Secretary of Labor v. KenAmerican Resources, Inc.

Plain-English summary

KenAmerican Resources failed to contest a proposed penalty assessment within 30 days, causing it to become a final Commission order. The employee who normally handled MSHA contests was out of the office for a serious medical issue, and an inexperienced substitute sent the contest to MSHA's payment center instead of the Civil Penalty Compliance Office. The Secretary did not oppose reopening but urged the operator to prevent future late filings. The Commission reopened the assessment in the interest of justice and remanded the matter for penalty proceedings. It directed the Secretary to file a penalty petition within 45 days.

Decision snapshot

• Cited authority: 30 U.S.C. § 815(a); 29 C.F.R. §§ 2700.1(b), 2700.28
• Outcome: The final penalty assessment was reopened and remanded to the Chief Administrative Law Judge.
• Key point: A temporary staffing disruption and an inexperienced employee's prompt but misdirected contest supported relief from the final assessment.

Full text (FMSHRC public release)

FEDERAL MINE
SAFETY AND HEALTH REVIEW COMMISSION

1331
PENNSYLVANIA AVE., N.W., SUITE 520N

WASHINGTON,
DC 20004-1710

SECRETARY
OF LABOR,

MINE
SAFETY AND HEALTH   

ADMINISTRATION
(MSHA)        

v.

KENAMERICAN
RESOURCES, INC.

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Docket
No. KENT 2015-549

A.C.
No. 15-17741-380586

BEFORE:  Jordan,
Chairman; Young and Cohen, Commissioners[1]

ORDER

BY THE
COMMISSION:

This
matter arises under the Federal Mine Safety and Health Act of 1977, 30 U.S.C.   
§ 801 et seq. (2012) (“Mine Act”). On July 3, 2015, the Commission received
from KenAmerican Resources, Inc. (“KenAmerican”) a motion seeking 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).

We
have held, however, 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 orders, the Commission has found guidance
in Rule 60(b) of the Federal Rules of Civil Procedure, under which the
Commission may relieve a party from a final order of the Commission on the
basis of mistake, inadvertence, excusable neglect, or other reason justifying
relief. 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).

Records
of the Department of Labor’s Mine Safety and Health Administration (“MSHA”)
indicate that the proposed assessment was delivered on May 11, 2015, and became
a final order of the Commission on June 10, 2015. KenAmerican asserts that the
person who normally handles its MSHA contests was out of the office for a
serious medical issue in May of 2015, and an employee who was unfamiliar with
the proper contest procedure sent the contest to MSHA’s payment center in St.
Louis, Missouri, instead of the Civil Penalty Compliance Office in Arlington,
Virginia. The Secretary does not oppose the request to reopen, but urges the
operator to take steps to ensure that future penalty contests are timely filed.

Having
reviewed KenAmerican’s request and the
Secretary’s response, in the interest of justice, we hereby reopen this matter
and remand it 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. Accordingly, consistent with Rule 28, the Secretary shall file a
petition for assessment of penalty within 45 days of the date of this order. See
29 C.F.R. § 2700.28.

/s/ Mary Lu Jordan

Mary Lu Jordan, Chairman

/s/ Michael G. Young

Michael G. Young, Commissioner

/s/ Robert F. Cohen, Jr.

Robert F. Cohen Jr., Commissioner

Distribution:

Christopher
D. Pence, Esq.

David
J. Hardy, Esq.

James
P. McHugh, Esq.

Hardy
Pence PLLC

500
Lee Street, East, Suite 701 (25301)

Post
Office Box 2548

Charleston,
WV 25329-2548

W.
Christian Schumann, Esq.

Office
of the Solicitor

U.S.
Department of Labor

201
12th St. South, Suite 500

Arlington,
VA 22202-5450

Chief
Administrative Law Judge Robert J. Lesnick

Federal
Mine Safety & Health Review Commission

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

Washington,
DC 20004-1710

Melanie
Garris

Office
of Civil Penalty Compliance

Mine
Safety and Health Administration

U.S.
Department of Labor

201
12th St. South, Suite 500

Arlington,
VA 22202-5450

[1] This case has
been delegated to a panel of three Commissioners pursuant to section 113(c) of
the Mine Act for the limited purpose of assessing the merits of the motion to
reopen. 30 U.S.C. § 823(c).