHRC at 602 (stating that Judges are “expected
to . . . determine whether the facts support the penalty agreed to by the
parties”).

The
Commission determined that the provided facts in Hopedale supported the
penalty reduction agreed to in the settlement, and that “[t]he rejection in
this case was contrary to stipulated facts, mischaracterized the operator’s
compliance history, and failed to give weight to the considerable non-monetary
value preserved by the settlement.” Id. at 602. For citations where the
Secretary proposed a reduction in negligence, he provided respondent
contentions demonstrating that the “violative conditions were not obvious or
readily known to the operator.” Id. at 598. For other violations
challenging gravity, the Secretary provided contentions showing possible
compliance (i.e., no violation) or the reduced likelihood of hazard because the
equipment was found to be functioning better than noted. Id. at 597–98. These
facts were all substantive because they were offered to dispute a fact
at issue. These substantive facts, as described, were also relevant to
the individual modifications proposed, a principle that should also apply to
the removal of S&S designations. This case thus differs from Hopedale
Mining , in that it does not involve the rejection of substantive, relevant
facts. Rather, the parties have not provided me with sufficient facts to serve
as the basis for an evaluation under AmCoal I . [5]

2. The
   Secretary misreads the cited authorities.

a.     
Although the
Secretary cites Am. Coal Co. , this case requires the submission of
relevant facts.

The
Secretary states in the Motion to Approve Settlement that he “has considered
the deterrent value of the penalty and obtaining a final resolution to this
matter.” As support for this statement, the Secretary cites the following
excerpt:

The Amended [motion] provides
substantive explanations supporting the Secretary’s decision to compromise the
issues of one violation at issue . . . . In addition, the Secretary has set
forth reasons why it would not be in the public interest to litigate certain
legal issues in the context of this case. Moreover, the amended motion explains
that the operator’s mines have closed since the citations issued, reducing the
deterrent value of the penalty. Commissioners Jordan and Cohen note that these
justifications were absent in the initial settlement motion . Upon review of
the amended motion , Commissioners Jordan and Cohen agree to grant the
motion and approve the settlement.

Am.
Coal Co. , 40
FMSHRC at 766 n.1 (emphasis added).

The
Secretary asserts that it is sufficient for him to “consider the deterrent
value” of the penalty. This assertion is based on only a partial understanding
of the cited authority. In citing this footnote as support, the Secretary
ignores the facts of the case. Importantly, the settlement at issue was only
granted following the submission of additional facts . Id. at 766. After
AmCoal appealed a remanded decision, the parties submitted a motion to approve
settlement that was denied by the Commission in a 2-2 split.

As
support for their denial, Commissioners Jordan and Cohen set forth reasons why
approval would not be in the public interest, including their concerns that (1)
it was unclear what AmCoal had agreed to give in exchange for settlement, (2)
the Commission did not remand for a gravity reduction where the trier of fact
already made a gravity determination, and (3) the settlement was one-sided and
did not help with enforcement of the Mine Act. Am. Coal Co. , 40 FMSHRC
330, 337–39 (Mar. 2018).

Commissioners Jordan and Cohen
joined in approving settlement after the parties submitted an amended motion
that included additional factual support. Amended Joint Motion to Approve
Settlement Agreement, Docket No. LAKE 2009-0035, at 8 (May 18, 2018).

The
amended motion included at least three additional substantive facts that were
directly relevant to the proposed modification, including acknowledgement that
the operator’s mines had since closed. Am. Coal Co. , 40 FMSHRC at 766
n.1. This decision, and the footnote cited by the Secretary, do not support the
contention that the Secretary need only consider the deterrent value of a
penalty in obtaining a final resolution. The outcome of this case clearly depended
on the submission of substantive, relevant facts. This is the standard I have
followed in rejecting the settlement.

b.     
AmCoal
II also
requires the submission of substantive facts.

