Secretary of Labor v. Kemper Equipment, Inc. (Commission decision, February 27, 2013)

Plain-English summary

Kemper timely contested a citation and order, but its vice president did not forward the later proposed penalty assessment to counsel because she mistakenly believed the earlier contests also covered the penalties. The Mine Act requires separate filings: contesting a citation does not contest its later penalty. Although Kemper missed that second deadline, the Secretary did not oppose relief. The Commission reopened the penalty assessment, vacated the dismissal of the citation contests, and remanded all matters for adjudication.

Decision snapshot

• Governing authority: 30 U.S.C. §§ 815(a) and 815(d); 29 C.F.R. §§ 2700.21(a) and 2700.26
• Outcome: The proposed penalty assessment was reopened, the dismissal order vacated, and the cases remanded.
• Key point: Citation contests and penalty contests are separate filings, but an excusable internal misunderstanding may support reopening.

Full text (FMSHRC public release)

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

1331 PENNSYLVANIA AVENUE, NW, SUITE 520N

WASHINGTON, D.C. 20004-1710

February 27, 2013

SECRETARY OF LABOR,

MINE SAFETY AND HEALTH

ADMINISTRATION (MSHA) 

v.

KEMPER EQUIPMENT, INC.

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Docket No. WEVA 2010-1316-RM

Citation No. 8574124

Docket No. WEVA 2010-1317-RM

Order No. 8574125

BEFORE: Jordan, Chairman; Young and Nakamura, Commissioners

DECISION

BY THE COMMISSION: 

These captioned contest cases arise under the Federal Mine Safety and Health Act of 1977, 30 U.S.C. § 801 et seq. (2006) (“Mine Act”). On June 7, 2010, the Mine Safety and Health Administration (“MSHA”) issued Citation No. 8574124 and Order No. 8574125 to Kemper Equipment, Inc. (“Kemper”) pursuant to section 104(d)(1), 30 U.S.C. § 814(d)(1). Subsequently, Kemper filed notices of contest pursuant to section 105(d), 30 U.S.C. § 815(d). On July 15, 2010, the Commission docketed the contest cases as WEVA 2010-1316-RM and WEVA 2010-1317-RM and issued an order staying the cases pending the issuance of the proposed assessment of civil penalties. The issue presently before us arises from Kemper’s failure to timely contest these proposed civil penalties pursuant to section 105(a), 30 U.S.C.

§ 815(a).

The Mine Act sets forth a scheme of dual filing relating to contests of citations and orders (29 C.F.R. Part 2700, Subpart B), and contests of proposed penalties (29 C.F.R. Part 2700, Subpart C). The filing of a contest of a citation does not constitute a challenge to a proposed penalty for that citation. See 29 C.F.R. § 2700.21(a) (“The filing of a notice of contest of a citation or order issued under section 104 of the Act . . . does not constitute a challenge to a proposed penalty assessment that may subsequently be issued by the Secretary under section 105(a) of the Act . . . which is based on that citation or order.”); 29 C.F.R. § 2700.26 (“A person who wishes to contest a proposed penalty assessment must provide such notification regardless of whether the person has previously contested the underlying citation. . . .”). Thus, after filing the notices of contest for Citation No. 8574124 and Order No. 8574125, the operator was still required to file contests of the associated proposed penalties within 30 days of receipt.

On January 18, 2011, MSHA issued Proposed Assessment No. 000244466 for the aforesaid citation and order. The record indicates that the proposed assessment was delivered to Kemper on January 24, 2011. When Kemper failed to contest the proposed assessment within 30 days of delivery, it became a final order of the Commission. 30 U.S.C. § 815(a). On May 16, 2011, after receiving documentation from MSHA indicating that the time for contesting the civil penalties had lapsed, Chief Judge Lesnick issued an order dismissing the contest proceedings.

On June 8, 2011, the Commission received Kemper’s requests to reopen both the contest and civil penalty cases for the citation and order.

The Commission construed the motion as a
petition for discretionary review of the dismissal order and a request to reopen the associated civil penalty proceeding. On June 27, 2011, review was granted. On July 13, 2011, the Commission ordered Kemper to submit a statement supplying further information regarding the circumstances surrounding its failure to timely contest the proposed assessments. On August 12, 2011, the Commission received Kemper’s opening statement. Kemper asserts that its counsel requested that all correspondence be sent to his office, but never received the proposed assessments. Kemper acknowledges that its vice president received the proposed assessments on January 24, 2011, but did not send them to counsel because she believed they had already been contested.

The Secretary does not oppose the motion to reopen, but notes that it is the responsibility of the operator to contest the proposed assessment or forward it to counsel to contest within 30 days of receipt.

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).

Having reviewed Kemper’s requests and the Secretary’s response, in the interests of justice, we hereby reopen Proposed Penalty Assessment No. 000244466 relating to Citation No. 8574124 and Order No. 8574125, and vacate the order dismissing the subject contest cases. We remand these matters 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, relating to Proposed Penalty Assessment No. 000244466, and the operator shall file an answer to that petition within 30 days after service of the petition. See 29 C.F.R. §§ 2700.28, 2700.29.

/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:

Paul R. Ober, Esq.

Paul R. Ober & Associates

234 N. 6th Street

Reading, PA 19601

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