Sidney Coal Company (Commission decision, May 28, 2009)

Plain-English summary

Sidney Coal previously contested several orders and said its safety director later faxed the proposed penalty assessment to counsel. Counsel had no record of receiving it, and the company blamed an undetected mechanical failure for the missed penalty contest. The Secretary did not oppose relief, but the record was unclear about the company's backup procedures and whether it intended to contest four or six penalties. The Commission remanded for the Chief ALJ to resolve those questions and determine whether good cause supported reopening.

Decision snapshot

• Governing provisions: 29 C.F.R. § 2700.1(b) and 30 U.S.C. § 815(a)
• Outcome: The matter was remanded for a good-cause determination on reopening.
• Key point: A claimed fax failure requires evidence about transmission safeguards and the exact scope of the intended contest.

Full text (FMSHRC public release)

Federal Mine Safety and Health Review Commission

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

601 NEW JERSEY AVENUE, NW

SUITE 9500

WASHINGTON, DC 20001

May 28, 2009

SECRETARY OF LABOR,

MINE SAFETY AND HEALTH

ADMINISTRATION (MSHA)

v.

SIDNEY COAL COMPANY

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Docket No. KENT 2008-862

A.C. No. 15-09724-135356

BEFORE: Duffy, Chairman; Jordan, Young, and Cohen, Commissioners

ORDER

BY THE COMMISSION:

This matter arises under the Federal Mine Safety and Health Act of 1977, 30 U.S.C.
§ 801 et seq. (2006) (“Mine Act”). On April 17, 2008, the Commission received from Sidney Coal Company (“Sidney Coal”) a motion made by counsel 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).

On January 8, 2008, the Department of Labor’s Mine Safety and Health Administration (“MSHA”) issued Proposed Assessment No. 000135356 to Sidney Coal, proposing penalties for eleven citations and orders that had been issued to the company in September and December 2007. According to Sidney Coal, it contested four of the violations in a notice of contest docketed as Nos. KENT 2008-52 through KENT 2008-55, which have been stayed pending the assessment of a proposed penalty. Sidney Coal asserts that the company’s safety director faxed the proposed assessment to its attorneys but that they have no record of having received the document. It explains that due to an undetected mechanical failure beyond its control, the proposed assessment was not contested. Sidney Coal states that it always intended to contest the proposed assessments associated with the four orders it previously contested and requests the Commission to grant its request to reopen the proposed assessment.

The Secretary states that she does not oppose Sidney Coal’s request to reopen the proposed penalty assessment.

We have held 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 section 105(a) orders, the Commission has found guidance in Rule 60(b) of the Federal Rules of Civil Procedure under which, for example, a party could be entitled to relief from a final order of the Commission on the basis of inadvertence or mistake. 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”); JWR, 15 FMSHRC at 787. 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 permitted. See Coal Prep. Servs., Inc., 17 FMSHRC 1529, 1530 (Sept. 1995).

Having reviewed Sidney Coal’s motion, in the interests of justice, we remand this matter to the Chief Administrative Law Judge for a determination of whether good cause exists for Sidney Coal’s failure to timely contest the penalty proposal and whether relief from the final order should be granted. We also direct the judge to determine what, if any, backup system Sidney Coal and its counsel had in case of a mechanical or other failure in faxing a document

and whether the operator intended to contest four or six proposed penalties. If it is determined that relief from the final order is appropriate, this case shall proceed pursuant to the Mine Act and the Commission’s Procedural Rules, 29 C.F.R. Part 2700.

Michael F. Duffy, Chairman

Mary Lu Jordan, Commissioner

Michael G. Young, Commissioner

Robert F. Cohen, Jr., Commissioner

Distribution:

Sarah Ghiz Korwan, Esq.

Dinsmore & Shohl, LLP

P. O. Box 11887

900 Lee Street, Suite 600

Charleston, WV 25339

W. Christian Schumann, Esq.

Office of the Solicitor

U.S. Department of Labor

1100 Wilson Blvd., Room 2220

Arlington, VA 22209-2296

Myra James, Chief

Office of Civil Penalty Compliance

MSHA

U.S. Dept. Of Labor

1100 Wilson Blvd., 25th Floor

Arlington, VA 22209-3939

Chief Administrative Law Judge Robert J. Lesnick

Federal Mine Safety & Health Review Commission

601 New Jersey Avenue, N.W., Suite 9500

Washington, D.C. 20001-2021