Pederson Brothers, Inc. (Commission decision, April 4, 2008)

Plain-English summary

Pederson Brothers notified MSHA that its legal address had changed after six citations were issued. MSHA later sent the proposed penalties by certified mail to the former address, where no one could sign for or forward them, and Pederson learned of the assessment only when a collection letter reached its new address. Pederson said it had always intended to contest the citations and penalties, and the Secretary did not oppose reopening. The Commission remanded for the Chief Administrative Law Judge to determine whether good cause existed and whether relief from the final order should be granted.

Decision snapshot

• Governing provisions: 29 C.F.R. § 2700.1(b); 30 U.S.C. § 815(a)
• Outcome: The assessment for six citations was remanded for a determination of good cause and entitlement to relief.
• Key point: An assessment sent to an operator's former address after a filed identity change requires factual review before the final order can be reopened.

Full text (FMSHRC public release)

Federal Mine Safety and Health Review Commission

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

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

Washington, D.C. 20001

April 4, 2008

SECRETARY OF LABOR,

MINE SAFETY AND HEALTH

ADMINISTRATION (MSHA),

v.

PEDERSON BROTHERS, INC.

:

:

:

:

:

:

:

Docket No. LAKE 2008-61-M

A.C. No. 21-00071-123814

BEFORE: Duffy, Chairman; Jordan and Young, 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. (2000) (“Mine Act”). On November 20, 2007, the Commission received from

Pederson Brothers, Inc. (“Pederson”) 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).

On December 5, 2006, the Department of Labor’s Mine Safety and Health Administration (“MSHA”) issued six citations to Pederson. In its motion, Pederson states that, on April 4, 2007, it filed a change in legal identity with MSHA that included a change in the company’s legal address from one state to another. Sometime in August 2007, MSHA issued proposed penalties in connection with the citations but mistakenly mailed them by certified mail to Pederson’s old address. Pederson further states in its motion that there was no one at the old address who could sign for the mail and forward it to the new address. On November 1, 2007, when MSHA sent Pederson a letter by first class mail, demanding payment in full for the proposed penalties, that letter was forwarded to Pederson’s new address. Pederson states that it always had intended to contest the citations and penalties. The Secretary does not oppose the request to reopen the proposed 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 Pederson’s request, in the interests of justice, we remand this matter to the Chief Administrative Law Judge for a determination of whether good cause exists for Pederson’s failure to timely contest the penalty proposal and whether relief from the final order should be granted. If it is determined that such relief 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

Distribution:

Adele L. Abrams, Esq.

Law Office of Adele L. Abrams, P.C.

4740 Corridor Place, Suite D

Beltsville, MD 20705

W. Christian Schumann, Esq.

Office of the Solicitor

U.S. Department of Labor

1100 Wilson Blvd., 22nd Floor

Arlington, VA 22209-2296

Myra James, Chief

Office of Civil Penalty Compliance, MSHA

U.S. Department 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