Secretary of Labor v. Performance Coal Company (Commission decision, January 27, 2010)

Plain-English summary

Performance Coal missed the deadline to contest penalties totaling $34,269 for 19 violations. It said a proposed assessment was misplaced during a change in safety directors, when offices and files were moved and the incoming director was being trained. The company found the assessment in October and promptly sent it to counsel. The Secretary opposed reopening because the company's internal procedures had been inadequate. The Commission held that the general reference to a personnel transition lacked enough detail and denied reopening without prejudice.

Decision snapshot

• Governing provisions: 30 U.S.C. § 815(a); 29 C.F.R. § 2700.1(b)
• Outcome: The request to reopen was denied without prejudice.
• Key point: A company seeking relief from a final assessment must give a detailed account of how a staffing transition caused the missed contest deadline.

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

January 27, 2010

SECRETARY OF LABOR,

MINE SAFETY AND HEALTH

ADMINISTRATION (MSHA)

v.

PERFORMANCE COAL COMPANY

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Docket No. WEVA 2009-370

A.C. 46-08436-157026

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 December 1, 2008, the Commission received from Performance Coal Company (“Performance”) a motion by counsel 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).

On July 15, 2008, the Department of Labor’s Mine Safety and Health Administration issued a proposed penalty assessment for 19 violations totaling $34,269 to Performance. Performance states that it received the proposed penalty assessment on July 25, 2008. It explains that it failed to timely process the proposed assessment because of a change in safety directors at the company around the time of its receipt of the proposed assessment. Specifically, Performance states that the transition occurred between June and August 2008. In June and July 2008, Performance states that its current safety director was frequently out of the office for up to two weeks at a time, while the new safety director, who did not assume responsibility until August, was being trained. It asserts that during this transition, the proposed assessment was misplaced when files and offices were moved and was not discovered until October 20, 2008.

Upon discovering the overdue assessment, the operator states that it promptly submitted the assessment to its counsel on October 21.

The Secretary opposes reopening the proposed penalty assessment, maintaining that Performance has failed to establish the existence of “exceptional circumstances.” Specifically, the Secretary contends that for two months, the operator’s system for handling penalty assessments was inadequate, which militates against reopening. She states that inadequate or unreliable internal procedures do not constitute an adequate excuse to reopen.

Having reviewed Performance’s request and the Secretary’s response, we conclude that Performance has failed to provide a sufficiently detailed explanation for its failure to timely contest the proposed penalty assessment. Performance’s explanation that it failed to file a timely contest due to a “change in safety directors,” without further elaboration, does not provide the Commission with an adequate basis to justify reopening of the assessment.

Accordingly, we
deny without prejudice Performance’s request. See, e.g., Eastern Associated Coal LLC, 30 FMSHRC 392, 394 (May 2008); James Hamilton Constr., 29 FMSHRC 569, 570 (July 2007).

Mary Lu Jordan, Chairman

Michael F. Duffy, Commissioner

Michael G. Young, Commissioner    

Robert F. Cohen, Jr., Commissioner

Distribution:

Carol Ann Marunich, Esq.

Dinsmore & Shohl, LLP

215 Don Knotts Blvd., Suite 310

Morgantown, WV 26501

Myra James, Chief

Office of Civil Penalty Compliance

MSHA

U.S. Dept. Of Labor

1100 Wilson Blvd., 25th Floor

Arlington, VA 22209-3939

W. Christian Schumann, Esq.

Office of the Solicitor

U.S. Department of Labor

1100 Wilson Blvd., Room 2220

Arlington, VA 22209-2296

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