The
Secretary states that he has evaluated enforcement values and maximized his
prosecutorial impact, citing page 989 of AmCoal II . The cited authority requires
that the facts provided “reflect a mutual position that the parties have agreed
is acceptable to them in lieu of the hearing process.” Am. Coal Co. , 40
FMSHRC 983, 991 (Aug. 2018) (“ AmCoal II ”). The Secretary uses this
language to make the overbroad assertion that he need only state that the parties
are in agreement without submitting adequate support. However, the Commission has
consistently required that the Secretary provide substantive facts, relevant to
the proposed modifications.

The standard for Commission evaluation is
whether the proposed settlement is “fair, reasonable, appropriate under the
facts, and protects the public interest.” AmCoal II , 40 FMSHRC at 987. [6]
The Commission found that in order to effectively apply this standard,
Commission Judges must be provided with “sufficient information” upon which to
base their evaluation. Id. (quoting Black Beauty Coal Co. , 34
FMSHRC 1856, 1862 (Aug. 2012)). Specifically, the Commission found that the Judge
required substantive facts to support proposed penalty reductions. Id.
at 989 (“[T]he Judge appropriately determined that the submission of
additional substantive facts to support the proposed penalty reductions was
necessary . . . .”) (emphasis added).

Similar to the AmCoal case noted
above, see supra Section I.B.2.a., the settlement motion approved by the
Commission depended on the submission of new facts that were substantial and
relevant to the modifications—primarily that the mine ceased production two
years prior, and that the respondent’s other mine also ceased production, facts
that proved a reduced enforcement value. Am. Coal Co. , 40 FMSHRC 1380,
1388 (Sept. 2018) (ALJ); Joint Mot. Approve Settlement & Dismiss Proc.,
Docket No. LAKE 2011-0013, at 2 (Sept. 7, 2018).

In this case, the Secretary denies that he
must provide substantive, relevant facts in support of settlement. AmCoal II
does not support this claim. The Commission requires sufficient facts— including
nonmonetary assessments regarding enforcement value—upon which Judges can make
an appropriate finding. AmCoal II , 40 FMSHRC at 991 (“[F]acts required
by Rule 31 may include a description of an issue on which the parties have
agreed to disagree.”). In the present case, the Secretary has failed to provide
any detailed explanation of how the enforcement value of the violation will be
maintained.

II.        
The facts
provided by the Secretary do not justify removal of the S&S designation.

A.    
The Commission
utilizes an abuse of discretion standard to evaluate the Secretary’s
enforcement decisions.

Rule
31 requires that a settlement motion include facts in support of the penalty
agreed to for “each violation,” and that a Judge’s order set forth reasons for
approval and be supported by the record. 29 C.F.R. § 2700.31(b), (g). The abuse
of discretion standard requires the Secretary to provide relevant facts from
which a Commission Judge may understand the reasonable conclusions drawn in
support of his decision. See Prairie State Generating Co. , 792 F.3d 82,
92 (D.C. Cir. 2015); Knight Hawk Coal, LLC , 42
FMSHRC 435, 445–46 (July 2020).

The
Commission has established that denial or reversal is justified in cases where
there is no evidence to support the Secretary’s decision. See Solar Sources
Mining, LLC , 41 FMSHRC at 599 (citing Shemwell v. Armstrong Coal Co. ,
36 FMSHRC 1097, 1101 (May 2014) (“An abuse of discretion may be found where
there is no evidence to support the Judge’s decision or if the decision is
based on an improper understanding of the law”)); see also Twentymile Coal
Co. , 27 FMSHRC 260, 278 (Mar. 2005) (Jordan, dissenting) (quoting Mingo
Logan Coal Co. , 19 FMSHRC 246, 249–50 n.5 (Feb. 1997), aff’d ,
133 F.3d 916 (4th Cir. 1998)).

