Fools Gold Energy Corporation (Commission decision, April 3, 2013)

Plain-English summary

Fools Gold Energy defaulted after failing to answer a penalty petition and show-cause order. The company said it contacted MSHA's litigation representative, while the Secretary reported several unreturned calls and an undeliverable delinquency notice. The Commission noted that the petition, order, and notice all went to the operator's current address of record and reminded Fools Gold that it was responsible for reporting address changes. In the interest of justice, the Commission nevertheless vacated the default and remanded the case.

Decision snapshot

• Governing authority: 30 U.S.C. § 823(d); 29 C.F.R. §§ 2700.1(b), 2700.69(b), and 2700.70(a)
• Outcome: The default order was vacated and the penalty proceeding was remanded.
• Key point: Reopening was granted despite communication failures, but the operator remained responsible for maintaining an accurate address of record.

Full text (FMSHRC public release)

Federal Mine Safety and Health Review Commission

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

1331 PENNSYLVANIA AVENUE, NW, SUITE 520N

WASHINGTON, D.C. 20004-1710

April 3, 2013

SECRETARY OF LABOR, 

MINE SAFETY AND HEALTH 

ADMINISTRATION (MSHA) 

v.

FOOLS GOLD ENERGY CORPORATION

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Docket No. KENT 2011-738

A.C. No. 15-19129-245843

BEFORE: Jordan, Chairman; Young and Nakamura, 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 March 13, 2012, the Commission received from Fools Gold Energy Corporation (“Fools Gold”) a motion seeking to reopen a penalty assessment proceeding and relieve it from the default order entered against it.

On June 28, 2011, Chief Administrative Law Judge Lesnick issued an Order to Show Cause which by its terms became a Default Order if the operator did not file an answer within 30 days. This Order to Show Cause was issued in response to Fools Gold’s failure to answer the Secretary’s April 29, 2011 Petition for Assessment of Civil Penalty. The Commission did not receive Fools Gold’s answer within 30 days, so the default order became effective on July 29, 2011.

Fools Gold asserts that it contacted the Conference Litigation Representative (“CLR”) soon after the petition was filed, but has not heard back from the CLR since. The Secretary does not oppose the request to reopen, but notes that the CLR placed several unreturned calls to Fools Gold on May 9 through May 23, 2011. The record shows that the Show Cause Order was delivered on June 30, 2011. The Secretary further notes that MSHA mailed a delinquency notice to Fools Gold’s address of record on January 5, 2012, which was returned undelivered. MSHA then forwarded this delinquency to the U.S. Department of Treasury for collection on February 20, 2012.

The judge’s jurisdiction in this matter terminated when the default occurred. 29 C.F.R.
§ 2700.69(b). Under the Mine Act and the Commission’s procedural rules, relief from a judge’s decision may be sought by filing a petition for discretionary review within 30 days of its issuance. 30 U.S.C. § 823(d)(2)(A)(i); 29 C.F.R. § 2700.70(a). If the Commission does not direct review within 40 days of a decision’s issuance, it becomes a final decision of the Commission. 30 U.S.C. § 823(d)(1). Consequently, the judge’s order here has become a final decision of the Commission.

In evaluating requests to reopen final 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 mistake, inadvertence, or excusable neglect. 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”); Jim Walter Res., Inc., 15 FMSHRC 782, 786-89 (May 1993) (“JWR”). 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).

We note that the petition, delinquency notice, and Show Cause Order were mailed to the same address, which still appears to be Fools Gold’s current address of record. It is the operator’s responsibility to notify MSHA of any change to its address.

Having reviewed Fools Gold’s request and the Secretary’s response, in the interest of justice, we hereby reopen the proceeding and vacate the Default Order. Accordingly, this case is remanded to the Chief Administrative Law Judge for further proceedings pursuant to the Mine Act and the Commission’s Procedural Rules, 29 C.F.R. Part 2700.

/s/ Mary Lu Jordan

Mary Lu Jordan, Chairman

/s/Michael G. Young

Michael G. Young, Commissioner

/s/ Patrick K. Nakamura

Patrick K. Nakamura, Commissioner

Distribution:

Fools Gold Energy Corporation

Gerald W. McMasters, Consultant

630 Washington Avenue

Paintsville, KY 41240

[email protected]

W. Christian Schumann, Esq.

Office of the Solicitor

U.S. Department of Labor

1100 Wilson Blvd., Room 2220

Arlington, VA 22209-2296

Melanie Garris

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

1331 Pennsylvania Avenue, N. W., Suite 520N

Washington, D.C. 20004-1710