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Current Issue: Vol23, Nos10 & 11 | June 2016

  • Accidents:
    • Miner severely burned in explosion at Wolfmeier Trucking (224)
    • Marshall County Coal reports two injuries involving underground doorways (225)
    • Rosebud Mining reports two serious limb injuries in 8 days at Madison Mine (225)
    • 4-foot fall causes serious injuries at Ames Plant Dredge(226)
    • Loader Fractures pelvis of worker at Hi-View Quarry (227)
    • Two hurt by pipe burst in Brushy Eagle Mine (227)
    • Bunting Sand & Gravel reports two illnesses from welding in tank (227)
  • Civil Penalties: Judge to decide if delinquent penalties should be considered in latest order (228)
  • Criminal Proceedings: Foreman agrees to forfeit papers where miner died under his watch (229)
  • Diesel Rules: MSHA revisiting diesel exhaust exposure rules (230)
  • Examinations: MSHA proposes rule to expand workplace checks in metal/nonmetal sector (231)
  • Fatalities:
    • Two die in impoundment failure at Harmony Mine & Mill (233)
    • Fatality is second serious incident this year at Ash Grove Cement in Texas (234)
    • Miner crushed under loader in American Coal Co.’s New Era Mine (235)
    • Company neglected unsafe ground conditions before latest death at 4 West (236)
    • MSHA proposes $3,143 fine in drill operator’s death at SSX Gold Mine (239)
  • Imminent Danger: Imminent danger upheld based on inspector’s belief at time of occurrence (241)
  • Investigations: Operator ordered to turn over employee contact information for investigation (242)
  • Safeguards: Winch and cable not “approved equipment” for moving supply cars (244)
  • Review Commission Orders and ALJ Decisions (246)

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Commissioners Appear to Reject Secretary’s Challenge to FMSHRC Settlement Authority

Special report by Kathy Snyder
 All five Presidentially-appointed members of the Federal Mine Safety and Health Review Commission indicated this morning that Judge William Moran did not abuse his discretion when he rejected a proposed settlement between MSHA and Murray Energy Corp.’s American Coal Co. when the Secretary declined to provide further specific justification beyond a statement that the parties wished to settle amicably, referencing the “nature of the citations” and “uncertainties of litigation.”
 Preparation of a formal decision is pending, and the Commissioners are free to change their opinion in the written decision.
 The Secretary’s counsel, Sara Johnson, had argued on July 12 before Chairman Mary Lu Jordan, and Commissioners Patrick Nakamura, Michael Young, Robert Cohen and William Althen, that the Commission judges should take a sharply limited role in settlements compared with practice during the past 38 years.
 According to the Secretary, language in Section 110(k) in the Mine Act specifically requiring settlements to be approved by the Commission should be interpreted in the context of a “greater scheme,” and that legislative history referencing past abuses of the former penalty settlement process should be discounted. Johnson, on behalf of the Secretary, used similar arguments that have been rejected by the Commission, and its judges, since 1979.
 Some Commissioners in their discussion today noted that the Secretary had chosen to create a test case challenging some 35 years of practice, in that providing more information to the ALJ – as traditionally done for other initially rejected settlements –  would almost certainly have resulted in a settlement being achieved.
 “[T]his case may go beyond us,” Commissioner Althen observed. In fact, Associate Solicitor of Labor, Heidi Strassler, said in a May 2, 2014, memo, obtained by Mine Safety and Health News, that the Labor Dept. anticipated “interlocutory appeal to the Commission and likely to the Court of Appeals. The legal issues raised in the test case will therefore take several years to resolve,” Strassler told the Labor Dept. attorneys  in 2014.
 On Tuesday, Chairman Jordan asked Johnson to frame the Secretary’s argument and problems after the Commission’s 2012 decision in Black Beauty Coal Co.
 “Counsel, you said you were asking the Commission to revisit the standard…in Black Beauty. How would you describe that standard? And explain what standard you’re proposing,” Jordan asked Johnson.