On
review, the D.C. Circuit Court of Appeals has noted that the Commission’s ALJs
determine, in the first instance, whether the Secretary has been
arbitrary and capricious, abusing his discretion in his decision, and that the
Commission’s standard of review is whether substantial evidence supports the
Judge’s determination. See Sec’y of Lab. v. Knight Hawk Coal, LLC , 991
F.3d 1297, 1308 (D.C. Cir. 2021) (citing 30 U.S.C. § 823(d)(2)). Under the
arbitrary and capricious standard, the Secretary must “articulate a
satisfactory explanation for its action including a ‘rational connection
between the facts found and the choice made.’” Id. at 1307 (quoting Motor
Vehicle Mfrs. Ass’n of the U.S. v. State Farm Mut. Auto. Ins. Co. , 463 U.S.
29, 43 (1983) (quoting Burlington Truck Lines, Inc. v. United States ,
371 U.S. 156, 168 (1962))).

This
standard is deferential to the Secretary, but its grace is not unlimited. In
particular, the law—statutory law, Court and Commission precedents, and the
Commission’s procedural rules—clearly establishes a requirement that the
Secretary’s decisions be consistent with the reasoning and assumed facts
provided with a motion to approve settlement.

Congressional
intent, as well as Commission and court precedent, compels a meaningful review
of all settlements submitted for approval. Section 110(k) of the Mine Act
serves to maintain the deterrent effect of violations and penalties, in part by
preventing the Secretary from abusing his authority to settle such violations
without appropriate justification. See AmCoal I , 38 FMSHRC at 1976
(citing S. Rep. No. 95-181, at 44, reprinted in Senate Subcommittee on
Labor, Committee on Human Res., 95th Cong., Legislative History of the
Federal Mine Safety and Health Act of 1977 , at 632–33 (1978)) (“Congress
explained that ‘[b]y imposing [the] requirements’ of section 110(k), it
‘intend[ed] to assure that the abuses involved in the unwarranted
lowering of penalties as a result of the off-the-record negotiations are
avoided .”).

The
Commission has acknowledged the importance of section 110(k) in preventing
abuse, and it possesses the authority to deny the Secretary’s decisions when
appropriate. This includes when the Secretary declines to provide an
explanation for a settlement decision, or when the facts provided by the
Secretary do not reasonably support a settlement decision. See Black Beauty
Coal Co. , 34 FMSHRC 1856, 1862 (Aug. 2012) (authorizing the Commission to
approve the settlement of contested penalties in section 110(k) “[i]n order to
ensure penalties serve as an effective enforcement tool, prevent abuse, and
preserve the public interest.”)

Thus,
under the governing law, I—as well as the Secretary—must make a rational
decision governed by the operative facts and the law as it has been
interpreted. I would abuse my discretion if I approved a settlement that is
inconsistent with the facts provided. I have declined to do so.  

B.    
Judges must
have sufficient facts from which to plausibly infer that the violation would
not meet S&S requirements.

The
abuse of discretion standard requires judges to consider sufficient facts,
taken as true, from which they may plausibly infer that proposed modifications
are reasonable. Although the term “plausible” has not yet been defined by the
Commission (and has in fact caused confusion amongst judges and scholars
alike), the plausibility standard is evident in Commission precedent. The Commission
has consistently required consideration of facts relevant to proposed
modifications. See Knight Hawk Coal, LLC , 42 FMSHRC at 446 n.22
(requiring “some plausible—i.e., not speculative or preconceived—factual
basis.”).

In
Knight Hawk Coal, LLC , the Commission affirmed a Judge’s decision to
vacate the Secretary’s rejection of a ventilation plan because substantial
evidence existed in support of the Judge’s conclusion that the plan was
acceptable. 42 FMSHRC at 452. The Commission applied a plausibility standard,
agreeing that the Secretary had failed to articulate reasons, “rationally
supported by the facts,” that the ventilation approach did not protect miners. Id.
The Commission could not condone rejection of a long-used plan based upon an
“implausible belief” that harmful conditions might arise from the plan. Id.
at 446 n.22 (describing such “implausible belief” as an “irrational belief not
grounded on the record evidence”).

