Phillips Companies (Commission decision, June 23, 2010)

Plain-English summary

Phillips Companies requested a conference on one of five citations covered by a proposed penalty assessment. The company said it never received the assessment and paid it in full after learning it was delinquent, then asked to reopen the penalty for the disputed citation. The Secretary did not oppose reopening but noted that Federal Express recorded a recipient signature and that requesting a conference did not replace the need to contest the later assessment. In the interests of justice, the Commission reopened the matter and remanded it for penalty proceedings. It required the Secretary to file a penalty petition within 45 days.

Decision snapshot

• Governing provisions: 30 U.S.C. § 815(a); 29 C.F.R. §§ 2700.1(b) and 2700.28
• Outcome: The penalty for Citation No. 6500213 was reopened and remanded to the Chief Administrative Law Judge.
• Key point: Paying an assessment after a delinquency notice did not prevent reopening where the operator sought to litigate a citation and the Secretary did not oppose relief.

Full text (FMSHRC public release)

Federal Mine Safety and Health Review Commission

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

601 NEW JERSEY AVENUE, NW

SUITE 9500

WASHINGTON, DC 20001

June 23, 2010

SECRETARY OF LABOR,

MINE SAFETY AND HEALTH

ADMINISTRATION (MSHA),

v.

PHILLIPS COMPANIES

Docket No. LAKE 2010-478-M

A.C. No. 33-01603-197050

BEFORE: Jordan, Chairman; Duffy, Young, Cohen, 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 February 23, 2010, the Commission received from Phillips Companies (“Phillips”) a request 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 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 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”); 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).

Phillips states that it requested a conference regarding one of the five citations covered by the proposed assessment; that it never received the proposed assessment; and that, upon being informed that it was delinquent, it paid the assessment in full. Phillips requests reopening as to the penalty for Citation No. 6500213. The Secretary does not oppose reopening, but notes that the Federal Express delivery of the assessment was signed for by “W. Heathcock” and reminds the operator that, even though a conference was requested, the operator was also required to contest the penalty once the assessment issued.

Having reviewed Phillips’ request and the Secretary’s response, in the interests 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.

______

Mary Lu Jordan, Chairman

______

Michael F. Duffy, Commissioner

______

Michael G. Young, Commissioner

______

Robert F. Cohen, Jr., Commissioner

______

Patrick K. Nakamura, Commissioner

Distribution:

Gary L. McDaniels

Phillips Companies

30 Haines Rd.

Xenia, OH 45385

W. Christian Schumann, Esq.

Office of the Solicitor

U.S. Department of Labor

1100 Wilson Blvd., Room 2220

Arlington, VA 22209-2296

Myra James, Chief

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

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

Washington, D.C. 20001-2021