Secretary of Labor v. ICG Hazard, LLC

Plain-English summary

Two orders involving missing water sprays and inadequate water pressure on continuous miners remained under review. For Order No. 8315597, the ALJ affirmed unwarrantable failure without analyzing all relevant factors, and the Secretary effectively conceded that the record did not prove aggravated conduct. The Commission converted that order to a section 104(a) citation and remanded its penalty for reassessment. For Order No. 8316130, the Secretary had declined to pursue a flagrant designation, but the ALJ imposed the original $138,500 flagrant-level penalty without making flagrant findings. The Commission held that the non-flagrant statutory maximum controlled and imposed a $70,000 penalty.

Decision snapshot

• Cited standards: 30 C.F.R. §§ 75.362(a)(2) and 75.370(a)(1)
• Outcome: Order 8315597 was modified to a section 104(a) citation and remanded for a new penalty; Order 8316130's penalty was reduced from $138,500 to $70,000.
• Key point: Unwarrantable failure requires findings on all relevant aggravated-conduct factors, and a penalty cannot exceed the non-flagrant maximum without proof of a flagrant violation.

Full text (FMSHRC public release)

FEDERAL
MINE SAFETY AND HEALTH REVIEW COMMISSION

1331
PENNSYLVANIA AVENUE, NW, SUITE 520N

WASHINGTON,
DC 20004

SECRETARY OF LABOR,                           
 :                        

MINE SAFETY AND HEALTH                    :                  

ADMINISTRATION (MSHA)                       :       Docket
Nos.  KENT 2009-951       

:                           KENT 2009-952

v.                                  
 :                               KENT 2009-960           

:                             

ICG HAZARD, LLC                                      
 :

BEFORE: Nakamura, Acting
Chairman; Cohen and Althen, Commissioners

DECISION

BY THE COMMISSION:

These matters
arise under the Federal Mine Safety and Health Act of 1977, 30 U.S.C.

§ 801 et seq. (2012) (“the
Act”). Two orders issued to ICG Hazard, LLC, by the Secretary of Labor remain
at issue before the Commission.1
The specific issues for review are: whether the Administrative Law Judge
properly affirmed Order No. 8315597 as a section 104(d)(1) order;2 and whether the Judge
properly assessed a $138,500 civil penalty for Order No. 8316130.

For the reasons
that follow, we modify section 104(d)(1) Order No. 8315597 to a

section 104(a) citation3 and remand the citation
for reassessment of the penalty. We also

vacate the Judge’s penalty
for Order No. 8316130 and impose a civil penalty of $70,000.

I.

Order No. 8315597

A.        Factual
and Procedural Background

Mine Safety and
Health Administration (“MSHA”) Inspector James Daniels issued

Order No. 8315597 after
inspecting the 001 Section Joy Continuous Miner in ICG’s Flint Ridge Mine No 2.
The order alleges that ICG failed to conduct an adequate on-shift dust control
examination, in violation of section 75.362(a)(2),4 by failing to note that the
continuous miner had inadequate water pressure and insufficient sprays. Gov.
Exs. 12, 13. The inspector designated the alleged violation as non-significant
and substantial (“non-S&S”), but attributable to a high degree of
negligence.

Inspector Daniels
also determined that the violation was the result of an unwarrantable failure
to comply with a mandatory standard pursuant to section 104(d) of the Act. Gov.
Ex. 13. Because MSHA had previously issued a section 104(d)(1) citation
to ICG at this mine, he determined that the violation gave rise to a section
104(d)(1) order.5

The Judge
affirmed the order as “non-S&S with a high degree of negligence” based on
the obviousness of the missing sprays and inadequate pressure. Slip op. at 16. The
Judge made

no explicit finding of
unwarrantable failure; however, she ultimately affirmed the violation as a
section 104(d)(1) order by stating “Modifications - None” in her summary of the
penalties, and raised the penalty from $2,000 to $5,000. Id. at 22; Pet.
for Assessment of Penalty, Ex. A.     

ICG contends, and
the Secretary agrees, that the Judge failed to make an unwarrantable failure
finding, and therefore Order No. 8315597 cannot stand as a section 104(d)
order. The parties request that the order be modified to a section 104(a)
citation. ICG Br. at 5; Sec’y Resp. at 2.