The
Commission articulated that the minimum standard requires “some plausible—i.e.,
not speculative or preconceived—factual basis for rejecting an operator’s
claim.” Id. (“Requiring the Secretary to show his work in this regard is
hardly a ‘new’ requirement. Rather, it reflects his fundamental duty under the
Act to defend his choices as ‘reasonable,’ at a minimum.”). This should be no
different from requiring the Secretary to provide facts in support of a proposed
settlement—i.e., “show[ing] his work”—to support a Judge’s 110(k) review.

This
standard is also supported by the Commission’s requirement to be guided, when
practicable, by the Federal Rules of Civil Procedure. See 29 C.F.R. §
2700.1(b) (“[T]he Commission and its Judges shall be guided so far as
practicable by the [FRCP].”); see also Jim Walter Res., Inc. , 15 FMSHRC
782, 787 (May 1993). Specifically, the Secretary’s case can be likened to a
pleading to survive a motion to dismiss for failure to state a claim under Rule
12(b)(6).

Black’s
Law Dictionary equates the term “Plausibility Test” to the “Twombly Test,”
which requires the following in a pleading to survive a 12(b)(6) motion: “(1)
state facts that, taken as true, make a plausible (rather than conceivable)
claim, and (2) not rely solely on conclusions of law, which are not entitled to
the same assumption of truth as factual allegations.” Twombly Test , Black’s . The Court in Bell Atlantic
Corp v. Twombly required a FRCP 8 pleading to “possess enough heft to
‘sho[w] that the pleader is entitled to relief.’” 550 U.S. 544, 557 (2007).

The
Court noted that “[a]sking for plausible grounds does not impose a probability
requirement at the pleading stage; it simply calls for enough facts to raise a
reasonable expectation that discovery will reveal evidence of illegal
agreement.” Id. at 556. Requiring substantive, relevant facts in a
settlement motion only requires sufficient facts to “raise a reasonable
expectation” that there was no violation, or that the violation did not meet
the level of gravity or negligence cited.

In
Ashcroft v. Iqbal , the Supreme Court provided a description of the
plausibility requirement, stating that in order to survive a motion to dismiss,
“a complaint must contain sufficient factual matter, accepted as true, to
‘state a claim to relief that is plausible on its face.’” 556 U.S. 662, 678
(2009) (quoting Twombly , 550 U.S. at 570). The Court described facial
plausibility as “factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged.” Id.
(citing Twombly , 550 U.S. at 556). In relation to a settlement motion,
the factual content provided should allow a Commission Judge to draw the
reasonable inference that there is no violation, or that the violation does not
meet the level of gravity or negligence cited.

The standard of plausibility exists
in Commission review of decisions on the merits of a violation. Upon a prima
facie showing of a violation by the Secretary, a respondent operator must
demonstrate a “plausible theory based upon any facts in the record to support a
reasonable inference” that the violation did not occur. Jim Walter Res.,
Inc. , 28 FMSHRC 983, 988, 989–90 (Dec. 2006) (affirming the Judge’s
decision to uphold a S&S designation because there was substantial evidence
to support the conclusion that the respondent did not show “any plausible
theory” rebutting the Secretary’s case).

The
need to make a plausible demonstration refuting the existence of a violation
could and should be applied to facts required in a settlement motion. Such a
requirement is not contradictory to the Commission’s directives in AmCoal II .
See 40 FMSHRC at 991 (ruling that judges must not assign
probative value to some facts). It
merely requires that the submitted facts, if taken as true, plausibly
demonstrate that there was no violation, or that the violation did not reach
the level of gravity or negligence assigned.

C.    
The facts
provided by the Secretary cannot support the removal of the S&S
designation.

An
S&S designation is appropriate if, “based upon the particular facts
surrounding the violation, there exists a reasonable likelihood that the hazard
[danger to safety or health] contributed to will result in an injury or illness
of a reasonably serious nature.” Mathies Coal Co. , 6 FMSHRC 1, 3–4 (Jan.
1984) (citing Cement Div., Nat’l Gypsum Co. , 3 FMSHRC 822, 825 (Apr.
1981)). An S&S determination must be based on the
continuation of normal mining operations. See Consol PA Coal Co. , 43
FMSHRC 145, 148 (Apr. 2021) (citing U.S. Steel Mining Co. , 6 FMSHRC
1573, 1574 (Jan. 1984)) (“A determination of ‘significant and substantial’ must
be based on the facts existing at the time of issuance and assuming continued
normal mining operations, absent any assumption of abatement or inference that
the violative condition will cease.”).

