Aerospace Manufacturing CT Systems, LLC

Plain-English summary

After a workplace fatality, OSHA issued Aerospace Manufacturing a willful citation and referred the matter to the Department of Justice for possible criminal proceedings. The administrative law judge denied the Secretary's request to stay the Commission case because no indictment had been issued. The Commission reversed, finding that parallel civil discovery could interfere with a criminal investigation and could prompt company personnel to invoke their rights against self-incrimination. It directed the judge to stay the case for a reasonable period and require periodic status reports.

Decision snapshot

• Cited standard(s): None specified in the order.
• Outcome: The orders denying a stay were reversed, and the Commission case was stayed during the criminal review process.
• Key point: A civil OSHA case may be stayed before an indictment when the interests of justice and the risk of discovery interference favor a pause.

Full text (OSHRC public release)

AEROSPACE MANUFACTURING CT SYSTEMS, LLC., Docket No. 11-0315

United States of America

OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION

1120 20th Street, N.W., Ninth Floor

Washington, DC 20036-3457

SECRETARY OF LABOR,

Complainant,

v.

OSHRC Docket No. 11-0315

AEROSPACE MANUFACTURING CT

SYSTEMS, LLC,

Respondent.

ORDER

Before: ROGERS, Chairman; ATTWOOD, Commissioner.

BY THE COMMISSION:

Following a July 6, 2010 fatality at Aerospace Manufacturing CT Systems, LLC
(“Aerospace”), the Occupational Safety and Health Administration conducted an inspection and
issued the company a willful citation under the Occupational Safety and Health Act of 1970, 29
U.S.C. 651-678 (“OSH Act” or “Act”). On May 3, 2011, two months after the Secretary filed a
complaint in this matter, she referred the case to the Department of Justice (“DOJ”) for potential
criminal investigation and proceedings.

On May 31, 2011, the Secretary filed a motion with
Administrative Law Judge Patrick B. Augustine seeking a stay of the Commission’s
proceedings. In her motion, she argued that a stay was necessary to prevent the proceedings
before the Commission from interfering with any potential criminal prosecution and to prevent
the Secretary from being prejudiced in her ability to conduct discovery in the pending
Commission case. Aerospace filed an opposition to the Secretary’s motion, and on June 29,
2011, the judge denied the Secretary’s request for a stay because no indictment had yet been
issued against Aerospace. The Secretary subsequently filed a motion for reconsideration with
the judge on July 18, 2011, which Aerospace opposed as untimely. The judge agreed with
Aerospace and denied the Secretary’s motion for reconsideration on August 1, 2011.

Pursuant to Commission Rule 73, 29 C.F.R. § 2200.73, the Secretary filed a Petition for
Interlocutory Review (“PIR”) of the judge’s orders on August 9, 2011.

We granted the
Secretary’s petition on September 6, 2011. For the following reasons, we reverse the judge’s
June 29 and August 1, 2011 orders denying the Secretary’s motions, and direct the judge to issue
an order staying the proceedings subject to the provisions of Commission Rule 63(c), 29 C.F.R.
§ 2200.63(c), which requires that the parties submit periodic status reports as directed.

Discussion

Under Commission precedent, civil proceedings may be stayed pending the outcome of
parallel criminal proceedings “to permit disposition of cases ‘with economy of time and effort
for [the court], for counsel and for litigants.’ ” C & S Erectors Inc. , 18 BNA OSHC 1052, 1053,
1995-97 CCH OSHD ¶ 31,408, p. 44,388 (No. 96-1525, 1997) (alteration in original) (quoting
Landis v. N. Am. Co. , 299 U.S. 248, 254-55 (1936); Pitt-Des Moines, Inc. , 17 BNA OSHC 1936,
1938, 1995-97 CCH OSHD ¶ 31,273, p. 43,939 (No. 94-1355, 1997)). Although indeterminate
stays are strongly disfavored, the Commission “ ‘ha[s] deferred civil proceedings pending the
completion of parallel criminal prosecutions when the interests of justice seemed to require such
action, sometimes at the request of the prosecution, . . . sometimes at the request of the
defense . . . .’ ” C & S Erectors , 18 BNA OSHC at 1053, 1995-97 CCH OSHD at p. 44,389
(quoting United States v. Kordel , 397 U.S. 1, 12 n.27 (1970)).

In denying the Secretary’s request for a stay here, the judge primarily focused on one
point—the fact that a criminal indictment had not yet been issued against Aerospace—and
agreed with Aerospace that the Secretary’s motion was therefore premature. However, under
Commission precedent, in determining whether to grant a stay, a judge must balance competing
interests and consider whether the interests of justice require the stay. C & S Erectors , 18 BNA
OSHC at 1053, 1995-97 CCH OSHD at pp. 44,388-89 (citing Kordel , 397 U.S. at 12 n.27;
Landis , 299 U.S. at 254-55; Sec. & Exch. Comm’n v. Dresser Indus. , 628 F.2d 1368, 1375 (D.C.
Cir. 1980)). Accordingly, we agree with the Secretary that the judge failed to consider her
request under the proper legal framework.

