Secretary of Labor v. Rockwell Mining, LLC

Plain-English summary

The Commission vacated an earlier order denying Rockwell Mining's settlement and directed the Judge to reconsider it under the Commission's settlement-review standard. The agreement resolved seven citations, left three penalties unchanged, reduced three penalties, and vacated a cleanup-program citation. Judge William B. Moran explained that the Commission treated mutually acceptable party assertions as sufficient supporting facts and did not require the Secretary to prove a hearing-worthy factual dispute or justify each percentage reduction. Applying that instruction, he approved a total penalty of $5,232 instead of the proposed $6,977 and dismissed the case upon payment.

Decision snapshot

• Cited standards: 30 C.F.R. §§ 75.202(a), 75.380(d)(4), 75.400-2, and 75.604(b)
• Outcome: The seven-citation settlement was approved for $5,232, including one vacated citation and three reduced penalties.
• Key point: Under the Commission's remand instructions, mutually acceptable assertions supporting the agreed penalties satisfied settlement review without separate proof of a legitimate hearing dispute.

Full text (FMSHRC public release)

FEDERAL MINE SAFETY
AND HEALTH REVIEW COMMISSION

OFFICE OF
ADMINISTRATIVE LAW JUDGES

1331 Pennsylvania
Avenue, NW, Suite 520N

Washington, DC
20004-1710

Phone: (202) 434-9933
| Fax: (202) 434-9949

September 20,
2018

SECRETARY
OF LABOR,                                :     CIVIL PENALTY PROCEEDING

MINE
SAFETY AND HEALTH                      :

ADMINISTRATION
(MSHA),                        :     Docket No. WEVA 2017-0220

Petitioner,                          :     A.C.
No. 46-06618-427999

v.                                                   :    

:    

ROCKWELL MINING, LLC ,                            :     Mine:
Gateway
Eagle Mine

Respondent.                      :

DECISION UPON
REMAND

Before:
Judge Moran

In
a Decision, issued August 2, 2018, the Commission, upon interlocutory review,
concluded that this Court “applied an incorrect legal standard in denying the
settlement motion and abused [its] discretion.” Sec’y of Labor,
Mine Safety and Health Admin. (MSHA), v. Rockwell Mining, LLC , 40 FMSHRC ,
slip op. at 1, 2018 WL 3830146 1 (Aug. 2, 2018) (hereinafter Rockwell ) . It then
vacated the Court’s “order denying the settlement motion and remand[ed] for
further proceedings.” Id. Specifically, the Commission remanded the
matter “for reconsideration consistent with [its] opinion and [its]
decision in AmCoal issued on this date.” Id. at 4, 2018 WL at 3
(emphasis added), citing Sec’y of Labor, Mine Safety & Health Admin.
(MSHA) v. The American Coal Company and United Mine Workers of America and
United Steel, Paper and Forestry, Rubber Mfg., Energy, Allied Indus. and
Service Workers International Union , 40 FMSHRC , slip op., 2018 WL
3830145 (Aug. 2, 2018) (hereinafter AmCoal ).

In
its May 9, 2018 decision denying settlement, the Court recounted the
information provided in the parties’ motion:

Citation
No. 9068232, which alleged a violation of 30 C.F.R. § 75.202(a), was proposed
for a penalty reduction from $446.00 to $244.00. This citation alleged that,

on
the CO #2 section, 012/013 MMU, the rib area of the #3 entry, on the inby right
rib corner across from the loading point, has not been supported or otherwise
controlled to protect persons from hazards related to fall of the rib. When
checked, the rib corner was found cracked and loose. When the rib was pulled,
the corner fell in two pieces. When measured, one piece was approximately
18”x21”x10” and was rectangular in shape and the second piece was approximately
12”x21”x9” and was triangular in shape.

Citation
No. 9068232 (formatting added).

The
Secretary alleged that this violation was S&S, reasonably likely to result
in lost workdays or restricted duties for one person, and the result of
moderate negligence.

In support of the proposed penalty reduction for this
citation, the motion stated,

the Respondent argues that the evidence would establish that it
was not negligent. The Respondent was taking steps to control the ribs by
installing rib bolts throughout the section as needed. Furthermore, the cited
conditions likely occurred since the most recent examination in the area. The
Secretary notes that no rock dust was observed in the cracks in the ribs
indicating that the cracks were fairly recent. Taking into account the
Respondent’s arguments, as well as the uncertainties of litigation, the Secretary
has agreed to a reduced penalty.

Mot.
at 3.