The
four elements supporting an S&S designation provided in Mathies have
been refined and expressed as follows: (1) an underlying violation of a
mandatory safety standard; (2) a reasonable likelihood the violation will cause
the occurrence of the discrete safety hazard against which the standard is
directed; (3) a reasonable likelihood that the hazard would cause an injury;
and (4) a reasonable likelihood that the injury would be of a reasonably
serious nature. Peabody Midwest Mining, LLC , 42 FMSHRC 379, 383 (June
2020) (integrating the refinement of the second Mathies step in Newtown
Energy, Inc. ).

1. The relevant facts provided demonstrate a prima
   facie showing of a S&S violation.

The Mine Act and the
Commission’s precedents interpreting it compel me to determine whether the
settlement tendered is appropriate to the facts provided to me. Citation No.
9198038 arises from an alleged violation of the operator’s roof control plan,
which appears to have been discovered after a roof fall occurred. See 30
C.F.R. § 75.220(a)(1) (requiring operators to develop and follow approved roof
control plans); see also 30 C.F.R. § 75.202(a) (requiring roof support
to protect miners from hazards related to roof falls). Under the terms of the
plan, entry widths are limited to 19 feet. The operator asserts that a variance
permits it to inadvertently mine widths up to 21½ feet wide. In that case, the
variance requires the operator to use additional bolts that are one foot
longer in between the rows to support the roof in the wider area.

Both
the second and third amended motions state, “Because the area had never been
deemed to be wider than the plan allowed, the additional bolts had not been
installed.” This explanation does not provide a sufficient evidentiary basis to
support removal of an S&S designation. The explanation notes that the
condition was not obvious, had not been noted on prior inspections, and did not
present visible signs that a roof fall was imminent.

While
these facts would support a reduction in negligence, they would not support a
reduction of the likelihood of injury in an area where a roof fall occurred. Additionally,
the operator’s belief that a confluence of factors did not exist has no value
to an assessment of the likelihood of injury from the hazard.

The limited facts
provided in the motion included an acknowledgment that at least one miner, the
examiner, would work or travel in the area where the fall occurred—an area
where the Secretary has alleged the roof support was deficient—and a roof fall
in fact occurred. During that time, the area was examined at least once every
shift by an examiner. The motion provided no facts from which one might infer
that this miner was not exposed to a possible hazard of serious injury from a
roof fall.

A finding of S&S
for a violation of an approved roof control plan is supported by Commission
precedent. See, e.g. , Consol Pa. Coal Co. , 43 FMSHRC 145, 149
(Apr. 2021) (affirming Judge’s determination that roof control plan violation
was S&S); Halfway, Inc. , 8 FMSHRC 8, 12–13 (Jan. 1986) (affirming
S&S for failing to comply with roof control plan when miners could have
worked or traveled in areas with inadequately supported roof). Importantly, I
do not find that the cited violation is or must be held to be S&S. I have
been provided with limited facts, and neither party has waived its right to
contest this issue by providing additional facts or legal authority at hearing.
I am thus not substituting my enforcement judgment for that of the Secretary; I
am merely noting that his conclusion that this violation might not be found to
be S&S is entirely inconsistent with the evidence the Secretary himself has
chosen to provide.

2 .   The
Secretary has provided no facts plausibly supporting the inference that the
violation does not meet any one of the Mathies elements .