 “So in Black Beauty,” responded Johnson, “the Commission said that judges have very wide discretion to reject the Secretary’s proposed settlements, and that Section 110(k) doesn’t set any limits on their ability to do that, other than the Secretary’s prosecutorial discretion to vacate a citation. And the Secretary is suggesting that the standard of review should be more limited than that. … So Black Beauty basically allows for sort of unbounded review of proposed settlements, and the Secretary is arguing that some of the factors that judges have been considering are improper after you look at the Secretary’s prosecutorial role under the Mine Act and the Commission’s review role.”
 Jordan responded back that she was concerned over the Secretary’s “boilerplate” language in the settlements, language, which has been sharply rejected in previous decisions, and for years.
 Johnson said that the Commission’s role was to ensure that a settlement did not present any conflict with Constitutional or statutory provisions outside of 110(k).
 Johnson also told the Commissioners on Tuesday that a “settlement can be used as a tool to change operators’ behavior. An ultimate goal of MSHA’s enforcement program is operator compliance with the Mine Act and the standards so that miners can return home safely to their families after every shift. And through settlement, the Secretary can negotiate proactive terms with operators to promote compliance,” Johnson said.
Johnson said the settlement process “allows agencies to self-correct. When MSHA inspectors issue citations and orders, they make the best on-the spot decisions they can with the information they have. And through the process of contest and litigation, additional considerations, whether legal or factual, can be brought to bear. Settlement allows for a dialogue between MSHA and operators so that adjustments to citations orders and penalties can be made that reflect both the law and the facts as supported by the evidence.”
 Commissioner Robert Cohen noted on Tuesday that this particular case did not involve any dispute as to whether the violations existed, or the degree of negligence, and Johnson admitted during the oral argument that, “In this case, the settlement terms were to maintain the paper as written, with a 30% reduction in…penalties, so this case does not make changes to the paper.”
 Johnson also did not address the fact that in this particular case the Secretary sought an across-the-board 30% reduction in the penalties, some of which were repeat violations of the same standard. For instance, the mine had violated §75.202(a) 106 times in the previous two year period; violated three specific safeguards issued under §75.1403  – 67 times, 72 times, and 56 times; or that in a ventilation violation, there was water up to 5 feet deep in a bleeder that took almost a month to pump out.
 In refusing to approve the settlement, Judge Moran issued a scathing rejection. “The idea that every one of 32 citations could warrant a 30% reduction demonstrates, by that fact alone, that the reductions were more in the nature of yard sale, rather than any individualized review meriting, by some impossibly small odds, that each just happened to have earned such an implausibly uniform reduction… There is no legitimate basis to reduce any of these citations. … Nor can it be said that the cited matters are all negligible violations.”
 During Tuesday’s argument Commissioner Young said “everyone seems to acknowledge” that the case before the Commission “is an exceptional case.” MSHA professes a high degree of confidence in its penalty assessment procedure. If no additional facts are presented, “and all of a sudden there’s a 30% discount on that, how is the judge supposed to view that?  I mean, how is it an abuse of discretion” to want additional information?
 Johnson said the Secretary “would urge the Commission to articulate some boundaries.”
 In Tuesday’s argument there was a debate on whether an ALJ should factor in deterrence to try and prevent similar violation, Johnson was adamant that “deterrence” should not be considered by the ALJ when approving or disproving a settlement. “Deterrence is actually a factor that is more appropriate for [MSHA] to consider rather than [a judge].”
 Johnson also repeated several times that the Labor Dept. has limited resources. And while the legislative history of the Mine Act may indicated that the Commission judge’s have discretion to reject settlements, she said the Secretary doesn’t view the legislative history of the Mine Act “as controlling.”
 During Thursday’s meeting, Commissioner Robert Cohen stated, “The issue is really quite simple. The Secretary’s claim amounts to [chanting] the mantra of uncertainty of litigation,’ while the grand theoretic structure of the Secretary’s brief ignored the nature of the Commission as a special entity created by Congress, purposely with explicit authority over settlement agreements.” Cohen said he would be concerned if an ALJ tried to impose his or her own settlement agreement upon the two parties, and said if that were to happen it should be brought to the Commission’s attention, but there has not been any indication this is occurring.