Citation No. 9070540, which alleged a
violation of 30 C.F.R. § 75.380(d)(4), was proposed for a penalty reduction
from $2,598.00 to $2,000.00. The citation alleged that,

The
operator failed to maintain 6 foot of clearance on the branch line leading from
secondary escapeway lifeline to the section refuge chamber, on 1 Section (010
and 011 MMU), in that upon arrival to the section a 6 man Diesel mantrip was
observed parked under the branch line leading from the secondary escapeway
lifeline to the section refuge chamber.

Citation
No. 9070540.

The Secretary alleged that this
violation was S&S, reasonably likely to result in permanently disabling
injuries for 10 persons, and the result of moderate negligence.

In support of the proposed penalty
reduction for this citation, the Motion stated,

the
Respondent argues that the evidence would establish that it was not negligent
because there is no evidence as to how long the referenced mantrip was parked
beneath the branch line or that management was aware of its presence. Taking
into account the Respondent’s arguments, as well as the uncertainties of
litigation, the Secretary has agreed to a reduced penalty.

Mot.
at 3-4.

Citation No. 9070542, which alleged a
violation of 30 C.F.R. § 75.604(b), was proposed for a penalty reduction from
$666.00 to $443.00. The citation alleged that,

The
operator failed to effectively insulate and seal a permanent splice in the
energized 995 volt trailing cable suppling [sic] power to the Co.# 251
continuous mining machine located on the right side of the 1 Section (010and
011MMU), in that an opening was observed in the permanent splice exposing the
energized insulated inner conductors.

Citation
No. 9070542.

The Secretary alleged that this
violation was S&S, reasonably likely to result in permanently disabling
injuries for one person, and the result of moderate negligence.

In support of the proposed penalty
reduction for this citation, the Motion stated,

the
Respondent argues that the levels of gravity and negligence were overwritten.
The Respondent would argue that the violation should not have been issued as
S&S because there were no exposed inner leads in the splice. Respondent
also argues that the cable is being moved on a continuous basis and the damage
to the splice likely occurred sometime after the most recent weekly electrical
examination. Taking into account the Respondent’s arguments, as well as the
uncertainties of litigation, the Secretary has agreed to a reduced penalty.

Mot.
at 4, Decision Denying Settlement at 1-3.

The
Court also summed up the motion, noting that, “[s]even citations are involved
in this docket. The settlement motion proposed penalty reductions for three
citations, and the Respondent agreed to pay the proposed penalties for three
more, with no modifications.” Decision Denying Settlement at 1.

The motion also informed the Court that
the Secretary had decided to vacate Citation No. 9070543, which alleged a
violation of 30 C.F.R. § 75.400-2. That citation, issued under section 104(a), initially
alleged that “[t]he operator failed to follow the cleanup program on 1 Section
(010 and 011 MMU), in that roadway coal spillage is present from the active
pillar line to the section dump and from #1 entry to #8 entry. This creates
slip, trip and fall hazards for mine personn[el] in the event of a rock fall
trying to escape the rock fall.” Citation No. 9070543, issued November 30, 2016.
The cited standard, 30 C.F.R. § 75.400-2, titled, “Cleanup program,” provides,
in relevant part, that “[a] program for regular cleanup and removal of
accumulations of coal and float coal dusts, loose coal, and other combustibles
shall be established and maintained.”

The condition or practice was then
modified to state that the “[t]he operator’s cleanup program on 1 Section (010
and 011 MMU) is deficient, in that rock, hydraulic oil cans, timber saw butts
and metal are present across the section, presenting tripping hazards.”  Citation
No. 9070543-01. Subsequently, because the operator had made “good efforts” to
correct the cited conditions, more time was granted on December 5, 2016, to
perform more cleaning.  Finally, on December 11, 2016, the citation was
terminated as “[t]he section has been cleaned and all combustible material
[was] removed.” Citation No. 9070543-03. The gravity for the injury was marked
as “Reasonably Likely,” and “Permanently Disabling,” and designated as
“Significant and Substantial,” with the negligence listed as “Moderate.”  The
proposed penalty for that now vacated citation was $722.00, an amount, like
each of the citations in this docket, that included a 10 (ten) percent
reduction for “good faith.”

Two of the reduced penalties, Citation
Nos. 9070540 and 9070542, were in the same area 1 Section: 010 MMU and 011 MMU,
as the vacated citation. The total proposed penalty amount was $6,977.00, with
that amount representing the 10% across the board reduction for “good faith.” The
proposed settlement is for $5,232.00. This amounts to a 25% reduction from the
total proposed penalty.” [1]
Id. at 1.

