Timber Savers, Inc.

Plain-English summary

MSHA cited a gravel-crushing site identified as Timber Savers, while its owner said the operation had been renamed Solid Rock Gravel Company. Judge William B. Moran allowed the petition to be amended because both names referred to the same Idaho site and owner. He also granted partial summary judgment to the Secretary, finding the year-round extraction, crushing, screening, and sale of aggregate was mining activity that affected commerce through its market sales, equipment, communications, and payment systems. The parties were directed to discuss settlement of the remaining $100 penalty issue.

Decision snapshot

• Governing authority: 30 U.S.C. § 801 et seq.
• Outcome: The petition amendment and the Secretary's jurisdiction motion were granted, leaving the penalty issue unresolved.
• Key point: A local aggregate operation falls under the Mine Act when its commercial mining activity, considered with similar activity, affects interstate commerce.

Full text (FMSHRC public release)

Federal Mine Safety and Health Review Commission

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

1331 Pennsylvania Avenue, N.W. Suite 520N

WASHINGTON, D.C. 20004-1710

(202) 434-9933

September 18, 2012

SECRETARY OF LABOR,   

MINE SAFETY AND HEALTH    

ADMINISTRATION (MSHA),  

Petitioner 

v.

TIMBER SAVERS, INC. 

Respondent

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CIVIL PENALTY PROCEEDING

Docket No. WEST 2011-612-M

A.C. No. 10-02190-244171 

Mine: Rock Solid Mine

ORDERS ON MOTION TO AMEND PETITION FOR CIVIL PENALTY

AND MOTION FOR PARTIAL SUMMARY JUDGMENT

In this Civil Penalty Proceeding involving a single citation, with a proposed penalty of
$100.00, issued to the Respondent, Timber Savers, Inc., the Secretary seeks to amend its Petition
to list the Respondent’s name as either Timber Savers, Inc. and/or the Solid Rock Gravel
Company. The Secretary also seeks Partial Summary Judgment on the issue of jurisdiction,
finding, whichever name(s) appropriately and most accurately describe the Respondent’s
operations, that it is a mine within the meaning of the Mine Act and subject to the jurisdiction of
the Mine Safety and Health Administration. Upon review of the Motions and the Responses
thereto, the Court finds that the amendment modifying the named Respondent is appropriate and
warranted under the circumstances and is therefore GRANTED and further that, as this case is
nothing more than a garden variety, and meritless, objection to MSHA’s jurisdiction, the
Secretary’s motion for summary judgment is also GRANTED.

Protracted discussion of these matters is not warranted and will not be made. Regarding
the correct name of the operation cited, suffice it to say that MSHA, relying upon quarterly
production reports submitted by Timber Savers, believed that to be the correct name for the
Respondent’s crushing aggregate site. In an attempt to ferret out the correct name for the
operation cited, the Petitioner, upon deposing Phillip Berreth, the sole owner/shareholder for
Timber Savers, learned that the cited mining operation was changed to “The Solid Rock Gravel
Company.” Mr. Berreth testified that Timber Savers ceased operations in 2004, selling its assets
to the Solid Rock Gravel Company. Mr. Berreth, again through his deposition, stated that he
bought Timber Savers from his father and, when that operation ceased, its assets were sold to the
Solid Rock Gravel Company. Mr. Berreth, as the sole owner of Timber Savers, then became the
sole owner of the Solid Rock Gravel Company. The latter, “new” operation of Mr. Berreth
operates year round, selling crushed gravel to purchasers for their various needs. Critically, Mr.
Berreth admitted in his deposition that the site which was inspected by MSHA is the same site
where the Solid Rock Gravel Company performs its gravel crushing operation.

Jurisdiction is not defeated merely because MSHA, in good faith, incorrectly named the
entity where the crushing activities were ongoing. All parties understood the location of the
operation cited and something as superficial as listing its formal name does not impair the
effectiveness of the civil penalty proceeding filing. It would, for example, be sufficient if
MSHA, unable to accurately determine the correct mine name, had to list the operation’s location
simply by its geographic coordinates alone. Here, the heart of the Respondent’s objection
emanates not from an incorrect listing of the mine operation, but rather from its view that its
activity does not constitute interstate activity. That issue, raised in the Secretary’s other motion,
will be next addressed. Accordingly, the motion to amend the petition is GRANTED.

The Secretary’s second motion is a motion for partial summary judgment. In that motion
the Secretary seeks a ruling that the Respondent, Timber Savers, Inc., and/or its alternative
identifying name, the Solid Rock Gravel Company, is a mine subject to the jurisdiction of the
Mine Act. For the reasons that follow, the Court, having considered the motion and the
Respondent’s responses thereto, finds that the Respondent’s operation is indeed and without any
doubt subject to the Mine Act. Accordingly, the Secretary’s Motion for Partial Summary
Judgment is also GRANTED.