B.        Disposition

The Commission
has ruled that the question of whether a violation resulted from an
unwarrantable failure to comply is based on an examination of specific
criteria. Here, the Judge failed to address the relevant criteria, and did not
make an explicit finding of unwarrantable failure for Order No. 8315997.

The Commission has
defined “unwarrantable failure” as “aggravated conduct constituting more than
ordinary negligence.” Manalapan Mining Co., 35 FMSHRC 289, 293 (Feb.
2013) (citing Emery Mining Corp., 9 FMSHRC 1997, 2001 (Dec. 1987)). The
Commission outlined the criteria for determining whether conduct is “aggravated,”
including:

(1) the extent of the
violative condition, (2) the length of time that the violative condition
existed, (3) whether the violation posed a high degree of danger, (4) whether
the violation was obvious,

(5) the operator’s knowledge
of the existence of the violation,

(6) the operator’s efforts in
abating the violative condition, and

(7) whether the operator had
been placed on notice that greater efforts were necessary for compliance. See
IO Coal Co., 31 FMSHRC 1346, 1351-57 (Dec. 2009); Cyprus Emerald Res.
Corp., 20 FMSHRC 790, 813 (Aug. 1998), rev’d on other grounds, 195
F.3d 42 (D.C. Cir. 1999).

Id. Although not all factors may be relevant to every
case, all relevant factors must be examined. Id.; IO Coal, 31
FMSHRC at 1351.

In
this case, the Judge made no finding with respect to unwarrantable failure. The
Judge’s decision with respect to Order No. 8315597 does note the obviousness of
the violation, basing the high negligence finding on the mine’s “fail[ure] to
conduct an adequate on-shift in  the face of such obvious problems.” Slip op.
at 16. The Judge also concludes that the underlying conditions existed for more
than one shift, though this finding is made as evidence of the violation itself
– i.e., that the conditions did not occur after the most recent on-shift
examination – rather than as evidence of aggravated conduct. Id. However,
the decision fails to address the remaining factors, or alternatively, to
explain why they are not relevant.6

We
emphasize that it is the failure to address all the relevant factors, rather
than the mere absence of the phrase “unwarrantable failure,” that compels this
conclusion. A Judge must analyze and weigh relevant testimony, make appropriate
findings, and explain the reasons for her decision. See Mid-Continent Res.,
Inc., 16 FMSHRC 1218, 1222 (June 1994) (citing Anaconda Co.,
3 FMSHRC 299, 299-300 (Feb. 1981)). Here, the appropriate findings are the
relevant unwarrantability factors, irrespective of the inclusion of the words “unwarrantable
failure.”

Generally,
when a Judge has failed to make appropriate findings, remand is appropriate. See,
e.g., Mid-Continent Res., 16 FMSHRC at 1222-23. However, the
burden of proving unwarrantable conduct rests with the Secretary, Peabody
Coal Co., 18 FMSHRC 494, 499

(Apr.
1996), and here, the Secretary has in essence conceded that the record is
insufficient

to
establish unwarrantable failure.7
Accordingly, remand with regard to that element is unnecessary. Order No.
8315597 is modified to a section 104(a) citation, and remanded

for
reconsideration of the penalty consistent with the removal of the unwarrantable
failure designation.  

II.

Order No. 8316130

A.        Factual and Procedural Background

MSHA
Inspector Robert Ashworth issued Order No. 8316130 after inspecting the
continuous miner in the mine’s 002 Section. The order alleges that the
continuous miner had inadequate water pressure and a number of missing sprays,
in violation of section 75.370(a)(1),

which
requires compliance with the approved ventilation and dust control plan.8 Gov. Ex. 16.

The
Secretary initially designated the condition as a flagrant violation and
proposed a $138,500 civil penalty pursuant to section 110(b)(2) of the Act, 30
U.S.C. § 820(b)(2). Prior to the hearing in this matter, the parties filed
joint stipulations in which the Secretary agreed not to pursue the flagrant
designation. Jt. Ex. 1, Jt. Stip. 6. However, the relevant stipulation was not addressed
at the hearing or in the parties’ post-hearing briefs, nor did the Secretary
propose a new reduced penalty for Order No. 8316130 consistent with a
non-flagrant violation.  

The
Judge affirmed the order as S&S and attributable to unwarrantable failure,
with no modifications, and assessed the $138,500 penalty originally proposed by
the Secretary. Slip op. at 17-19, 22. The Judge’s decision makes no mention of
the flagrant designation.