The
Commission’s Decisions in Rockwell and AmCoal

To comply with the remand order,
the Court must first recount the Commission’s holdings in those decisions.

In
its August 2, 2018 decision in Rockwell, remanding this matter for
further proceedings, the Commission instructed the Court to conduct
“reconsideration consistent with this opinion

and
[its] decision in AmCoal issued on this date.” Rockwell, slip op.
at 4, 2018 WL at *3. Therefore, as stated, it is first necessary to discuss the
Commission’s decisions in those two matters. The Commission noted that in
“evaluat[ing] settlement motions, [it] consider[s] ‘whether the settlement of a
proposed penalty is fair, reasonable, appropriate under the facts, and protects
the public interest.” The American Coal Co ., 38 FMSHRC 1972, 1976 (Aug. 2016).”
Id . at 3. It then acknowledged that to make that evaluation both the “Commission
and its Judges ‘must have information sufficient to carry out this
responsibility.’” Id., citation omitted.

To accomplish this, the Commission,
citing Commission Procedural Rule 31, 29 C.F.R. §2700.31, stated that “for each
violation” a motion to approve penalty settlement must include three things:

(1)   
the
penalty proposed by the Secretary;

(2)   
the
amount of the penalty agreed to in settlement;

(3)   
“facts”
in support of the penalty agreed to by the parties.

Id .

The Commission determined that the Court
erred in denying the settlement motion in two particulars. First, it noted as
error that the Court “did not refer to or apply the [Rule 31] standard … that
[the Commission] use[s] for evaluating penalty reductions in settlement[s]. [2] Id.

Second, the Commission determined that
the Court “erred in concluding that a motion to approve settlement must include
an acknowledgement by the Secretary that the Respondent's assertions present
legitimate questions of fact which are in dispute and can only be resolved
through the hearing process. …[Instead,] facts alleged in a proposed settlement
need not demonstrate a ‘legitimate’ disagreement that can only be resolved by a
hearing.” Id. , and citing its AmCoal decision issued the same day
as Rockwell.

The Commission uses the term “facts” in
a sense that the Court had not previously applied to that term. The Court was
applying what it heretofore thought was meant by “facts,” that is, “[a] thing
that is known or proved to be true.” Fact, Oxford English Dictionary
(online ed.); something that has actual existence; a piece of information
presented as having objective reality; the quality of being actual. Fact, Merriam-Webster
(online ed.); “[a] fact is a statement that is consistent with reality or can
be proven with evidence. The usual test for a statement of fact is
verifiability.” Fact, Wikipedia , Wikipedia (Sept. 17, 2018), https://en.wikipedia.org/wiki/Fact.

Of course, the Court understands that
the parties may, in the context of a settlement motion, have a different view
of what the facts are and that they need not necessarily agree on what they
actually are. It was on the basis of that understanding that the Court sought a
representation from the Secretary that the Respondent's assertions present legitimate
questions of fact which are in dispute and can only be resolved through the
hearing process. The Commission has stated this is not required in settlements.
Instead, it has instructed that it is sufficient for the parties to submit
facts that reflect a mutual position that the parties have agreed is acceptable
to them in lieu of the hearing process. This means that such submitted “facts”
are sufficient where they “reflect a mutual position that the parties have
agreed is acceptable to them.” Rockwell , slip op. at 3, 2018 WL
at *3. Obviously, the Court plays no role in that mutual position of the
parties. Now the Court realizes that, in the context of a settlement, facts may
be different from the findings of facts resulting from a hearing. Still, it
seems to be a misnomer, in the context of a citation, to call one side’s, or
the other’s, statements to be facts. Rather, they are assertions about the parties’
view of the allegations and or conditions surrounding a citation or order, with
the key determinant being whether they have reached a mutual position that is
acceptable to them. Acceptability to the Court then, apparently under the
Commission’s view of the Court’s role in carrying out section 110(k), is to
apply the three elements, as described above.

For the Commission, in settlements, “facts”
may “reflect a mutual position that the parties have agreed is acceptable to
them in lieu of the hearing process.” Id (citation omitted). This occurs
where “the parties find and agree upon a mutually agreeable position that
resolves the dispute and obviates the need for further proceedings.” Id. (citation
omitted). Expressed differently, the Commission has stated the Rule 31 facts “may
include a description of an issue on which the parties have agreed to
disagree.” Id. Facts of this nature do “not require concessions from
parties in settlement as long as the parties provide mutually acceptable
facts that demonstrate the proposed penalty reduction is fair, reasonable,
appropriate under the facts, and protects the public interest.” Id. (emphasis
added).

