Secretary of Labor v. Essroc Cement Corp.

Plain-English summary

Essroc failed to file its answer with the Commission, and an unanswered show-cause order became a final default. The company had sent MSHA a detailed position statement and continued settlement communications with both the conference representative and the Solicitor's Office, leading it to believe the case remained active. The Secretary confirmed receiving the position statement and did not oppose reopening, while criticizing Essroc's office procedures. The Commission found the substantial response and continued post-default negotiations sufficient in the interest of justice. It reopened the proceeding, vacated the default, and remanded the penalty case.

Decision snapshot

• Cited authority: 30 U.S.C. §§ 823(d)(1) and 823(d)(2)(A)(i); 29 C.F.R. §§ 2700.1(b), 2700.69(b), and 2700.70(a)
• Outcome: The final default order was vacated and the proceeding was remanded.
• Key point: A detailed response sent to MSHA and settlement talks that continued after default supported reopening despite poor filing procedures.

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.

ESSROC
CEMENT CORP.

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Docket
No. WEVA 2013-1310-M

A.C.
No. 46-00007-330019

BEFORE:  Althen,
Acting Chairman; Jordan, 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. (2012) (“Mine Act”).  On November 10, 2014, the
Commission received from Essroc Cement Corp. (“Essroc”) a motion seeking to
reopen a penalty assessment proceeding and relieve it from the Default Order
entered against it. 

On
December 18, 2013, the Chief Administrative Law Judge issued an Order to Show
Cause in response to Essroc’s failure to timely answer the Secretary of Labor’s
October 21, 2013 Petition for Assessment of Civil Penalty.  By its terms, the
Order to Show Cause was deemed a Default Order on January 21, 2014, when it
appeared that the operator had not filed an answer within 30 days.  On May 28,
2014, MSHA mailed a delinquency notice to Essroc.  After receiving no response,
MSHA sent the case to the U.S. Treasury for collection on September 18, 2014.      

Essroc asserts that it submitted  a
detailed position statement, dated December 13, 2013, to MSHA and the
Commission,  and believed that it was participating in ongoing negotiations regarding
the case with the Conference and Litigation Representative (“CLR”) and
Solicitor.  The operator offers e-mail correspondence demonstrating that it
submitted the answer to MSHA on December 17, 2013.  The answer, however, does
not appear to have ever been sent to the Commission, and the operator does not
offer any proof of delivery of the answer to the Commission.  The operator further
claims that it was led to believe by MSHA that negotiation of the case was
still ongoing.  Specifically, it cites e-mail correspondence where the CLR
allowed additional time for the operator to submit its  position statement [1]
as well as an e-mail where the CLR thanked the operator for submitting the
answer while informing Essroc that it would “start reviewing [its] mitigation”
upon returning after the holidays.  The operator also cites an e-mail from the
Solicitor giving notice of substitution of counsel to the operator on March 4,
2014 and inquiring about the operator’s settlement positions.  Finally, Essroc
claims that it never received the Order to Show Cause, and that it did not know
that the case had been closed until it was contacted by the collections office
on November 6, 2014.  However, U.S. Post Office records show that on December
21, 2013, a notice of attempted delivery of the Order to Show Cause was left
with Essroc. 

The Secretary does not oppose the
request to reopen, and he confirms that he received the December 13, 2013  position
statement from the operator.  However, he notes that his decision not to oppose
reopening in this case should not be construed as condoning Essroc’s
“inadequate or sloppy office procedures.”  The Secretary urges the operator to
take steps to ensure that it timely responds to petitions, Administrative Law
Judge’s orders and MSHA delinquency notices in the future.                                                      

The
Judge’s jurisdiction in this matter terminated when the default occurred.  29
C.F.R.   § 2700.69(b).  Under the Mine Act and the Commission’s procedural
rules, relief from a judge’s decision may be sought by filing a petition for
discretionary review within 30 days of its issuance.  30 U.S.C. §
823(d)(2)(A)(i); 29 C.F.R. § 2700.70(a).  If the Commission does not direct
review within 40 days of a decision’s issuance, it becomes a final decision of
the Commission.  30 U.S.C. § 823(d)(1).  Consequently, the Judge’s order here has
become a final decision of the Commission.  

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”); Jim
Walter Res., Inc. , 15 FMSHRC 782, 786-89 (May 1993).  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 will be permitted.  See Coal Prep.
Servs., Inc. , 17 FMSHRC 1529, 1530 (Sept. 1995).

Having reviewed Essroc’s request and the Secretary’s
response, in the interest of justice, we
hereby reopen the proceeding and vacate the Default Order.  Essroc’s December
13, 2013 position statement represented a very substantial, albeit untimely,
response to the Secretary’s Petition for Assessment of Civil Penalty, and the
Secretary’s counsel continued discussing resolution of the case with Essroc
past the time when the Order of Default became final.   

Accordingly,
this case is remanded 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.

/s/ William I. Althen

William I. Althen, Acting Chairman

/s/ Mary Lu Jordan

Mary Lu Jordan, Commissioner

/s/ Michael G. Young

Michael G. Young, Commissioner

/s/ Robert F. Cohen, Jr.

Robert F. Cohen, Jr., Commissioner

Distribution:

Christine
E. Blackston

Manager,
Safety & Regulatory Compliance

Essroc
Cement Corp.

3152
Bath Pike

Nazareth,
PA 18064

W.
Christian Schumann, Esq.

Office
of the Solicitor

U.S.
Department of Labor

201
12th St. South, Suite 500

Arlington,
VA 22202-5450

Chief
Administrative Law Judge Robert J. Lesnick

Federal
Mine Safety & Health Review Commission

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

Washington,
DC 20004-1710

Melanie
Garris

Office
of Civil Penalty Compliance

Mine
Safety and Health Administration

U.S.
Department of Labor

201
12th St. South, Suite 500

Arlington,
VA 22202-5450

[1]   A CLR does not
have the authority to grant an extension of time for an operator to file an
answer.