ICG
contends, and the Secretary agrees, that the Judge improperly exceeded the
$70,000 maximum assessable civil penalty for non-flagrant violations provided
by section 110(a)(1) of the Act, 30 U.S.C. § 820(a)(1), because the Secretary
stipulated that he did not intend to pursue the flagrant designation. ICG Br.
at 5-6; Sec’y Resp. at 2. Alternatively, ICG argues that the penalty is
improper because the Judge failed to make a finding regarding a flagrant
violation. ICG Br. at 7.

ICG
requests that the $138,500 civil penalty be vacated and remanded for
reassessment

of
a penalty consistent with the non-flagrant maximum provided in section
110(a)(1). The Secretary contends that a remand is unnecessary, because “[i]nasmuch
as the judge assessed a penalty of $138,500 . . . the judge a fortiori has
already determined that a penalty of $70,000   is appropriate.” Sec’y Resp. at
3 n.1.

B.
       Disposition

Section
110(a)(1) states that the operator of a mine “in which a violation occurs of a
mandatory health or safety standard . . . shall be assessed a civil penalty by
the Secretary which penalty shall not be more than $50,000 [currently $70,000]
for each such violation;” however, pursuant to section 110(b)(2), “[v]iolations
under this section that are deemed to be flagrant may be assessed a civil
penalty of not more than $220,000.” 30 U.S.C. §§ 820(a)(1), (b)(2). The Judge
did not make a flagrant finding with regard to Order No. 8316130. Therefore,
the $138,500 civil penalty assessed by the Judge was improper.

A
violation is deemed to be flagrant if it is “a reckless or repeated failure to
make reasonable efforts to eliminate a known violation of a mandatory health or
safety standard

that
. . . reasonably could have been expected to cause[ ] death or serious bodily
injury.”

30
U.S.C. § 820(b)(2). ICG correctly states that the Judge failed to make findings
with respect to any of the elements unique to a flagrant violation.                    

The
Secretary’s stipulation does not foreclose the possibility of a flagrant
designation.9 Nevertheless,
in this case, the Secretary’s stipulation does resolve the issue as a practical
matter, because the Secretary did not present any evidence at hearing related
to the unique elements of  a flagrant violation, i.e., that the violation was a
reckless or repeated failure to make reasonable efforts to eliminate a known
violation. Therefore, the record compels the conclusion that the Secretary did
not establish a flagrant violation. Accordingly, the Judge erred in assessing a
penalty in excess of the statutory maximum for non-flagrant violations.

The
remaining issue is whether to remand the penalty for reassessment or to reduce
the penalty to $70,000 without a remand. Where the evidence supports only one
conclusion, remand on that issue is unnecessary. See Sedgman, 28 FMSHRC
322, 331 (June 2006); Am. Mine Servs., Inc., 15 FMSHRC 1830, 1834 (Sept.
1993). Here, the imposition of a $138,500 penalty clearly indicates that the
Judge found that the gravity and negligence associated with the violation
(findings which ICG has not challenged) warranted an extremely high penalty.10 ICG has not challenged the
Judge’s assessed penalty in Order No. 8316130 except insofar as it exceeded the
statutory maximum for non-flagrant violations. We agree with the Secretary that
the Judge’s decision supports only the conclusion that the Judge intended to
assess at least $70,000. Therefore, remand is unnecessary; the penalty assessed
for Order No. 8316130 is vacated, and a penalty of $70,000 is imposed.

III.

Conclusion

For
the foregoing reasons, section 104(d) Order No. 8315597 is modified to a

section
104(a) citation, and remanded for reassessment of a civil penalty consistent
with a

non-unwarrantable
failure violation. Additionally, we vacate the $138,500 penalty imposed

by
the Judge for Order No. 8316130 and, consistent with section 110(a)(1) of the
Act, impose

a
penalty of $70,000.  

/s/
Patrick K. Nakamura

Patrick
K. Nakamura, Acting Chairman

/s/
Robert F. Cohen, Jr.

Robert
F. Cohen, Jr., Commissioner

/s/
William I. Althen

William
I. Althen, Commissioner

1 Of
the fifteen citations and orders in the captioned dockets, seven were resolved
through partial settlement, and eight were affirmed by the Judge. Unpub. Dec.,
slip op. at 21-22 (Oct. 2012) (ALJ). ICG sought review of four citations and
orders; the Commission granted review of the two orders discussed herein and
denied review of Citation No. 8315134 and

Order
No. 8315174.