Accordingly, by virtue of the submission
of a settlement motion, in all instances the parties have implicitly provided
“mutually acceptable facts.” And those “facts” may be composed entirely upon “a
description of an issue on which the parties have agreed to disagree.” Id.
at 3, 2018 WL at *3.

As noted, the Commission’s remand
directed further proceedings for reconsideration consistent with its opinion in
Rockwell and its decision in AmCoal issued on the same date. Therefore
the Court now takes into account the Commission’s decision in AmCoal . To
begin, the Commission held that the criteria in section 110(i) of the Mine Act
are not to be applied “in an overly rigid manner.” AmCoal , slip op. at
6, 2018 WL at 5. Further, the Commission held that it is not true “that the facts
supporting the settlement ‘must be tied to the six statutory criteria in
[s]ection l l0(i).’” Id. In this regard, the Commission stated that although
it “has previously explained that standards for factual support for a penalty
reduction in settlement may be found in section l l0(i),” it has also expressed
“that ‘parties may submit facts supporting a settlement that fall outside of
the section 110(i) factors but that support settlement.’” Id. at 7, 2018
WL at 5.

Rather,
the Commission has stated “there may be considerations beyond the six statutory
criteria of section 110(i) that are relevant to whether a settlement proposal
is fair, reasonable, appropriate under the facts, and protects the public
interest.” Id. citations omitted.

In
its AmCoal decision, the Commission identified that such other
considerations include “that the operator had agreed to accept all of the
citations as written,” endorsing the Secretary’s statement that “the fact that
the proposed settlement preserves all of the citations as written could assist
the Secretary in future enforcement efforts against this operator by ensuring
that the paper record reflects the Secretary's views regarding gravity and
negligence stated in the citations.” Id. Thus, AmCoal instructs
that it is proper to consider the “value of accepting the citations as written
on future enforcement actions.” Id.

Further, the
Commission instructed that a judge is “to accord due consideration to the
entirety of the proposed settlement package, including both its monetary and
nonmonetary aspects.” Id. , citation omitted.

In discussing what constitute “facts”
for a settlement, the Commission stated “there is no requirement that facts
supporting a proposed settlement must necessarily be submitted by the
Secretary. Facts supporting a penalty reduction in a settlement motion
may be provided by any party individually or by parties collectively.” Id. at
8 (emphasis added), 2018 WL at *6. The only associated requirement with such
“facts” is that “there is a certification by the filing party that any
non-filing party has consented to the granting of the settlement motion.” [3] Id.

Accordingly, the Commission rejected the
view that a respondent’s assertions of fact need to “present legitimate
questions of fact,” and further that the Secretary need not comment yea or nay
to the facts asserted by a respondent. Id.

Instead, the Commission announced that
“[f]acts alleged in a proposed settlement need not demonstrate a ‘legitimate’
disagreement that can only be resolved by a hearing. The Commission's
Procedural Rules and standing precedent do not contain such a requirement.” Id.
at 9, 2018 WL at *6. Instead, the Commission will allow that the “parties may
submit facts that reflect a mutual position that the parties have agreed is
acceptable to them….” Id .

As the Commission did not expressly set
forth how one discerns that the submitted facts “reflect a mutual position that
the parties have agreed is acceptable,” the Court infers that the act of
submitting the settlement reflects such a mutually acceptable position from the
parties, else the submission could not be denominated a “settlement.” That this
is the case is reflected by the Commission’s statement that it is “‘[ i ] nherent
in the concept of settlement [ ] that the parties find and agree upon a
mutually acceptable position that resolves the dispute and obviates the need
for further proceedings.’” Id. , citation omitted.

To meet Rule 31, it is enough, the
Commission has stated, to “include a description of an

issue
on which the parties have agreed to disagree. The Commission does not require concessions
from parties in settlement as long as the parties provide mutually acceptable
facts

“that
demonstrate the proposed penalty reduction is fair, reasonable, appropriate
under the facts,

and
protects the public interest. ” Id. (emphasis added). That
phrase, repeated seven (7) times in AmCoal , is unadorned. Rather, in
terms of any tangible guideposts as to its meaning, a court is directed to
ascertain whether:

(1)   
there
has been a penalty proposed by the Secretary;

(2)   
the
settlement motion reflects the amount of the penalty agreed to in the
settlement;   and

(3)   
whether
there are “facts” which reflect a mutual position that the parties have agreed 
 is acceptable to them.