 Johnson also claimed on Tuesday that the number of settlements have gone up dramatically in the past five years, while in fact, commission judges have rejected only .04% – or 18 of 35,501 settlement cases over the last five years.
 But even if the percentage of rejected settlements has not risen, “there are still systemic costs,” Johnson said.
 “They all get approved eventually, right?” Althen asked.
 “Except for this one,” Johnson said, adding, “Not exactly, because in some cases…sometimes the Secretary goes to trial, and then in other cases, the Secretary vacates a citation.
 Althen then asked if the Secretary “would vacate a legitimate violation because they don’t want to try the case?” Would that “have to based on a principled decision that the case should be vacated?…They wouldn’t vacate a citation just because they didn’t feel like trying it?..”
 “If there are weaknesses in the case, and we’re not getting a settlement through and we don’t think we can prevail at trial, that might encourage the Secretary to vacate rather than go to trial,” Johnson said.
 Commissioner Althen also asked Johnson if an ALJ should determine if a settlement is fair, adequate or reasonable given the facts of a case, but Johnson said, “The Secretary has taken the position that adequacy is not an appropriate factor.”
Heckler v. Chaney and Secretary’s Comparisons
 The Secretary in his brief and in the oral argument before the Commission, said that the case Heckler v. Chaney supports the Secretary’s contention that the Secretary’s decision to settle a case is not reviewable by the Commission.
 In Heckler v. Chaney, death row inmates said the use of lethal injection drugs violated the Federal Food, Drug, and Cosmetic Act (FDCA), and requested that the FDA take various enforcement actions to prevent those violations. The FDA refused the request. The inmates then brought an action in Federal District Court against the Secretary of Health and Human Services, making the same claim and seeking the same enforcement actions, but HHS also refused to take any action.
 The U.S. Supreme Court ruled in this case that an agency’s decision not to take enforcement action is presumed immune from judicial review under §701(a)(2). Such a decision has traditionally been “committed to agency discretion,” and it does not appear that Congress, in enacting the APA, intended to alter that tradition. Accordingly, such a decision is unreviewable unless Congress has indicated an intent to circumscribe agency enforcement discretion, and has provided meaningful standards for defining the limits of that discretion.
 However, in this case before the Commission, MSHA was required by law to take action when inspectors saw violations, and did in fact take action, and the company did in fact contest the cases before the Commission. Parties supporting Commission ALJs’ roles in the settlement procedures, point out that under Sect 110(k), those penalties for those violations can only be compromised, mitigated, or settled with the approval of the Commission, according to Sec. 110(k) of the Mine Act.
 Referring to Heckler v. Cheney, and how it fits into this case,  Commissioner Cohen asked Johnson, “So, your reliance on Heckler v. Cheney assumes no reviewing role. And then you say, ‘Well, there’s some reviewing role because of 110(k),’ and doesn’t that kind of bastardize Heckler v. Cheney, and take it out of its roots, and the specific context that it rose in?”
 Johnson said the Secretary disagreed.
 “When Congress also established the split enforcement scheme in the Mine Act, in addition to 110(k) we have the overall structure of the Mine Act, and the courts have been very clear in that, under that structure, that enforcement authority resides with the Secretary, policy making and enforcement authority is the exclusive provenance of the Secretary, and that the Commission’s role is adjudicatory, fact-finding, a neutral arbiter. And so the kinds of considerations that go into the decision to reach a settlement rather than proceed with an enforcement action are better suited in the Secretary’s enforcement role. And so even though Section 110(k) provides for [Commission] approval, that approval has to be interpreted in the context of that greater scheme, which allocates those distinct and both important responsibilities, but they’re different.”
 Cohen then asked Johnson during the oral argument, “Your entire argument is predicated on the notion that the Commission is analogous to a generalist court, correct?”
 “Yes,” Johnson said, but then Cohen shot back, “You use the phrase ‘generalist court’ repeatedly in your brief. Now how does that square with Section 113(a) of the Act, which provides that the Commission ‘shall consist of five members, appointed by the President by and with the advice and consent of the Senate from among persons who by reason of training, education or experience are qualified to carry out the functions of the Commission under this Act’? The five of us who are up here are not generalist judges. We were appointed because of the qualifications that are set forth in Section 113(a).  Doesn’t that change the equation totally?”
