Secretary of Labor v. The American Coal Company

Plain-English summary

The Secretary proposed reducing the penalties for all 32 citations against The American Coal Company by exactly 30 percent without changing any gravity or negligence findings. The motion cited amicable resolution and litigation uncertainty but gave no individualized facts supporting the reductions. Judge William B. Moran found that explanation insufficient under section 110(k), pointing to cited conditions involving oil leakage, water in a longwall bleeder, roof and rib support, escapeway equipment, and coal accumulations. He denied the settlement motion because the record did not show that the reductions protected the public interest. He also declined to accept the Conference and Litigation Representative's appearance, finding that the unsupported blanket proposal did not demonstrate the competence required for non-attorney practice before the Commission.

Decision snapshot

• Governing provision: 30 U.S.C. § 820(k)
• Outcome: The proposed settlement was denied, and the Conference and Litigation Representative was not accepted in the case.
• Subsequent review: The Commission later addressed the settlement-review dispute in lake-2011-13-commission-2.
• Key point: A uniform penalty reduction needs facts that allow the judge to evaluate the settlement and protect the public interest.

Full text (FMSHRC public release)

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

OFFICE OF ADMINISTRATIVE LAW JUDGES

1331 Pennsylvania Avenue, N.W. Suite 520N

Washington, DC 20004-1710

Telephone: (202) 434-9933

February 11, 2013

SECRETARY OF LABOR,

MINE SAFETY AND HEALTH

ADMINISTRATION (MSHA),

Petitioner

v.

THE AMERICAN COAL COMPANY,

Respondent

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CIVIL PENALTY PROCEEDING

Docket No. LAKE 2011-13

A.C. No. 11-02752-232235-02

New Era Mine

DECISION DENYING SETTLEMENT MOTION

Before: Judge William B. Moran

Before the Court is the Secretary’s Motion to Approve Settlement (“Motion”) in LAKE 2011-13, “The Ameriacan [sic] Coal Company.”

The Court has reviewed the Motion
and finds it seriously wanting. Accordingly, it is DENIED. Further, for the reasons which
follow, the Court declines to accept the appearance of the Conference and Litigation
Representative.

The Motion seeks an across-the-board reduction of 30 (thirty) percent for each of the 32
citations involved. That, in itself, is a red flag. The idea that every one of 32 citations could
warrant a 30% reduction demonstrates, by that fact alone, that the reductions were more in the
nature of yard sale, rather than any individualized review meriting, by some impossibly small
odds, that each just happened to have earned such an implausibly uniform reduction.

The Motion itself did nothing to dispel this conclusion. The entirety of the justification
provided: “After further review of the evidence, the Secretary has determined that a reduced
penalty is appropriate in light of the parties’ interest in settling this matter amicably without
further litigation. In recognition of the nature of the citations at issue, and the uncertainties of
litigation, the parties wish to settle the matter with a 30% reduction in the total assessed penalty
with no changes in gravity or negligence for any of the citations at issue.” If this were a
satisfactory justification, then every case would warrant a 30% reduction to avoid the
“uncertainties of litigation.” The Secretary’s Part 100 penalty regulations contemplate only a
10% reduction in its proposed penalty formula for an operator’s good faith.

Ironically, the Motion, as just noted, then proceeds to confirm what appears to be the
case; on the basis of the motion itself, there is no legitimate basis to reduce any of these citations.
The Motion states this is exactly the case, noting there are no changes in gravity or negligence
for any of the 32 citations. Nor can it be said that the cited matters are all negligible violations. A few examples from among the 32 citations demonstrate this: a haul truck seriously leaking oil
with an engine that could not be shut down (Citation 8424013); up to 5 feet of water in a
longwall bleeder (Citation 8424511); inadequate roof and rib support, a problem which had been
cited some 107 times at this mine in the past 2 years, (Citation 7579878); an outdated escapeway
map and an incompletely installed life line in the primary escapeway (Citations 8424509 and
8424508); coal accumulations up to 20 inches in depth, and 18 feet wide for a distance of 165
feet, and another similar such situation (Citations 8424502 and 8424967).

The only thing that the motion gets right is the math; each of the 32 alleged violations
was reduced by 30 percent. Motions such as these serve to demonstrate the great wisdom of
Congress. It knew that without the fail-safe it installed in the Mine Act, through Section 110(k)
of that Act, settlements such as this could occur. For reasons underlying exactly the kinds of
unjustified reductions presented here, it provided that “No proposed penalty, which has been
contested before the Commission under section 105(a) shall be compromised, mitigated, or
settled except with the approval of the Commission.” 30 U.S.C. § 820(k). Submissions such as
this lay bare the failures that would most certainly occur should the Secretary ever be able to
have this protective provision removed from the Commission’s oversight.

As the Commission most recently stated in Secretary v. Black Beauty, 2012 WL 4026640
(Aug. 2012), “The plain language of section 110(k) of the Mine Act explicitly authorizes the
Commission to review a proffered settlement of a contested penalty.” It noted that “[t]he
legislative history of section 110(k) explains that Congress intended the settlement of a penalty to
be a transparent process that is open to public scrutiny and that the Commission is authorized to
approve contested penalties offered for settlement. The Senate Report recognized, in particular,
the importance of an Administrative Law Judge’s review of a proposed settlement of a penalty . .
. . [t]o remedy this situation, section 111(l) [later codified as section 110(k)] provides that a
penalty once proposed and contested before the Commission may not be compromised except
with the approval of the Commission. . . . By imposing these requirements, the Committee
intends to assure that the abuses involved in the unwarranted lowering of penalties as a result of
off-the-record negotiations are avoided. It is intended that the Commission and the Courts will
assure that the public interest is adequately protected before approval of any reduction in
penalties. Id. (emphasis added by the Commission). To carry out this responsibility, the Judge
must have information sufficient to establish that the penalty reduction does, in fact, protect the
public interest.” Black Beauty at *4-5.

Accordingly, the Secretary’s Motion is DENIED.

However, that does not end this matter. The Conference and Litigation Representative
(CLR) has sought to be accepted to represent the Secretary in accordance with the notice of
limited appearance he filed with the penalty petition. In support of that request, the CLR has
cited Cyprus Emerald Resources Corporation, 16 FMSHRC 2359 (Nov. 1994). This decision is
routinely cited by CLR’s in these matters. The authority for this request stems from
subparagraph (4) of section 2700.3 of the Commission’s regulations which provides that, apart
from attorneys, other persons may practice before the Commission “with the permission of the
presiding judge or the Commission.” For that exception, potentially allowing non-attorneys to
practice, it is clear that competence is a sine qua non for such permission to be granted by the
presiding judge. Regrettably, here that competence has not been demonstrated. The idea that
there can be a wholesale, large, across the board reduction for a significant number of violations
with no justification other than to achieve an amicable settlement and to avoid further litigation,
demonstrates a lack of understanding about the operation of the Mine Act’s requirements where
civil penalty reductions are sought. Accordingly, in the exercise of the Court’s discretion, it must
decline acceptance of the CLR in this instance.

/s/ William B. Moran

William B. Moran

Administrative Law Judge

Distribution:

Jeffrey S. Williams

Conference and Litigation Representative

U. S. Department of Labor                             

Mine Safety and Health Administration  

2300 Willow Street, Suite 200                       

Vincennes, IN 47591

Email: [email protected]

Kathy Bartek, Paralegal 

Murray Energy Corporation 

46226 National Road

St. Clairsville, OH 43950

Email: [email protected]