The Court notes that the motion is supported by the deposition of Phillip Berreth who, by
his own deposition, acknowledges that he is the sole stockholder of Timber Savers, a company
that he purchased from his father in 1995 and that he is also the sole owner of the Solid Rock
Gravel Company. The latter company is open year round, has equipment associated with mining
activities, such as front end loaders and a crusher and sells gravel to customers who need that
product. Mr. Berreth, again from his own words under oath during his deposition, admitted that
he has never filed a legal identity report for the Solid Rock Company, though he admits that the
Company crushes aggregate on the site where MSHA issued the citations in this docket.

As the Secretary notes in the Summary to her Motion: “There is no doubt that the
Respondent's rock crushing operation is a mine subject to the jurisdiction of the Mine Act. Mr. Berreth, the sole shareholder/owner testified that the operation, which he reports should be
called The Solid Rock Gravel Company (although he files quarterly reports with MSHA
suggesting that the production is really that of Timber Savers, Inc.) is a facility for the extraction,
crushing, screening and sale of rock/aggregate. The product, according to Mr. Berreth, is sold to
anyone who wants it and is used for road building. In producing this aggregate, Mr. Berreth
utilizes the telephone for taking customer orders, dump trucks manufactured outside the state of
Idaho for transporting the aggregate to the customers, front end loaders manufactured outside the
state of Idaho for loading the aggregate onto the dump trucks, and office equipment, including
computers as well as the use of credit cards. Mr. Berreth testified that the annual dollar volume
of business of this company is a quarter of a million dollars.” Motion at 11.

There is no genuine dispute of a material fact in this case and therefore summary
judgment is appropriate. Clearly, this operation is a mine within the meaning of Section 3(h) of
the Mine Act and its activity, all of which has been acknowledged by its owner, affects
commerce within the meaning of Section 4 of the Mine Safety and Health Act of 1977 (“the
Mine Act”), 30 U.S.C. § 801 et seq. The Court has reviewed Mr. Berreth’s responses to both
motions and finds them to be without any merit. In issuing this ruling, the Court takes note of
and incorporates by reference portions of the Secretary’s Motion. The Court also takes notice of
the very relevant and on point decision of fellow Administrative Law Judge Zane Gill’s decision
in Sec. v. Fittstone, Inc., 33 FMSHRC 2933 (Nov. 2011). That decision appears in the
Appendix to this decision.

Accordingly, the Court finds that the Respondent's facility, located at Weippe, Idaho and
known as both Timber Savers, Inc. and the Solid Rock Gravel Company, is a mine within the
meaning of the Mine Act and is subject to the jurisdiction of the Mine Safety and Health
Administration.

The parties are DIRECTED by these ORDERS to consult with one another to determine
if the civil penalty issues can be settled and to then email the Court within two (2) weeks of the
date of this Order to advise about the status of the matter. The communication to the Court is to
be sent to: [email protected] .

/s/ William B. Moran

William B. Moran

Administrative Law Judge

Distribution:

Patricia Drummond, Esquire

Office of the Solicitor, U.S. Department of Labor, 1111 Third Avenue, Suite 945, Seattle,
Washington, 98101 (email and first class mail)

Mr. Phil Berreth, President

Timber Savers, Inc./ The Solid Rock Gravel Company, 201 S. Garden Court, Lewiston, Idaho,
83501 (email, and certified mail)

APPENDIX

SECRETARY OF LABOR, MINE SAFETY AND HEALTH ADMINISTRATION (MSHA),
PETITIONER v. FITTSTONE, INC., RESPONDENT 33 FMSHRC 2933, 2011 WL 6148975
(Nov. 30 2011) Judge L. Zane Gill.

ORDER GRANTING THE SECRETARY'S PARTIAL SUMMARY JUDGMENT MOTION

This case is before the court on a petition for assessment of civil penalty under Section 105(d) of
the Federal Mine Safety and Health Act of 1977, 30 U.S.C. §801 et seq. (the “Act”). The parties
filed cross-motions for summary judgment. The underlying controversy involves citations issued
by the Department of Labor's Mine Safety and Health Administration (“MSHA”) under Section
104(a). The issue the parties argued in their cross-motions is whether MSHA has jurisdiction to
inspect the Respondent's limestone gravel operation. A telephone hearing on this issue was
conducted on September 28, 2011.

The Respondent argues that its limestone gravel facility is not subject to MSHA's jurisdiction
because it does not “substantially” affect interstate commerce. This position is based on the
Respondent's interpretation of the Supreme Court's decision in United States v. Lopez, 514 U.S.
549 (1995). Respondent argues that after Lopez, a mine must satisfy a “substantial qualifier” test
before MSHA can exert its inspection jurisdiction. This interpretation is plausible because in
Lopez the Supreme Court stated that “the proper test requires an analysis of whether the
regulated activity substantially affects interstate commerce.” Id., 559 (emphases added) The
Supreme Court also said that “where economic activity substantially affects interstate commerce,
legislation regulating that activity will be sustained.” Id. (emphases added)

However, by placing so much weight on the word “substantial,” the Respondent misinterprets
Lopez. The Lopez decision resolves the issue of whether a federal law banning possession of a
firearm on public school property, 18 U.S.C. § 922(q)(1)(A), the Gun-Free School Zones Act of
1990, could be applied under a Commerce Clause argument when there was no discernable nexus
between a student's possession of a firearm and any commercial or economic activity.