 Johnson answered, “I certainly respect that all of you and the administrative law judges bring expertise about mining to your jobs, and that’s why you’re here…” But Cohen cut in again, “…we bring expertise, we are required by statute, the Senate would not confirm, the President would not appoint us but for this experience.”
Johnson said she was trying to compare the role of the Commission to that of a court.
 “Section 110(k) speaks in the same terms as it does about the Commission’s approval role as it does about the courts’ approval role in settlements,” Johnson said. “So the first sentence of Section 110(k) says that no penalty shall be compromised, mitigated or settled except with the approval of the Commission, but the second sentence goes on to say that final penalties of the Commission shall not be compromised, mitigated or settled except with the approval of the court. And Congress, in speaking of the approval role, gave the Commission and the courts of appeal the very same – it is parallel language, right? And so that strongly suggests that the two roles should be considered similarly.”
 “Okay. But stop there for a second and look at what Congress did” Cohen said. “Your brief contains  10 pages…discussing the legislative history. And it quotes sections of the legislative history. But nowhere in that 10 pages does it mention Congress’s finding that the abuses involved in the unwarranted lowering of penalties as a result of off-the-record negotiations, is why Section 110(k) was created. You never mention in there that Congress found that there were abuses in the settlement of penalties.”
 Johnson finally did acknowledge “there were abuses under MESA…” but Cohen said, “You never mentioned that in your brief. You never acknowledged that there were abuses. Correct?”
 Johnson responded back, “If you’re telling me that we didn’t, I will recognize that.”
 Cohen then continued, “All right. Now, so the same Congress that acted because there were abuses, you’re saying, because of the language in the section, which you analogize to the language in other sections of other acts, you’re saying that Congress did not want any more oversight than what was in those other acts. And it seems to me that what you are in effect saying was that Congress was totally incompetent in passing the Mine Act for one reason, and then writing language which went a totally different direction.”
 “I would submit that Congress did not, in passing the Mine Act and in writing 110(k), did not adopt a policy that disfavored settlements. It says that it recognizes that settlements often serve a valid enforcement purpose,” Johnson answered.
 “And the Commission recognizes that, and approves settlements, thousands of them, correct?” Cohen asked Johnson, who said “the standard in Black Beauty goes beyond the Commission’s adjudicatory role.
 Chairman Jordan then asked of Johnson, “How exactly does it do that?” and Johnson said it was because the judges were “asking the Secretary to show why the original paper should have been lowered…”
 Commissioner Althen then said, “Tens of thousands of settlements have been approved…. So it seems to be what you’re saying is the real problem is not that we can’t settle cases, but the judges are being a pain in the neck about doing it… And so – you’re getting settlements, right? What’s the problem?”
 Johnson said, “there’s three problems with this basis of the compromise requirement. The first is that the basis of the compromise might be bigger than an individual citation. So, in a global settlement, the basis for the compromise might be across multiple citations and not adjusting the gravity or negligence for each individual citation.
 “The second is that the basis of the compromise might be something that’s inappropriate for the Secretary to share with opposing counsel and the judge, so something that implicates attorney-client privilege, or  deliberative process, or government informer privilege. One example might be would be if MSHA has an inspector that retired so we don’t have an available witness. That doesn’t reflect poorly on MSHA, but it does affect our case, and that might increase our likelihood of pursuing a settlement. But to reveal that to operator’s counsel and to the judge means that for all of the other citations out there issued by that same retired inspector, we might be compromised in our ability to get the same deal.
 “And the third problem with this basis of the compromise requirement is that what it really asks the Secretary to do is to polish up the operator’s defenses to make them sound persuasive to the judge…. If the judge denies the settlement, and orders a hearing, then we reveal the weaknesses in our case to the judge, lend credibility, lend legitimacy to what the operator has said, right? And it also means that we’re putting resources into justifying these self-corrections on lower-priority matters rather than aggressively pursuing the higher-priority matters. So for all of those reasons, this basis of the compromise on each individual citation creates problems in individual cases and overall.”