2 In relevant part, section 104(d)(1) establishes
additional sanctions for any violation caused by “an unwarrantable failure of
[an] operator to comply with . . . mandatory health or safety standards.” 30
U.S.C. § 814(d)(1).

3 Section 104(a) generally authorizes the Secretary to
issue citations for violations of “this [Act], or any mandatory health or
safety standard, rule, order, or regulation promulgated pursuant to this [Act].”
30 U.S.C. § 814(a).

4 Section 75.362(a)(2) states in relevant part that “[a]
person designated by the operator shall conduct an examination and record the
results and the corrective actions taken to assure compliance with the
respirable dust control parameters specified in the approved mine ventilation
plan . . . within 1 hour after the shift change,” including an examination of “water
pressures . . . [and] water spray numbers.” 30 C.F.R. § 75.362(a)(2).

5 Section
104(d)(1) establishes a “d-chain” framework in which an initial violation that

is both S&S and an
unwarrantable failure is designated as a section 104(d)(1) citation, and any
subsequent unwarrantable failure violation within the next 90 days, even if not
S&S, necessarily results in the issuance of a section 104(d)(1) withdrawal
order. 30 U.S.C. § 814(d)(1).

Here, the d-chain
predicate was Citation No. 8315134, which was issued 57 days prior to Order No.
8315597, and alleged an S&S violation and an unwarrantable failure to
comply with the mine’s ventilation plan, in violation of section 75.370(a)(1). Gov.
Ex. 19; see n.8, infra.

The
citation was affirmed by the Judge in the decision at issue, and review was
denied. Slip op. at 3-6; see n.1, supra.

6 A number of other unwarrantability factors, as
related to the underlying conditions only, are discussed in the Judge’s
analysis of Citation No. 8315596, which found that the inadequate water
pressure and missing sprays on the 001 continuous miner constituted a failure
to comply with the mine’s dust control plan, in violation of 30 C.F.R. §
75.370(a)(1). Slip op. at 15-16; see n.8, infra. However, as
noted by the Judge, the unwarrantability of an inadequate examination must be
established independently from that of the underlying violative conditions. Id.
at 14; see Consolidation Coal Co., 23 FMSHRC 588, 597 (June 2001)
(finding that the unwarrantability analyses for related violations of 30 C.F.R.
§§ 75.400 and 75.360 may rely on some of the same factual findings, but are not
interchangeable).

7 The
Secretary’s Response Brief states:

[A]
reading of the Judge’s decision confirms that the judge did not make a finding
that the violation alleged in Order No. 8315597 was an unwarrantable failure. See
Dec. at 16. Accordingly, the judge should have modified Order No. 8315597 from
a Section 104(d)(1) order to a Section 104(a) citation.

Sec’y
Resp. at 2.

8 Section 75.370(a)(1) requires the operator to “follow
a ventilation plan approved by the district manager . . . designed to control
methane and respirable dust.” 30 C.F.R. § 75.370(a)(1).

9 Section 110(k) of the Act states that “[n]o proposed
penalty which has been contested before the Commission . . . shall be
compromised, mitigated, or settled except with the approval of the Commission.”
30 U.S.C. § 820(k).

10 The
Judge’s imposition of an extremely high penalty was justified by the MSHA
inspector’s findings of inadequate water pressure and missing sprays on a
continuous miner. Specifically, the inspector found: (1) only 5 psi of water
pressure on the continuous miner instead of the required 60 psi, resulting in
only a small trickle of water from the spray; (2) only 3 sprays instead of the
required 5 sprays on the front cutter head; (3) only 2 sprays instead of the
required 3 sprays on another spray block; (4) only 5 sprays instead of the
required 7 sprays on one of the top spray blocks; and (5) only 5 sprays instead
of the required 8 sprays on the other top spray block. Slip op. at 17; Tr.
116-22. The Judge agreed with the inspector that the violation resulted in
increased dust in the air, and hence the health hazard of greater exposure to
respirable dust leading to the crippling diseases of silicosis and
pneumoconiosis. Slip op. at 18-19. The Judge also found the violation to be
S&S and an unwarrantable failure based on the inspector’s testimony that
the violation was dangerous in exposing two miners to the hazards of silicosis

and
pneumoconiosis, that it was extensive and had existed for some time, that it
was obvious, and that the operator knew or should have known about the serious
violation of its ventilation plan. Id.