Secretary of Labor obo Alvaro Saldivar v. Grimes Rock, Inc.

Plain-English summary

On remand, the judge considered whether miner Alvaro Saldivar could recover consequential damages tied to delayed temporary-reinstatement payments. He held that such damages are available only after a proven section 105(c) discrimination violation, while the unappealed merits decision had found no discrimination. He also explained that Saldivar's periods of incarceration would make causation and calculation difficult and noted that the damages request had not been raised before the original judge. The motion for consequential damages was denied. The Commission later vacated its direction for review and dismissed the operator's appeal.

Decision snapshot

• Cited authority: 30 U.S.C. § 815(c)(2)
• Outcome: The Secretary's motion for consequential damages was denied.
• Subsequent review: The Commission vacated review and dismissed the appeal in west-2021-0178-commission.
• Key point: Temporary reinstatement alone did not support consequential damages when the merits case ended without a discrimination finding.

Full text (FMSHRC public release)

FEDERAL MINE SAFETY AND HEALTH
REVIEW COMMISSION

Office of the Chief Administrative
Law Judge

721 19th Street, Suite
443

Denver, CO 80202-2536

Email: [email protected]

SECRETARY
OF LABOR

MINE
SAFETY AND HEALTH       

ADMINISTRATION,
(MSHA), on

behalf
of ALVARO SALDIVAR,

Complainant

v.

GRIMES
ROCK, INC.,

Respondent

APPLICATION
FOR TEMPORARY

REINSTATEMENT

Docket
No. WEST 2021-0178-DM

MSHA
Case No: WE MD 21-06

Grimes
Rock, Inc.

Mine
ID: 04-05432

ORDER DENYING MOTION FOR
CONSEQUENTIAL DAMAGES

On
November 28, 2023, the Commission issued a decision in this case affirming in
part and reversing in part orders issued by former Commission Judge Margaret
Miller and remanding other matters for further determination. 45 FMSHRC 947
(Nov. 2023). [1]

Following
Grimes Rock’s unsuccessful appeal to the Ninth Circuit Court of Appeals, the
Commission, by order dated July 23, 2024, confirmed that I retain jurisdiction
over this matter and can proceed on remand pursuant to the Commission’s
instructions in the November 28, 2023 decision. The Commission’s instructions
on remand require a “recalculation of the temporary reinstatement amount owed
between the date the Judge issued the order of enforcement and the date her
merits decision became final” and “a determination of any remaining temporary
reinstatement payments and interest owed as well as a determination on whether consequential
damages are appropriate.” 45 FMSHRC at 961.

On
August 5, 2024, I ordered the parties to file briefs by September 10, 2024 on
the remanded issues and to suggest possible resolution of those issues. At the
time I issued that order, I had not yet carefully studied the Secretary’s
motion for consequential damages filed on August 25, 2022 or Grimes Rock’s
opposition to the motion filed on September 7, 2022. [2]
However, having since had an opportunity to review the motion and opposition, I
find that the filings are comprehensive and provide all that is needed for me
to rule on the motion. Accordingly, I conclude that the issue of consequential
damages has been fully briefed by the

parties
and that further briefing on the subject is unnecessary and will not be helpful.
For the reasons set forth below, the Secretary’s motion for consequential
damages is DENIED .

SUMMARY OF THE
PARTIES’ ARGUMENTS

The Secretary, in her motion, asserts that
the complainant, Alvaro Saldivar, incurred certain consequential damages
because Grimes Rock failed to timely pay temporary economic reinstatement
amounts due under orders issued by former Commission Judge Miller. Sec’y Mot.

1. She argues that, in addition to miners who suffer discrimination, miners awarded
   temporary reinstatement are entitled to “make-whole” remedies, such as
   consequential damages, even when there is no finding of discrimination in the
   related case on the merits. Sec’y Mot. 6-7. In making this argument, the
   Secretary relies on the legislative history of the Mine Act (the “Act”) and
   Congress’s statement that temporary reinstatement is an “‘essential protection
   for complaining miners who may not be in a position to suffer even a short
   period of unemployment or reduced income pending the resolution’” of their
   complaint. Sec’y Mot. 7 (citing S. Rep. No. 95-181, at 37).