 Some Commissioners indicated at the meeting that they understood the Secretary’s factoring-in practical realities including resource considerations in a decision to settle. However, Commissioner Young also said, “there is a distinction between the public interest and the government’s interest” in some things, including convenience. Young said he was concerned “about the miners who work at the mines, whose interests have to be considered in approving a settlement…. don’t our judges have the duty to ensure that the absent miners who may or may not be party to the case that’s being settled have their interests represented, just as a check-off on the Secretary’s authority – not as a rubber stamp, which is kind of what the class action cases would suggest?”
 “Our position is that the determination, which involves the allocation of resources, the assessment of the strength of the evidence, the decision to proceed with one case over another, and sort of weighing all of those factors together, and figuring out what is most protective for miners, which is MSHA’s interest. That determination is better made by the enforcement agency rather than the Commission, because the Commission is just looking at the individual … reviewing the settlement reached in the individual action,” Johnson said.
 Chairman Jordan asked Johnson, “Congress, don’t you think, put 110(k) in, and we definitely have a role?”
 Johnson said the Secretary is not arguing that the settlements are unreviewable entirely.
 “The courts have been very clear in that, under that structure, that enforcement authority resides with the Secretary, policy making and enforcement authority is the exclusive provenance of the Secretary, and that the Commission’s role is adjudicatory, fact-finding, a neutral arbiter. And so the kinds of considerations that go into the decision to reach a settlement rather than proceed with an enforcement action are better suited in the Secretary’s enforcement role. And so even though Section 110(k) provides for approval, that approval has to be interpreted in the context of that greater scheme, which allocates those distinct and both important responsibilities, but they’re different…. The standard of review that the Secretary’s advancing – it’s not a rubber stamp, there are some teeth in there but they are objective factors to review the settlement rather than putting the Commission in the Secretary’s enforcement bailiwick.”
 That answer, however, was unconvincing to Commissioner Nakamura, who stated at Thursday’s meeting that “the Secretary “has drawn a line in the sand” and that his argument amounted to a “suggestion that we read Section 110(k) out of the statute.”
 Nakamura said the Mine Act “places determination of final penalties with the Commission, even in uncontested cases, while MSHA can only propose a fine.  Even without that section, the Commission would possess inherent authority including the “authority of any tribunal to determine if any settlement is tainted by corruption or collusion,” Nakamura asserted. Section 110(k) has to mean something more than that,” he stated. As to the question of whether the Secretary is the final arbiter of deciding whether a settlement is in the public interest, Nakamura also noted that the Mine Act “equates” the public interest with the interest of the miner and specifically allows miners to question actions by the Secretary.
UWMA Argues in Support of Commission’s Role
 Laura Karr, presenting on behalf of the United Mine Workers, stressed during Tuesday’s meeting that “one of the issues that Congress wanted to solve when they passed the Act was a history of secretive, off-the-record negotiations about settlements…that sometimes gave the appearance of improper collusion between the government and mine operators. So Congress’s response was to create…in the Act a split enforcement scheme under which the Secretary has the power to file charges against operators, withdraw charges and decide to settle charges, but the Commission has the power to do a meaningful evaluation of the settlement proposals and ultimately to approve or reject them. In this case the Secretary’s decided to challenge the system after it being in place and workable for 35 years and argue that they’re not required to give the Commission any of the factual information that is necessary to do that settlement review. In fact according to the Secretary, the Commission can [make?] only the most cursory review of settlement proposals.”
 Commissioner Nakamura asked Karr, “How do you respond to Ms. Johnson’s arguments … [that] sometimes there’s practical problems in telling the judge, publicly saying why it is the agency is settling the case? I mean a lot of us have practiced law before, and we’ve had settlements. Sometimes the reason is, my client lied to me…our case is going to crumble, so let’s get the best settlement we can. And I wouldn’t want to stand in open court and say that. So … how does the Solicitor respond?”
