Secretary of Labor v. Bill Simola, employed by United Taconite, LLC (ALJ decision, May 7, 2010)

Plain-English summary

MSHA sought to hold Bill Simola personally liable as an agent of United Taconite under section 110(c) of the Mine Act. Simola argued that the provision applies to agents of corporations but not agents of limited liability companies, and Judge Jerold Feldman had denied his motion to dismiss. Simola then requested immediate Commission review of that ruling. The Judge found a novel, controlling legal question and concluded that review could materially advance the case because a ruling for Simola would eliminate the need for further adjudication. He certified the LLC-agent liability question to the Commission.

Decision snapshot

• Governing provisions: 30 U.S.C. § 820(c); 29 C.F.R. § 2700.76(a)(1)(i)
• Outcome: The request to certify the interlocutory ruling for Commission review was granted.
• Subsequent review: The Commission affirmed the underlying denial of dismissal in lake-2010-128-m-commission.
• Key point: A novel jurisdictional question that could end the case may warrant immediate interlocutory review.

Full text (FMSHRC public release)

FMSRHC ALJ DECISION

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

OFFICE OF ADMINISTRATIVE LAW JUDGES

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

Washington, DC 20001

May 7, 2010

SECRETARY OF LABOR,

MINE SAFETY AND HEALTH

ADMINISTRATION, (MSHA),

Petitioner

v.

BILL SIMOLA, employed by

UNITED TACONITE, LLC,

Respondent

:

:

CIVIL PENALTY PROCEEDING

Docket No. LAKE 2010-128-M

A.C. No. 21-03404-201338 A

United Plant

Mine ID 21-03404

ORDER GRANTING RESPONDENT’S MOTION FOR CERTIFICATION OF
INTERLOCUTORY RULING

The captioned civil penalty proceeding concerns a 104(d) citation and a 104(d) order issued pursuant to section 110(c) of the Federal Mine Safety and Health Act of 1977 (the Mine Act), 30 U.S.C. § 820(c), to Bill Simola, as an agent of United Taconite, LLC (United Taconite). Section 110(c) of the Mine Act provides, in pertinent part:

Whenever a corporate operator violates a mandatory health or safety standard . . ., any director, officer, or agent of such corporation who knowingly authorized, ordered or carried out such violation, . . . shall be subject to the same civil penalties, fines, and imprisonment that may be imposed upon a person under subsections (a) and (d) of this section.

30 U.S.C. § 820(c) (emphasis added).

United Taconite is not a traditional corporation. Rather it is a limited liability company (LLC) that is organized under the laws of the state of Delaware. It is authorized to operate as a business entity based on a Certificate of Formation filed with the Office of the Delaware Secretary of State in the Division of Corporation. As a general proposition, a limited liability company is a business entity that is taxed as a partnership while benefitting from the personal liability protection afforded to the assets of corporate officers.

Simola moved to dismiss this proceeding on jurisdictional grounds asserting that an agent of a limited liability company is not subject to the personal liability provisions of section 110(c). The Secretary opposed Simola’s motion. Simola’s motion was denied on April 6, 2010.

32 FMSHRC ___.

On April 23, 2009 Simola filed a motion for certification of the April 6, 2010, interlocutory ruling. On May 5, 2010, the Secretary filed a motion in opposition to Simola’s motion for interlocutory review. The Secretary asserts immediate review will not materially advance the final disposition of this proceeding.

Commission Rule 76(a)(1)(i) provides that, upon motion of a party, a judge shall certify his interlocutory ruling to the Commission if the ruling involves a controlling question of law and immediate review will materially advance the final disposition of the proceeding.

29 C.F.R. § 2700.76(a)(1)(i). Simola’s motion for an interlocutory ruling involves a novel controlling question of law. Moreover, contrary to the Secretary’s assertion, an expeditious resolution of this jurisdictional question may materially advance the final disposition of this matter. In this regard, interlocutory review may obviate the need for adjudication if it is determined that Simola is not subject to the personal liability provisions of section 110(c) of the Mine Act. Consequently, Simola’s certification request shall be granted.

ORDER

In view of the above, Bill Simola’s Motion for Certification under Commission Rule 76 IS GRANTED. Accordingly, IT IS ORDERED that the question of the applicability of the personal liability provisions of section 110(c) to an agent of a mine operator doing business as a limited liability company IS CERTIFIED for Commission review.

Jerold Feldman

Administrative Law Judge

Distribution: (Certified Mail)

Emelda Medrano, Esq., Office of the Solicitor, U.S. Department of Labor, 230 S. Dearborn Street,

Room 844, Chicago, IL 60604

R. Henry Moore, Esq., Jackson Kelly, PLLC, Three Gateway Center, Suite 1340, 401 Liberty Ave.,

Pittsburgh, PA 15222

/rps