DATE: April 8, 1991
CASE NO. 90-STA-16

IN THE MATTER OF

JOE F. THOMAS,
DON DEARMAN,
   COMPLAINANTS,

v.

WESTERN AMERICAN CONCRETE,
   RESPONDENT.

BEFORE:   THE SECRETARY OF LABOR

   Before me for review is the [Recommended] Order of Dismissal issued by Administrative Law Judge Kenneth A. Jennings, on January 25, 1991, in this case which arises under the Surface Transportation Assistance Act of 1982 (STAA), 49 U.S.C. app § 2205 (1988). The ALJ dismissed the complaint of Complainants Thomas and Dearman because, subsequent to the filing of their complaint, Respondent "was placed into involuntary bankruptcy pursuant to Chapter 7 of the Bankruptcy Act". Order of Dismissal at 1. Prior to his Order of Dismissal, the ALJ ordered Complainants to show cause why their complaint should not be dismissed. Complainants failed to respond to that order.

   The basis of the ALJ's decision that this case should be dismissed was his conclusion that the automatic stay provision of the Bankruptcy Act, 11 U.S.C. § 362(a)(1) (1988), applies to this proceeding. For the reasons set forth below, I agree with the ALJ that further action on Thomas' and Dearman's complaint must be stayed, but I do not agree that dismissal of that complaint is appropriate at this time.

   The ALJ correctly concluded that the automatic stay provision in Section 362(a)(1) of the Bankruptcy Act is applicable to STAA proceedings. See Nelson v. Walker Freight Line. Inc., Case No. 87-STA-24, Sec. Dec. and Order, July 26, 1988. Furthermore, because the Assistant Secretary upon investigation of the complaint determined that it had no merit, and because of the ensuing absence of the Assistant Secretary

either as a prosecuting party or as an intervener, Complainants' STAA proceeding does not fall within Section 362(b)(4), which exempts from the automatic stay provision any proceedings by governmental units for enforcement of police or regulatory power. See Torres v. Transcon Freight Lines, Case No. 90-STA-29, Dip. Sec. Dec. and Order Staying Proceedings and Remanding Case, January 30, 1991, slip op. at 2-5. As noted in Torres:

It does not follow from the stay of Torres' STAA proceeding, however, that Torres' complaint is to be automatically dismissed. The stay remains in effect only until a final disposition of the bankruptcy case, see 11 U.S.C. § 362(c), which may or may not result in the discharge of Transcon from all of its debts. The fact that the bankruptcy proceeding is a Chapter 7 liquidation proceeding and there has been appointed a Trustee, whose duties include the liquidation and expeditious closing of the bankruptcy estate, see 11U.S.C. § 204(1), presupposes that the bankruptcy court will discharge Transcon from all of its debts on liquidation of its assets. There is, however, nothing in the record to indicate that this has occurred. Until the bankruptcy court orders the discharge of Transcon from all its debts, Complainant Torres has a viable (albeit stayed) claim.

Slip op. at 5.

   Here, too, the record lacks evidence that Respondent has been discharged from all of its debts by the bankruptcy court. Accordingly, this case is REMANDED to the ALJ, and further action on the STAA complaint is stayed pending disposition of the bankruptcy proceeding. The ALJ is directed to ascertain from the Trustee for the bankruptcy estate of the Respondent or from the Clerk of the United States Bankruptcy Court, Western District of Texas, the current status of Respondent's bankruptcy case, and to obtain for this record the final order of the bankruptcy court as soon as it becomes available. Thereupon, the ALJ shall promptly conclude his review of this case, consistent with this order.

SO ORDERED.

         Lynn Martin
         Secretary of Labor

Washington, D.C.