UNITED STATES COURT OF
APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT
______________________________________________________
No. 05-1124
______________________________________________________
SECRETARY
OF LABOR,
MINE
SAFETY AND HEALTH ADMINISTRATION (MSHA),
Petitioner,
v.
TWENTYMILE
COAL COMPANY
and
FEDERAL
MINE SAFETY AND HEALTH REVIEW COMMISSION,
Respondents.
______________________________________________________
ON PETITION FOR REVIEW OF
A DECISION
OF THE FEDERAL MINE SAFETY
AND HEALTH REVIEW COMMISSION
______________________________________________________
BRIEF FOR THE SECRETARY OF
LABOR
______________________________________________________
HOWARD M. RADZELY |
JACK POWASNIK |
Solicitor of Labor |
Attorney |
|
|
EDWARD P. CLAIR |
U.S. Department of Labor |
Associate Solicitor |
Office of the Solicitor |
|
1100 Wilson Boulevard |
W. CHRISTIAN
SCHUMANN |
Suite 2200 |
Counsel, Appellate |
Arlington, Virginia 22209-2296 |
Litigation |
Telephone:
(202) 693-9344 |
CERTIFICATE
AS TO PARTIES, RULINGS, AND RELATED CASES
(A) Parties and
Amici. The parties who appeared before the Federal Mine Safety and
Health Review Commission ("the Commission") are the Secretary of Labor ("the
Secretary") and Twentymile Coal Company ("Twentymile"). The parties in this
Court are the Secretary, Twentymile, and the Commission. No amici appeared
before the Commission, and there are no amici in this Court.
(B) Rulings Under
Review. The Secretary of Labor seeks review of the decision of the
Commission issued on March 18, 2005, in Twentymile Coal Co., FMSHRC
Docket No. WEST 2002-194, and reported at 27 FMSHRC 260 (March 2005) (App.
1).
(C) Related Cases.
This case was not previously before this Court or any other court. Counsel
for the Secretary is not aware of any other related cases pending in this
Court or any other court.
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TABLE OF CONTENTS
CERTIFICATE
AS TO PARTIES, RULINGS, AND RELATED CASES
TABLE
OF CONTENTS
TABLE
OF AUTHORITIES
GLOSSARY
OF ABBREVIATIONS AND ACRONYMS
STATEMENT
REGARDING JURISDICTION
STATEMENT
OF THE ISSUE PRESENTED
PERTINENT
STATUTES AND REGULATIONS
STATEMENT
OF THE CASE
A. Overview of the Case
B.
Nature of the Case, Course of Proceedings, and Disposition Below
STATEMENT
OF FACTS
A.
Statutory and Regulatory Background
B. Factual Background
C. The ALJ's Decision
D. The Commission's Decision
SUMMARY OF ARGUMENT
ARGUMENT
THE
COMMISSION ERRED IN VACATING THE CITATIONS ISSUED TO TWENTYMILE ON THE
GROUND THAT THE SECRETARY ABUSED HER DISCRETION IN CITING TWENTYMILE FOR
VIOLATIONS COMMITTED BY AN INDEPENDENT CONTRACTOR ENGAGED BY TWENTYMILE TO
PERFORM SERVICES AT TWENTYMILE'S MINE
A. Standard of Review
B. The
Secretary's Decision to Cite
Twentymile Was
Not Reviewable
1.
The Mine Act gives the Secretary discretionary authority to cite the owner
or production operator of a mine for violations committed by an independent
contractor performing services at the mine
2.
There are no meaningful standards by
which the Secretary's
decision to cite Twentymile can be reviewed
C.