Grimes
Rock, in its opposition, argues that because the issue of consequential damages
was not raised before Judge Miller, the Secretary waived and/or forfeited any
right to consequential damages and, as a result, the Commission does not have
authority to consider the request for consequential damages. Grimes Opp’n 7-10.
In addition, Grimes Rock argues that, because Saldivar failed to mitigate any
alleged damages, Grimes Rock is not obligated to pay consequential damages.
Grimes Opp’n 11. Specifically, Grimes Rock asserts that Saldivar failed to
mitigate his damages by (1) deliberately choosing to not seek modification of
the order approving temporary economic reinstatement so as to avoid Judge
Miller questioning his credibility due to his incarcerations, which would have
adversely affected his discrimination case, and (2) not making reasonable
efforts to find employment after being discharged from his other job. [3]
Grimes Opp’n 12-14. Finally, Grimes Rock argues that nothing in the Act’s
legislative history supports an absolute right to economic reinstatement,
especially when a miner is unavailable to work due to his own choices. Grimes
Opp’n 15-16. Here, Grimes Rock paid Saldivar exactly what was owed under the
settlement agreement, and it was Saldivar, through his own misconduct, who
created the financial woes for which he now seeks damages. Grimes Opp’n 16-17.

ANALYSIS

The Act grants the
Commission authority “to require a person committing a violation of . .
. [Section 105(c)(2)] to take such affirmative action to abate the violation
as the Commission deems appropriate, including, but not limited to, the
rehiring or reinstatement of the miner to his former position with back pay and
interest.” 30 U.S.C. § 815(c)(2) (emphasis added). In Sec’y of Labor on
behalf of Dunmire v. Northern Coal Co. , 4 FMSHRC 126 (Feb. 1982) the
Commission explained that “this broad remedial charge was designed not only to
deter illegal retaliation but also to restore the employee, as nearly as
possible, to the situation he would have occupied but for the discrimination .”
(citing Sec’y of Labor on behalf of Gooslin v. Kentucky Carbon Corp. , 4
FMSHRC 1 (Jan. 1982) (emphasis added)). Pursuant to this history, the
Commission and its judges have awarded relief in the form consequential damages
to miners for losses stemming from unlawful discrimination. E.g. , Amos
Hicks v. Cobra Mining , 14 FMSHRC 50 (Jan. 1992) (remanding case to judge
for recalculation of consequential damages related to repossession of a truck
the miner could not make payments on after he was discriminatorily discharged)
and Sec’y of Labor on behalf of Groves v. Con-ag, Inc. , 39 FMSHRC 1811
(Sept. 2017) (ALJ) (awarding damages for late fees on car payment incurred due
to loss of income stemming from discriminatory discharge).

Notably, but not
surprisingly, consequential damages have only been awarded in Commission
proceedings following an affirmative finding of discrimination in the
underlying merits case. Requiring a finding of discrimination in order to award
consequential damages is in harmony with both the language of the Act, which
requires a “violation” of 105(c)(2), i.e., a finding of discrimination, as well
as the legislative history, which states that “[i]t is the Committee’s
intention that the Secretary propose, and that the Commission require, all
relief that is necessary to make the complaining party whole and to remove the
deleterious effects of the discriminatory conduct including, but not
limited to reinstatement with full seniority rights, back-pay with interest,
and recompense for any special damages sustained as a result of the
discrimination. ” S. Rep. No. 95-181, at 37 (1977), reprinted in
Senate Subcomm. on Labor, Comm. on Human Res., Legislative History of the
Federal Mine Safety and Health Act of 1977 , at 625 (1978) (emphasis added).