Mathies Step 1 requires that the Secretary
establish a violation of a mandatory safety standard. The Respondent’s roof
control plan is the functional equivalent of a mandatory safety standard and
specifies the means of compliance with the ground support requirement for
underground mines: “The roof, face and ribs of areas where persons work or
travel shall be supported or otherwise controlled to protect persons from
hazards related to falls of the roof, face or ribs and coal or rock bursts.” 30
C.F.R. § 75.202(a). A failure to comply with the provisions of a roof control
plan would satisfy Step 1 of the Commission’s S&S analysis. The
Secretary has provided no facts plausibly supporting an inference that
Respondent was in compliance with the allowed variance. [7]

Mathies Step 2 requires a reasonable
likelihood that the violation will cause the occurrence of a discrete safety
hazard against which the standard is directed. The fact that a roof fall
actually occurred here is dispositive as to the second S&S factor, because
unintended roof falls in areas where miners work or travel is the focal point
of Section 75.202(a) and the plan developed to ensure the protection of miners
from such falls. See Jim Walter Resources, Inc., 37 FMSHRC 493,
495–96 (2015) (noting that the Mine Act strictly requires protection of miners
from roof falls in areas where miners work or travel). I find that an event
that has occurred is perforce reasonably likely to have occurred.

Unlike the second
factor, the remaining two S&S factors are not conclusively established. However,
the settlement motion must provide at least a plausible basis for concluding
that a hearing might result in a finding that there was no S&S violation,
either because one of the remaining factors might not be proved or depends on
questionable evidence, or because there may not have been a violation.

Mathies Step 3 requires a reasonable
likelihood that the hazard would cause an injury. It is accepted that roof
falls may cause injury as miners have died from roof falls. See, e.g. , Doe
Run Co. , 42 FMSHRC 521, 521 (Aug. 2020); Jim Walter Res., Inc. , 37
FMSHRC at 493. To support removal of a S&S designation, the facts must
allow the plausible inference that occurrence of the hazard would not cause an
injury. The Secretary has provided that only the examiner travels the area and
that exposure to the hazard would only last for a “split second of time,” but
these facts are insufficient for me to plausibly infer than an injury was
unlikely.

Respondent
acknowledged that an examiner traveled the area for the entire duration the
violative condition existed. The fact that a roof fall did not occur while the
examiner was traveling there does not negate the likelihood of an injury. Nor
does the fact that the examiner was only exposed once per shift. See Consol
Pa. Coal Co. , 43 FMSHRC at 149 (finding it sufficient for Step 3 that the
inspector determined that miners and an examiner would be exposed to the hazard
twice per shift). Additionally, an unplanned roof fall is an “instantaneous
event,” so the Secretary’s mention of only a split-second exposure fails to
negate the likelihood of injury.

Mathies
Step 4 requires a reasonable likelihood that the injury would be of a
reasonably serious nature. An inspector’s conclusion that a possible injury is
of a reasonably serious nature has been held sufficient for Step 4. Consol
Pa. Coal Co. , 43 FMSHRC at 149 (finding it sufficient that the inspector
characterized the potential injury as “serious”). Therefore, to support removal
of a S&S designation, the facts provided to challenge Step 4 must allow the
plausible inference that an injury would not be of a reasonably serious nature.

The
inspector characterized the likely injury as “fatal” at the time of citation
and petitioned for civil penalty on that finding. Roof and rib falls are
subject to an extensive regulatory regime precisely because of the great danger
of serious injury or death posed by unplanned ground movements in underground
mines. No facts contended by the Secretary allow a plausible inference to the
contrary—that the injury from a roof fall might not be of a reasonably serious
nature.

D.    
Application
of the abuse of discretion standard leaves me no choice but to deny the
Secretary’s motion to approve settlement.

Having
made a S&S designation, the Secretary must provide substantial and relevant
evidence as support for its removal. My denial of the Secretary’s motion to
approve settlement was specifically based on a lack of sufficient factual
support available for me to properly consider the settlement under the AmCoal
factors.