If the Secretary's Decision to Cite Twentymile Was Reviewable, the
Commission Erred in Finding That the Secretary's Decision Was an Abuse of
Discretion
CONCLUSION
CERTIFICATE
OF COMPLIANCE
CERTIFICATE
OF SERVICE
ADDENDUM
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TABLE OF AUTHORITIES
CASES
Abbott Laboratories v. Gardner,
387 U.S. 136 (1967)
Adams v. FAA,
1 F.3d 955 (9th Cir. 1993)
Baltimore Gas & Electric Co. v. FERC,
252 F.3d 456 (D.C. Cir. 2001)
*Brock
v. Cathedral Bluffs Shale Oil Co.,
796 F.2d 133 (D.C. Cir. 1986)
Buck Creek Coal Co.,
17 FMSHRC 8 (Jan. 1995) aff'd 52 F.3d 133 (7th Cir. 1995)
Bulk Transportation Services, Inc.,
13 FMSHRC 1354 (Sept. 1991)
Calvin Black Enterprises,
7 FMSHRC 1151 (Aug. 1985)
Chevron USA, Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984)
*Citizens
to Preserve Overton Park v. Volpe,
401 U.S. 402 (1971)
Claybrook v. Slater,
111 F.3d 904 (D.C. Cir. 1997)
Consolidation Coal Co.,
11 FMSHRC 1439 (Aug. 1989)
Cyprus Emerald Resources Corp.,
20 FMSHRC 790 (Aug. 1998)
Cyprus Industrial Minerals Co. v. FMSHRC,
664 F.2d 1116 (9th Cir. 1981)
Davis v. Latschar,
202 F.3d 359 (D.C. Cir. 2000)
Dickson v. Secretary of Defense, 68 F.3d 1396 (D.C. Cir. 1995)
Donnelly v. FAA,
411 F.3d 267 (D.C. Cir. 2005)
Donovan on behalf of Chacon v. Phelps Dodge Corp., 709 F.2d 86 (D.C. Cir. 1983)
Drake v. FAA, 291 F.3d 59 (D.C. Cir. 2002)
Hall v. Clinton,
285 F.3d 74 (D.C. Cir. 2002)
Harlan Cumberland Coal Co.,
20 FMSHRC 1275 (Dec. 1998)
*Heckler
v. Chaney,
470 U.S. 821 (1985)
ICC v. Brotherhood of Locomotive Engineers,
482 U.S. 270 (1987)
Int'l Union, UMWA v. FMSHRC, 840 F.2d 77 (D.C. Cir. 1988)
Lincoln v. Vigil,
508 U.S. 182 (1993)
Maple Creek Mining Co.,
27 FMSHRC ___, slip op. at 9 n.6 (Aug. 2005)
Mathies Coal Co.,
6 FMSHRC 1 (Jan. 1994)
Mingo Logan Coal Co.,
19 FMSHRC 246 (Feb. 1997), aff'd, 133 F.3d 916 (4th Cir. 1998)
Moog Industries, Inc. v.
FTC,
355 U.S. 411 (1958)
National Industrial Sand Ass'n v. Marshall,
601 F.2d 689 (3d Cir. 1979)
Old Ben Coal Co.,
1 FMSHRC 1480 (Oct. 1979)
Padula v. Webster,
822 F.2d 97 (D.C. Cir. 1987)
Phillips Uranium Cop.,
4 FMSHRC 549 (Apr. 1982)
RAG Cumberland Resources LP v. FMSHRC,
272 F.3d 590 (D.C. Cir. 2001)
Republic Steel Corp.,
1 FMSHRC 5 (April 1979)
Secretary of Labor v. Excel Mining, LLC, 334 F.3d 1 (D.C. Cir. 2003)
Secretary of Labor v. FMSHRC,
111 F.3d 913 (D.C. Cir. 1997)
Secretary of Labor v. Keystone Coal Mining Corp.,
151 F.3d 1096 (D.C. Cir. 1998)
Secretary of Labor v. Twentymile Coal Co.,
411 F.3d 256 (D.C. Cir. 2005)
Secretary of Labor on behalf of Wamsley v.
