Secretary of Labor v. Iluka Resources, Inc. (Commission decision, May 30, 2013)

Plain-English summary

Iluka Resources filed a penalty contest four days after the assessment became final because its mine manager was unaware of the deadline. The company learned of the problem after receiving MSHA's delinquency notice and adopted a new procedure for timely payment or contest of assessments. The Secretary did not oppose reopening and confirmed receipt of payment for the uncontested penalties. She warned that future late-contest motions might be opposed. The Commission reopened the assessment in the interests of justice and remanded it for penalty proceedings.

Decision snapshot

• Governing provisions: 30 U.S.C. § 815(a); 29 C.F.R. §§ 2700.1(b) and 2700.28
• Outcome: The final assessment was reopened and remanded, with a penalty petition due within 45 days.
• Key point: A manager's misunderstanding of the contest deadline supported reopening after the operator implemented a corrective filing procedure, but the Commission record included a warning about future late contests.

Full text (FMSHRC public release)

Federal Mine Safety and Health Review Commission

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

1331 PENNSYLVANIA AVENUE, NW, SUITE 520N

WASHINGTON, D.C. 20004-1710

May 30, 2013

SECRETARY OF LABOR, 

MINE SAFETY AND HEALTH 

ADMINISTRATION (MSHA) 

v.

ILUKA RESOURCES, INC. 

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Docket No. VA 2013-41-M

A.C. No. 44-07250-297344

BEFORE: Jordan, Chairman; Young 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 October 25, 2012, the Commission received from Iluka Resources, Inc. (“Iluka”) a motion seeking 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).

The record indicates that the proposed assessment was delivered on August 14, 2012, and became a final order of the Commission on September 13, 2012. Iluka asserts that it mailed a notice of contest on September 17, 2012, and received MSHA’s delinquency notice on October 11, 2012. Iluka states that the mine manager was not aware of the deadline, but has now implemented a new procedure to ensure the timely payment or contest of proposed assessments. The Secretary does not oppose the request to reopen, and notes that MSHA received a payment for the uncontested penalties, by check dated September 12, 2012. The Secretary cautions that she may oppose future motions to reopen penalty assessments that are not contested in a timely manner.

Having reviewed Iluka’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.

/s/ Mary Lu Jordan

Mary Lu Jordan, Chairman

/s/Michael G. Young

Michael G. Young, Commissioner

/s/ Patrick K. Nakamura

Patrick K. Nakamura, Commissioner

Distribution

Christopher D. Pence, Esq

Hardy Pence, PLLC

500 Lee Street, East, Suite 701

P.O. Box 2548

Charleston, WV 25301

W. Christian Schumann, Esq.

Office of the Solicitor

U.S. Department of Labor

1100 Wilson Blvd., Room 2220

Arlington, VA 22209-2296

Melanie Garris

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

1331 Pennsylvania Avenue, N. W., Suite 520N

Washington, D.C. 20004-1710