Thus, the
Commission has held, per its decisions in Rockwell and AmCoal , that
the

presence
of these three elements are consonant with Congress’ inclusion of Section
110(k) of the Mine Act, addressing the subject of “Compromise, mitigation, and
settlement of penalty,” which provides in relevant part that “[n]o proposed
penalty which has been contested before the Commission under section 815(a) of
this title shall be compromised, mitigated, or settled except with the approval
of the Commission.”  

30
U.S.C. § 820(k).

In evaluating the propriety of
settlements, the Commission also eschewed the idea that the Secretary is
required “to provide an explanation for the specific numerical percentage
reduction of each penalty.” Id. In this regard the Commission stated
that there may be non-monetary considerations that also support settlement that
are not amenable to “explanation about why a particular numerical reduction is
appropriate for a violation.” Id . at 10, 2018 WL at *7.

The
Commission has “recognized that, in reviewing information supporting a reduced penalty
in settlement, a Judge ‘need not make factual findings with respect to each of
the section 110(i) factors as a Judge would in the assessment of a penalty after
hearing.’” Id. at 9, citation omitted . Last, the Commission also
held that it was error for the Court to require that the Secretary need “provide
an explanation for the specific numerical percentage reduction of each
penalty.” Id.

Application
of the Commission’s decisions in Rockwell Mining and AmCoal

Pursuant to the entirety of the
Commission’s decisions in Rockwell Mining and AmCoal , the
settlement motion and in obeisance to those decisions, the Court finds that the
motion contains:

(1) the penalty proposed by the
Secretary;

(2) the amount of the penalty agreed to
in settlement;

(3)
“facts,” as the Commission has employed that term, in support of the penalty agreed
to by the parties.

The Court finds that the settlement
motion meets the Commission’s expressed requirements for settlement approval as
expressed in Rockwell Mining and AmCoal and, on that basis, it is
approved.

In sum the settlement amounts for the
citations in issue are as follows:

Citation           Assessment      Settlement

4201556          $1,484
           $1,484

9068232          $446                $244

9070540          $2598              $2,000

9070542          $666                $443

9070543          $722                $0
(Vacated by Secretary)

9065102          $446                $446

9065104          $615                $615

TOTAL:
        $6,977             $5,232

Within 30 days of this Order approving
this settlement, the Respondent shall send to

MSHA
a check in the amount of $5,232.00, made payable to “U.S. Department of
Labor/MSHA”, and mailed to the following address: P.O. Box 790390, St. Louis,
MO 63179-

0390.

WHEREFORE, the motion to
approve settlement is GRANTED.

It is ORDERED that the respondent pay a
civil penalty of $5,232.00.  Upon receipt of timely payment, the captioned case
is DISMISSED .

SO ORDERED.

/s/
William B. Moran

William
B. Moran

Administrative
Law Judge

Distribution:

John
Opperman

Blackhawk
Mining LLC

3228
Summit Square Place, Suite 180

Lexington,
KY 40509

Robert
S. Wilson

Regional
Counsel

Office
of the Solicitor

U.S.
Department of Labor

201
12th St. South, Suite 401

Arlington,
VA 22202-5450

April
Nelson, Esq.

Office
of the Solicitor

US
Department of Labor

201
12th St. South, Suite 401

Arlington,
VA 22202-5450

Ali
Beydoun, Esq.

Office
of the Solicitor

US
Department of Labor

201
12th St. South, Suite 401

Arlington,
VA 22202-5450

Melanie
Garris

Office
of Civil Penalty Compliance, MSHA

U.S.
Department of Labor

201
12th Street South, Suite 401

Arlington,
VA 22202-5450

Laura
Karr, Esq. and Arthur Traynor, III, Esq.,

United
Mineworkers of America,

15354
Quantico Gateway Dr., Suite 200,

Triangle,
VA 22172

Daniel
Kovalik, Esq.,

United
Steelworkers,

Five
Gateway Center,

60
Boulevard of the Allies

Pittsburgh,
PA 15222

[1] As will be
discussed more fully within, the Commission, concluding that the Court “applied
an incorrect legal standard in denying the settlement motion and abused [its]
discretion,” rejected the Court’s reliance in its denial that “that [while] the
penalty reduction proposed here is relatively modest, … Commission approval
under section 110(k) is not simply about dollars [and the Court’s conclusion
that for ] … two of the three citations … discussed above, the Secretary
provided no substantive or case-specific information following the Respondent’s
contentions. The repeated allusion to uncertainties of litigation does nothing
to help the Court discern whether there is a legitimate dispute of fact or law
at issue here.” Court’s Denial at 3.

[2] In this
decision upon remand, the Court hereby expressly refers to Commission Rule 31.

[3] It would
difficult to imagine a “settlement” motion where one party does not consent to
the granting of the motion.