Secretary of Labor v. Moltan Company (Commission decision, October 30, 2009)

Plain-English summary

Moltan missed the deadline to contest penalties after its founder died, new management took over, and the employee who received the assessment abruptly left without flagging its deadline. Company officials later found the assessment in papers left in the former employee's office. Moltan promptly attempted to contest 12 penalties and sought reopening after MSHA rejected the filing. The Secretary did not oppose relief. The Commission reopened the assessment in the interests of justice and remanded for proceedings on the merits.

Decision snapshot

• Governing provisions: 29 C.F.R. §§ 2700.1(b) and 2700.28; 30 U.S.C. § 815(a)
• Outcome: The assessment was reopened and remanded to the Chief Administrative Law Judge.
• Key point: A documented leadership crisis and abrupt staff departure can establish excusable neglect when the operator acts promptly after finding the assessment.

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

October 30, 2009

SECRETARY OF LABOR,

MINE SAFETY AND HEALTH

ADMINISTRATION (MSHA)

v.

MOLTAN COMPANY

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Docket No. SE 2009-601-M

A.C. No. 40-02968-179454

BEFORE: Jordan, Chairman; Duffy, Young, and Cohen, 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 June 12, 2009, the Commission received from Moltan Company (“Moltan”) 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 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).

On March 17, 2009, the Department of Labor’s Mine Safety and Health Administration (“MSHA”) issued Proposed Assessment No. 000179454 to Moltan, proposing penalties for 38 citations and orders that had been issued to Moltan the previous month. Moltan explains that it did not respond to the assessment until May 27, 2009, because shortly after the assessment was received, the company’s founder died, and new management assumed leadership. The employee who had received the assessment immediately left the company without informing anyone of the time sensitive nature of the assessment. Moltan states that, after company officials found the assessment in a pile of papers in the employee’s former office, it promptly mailed the contest to MSHA, indicating its intent to contest 12 of the proposed penalties. MSHA rejected the filing as untimely, and Moltan promptly filed this request to reopen. The Secretary states that she does not oppose Moltan’s request to reopen the assessment.

Having reviewed Moltan’s 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

Distribution:

Cheryl Followell

Moltan Co., LP

7125 Riverdale Bend Rd.

Memphis, TN 38125-4442

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