Mutual Mining, Inc., 80 F.3d 110 (4th Cir. 1996)
Sierra Club v. Whitman, 268 F.3d 898 (9th Cir. 2001)
Sioux Valley Rural Television, Inc. v. FCC,
349 F.3d 667 (D.C. Cir. 2003)
Steenholdt v. FAA,
314 F.3d 633 (D.C. Cir. 2003)
Swift v. United States,
318 F.3d 250 (D.C. Cir. 2003)
Thunder Basin Coal Co. v. Reich,
510 U.S. 200 (1994)
Webster v. Doe,
486 U.S. 592 (1988)
STATUTES AND CODES
Administrative Procedures Act
5
U.S.C. § 701(a)
*5 U.S.C. § 701(a)(2)
Federal Mine Safety and Health Act of 1977,
30 U.S.C. 801, et
seq. (1977)
Section 2(g)(2), 30 U.S.C. § 801(g)(2)
Section 3(d), 30 U.S.C. §802(d)
Section 101, 30 U.S.C. § 811
*Section
103(a), 30 U.S.C. § 813(a)
Section 104, 30 U.S.C. § 814
Section 104(a), 30 U.S.C. § 814(a)
Section 104(b), 30 U.S.C. § 814(b)
Section 105, 30 U.S.C. § 815
Section 105(a), 30 U.S.C. § 815(a)
Section 105(d), 30 U.S.C. § 815(d)
Section 106, 30 U.S.C. § 816
Section 106(b), 30 U.S.C. § 816(b)
Section 110(a), 30 U.S.C. § 820(a)
Section 110(i), 30 U.S.C. § 820(i)
Section 113, 30 U.S.C. §823
Section 113(d), 30 U.S.C. § 823(d)
Section 113(d)(2)(A), 30 U.S.C. § 823(d)(2)(A)
Section 113(d)(2)(A)(ii),
30 U.S.C. § 823(d)(2)(A)(ii)
Section 113(d)(2)(A)(ii)(IV),
30 U.S.C. § 823(d)(2)(A)(ii)(IV)
Section 507, 30 U.S.C. 956
30
C.F.R. § 45.2(d)
30
C.F.R. § 77.400(a)
30
C.F.R. § 77.404
30
C.F.R. § 77.412
30
C.F.R. § 77.1103(a)
30 C.F.R. § 77.1110
Miscellaneous
45
Fed. Reg. 44,494 (July 1, 1980)
*
Authorities upon which we chiefly rely are marked with asterisks.
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GLOSSARY OF ABBREVIATIONS
AND ACRONYMS
ALJ
|
Commission Administrative Law Judge |
APA
|
Administrative Procedure Act
|
App.
|
Appendix |
Commission
|
Federal Mine Safety and Health Review
Commission |
GX
|
Government's Exhibit |
JX
|
Joint Exhibit |
Mine Act
or Act
|
Federal Mine Safety and Health Act of 1977 or
Act |
MSHA
|
Mine Safety and Health Administration |
RX
|
Respondent's Exhibit |
Secretary
|
Secretary of Labor |
Stip.
|
Stipulation |
Tr.
|
Transcript |
Twentymile |
Twentymile Coal Company |
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STATEMENT REGARDING
JURISDICTION
The Court has jurisdiction over this proceeding for review of a decision of
the Commission under Section 106 of the Federal Mine Safety and Health Act
of 1977 ("the Mine Act" or "the Act"), 30 U.S.C. § 816. The Commission
had jurisdiction over the matter under Sections 105(d) and 113(d) of the
Mine Act, 30 U.S.C. §§ 815(d) and 823(d).
The decision of the
administrative law judge ("ALJ") in this case was issued on July 7, 2003.
25 FMSHRC 352 (July 2003) (App. 26). By order dated August 18, 2003, the
Commission granted Twentymile's petition for discretionary review of the
ALJ's decision pursuant to Section 113(d)(2)(A) of the Mine Act, 30 U.S.C. §
823(d)(2)(A) (App. 37). The Commission issued its decision on March 18,
2005. 27 FMSHRC 260 (March 2005) (App. 1). The Commission denied the
Secretary's petition for reconsideration of its decision on March 30, 2005
(App. 38). The Secretary filed a timely petition for review of the
Commission's decision with the Court on April 15, 2005 (App. 39).
The Secretary has standing
to appeal the Commission's decision under Section 106(b) of the Mine Act, 30
U.S.C. 816(b). The
Commission's decision represents a final Commission order that disposes of
all of the parties' claims.
STATEMENT OF THE ISSUES
PRESENTED
(1). Whether the
Secretary's decision to cite Twentymile for violations committed by an
independent contractor performing services at Twentymile's mine was
unreviewable as a matter of law.
(2). Whether, if the Secretary's decision to cite
Twentymile was reviewable, the Commission erred in finding that the
Secretary’s decision was an abuse of discretion.
PERTINENT STATUTES AND
REGULATIONS
Pertinent statutes and
regulations are set forth in the bound Addendum to this brief beginning at
page A 1.
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STATEMENT OF THE CASE
A.
Overview of the Case
It is settled law that, in enforcing the Mine Act, the Secretary has the
discretion to cite the owner operator of a mine, an independent contractor
performing services at the mine, or both for violations committed by the
independent contractor. In this case, the Secretary decided to cite
both, but the Commission found the citation of the operator to be an abuse
of discretion. The Secretary contends, however, that her decision to
cite the owner operator was not reviewable -- that is, there are no
meaningful standards by which that decision can be reviewed.
