Cyprus Emerald Resources Corporation

Plain-English summary

Cyprus Emerald was cited for failing to investigate a mine accident as required by 30 C.F.R. § 50.11(b). The Commission had previously treated the violation as significant and substantial, but the D.C. Circuit held that an S&S finding is available only for a violation of a mandatory health and safety standard. On remand, the Commission deleted the S&S designation, otherwise affirmed the citation, and sent the case back for reassignment and a new penalty assessment under the Mine Act’s penalty criteria. Two commissioners dissented, stating that the judge’s $3,000 penalty should have been affirmed.

Decision snapshot

• Cited standard(s): 30 C.F.R. § 50.11(b); 30 U.S.C. §§ 814(d)(1), 814(e), 820(i)
• Outcome: The S&S designation was deleted, the citation was otherwise affirmed, and the penalty was remanded for reassessment.
• Key point: Under the controlling court decision described in the release, an S&S designation cannot attach to a citation for violating a non-mandatory standard.

Full text (FMSHRC public release)

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION
1730 K STREET NW, 6TH FLOOR
WASHINGTON, D.C. 20006

                                      March 3, 2000

SECRETARY OF LABOR, :
MINE SAFETY AND HEALTH :
ADMINISTRATION (MSHA), :
:
v. : Docket Nos. PENN 94-23
: PENN 94-166
CYPRUS EMERALD RESOURCES :
CORPORATION :

BEFORE: Jordan, Chairman; Marks, Riley, Verheggen, and Beatty, Commissioners

                                          ORDER

BY THE COMMISSION:

    In this civil penalty proceeding, arising under the Federal Mine Safety and Health Act of

1977, 30 U.S.C. § 801 et seq. (1994) (“Mine Act” or “Act”), Cyprus Emerald Resources
Corporation (“Emerald”) challenged the “significant and substantial” (“S&S”)1 designation of a
citation alleging a violation of 30 C.F.R. § 50.11(b), which requires an operator to investigate any
mine accident. Among other grounds, Emerald argued that because section 50.11(b) is not a
mandatory health or safety regulation, it could not be designated S&S, because the Mine Act
refers to S&S violations only of mandatory health or safety standards. See 30 U.S.C.
§ 814(d)(1), (e).

   Administrative Law Judge William Fauver rejected that argument, stating:

           [T]he citation was issued under § 104(a), not 104(d). An allegation
           of a “significant and substantial” violation in a § 104(a) citation is
           an allegation of gravity, not an assertion of jurisdiction to apply the
           sanctions of § 104(d). Accordingly, I do not reach the issue
           whether the sanctions of § 104(d) apply to a violation of Part 50.

17 FMSHRC 2086, 2099 (Nov. 1995) (ALJ). The judge found that, with respect to the accident
at issue, continuing operations without investigating the accident could contribute significantly
and substantially to another accident with a risk of serious injury, and that such an accident had

   1
      The S&S terminology is taken from section 104(d)(1) of the Act, 30 U.S.C. §

814(d)(1), which distinguishes as more serious any violation that “could significantly and
substantially contribute to the cause and effect of a . . . mine safety or health hazard.”

                                     22 FMSHRC 285

Page 2

occurred in case. Id. Finding that the violation was also due to Emerald’s high negligence, and
stating that he had taken into account all of the civil penalty criteria set forth in section 110(i) of
the Act, 30 U.S.C. § 820(i), the judge assessed a penalty of $3,000. Id. at 2099-2100.

    On review of the judge’s decision, the Commission, at the request of the parties, reached

the issue that the judge did not. 20 FMSHRC 790, 801 (Aug. 1998). After affirming the judge’s
finding of a violation of section 50.11(b), a Commission majority held that violations of non-
mandatory health or safety standards could be designated as S&S under sections 104(d) and
104(e) of the Act. Id. at 798-809 (Chairman Jordan and Commissioner Beatty), 822
(Commissioner Marks). That Commission majority also affirmed the judge’s finding that
Emerald’s violation of section 50.11(b) was S&S. Id. at 810, 822. Commissioners Riley and
Verheggen, in dissent, held that under the plain meaning of the Mine Act, only violations of
mandatory health and safety standards could be designated as S&S. Id. at 826-30.

    Emerald subsequently petitioned the United States Court of Appeals for the District of

Columbia Circuit for review of this issue. The court held “that a ‘significant and substantial’
finding is permissible in a citation charging a violation of a mandatory health and safety standard
only[.]” Cyprus Emerald Resources Corp. v. FMSHRC, 195 F.3d 42, 44 (D.C. Cir. 1999).
Accordingly, the court granted Emerald’s petition, reversed the Commission’s S&S
determination, and remanded the case to the Commission for further action. Id. at 46.

    Pursuant to the court’s order, we modify Citation No. 3658696 to delete the S&S

designation. We otherwise affirm the citation and remand to the Chief Judge for reassignment
and assessment of an appropriate penalty based upon consideration of, and findings regarding, all
of the criteria in section 110(i) of the Act.

                                            James C. Riley, Commissioner




                                            Theodore F. Verheggen, Commissioner




                                            Robert H. Beatty, Jr., Commissioner



                                      22 FMSHRC 286

Page 3

Chairman Jordan and Commissioner Marks, dissenting:

    We would modify the citation to delete the S&S designation, but would otherwise affirm

the citation and the judge’s $3000 penalty assessment. While the court held that the violation at
issue could not be designated S&S under the terms of the Mine Act, the factual findings that
underlay the judge’s S&S determination were not disturbed, and were viewed by all
Commissioners as sufficient support for the judge’s finding on the gravity of the violation. See
20 FMSHRC at 810 (opinion of Chairman Jordan and Commissioner Beatty), 822 (concurring
opinion of Commissioner Marks), 829-30 (opinion of Commissioners Riley and Verheggen,
dissenting on other grounds). Previously, the Commission has held that a penalty need not
necessarily be reduced when a special finding is vacated. See Mechanicsville Concrete, Inc., 18
FMSHRC 877, 881-82 (June 1996) (vacating judge’s S&S determination as beyond his authority,
but nevertheless affirming penalty based in part on high gravity finding as supported by
substantial evidence); Austin Powder Co., 21 FMSHRC 18, 21 (Jan. 1999) (decision vacating
judge’s unwarrantable failure determination as beyond his authority does not necessarily require
judge to find on remand lower level of negligence or to reduce his earlier penalty assessment). In
these circumstances, therefore, there is no need to remand for a reassessment of the penalty, and
therefore, we respectfully dissent.

                                         Mary Lu Jordan, Chairman




                                         Marc Lincoln Marks, Commissioner




                                    22 FMSHRC 287

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Distribution

W. Christian Schumann, Esq.
Office of the Solicitor
U.S. Department of Labor
4015 Wilson Blvd., Suite 400
Arlington, VA 22203

R. Henry Moore, Esq.
Buchanan Ingersoll
One Oxford Centre
301 Grant St., 20th Floor
Pittsburgh, PA 15219-1410

Chief Administrative Law Judge David Barbour
Federal Mine Safety & Health Review Commission
1730 K Street, N.W., Suite 600
Washington, D.C. 20006

                               22 FMSHRC 288