Although the
Commission possess broad remedial authority following a finding of
discrimination in a merits proceeding, the Act does not grant the Commission
the same range of remedies in a temporary reinstatement proceeding. Rather, in
the context of temporary reinstatement, the Act provides only for “the
immediate reinstatement of the miner pending final order on the complaint.” 30
U.S.C. § 815(c)(2); See Sec’y of Labor on behalf of Garcia v. Veris Gold
U.S.A., Inc. , 36 FMSHRC 2365 (Aug. 2014) (ALJ). [4] A review of Commission case
law reveals no instance in which consequential damages have been awarded in a
temporary reinstatement proceeding absent a finding of discrimination in a
related merits case. [5]
In light of this analysis, I hold that, as a general matter, consequential
damages are only available where a violation of Section 105(c) is proven in the
merits case.

I find that the
Act does not authorize an award of consequential damages in this case. On June
17, 2022, Judge Miller issued her decision in the merits case finding that the
Secretary had “failed to prove a violation of section 105(c) of the Mine Act.” Sec’y
of Labor on behalf of Saldivar v. Grimes Rock Inc. , 44 FMSHRC 473 (June
2022) (ALJ). Although the parties appealed the temporary reinstatement case to
the Commission, Judge Miller’s decision on the merits was not appealed by
either party and, accordingly, became a final decision of the Commission 40
days after its issuance. Sec’y of Labor on behalf of Hargis v. Vulcan
Constr. Materials, LLC , 46 FMSHRC __, No. SE 2021-0163 et al. (Aug. 29,
2024). Consequently, because there was no violation of Section 105(c), and
given my holding that consequential damages are only available where a
violation of Section 105(c) is proven in the merits proceeding, I find that an
award of consequential damages in this temporary reinstatement proceeding is
not appropriate.

Even if an award of consequential damages
were appropriate, it would be virtually impossible to calculate here. The Secretary’s
principal argument in her motion is that Saldivar “incurred consequential
damages” because he did not receive temporary economic payments in a timely
manner. [6] Sec’y Mot. 4.
The Secretary agrees that she must prove that the requested consequential
damages were caused by Grimes Rock’s “wrongdoing.” Sec’y Mot. 7. However,
Saldivar was incarcerated approximately 32% of time between the date Judge
Miller issued the order approving temporary economic reinstatement and when she
ultimately terminated his reinstatement, albeit prematurely, in her decision
dismissing the merits case on June 17, 2022. [7]
Temporary economic reinstatement payments were tolled during periods of Saldivar’s
incarceration. As a result, Saldivar’s loss of income during those periods of
tolling was a result of his own actions rather than any wrongdoing by Grimes
Rock. It would be nearly impossible to determine whether the consequential
damages that the Secretary is seeking were the result of the wrongdoing of
Grimes Rock, the actions of Saldivar, or a combination of both. Nevertheless,
the primary reason for my denial of consequential damages is as set forth above.

Finally,
Grimes Rock makes an important point concerning the Secretary’s failure to
raise the issue of potential consequential damages before Judge Miller. It
argues that the Secretary and Saldivar waived, and therefore forfeited, any
claimed right to consequential damages because the Secretary failed to
establish good cause for not raising the consequential damages issue before
Judge Miller. Grimes Opp’n 9-10. The Commission’s procedural rules make clear
that “[e]xcept for good cause shown, no assignment of error by any party shall
rely on any question of fact or law upon which the Judge had not been afforded
an opportunity to pass.” 30 C.F.R. § 2700.70(d). Even if consequential damages
were available, I might well find that the Secretary, by waiting more than two
months after Judge Miller issued her decision dismissing the discrimination
case to file the motion for consequential damages, waived any right Saldivar
may have had to such damages, and that the cursory reason offered for the delay,
i.e., “mostly because Grimes stopped paying near the end of the ligation before”
Judge Miller, Sec’y Mot. 8, does not establish good cause. Nevertheless, the Commission
in its November 28, 2023 decision ordered me to determine whether
“consequential damages are appropriate.” 45 FMSHRC at 961. [8]

ORDER

For
the reasons set forth above, the Secretary’s motion for consequential damages
is DENIED .