Alternatively, the Secretary contends that, even if reviewable, the
Commission erred in finding that that decision was an abuse of discretion.
B. Nature of the
Case, Course of Proceedings, and Disposition Below
On August 30, 2001, an
MSHA inspector issued six citations to Twentymile, the owner operator of an
underground coal mine, and to an independent contractor performing services
at the mine, for the same alleged violations of MSHA safety standards at the
mine. GX-2 (App. 42-64). The six violations involved defective equipment
owned and operated by the independent contractor at the mine. Ibid.
[1]
Twentymile contested
the citations it received and the penalties proposed against it, and a
hearing was held before a Commission ALJ. 25 FMSHRC 352 (July 2003) (ALJ)
(App. 26).
[2] Twentymile agreed that the conditions described in the citations constituted
violations and that the proposed penalties were consistent with the penalty
criteria set forth in Section 110(i) of the Mine Act, 30 U.S.C. § 820(i),
but challenged the propriety of citing it for the same violations as the
independent contractor. Stip. 18 (App. 67-68). The ALJ found that the
Secretary did not abuse her discretion in citing Twentymile for the
violations committed by the independent contractor. 25 FMSHRC at 358-361
(App. 32-35). Twentymile appealed the ALJ's decision to the Commission.
Before the
Commission, the Secretary argued that her decision to cite Twentymile for
the violations was unreviewable -- that is, that there are no meaningful
standards by which that decision can be reviewed -- and that, in any event,
her decision was not an abuse of discretion. The Commission held that
it has the authority under the Mine Act to review the Secretary’s
enforcement decisions, and a majority found that, in this case, the
Secretary abused her discretion in deciding to cite Twentymile. 27 FMSHRC
at 266-277 (Mar. 2005) (App. 7-18). On that basis, the Commission
dismissed the citations issued to Twentymile.
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STATEMENT OF FACTS
A. Statutory and
Regulatory Background
The Mine Act was enacted
to improve safety and health in the Nation's mines. 30 U.S.C. § 801. One
of the stated purposes of the Act is to require that "each operator" of a
mine comply with mandatory safety and health standards promulgated by the
Secretary. 30 U.S.C. § 801(g)(2).
Sections
101 and 103 of the Mine Act authorize the Secretary, acting through the Mine
Safety and Health Administration ("MSHA"), to promulgate mandatory safety
and health standards for the Nation's mines and to conduct regular
inspections of those mines. 30 U.S.C. §§ 811 and 813. MSHA
inspectors regularly inspect mines to assure compliance with the Mine Act
and MSHA standards. 30 U.S.C. § 813(a).
Section 104 of
the Mine Act provides for the issuance of citations and orders for
violations of the Mine Act or MSHA standards. 30 U.S.C. § 814.
If an MSHA inspector discovers a violation of the Mine Act or a standard
during an inspection or an investigation, he must issue a citation or an
order pursuant to Section 104(a) or 104(b) of the Mine Act to the
"operator." 30 U.S.C. §§ 814(a) and 814(b). An “operator” is
defined as:
any owner, lessee, or
other person who operates, controls, or supervises a coal or other mine or
any independent contractor performing services or construction at such mine.
30 U.S.C. § 802(d). This
Court has recognized that there can be more than one “operator” at a mine --
that is, that both the production operator and an independent contractor can
be an “operator” -- and that the Secretary has the authority to cite the
independent contractor, the production operator, or both for violations
committed by the independent contractor. Brock v. Cathedral Bluffs Shale
Oil Co., 796 F.2d 533, 535 (D.C. Cir. 1986) (discussing cases).
In 1980, the
Secretary published enforcement guidelines setting forth guidance for MSHA
inspectors to use in deciding whether, in individual cases, to cite a
production operator for violations committed by an independent contractor.
45 Fed. Reg. 44,494 (1980). This Court has recognized that the Secretary’s
Enforcement Guidelines are not binding on the Secretary and do not prevent
the Secretary from citing a production operator when the criteria set forth
in the Guidelines are not met. Cathedral Bluffs, 796 F.2d at 536-39.
Sections 105(a) and 110(a) of the Mine Act
provide for the proposal and assessment of civil penalties for violations of
the Mine Act or MSHA standards. 30 U.S.C. §§ 815(a) and 820(a).