 Karr stressed that over the years, and the numbers indicate that “the Secretary has not had a problem getting around issues like that. … [C]learly in a majority of cases they are able to satisfy the judge’s curiosity, and give the judge enough to feel like he or she can make a reasoned decision on the settlement.” Kar pointed out that in a settlement the Secretary can in fact explain concerns about the case or witnesses, and the judges don’t take “issue with that sort of explanation.”
 Commissioner Althen asked Karr if she thought, in the “real world,” it was fair to assume that the Secretary had “an unlimited budget to try hundreds and hundreds and hundreds of cases?” Althen stressed that the Secretary had to deal with “real world” budget issues. Karr said it wasn’t an issue addressed in their brief.
 Althen asked Karr if the union would accept a “standard of fair, adequate, reasonable and appropriate under the particular facts,” but Karr stressed that the union doesn’t think there needs to be “any single standard,” for the settlements.
 Karr stressed that the union supports the policy and standards used for the last 35 years. Karr said the union was not there to argue for a defined standard on settlements. “What we’re here to do is to defend the right of the Commission to make these decision on and not have the Secretary take over the responsibility of telling the Commission what standard they should apply.”
 Young asked Karr about the possibility of a judge over stepping his or her role.
 “That’s certainly a possibility that’s out there, but the unions would assert that the way to correct that is a case-by-case basis. No one is arguing that the Secretary can’t challenge individual ALJ decisions, to reject settlements, and argument about judge overstepping his bounds and his discretion, we see the Commission is more than capable of resolving those,” Karr stressed. “We know that since the time the Act was passed, the Commission has had a plan in place – its procedural rules – to approve settlements. It’s followed that plan successfully in thousands of cases over the years…. And we know that the legislative history, that Congress had two main reasons for giving the Commission this active role… one being to avoid those secretive, off-the-record, sometimes collusive negotiations that happened under the predecessor statute, and the other to ensure that no settlement occurred without somebody making a reasoned decision that it promotes the public interest in operator compliance.”
 Commissioner Young asked Karr how the Commission was to “ensure without a standard or some kind of recognition of the boundaries of the judge’s discretion that the settlement is appropriate while respecting the Secretary’s policy and prosecutorial prerogative?”
 “Because of the text of 110(k) and the legislative history,” Karr said. “We know that the content of that settlement…that’s not solely a prosecutorial thing. That is an adjudicative process that’s assigned to the Commission.” In terms of individual cases, Karr said the records shows that the “ALJs [are] doing this just fine and it’s worked out for miner safety and health since the Act’s inception.” Karr also stressed that the union wants to see flexibility, and for the ALJs to use “reasoned analysis” as they have done over the last 38 years.
 Karr said the union was concerned that “The Secretary really is trying to take over the Commission’s responsibility of deciding how it is going to approve settlements, how it is going to evaluate them,” and the Secretary has not given any reason as to why his interpretation is better than “the interpretation that the Commission has developed over 35-plus years of practice.”
 In a response to a comment by Commissioner Young regarding Heidi Strasseler’s memo of May 2, 2014, on language that should be placed in each settlement, Karr said, “It clearly was not tailored to the facts at hand, it wasn’t tailored to the citations they were dealing with, and really was not responsive at all to what the judge would ask for…What really happened here?  What was the Secretary’s thought process? How did the Secretary think that this course of action satisfies the purposes of the Act?..A response from the Secretary that ‘I don’t have to give you any factual information at all’ really is not appropriate.”
 Karr also stressed that since the beginning of the Commission, “ALJs have been successfully engaging in dialogue with the Secretary since the Act began successfully getting – even post Black Beauty –  successfully getting information that satisfies judges enough to approve these settlements.”
 “No one [is] challenging [the] Secretary’s discretion to file charges, withdraw or decide to settle, Karr said. “What we are doing is underlining and protecting the Commission’s role…to evaluate and approve those settlements.” Karr said, the Secretary has not given any good argument for upending 38 years of successful settlement practice, and all five Commissioners appeared to agree.
 
Secretary of Labor, MSHA v. The American Coal Co., Docket No. LAKE 2011-13

 

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