The
Secretary must provide me with a plausible basis for the proposed modification
of Citation No. 9198038. The Commission should not condone the removal of a
cited and petitioned designation based on the implausible conclusion that the violation
did not meet the requirements of an S&S designation. The conclusion to
which the Secretary comes—that the proposed modification is justified by the
respondent’s contentions—must be rationally supported by the facts. It is not. The
facts provided by the Secretary do not allow me to plausibly infer that the
violation did not meet the Mathies requirements for a S&S
designation. If anything, they support the existence of a S&S violation.

III.     
Certification

A
settlement would finally resolve this matter without a hearing. I have invited
the parties to submit additional facts that might permit approval, and they are
apparently unable to agree on such facts. Following Hopedale, it would
not be appropriate for me to proceed to a hearing with this legal question unresolved.
Therefore, u nder Commission Procedural Rule 76, 29
C.F.R. § 2700.76, I certify that this interlocutory ruling involves a
controlling question of law— whether the Secretary has unreviewable
discretion to remove an S&S designation from a

contested
citation without the Commission’s approval —and that
immediate review will materially advance the final disposition of the
proceeding.

This
interlocutory ruling is hereby CERTIFIED .

/s/
Michael G. Young

Michael G. Young

Administrative Law Judge

Distribution
(by email):

Alexandra
J. Gilewicz, Esq., Office of the Solicitor, U.S. Dep’t of Labor, 201 12 th
Street South, Suite 401, Arlington, VA 22202 [email protected]

Emily
Toler Scott, Esq., Office of the Solicitor, U.S. Dep’t of Labor, 201 12 th
Street South, Suite 401, Arlington, VA 22202 [email protected]

John
Miklos, Director of Health and Safety, Knight Hawk Coal, LLC, 500 Cutler-Trico
Road, Perry, IL 62272, [email protected]

[1] This is a controlling question of law because there is
no other defect with the settlement. If I am found to be in error, I will
approve on remand the motion as submitted to me. Otherwise, the case will still
be before me subject to further action by the Secretary and Respondent.

[2] I incorporate that order here by reference.

[3] I note that I have not found, and do not find, that
the violation must be affirmed as S&S. Nor have I required the Secretary to
establish that it is not. I merely note that the limited facts the parties have
chosen to provide would preclude a non-S&S finding for this violation.

[4]
Commissioners
Jordan and Traynor dissented, arguing that the parties failed to meet the AmCoal
standards because the motion contained insufficient factual support. See Id.
at 607 (Jordan, Traynor, dissenting).

[5] Though
the Commission found that the facts provided in Hopedale Mining were
substantive and relevant to either gravity or negligence modifications, two
Commissioners thought even these facts were insufficient to support the
modifications. See 42 FMSHRC at 608–09 (Commissioners Jordan and
Traynor, arguing in dissent that settlements must provide substantive
explanations). The dissenting Commissioners asserted that “[t]he Congressional
transparency mandate has always meant that the Judge’s decision must include a
substantive explanation as to how the penalty reduction submitted for approval
is (or is not) warranted by the facts and legal contentions the parties claim
as support for their motion.” Id. (citing Co-Op Mining Co. , 2
FMSHRC 3475, 3475, 3476 (Dec. 1980) (vacating a settlement with finding
of violation where the stipulations demonstrate that a violation did not
actually occur)). My decision is consistent with both the majority and the
dissent in Hopedale and the decision in Co-Op Mining . All
of the opinions rely on the same legal principles requiring settlement
decisions to be consistent with the facts provided, but the dissent in Hopedale
disagreed that the required quantum of substantive evidence had been met.

[6] While this is a
“four factor” analysis, as a practical matter, there is often considerable
overlap between the factors. Thus, a proposed settlement may not be “fair”
because it is insufficiently protective of the public interest, or it may not
be “reasonable” because it is inappropriate to the facts provided in support of
the settlement.

[7]
The facts provided would establish a violation
of the plan. The motion does not provide even a contention by the operator that
the entries did not exceed the plan’s limits or that the additional longer
bolts permitted by the variance had been employed in the areas cited by the
inspector. As noted in the Denial Order, my decision does not prejudice
Respondent’s ability to argue or prove facts contrary to those provided in the
settlement motions.