An operator may contest
a citation, order, or proposed civil penalty before the Commission. 30 U.S.C. §§ 815 and 823. The Commission is an independent adjudicatory agency
established under the Mine Act to provide trial-type administrative hearings
before an ALJ and appellate review in cases arising under the Mine Act. 30
U.S.C. § 823. See Thunder Basin Coal Co. v. Reich, 510 U.S.
200, 204 (1994); Secretary of Labor on behalf of Wamsley v. Mutual
Mining, Inc., 80 F.3d 110, 113-14 (4th Cir. 1996).
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B.
Factual Background
Twentymile is the owner
operator of the Foidel Creek Mine, an underground coal mine in Routt County,
Colorado. Stip. 1, 2 (App. 65).
[3]
Twentymile regularly uses independent contractors
to perform large and small-scale projects at the mine. Tr. 67 (App. 119).
In August 2001, Twentymile hired independent contractor Precision
Excavating, Inc. ("Precision") to remove clay from a refuse pile at the
mine. Tr. 70-71, 76, 83-84 (App. 121-22, 126, 131-32); Stip. 13
(App. 66). As
an
owner operator, Twentymile regularly conducts safety audits of the mine's
surface and underground areas and, in doing so, inspects independent
contractors' equipment. Tr. 87-88, 102, 106, 120, 123 (App. 135-36, 139,
143, 154, 157).
On August 30, 2001,
MSHA Inspector Michael Havrilla conducted an
inspection of the surface areas of the mine. Tr. 14-15 (App. 86-87).
During the inspection, Havrilla observed Precision employees
operating a pan scraper and a truck at the refuse pile. Tr. 43-44 (App.
111-12). MSHA issued six citations to Precision
for the violations that Inspector Havrilla observed with respect to the
scraper and the truck. Tr. 14, 20-30 (App. 86, 88-98); Stip. 15 (App.
66-67). MSHA also issued six citations to Twentymile for the same
violations. Tr. 30-31 (App. 98-99); Stip. 15 (App. 66-67); GX-2 (App.
42-64).
[4]
Inspector
Havrilla testified as to why MSHA issued citations to Twentymile. Havrilla
had been inspecting the Foidel Creek Mine approximately once a year since
1996. Tr. 13 (App. 85). In 1998 and 1999, Havrilla observed an increase in
the number of violations by some independent contractors performing services
at the mine. Tr. 33-35 (App. 101-03); Stip. 17 (App. 67); JX-2 (App.
71-84). At about the same time, MSHA issued a memorandum to its district
offices addressing an increase in accidents involving independent
contractors nationwide. Tr. 33 (App. 101).
In 1999,
Havrilla specifically discussed with Twentymile the increase in the number
of violations committed by Bauer Brothers Construction, a hauling contractor
performing services at the mine. Tr. 34 (App. 102). Because of the number
of citations Bauer Brothers Construction received, Havrilla believed that
the contractor was not taking adequate safety precautions with respect to
its machinery. Ibid. Havrilla testified that he told Twentymile
that an increase in contractor violations often results in an increase in
accidents, and that Twentymile needed to take action to correct the
problem. Ibid. To correct the problem, Havrilla testified that,
rather than issuing citations to Twentymile for the contractor's violations,
he suggested that Twentymile try to reduce the number of contractor
violations through proper management. Ibid.
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Inspector
Havrilla testified that in November 2000, he noticed a decrease in the
number of violations by independent contractors at the Foidel Creek Mine.
Havrilla testified that on August 30, 2001, however, the number of
violations appeared to be on the rise again because of the number of
violations by Precision that he observed during his inspection on that
date. Tr. 35 (App. 103). During the inspection on August 30, 2001,
Havrilla also learned from Precision’s leadman that Twentymile did not
inspect contractor's equipment before it was used at the mine, as most mine
operators in the area do. Tr. 36 (App. 104). Havrilla testified that "most
operators, just like the Twentymile property, have a location where vendors
and contractors must check in ... and equipment is usually examined." Tr.
36 (App. 104); see also Tr. 54, 62, 117-19 (App. 116, 151-53).