/s/
Richard W. Manning

Richard W. Manning

Administrative Law
Judge

Distribution:
(Via email and First Class Mail)

Ryan
M. Kooi, Esq. U.S. Department of Labor, Office of the Solicitor, U.S.
Department of Labor, Mine Safety and Health Division, 201 12th Street South,
Suite 401, Arlington, VA 22202-5452 ( [email protected] )

Kenneth
H. Moss, Esq., Mark R. Pachowicz, Esq., and Tina Amoke, Pachowicz &
Goldenring PLC, 6050 Seahawk Street, Ventura, CA 93003 ( [email protected] ; [email protected] ; [email protected] )

Alvaro
Saldivar, 2531 Taffrail Ln., Oxnard, CA 93035 ( [email protected] )

RWM

[1] The Commission
affirmed the Judge’s January 7, 2022 order denying the operator’s motion to
toll temporary reinstatement and her June 17, 2022 order enforcing temporary
reinstatement.

[2] The Secretary’s
motion also asked for interest on the amount not timely paid by Grimes Rock to
Saldivar. Grimes Rock opposed the motion for the payment of interest. However,
in its November 28, 2023 decision, the Commission resolved the issue of whether
interest is due and remanded to me the responsibility to calculate the amount
of the interest owed. That issue remains before me and is not addressed in this
order.

[3] Given my analysis
and findings below, I do not reach the question of mitigation of damages.
However, it is worth noting that, in the context of temporary economic
reinstatement, such as is the case here “there is no right for the operator to
seek reimbursement from the miner should the miner not eventually prevail on
his or her discrimination claim.” North Fork Coal Corp ., 33 FMSHRC 589,
593 (Mar. 2011). In response to my August 15, 2024 order to provide
information, the Secretary confirmed that Grimes Rock’s payment of $12,533.94
satisfied its temporary economic reinstatement payment obligations through June
17, 2022, excluding interest and possible consequential damages. Given my
findings and conclusions, only the issue of interest remains for the period up
to and including June 17, 2022. Accordingly, Grimes Rock’s arguments regarding mitigation
of damages need not be addressed.

[4] In Garcia ,
Judge Simonton noted the “differing scopes of relief provided for within
Section 105(c)(2)” and found that, although an “expansive range of remedies” is
available in a discrimination case on the merits upon a finding of unlawful
discrimination, temporary reinstatement itself is the “sole remedy directly
provided for by the Mine Act” in a temporary reinstatement proceeding. 36 FMSHRC
at 2368. I agree with Judge Simonton’s reasoning.

[5] In its November
28, 2023 decision in this matter the Commission stated that “[i]f a miner
prevails on the merits of the [discrimination] complaint, and the Judge finds
that the operator violated the Mine Act, only then does the Judge consider remedies
for the violation.” 45 FMSHRC at 953.

[6] In her motion,
the Secretary seeks consequential damages for the following items: Interest on
late and missing child support payments, late rent fees, repossession of his
vehicle, suspension of cell phone service, rental insurance suspension, and car
insurance cancellation. Sec’y Mot. 4.

[7] This percentage
was calculated by counting the days that Saldivar was entitled to temporary economic
reinstatement and the days that he was incarcerated and then calculating the
percentage of the time that he was incarcerated. Consistent with the
Commission’s November 23, 2023 decision in this matter, I recognize that Grimes
Rock may be required to pay additional temporary economic reinstatement, as
well as interest on those payments, for the time period after Judge Miller
issued her decision on the merits, but before that decision became final.

[8] I note that
former Commissioner Althen, in his dissent in the Commission’s November 28,
2023 decision, agreed with the argument presented by Grimes Rock. 45 FMSHRC at
977-79. However, I am bound by the Commission’s majority decision on this issue
and it was remanded to me for resolution. As a consequence, I find that I have
jurisdiction to make the findings included in this order.