*2934 While it is true that in order for an activity to come under the Commerce Clause, there
must be a showing that the activity “substantially affects” interstate commerce, i.e., the activity
must first be shown to be commercial in nature. Lopez determined that possession of a firearm
was not commercial or economic in nature, therefore there was no need to move to the secondary
issue of whether the commercial activity had a substantial impact on interstate commerce.

In short, the Lopez decision did not elevate the “substantial qualifier” test to primary importance
as the Respondent argues, but affirmed that laws and/or regulations promulgated via the
Commerce Clause need to have some basis in commerce. By validating Wickard v. Filburn 317
U.S. 111 (1942) in its Lopez decision, the Supreme Court made it clear that if an economic
activity is involved, the level of activity needed to justify extension of Commerce Clause
authority is indeed quite minimal. The Supreme Court cited Wickard as “perhaps the most far
reaching example of Commerce Clause authority over intrastate activity.” Id., at 560
Accordingly, Wickard is still good precedent, and we are bound by it in this matter.

**2 Comparing the facts in Wickard with the facts in this case, there is no question that the
Fittstone facility affects commerce and is under the Mine Act's jurisdiction. In Wickard, a law
was established to limit wheat production based on acreage owned by a farmer in order to drive
up wheat prices during the Great Depression. A farmer grew more than the limits permitted and
was ordered to destroy his crops and pay a fine, even though he was producing the excess wheat
for his own use and had no intention of selling it. The Supreme Court found that “[e]ven activity
that is purely intrastate in character may be regulated by Congress, where that activity, combined
with like conduct by others similarly situated, affects commerce among the States […].” Fry v.
United States, 421 U.S. 542, 547 (1975) citing Wickard, at 127-128

Here, the Respondent's total facility sales were $358,901.00 for the time period February 23,
2010, to August 24, 2010. [FN1] In addition, the Research and Innovative Technology *2935
Administration (“RITA”) survey [fn2] CITED BY THE respondent in support of its position,
confirms that there is only a small amount of gravel and stone included in the total freight
transported in the United States. This demonstrates that even a relatively small amount of gravel
production can have a disproportionate effect on interstate commerce for purposes of
jurisdictional analysis, and it bolsters the Secretary's argument.

In addition to Wickard and Fry, there are numerous decisions that support the argument that
MSHA has jurisdiction over the Respondent's Fittstone facility. For instance, in Jerry Ike Harless
Towing, Inc. and Harless Inc. v. Sec'y of Labor, the Commission stated that the “Commerce
Clause of the Constitution has been broadly construed [ … and that] Commercial activity that is
purely intrastate in character may be regulated by Congress under the Commerce Clause, where
the activity, combined with like conduct by others similarly situated, affects commerce among
the states.”Jerry Ike Harless Towing, Inc. and Harless Inc. v. Sec'y of Labor, 16 FMSHRC 683,
686 (April 1994), citing Fry v. United States, 421 U.S. 542, 547 (1975); Wickard, at 111. The
Commission continued by saying that “Congress intended to exercise its authority to regulate
interstate commerce to the ‘maximum extent feasible’ when it enacted section 4 of the Mine
Act.” Id., citing Marshall v. Kraynak, 604 F.2d 231, 232 (3d Cir. 1979), cert. denied 444 U.S.
1014 (1980) Though Harless Towing was published a year prior to Lopez, the Commission has
not changed its stance on the matter.

In a Second Circuit decision issued in 2004, the court affirmed Wickard and Fry v. United States
when it found that a gravel mine that did business only in New York was under the Mine Act's
jurisdiction. D.A.S. & Gravel v. Sec'y of labor, 386 F. 3d 460, 463 (2nd Cir. 2004). The court
stated that “the Commerce Clause does not preclude Congress from regulating the activities of an
economic actor whose products do not themselves enter interstate commerce, where the activities
of such local actors taken together have the potential to affect an interstate market the regulation
of which is within Congress' power.” Id.

**3 In United States v. Lake, 985 F.2d 265, 267-69 (6th Cir. 1993), which the Commission cited
in Harless Towing above, a mine operator sold all its coal locally and purchased mining supplies
from a local dealer. Id., at 269. The court found that the operator was engaged in interstate
commerce because “such small scale efforts, when combined with others, could influence
interstate coal pricing and demand.”

The Secretary has also argued and provided evidence that the Respondent's use of machinery and
equipment bought from out-of-state manufactures affects interstate commerce, also bringing
respondent under MSHA's jurisdiction. Though there is abundant precedent *2936 supporting the
Secretary's assertion on this point, [FN3] it only serves to bolster my decision. I conclude,
therefore, that the Respondent's gravel operation affects interstate commerce and comes under
MSHA's inspection authority.

Accordingly, the Secretary's Motion for Partial Summary Judgment is GRANTED and the
Respondent's summary judgment motion is DENIED.