The Secretary argues that absent a stay of the Commission’s proceedings, effective
prosecution of the criminal case would be compromised because Aerospace could circumvent
the restrictive discovery rules that apply to criminal matters by taking advantage of the broad
discovery opportunities available in the civil case. In addition, the Secretary claims that her
ability to prosecute the case before the Commission would be impaired because Aerospace
managers may exercise their right to invoke the Fifth Amendment to withhold potentially
incriminating documents and information. The Commission has specifically recognized the
potential for abuse that can arise from the difference between civil and criminal discovery rules
as “a significant and legitimate factor weighing heavily in favor of a stay.” C & S Erectors , 18
BNA OSHC at 1053, 1995-97 CCH OSHD at p. 44,389; Pitt-Des Moines , 17 BNA OSHC at
1938-39, 1995-97 CCH OSHD at p. 43,940. Thus, a stay “furthers the public interest in ensuring
effective enforcement of [both] the civil and criminal provisions of the Act, and achieves
efficient use of government resources by precluding relitigation of issues resolved in the criminal
proceeding.” Pitt-Des Moines , 17 BNA OSHC at 1939, 1995-97 CCH OSHD at pp. 43,940-41.
These principles apply equally here, even at the earliest stages of investigation following a
criminal referral, because the potential for discovery abuse could compromise any subsequent
criminal prosecution. And we agree that there is also the potential at this point for Aerospace
personnel to invoke constitutional protections against self-incrimination because a decision to
develop a criminal case is under active consideration.

Aerospace claims that the Secretary’s referral to DOJ is merely a delaying tactic to
unnecessarily postpone the government’s obligation to provide already overdue documents and
to prevent Aerospace from preparing its case. Aerospace supports this claim by noting the
timing of the Secretary’s criminal referral, which occurred after she commenced the civil
proceeding before the Commission. But Aerospace admits that the Secretary informed the
company of her intent to refer this case on January 7, 2011, several months before filing the civil
complaint.

Furthermore, Aerospace has not shown that it would be prejudiced by a delay in
receiving the referenced documents, as it may request any additional time needed for review
once the stay is lifted. See Pitt-Des Moines , 17 BNA OSHC at 1939, 1995-97 CCH OSHD at
pp. 43,940-41 (rejecting claim of prejudice from discovery delay where respondent “cited no
particular witness whose continued availability is uncertain or other specific forms of prejudice
except for that which is incident to faded memories”). Aerospace also contends that it would be
unfairly prejudiced by a stay because it is unable to obtain the advice of state government safety
and compliance experts regarding safety issues at its facility while the case is pending before the
Commission. However, such officials are not Aerospace’s only source of such expertise—we
fail to see how a stay prevents Aerospace from hiring private consultants.

Accordingly, we conclude that a stay is appropriate to accommodate the completion of
the criminal review process and, if initiated, any subsequent criminal proceedings. Thus, we
reverse the judge’s orders denying a stay and direct him to issue a stay of the proceedings for a
reasonable period of time.

We also direct the judge to order the parties to file periodic status
reports in accordance with the provisions of Commission Rule 63(c), 29 C.F.R. § 2200.63(c).

SO ORDERED.

_/s/_______

Thomasina V. Rogers

Chairman

_/s/_______

Cynthia L. Attwood

Dated:   September 22, 2011                             Commissioner

SECRETARY OF LABOR,  

Complainant,

v.  

AEROSPACE MANUFACTURING CT
SYSTEMS, LLC.,

Respondent.  

OSHRC DOCKET

NO.:      11-0315

ORDER

This matter is before the court on the Complainant’s Motion for Stay (“Stay”) of
Proceedings (“Motion”). The court has reviewed the Complainant’s Memorandum in Support of
Motion for Stay of Civil Proceedings and Respondent’s Response Memorandum in Opposition to
Complainant’s Motion for Stay of Civil Proceedings.

The Complainant requests a Stay of these proceedings for two reasons: (1) the
Complainant has made a referral to the U.S. Attorney for the District of Kansas for consideration of
criminal proceedings; and (2) the U.S. Attorney would be prejudiced if this action would be allowed
to proceed while considering whether or not to pursue criminal proceedings.

The case for staying civil proceedings is a “far weaker one” when no indictment has been
returned. Securities and Exchange Comm’n v. Dresser Indus., 628 F.2d 1368, 1375 (D.C. Cir) cert.
denied, 449 U.S. 993, 101 S.Ct. 529, 66 L.Ed.2d 289 (1980); Federal Savings and Loan Insurance
Corporation v Molinaro, 889 F.2d 899 (9 th Cir. 1989). In general, federal courts do not grant stays of
parallel civil proceedings unless there is an indictment of the Respondent/Defendant. See Securities
and Exchange Commission v. Brown, 2007 WL 4191998 (D.Minn); In re Par Pharm Inc. Sec. Litig.,
133 F.R.D. 12, 13-14 (S.D.N.Y 1990) noting the 2 nd Circuit will deny a stay of civil proceedings
where no indictment has been issued. See StateFarm Mut. Auto Ins. Co. v. Bechkam-Easley, 2002
WL 31111766 (E.D.Pa); United States v. Private Sanitation Inds. Ass’n of Nassau/Suffolk, 811
F.Supp . 802, 805 (E.D.N.Y. 1992)

In this case the only event that has occurred is the Complainant referring this matter to the
U.S. Attorney for the District of Kansas for possible criminal proceedings, (emphasis added). The
Solicitor’s Office represents the interests of the memorandum, argues that the U.S. Attorney will be
prejudiced, but has no standing to advance whatever the position of the U.S. Attorney is. The
Complainant’s Motion is devoid of any reference to discussing this matter with the U.S. Attorney’s
office or the fact that the “real party” in interest as it relates to the stay is the U.S. Attorney – not the
Complainant. If the U.S. Attorney’s office takes the position that it would be prejudiced in its
investigation, then the U.S. Attorney has the procedure available to protect its interest by filing a
Petition for Leave to Intervene ( “Petition”). See Fed.R.Civ.P. 24 and Commission Rule 21.

The Motion is DENIED . These proceedings will be held in abeyance for twenty (20) days in
order for the U.S. Attorney for the District of Kansas to decide to file a Petition . If not filed within
that date, the court will proceed to schedule a Pretrial Conference with the Parties.

/s/ Patrick B. Augustine

Patrick B. Augustine

Judge, OSHRC

Dated: June 29, 2011