Secretary of Labor v. Freeport-McMoran Morenci, Inc.

Plain-English summary

Freeport-McMoRan Morenci was short-staffed after two industrial-hygiene employees resigned. The health and safety superintendent was covering that program while also handling proposed assessments and mistakenly believed the normal contest procedure had been completed. When MSHA sent a delinquency notice, the superintendent immediately forwarded it to outside counsel, who promptly sought reopening. The Commission found inadvertence or mistake amounting to good cause, reopened the assessment, and remanded it for further proceedings.

Decision snapshot

• Cited authority: 30 U.S.C. § 815(a); 29 C.F.R. §§ 2700.1(b), 2700.28
• Outcome: The final assessment was reopened and the matter was remanded.
• Key point: A temporary staffing shortage supported relief where the operator and counsel acted promptly upon receiving a delinquency notice.

Full text (FMSHRC public release)

FEDERAL
MINE SAFETY AND HEALTH REVIEW COMMISSION

1331
PENNSYLVANIA AVE., N.W., SUITE 520N

WASHINGTON,
DC 20004-1710

SECRETARY
OF LABOR,

MINE SAFETY AND HEALTH    

ADMINISTRATION (MSHA)           

v.

FREEPORT-MCMORAN
MORENCI INC.

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Docket
No. WEST 2019-0278-M

A.C.
No. 02-00024-480570

BEFORE:  Rajkovich,
Chairman; Althen and Traynor, 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. (2018) (“Mine Act”).  On April 17, 2019, the Commission received
from Freeport-McMoRan Morenci Inc. (“Freeport”) 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 orders, the Commission has found guidance in Rule
60(b) of the Federal Rules of Civil Procedure, under which the Commission may
relieve a party from a final order of the Commission on the basis of mistake,
inadvertence, excusable neglect, or other reason justifying relief.  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).

Records
of the Department of Labor’s Mine Safety and Health Administration (“MSHA”)
indicate that the proposed assessment was delivered on January 14, 2019, and
became a final order of the Commission on February 13, 2019.  During that time,
Freeport alleges that it was short-staffed due to the resignation of two
employees in its industrial hygiene program and that its Superintendent for
Health & Safety, who is responsible for reviewing MSHA’s proposed
assessments, was also covering the tasks of the industrial hygiene program.  Freeport
believed it had followed its typical procedure, which is to forward proposed
assessments it intends to contest to outside counsel.  However, on April 4,
2019, having failed to timely contest or pay the assessment, MSHA sent a delinquency
notice to Freeport.  Upon receipt of MSHA’s delinquency notice, Freeport’s
Superintendent promptly sent the notice to its outside counsel who also
promptly filed a motion to reopen the final penalty assessment.  The Secretary
does not oppose the request to reopen, but urges the operator to take steps to
ensure that future penalty contests are timely filed. 

Having
reviewed Freeport’s request and the Secretary’s
response, we find that Freeport failed to timely contest penalties
through inadvertence or mistake, and that such inadvertence or mistake
constitutes good cause to reopen the penalty proceeding.  In the interest 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/ Marco M. Rajkovich, Jr.

Marco
M. Rajkovich, Jr., Chairman

/s/ William I. Althen

William
I. Althen, Commissioner

/s/ Arthur R. Traynor, III

Arthur R. Traynor, III, Commissioner

Distribution:

Laura
E. Beverage

Jackson
Kelly PLLC

[email protected]

Emily
Scott, Esq.

Office
of the Solicitor

[email protected]

Chief
Administrative Law Judge Glynn Voisin

Federal
Mine Safety & Health Review Commission

[email protected]

Melanie
Garris

Office
of Civil Penalty Compliance

Mine
Safety and Health Administration

[email protected]