In essence,
MSHA issued citations to Twentymile in this case for five reasons: (1)
because Twentymile did not examine the equipment or ensure that the
independent contractor examined the equipment before it was operated at the
mine; (2) because Twentymile did not examine the equipment while it was
being operated at the mine; (3) because Twentymile employees would be
exposed to hazards during any fire fighting that resulted from the
violations; (4) because Twentymile exercised control over the hazardous
conditions that required abatement; and (5) because MSHA wanted to ensure
that past contractor compliance problems were not resurfacing. Tr. 33-42
(App. 101-10). Havrilla testified that "[i]f I would not have come to the
mine site to find these conditions, this would have been allowed to
continue," and that "again, [I] am trying to protect the miners." Tr. 35-36
(App. 103-04).
Twentymile contested the
citations, and the case was assigned to a Commission ALJ. Twentymile
stipulated that it agreed with the occurrence of the violations and the
appropriateness of the proposed penalties. Stip. 18 (App. 67-68).
Twentymile, however, claimed that the Secretary should never be allowed to
cite an owner operator for a violation committed by a contractor, and that,
in any event, the Secretary abused her discretion in citing it for the same
violations committed by its contractor. 25 FMSHRC at 354-55, 361 (App.
28-29, 35).
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C.
The ALJ's Decision
The ALJ held that the
Secretary did not abuse her enforcement discretion in citing Twentymile for
the violations committed by the independent contractor. 25 FMSHRC at 359
(App. 33).
[5]
The ALJ made three fundamental findings in affirming the citations issued to
Twentymile: (1) that the Secretary presented a rational, reasoned basis for
citing Twentymile based on the MSHA inspector's perception of an increase in
the number of contractor violations at the mine; (2) that under MSHA's
Enforcement Guidelines, Twentymile contributed to the violations committed
by the contractor because Twentymile did not inspect the contractor's
equipment when it entered the mine or at any time during its use at the
mine; and (3) that under MSHA's Enforcement Guidelines, Twentymile exercised
sufficient control over the independent contractor's equipment. 25 FMSHRC
at 359-60 (App. 33-34).
[6]
In rejecting Twentymile's
argument that the Secretary abused her enforcement discretion, the ALJ
emphasized that the MSHA inspector observed a number of obvious violations
involving the independent contractor's equipment and, on inquiring further,
discovered that neither Twentymile nor the contractor had inspected the
equipment prior to its use at the mine. 25 FMSHRC at 360-61
(App. 34-35).
The ALJ also rejected
Twentymile's argument that an owner operator should never be cited for a
violation committed by an independent contractor. 25 FMSHRC at 361 (App.
35). The judge found that Twentymile's argument "has been thoroughly
discussed by the Commission and the Courts of Appeals" and that "Twentymile's
argument[] [has] not been adopted." Ibid.
D.
The Commission's Decision
Reaffirming many
years of court and Commission case law, the Commission unanimously held that
the Secretary has the statutory authority to cite more than one operator for
a violation at a multi-operator mine site. 27 FMSHRC at 263-64 (App. 4).
More specifically, the Commission unanimously held that the Secretary has
the statutory authority to cite an owner operator, an independent
contractor, or both for violations committed by the independent contractor.
Ibid.
The Commission,
however, unanimously rejected the Secretary’s argument that her decision as
to which operator or operators to cite for violations at a multi-operator
site is unreviewable. 27 FMSHRC at 265-66 (App. 6-7). The Commission based
that ruling on two grounds. First, the Commission reasoned that it has the
authority under Section 113 of the Mine Act to review the Secretary’s
enforcement decisions because that provision purportedly gives the
Commission authority to review a "substantial question of law, policy or
discretion," and contains no limits on the Commission's authority to do so.
27 FMSHRC at 265-66 (citing 30 U.S.C. § 823(d)(2)(A)(ii)(IV))
(App. 6-7). Second, the Commission
reasoned that the purportedly APA-based case law the Secretary relied on is
not applicable to Commission proceedings because Section 507 of the Mine
Act, 30 U.S.C. § 956, states that "sections 701-706 of title 5 of the United
States Code shall not apply to the making of any order, notice, or decision
made pursuant to the Act, or to any proceeding for the review thereof." 27
FMSHRC at 265 (App. 6).
[7]
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A majority of the
Commission then found that the Secretary abused her discretion in citing
Twentymile for the violations committed by its contractor in this case by
purporting to apply an abuse of discretion standard of review consisting of
three criteria culled from the Commission's own case law and the four
criteria set forth in MSHA’s Enforcement Guidelines. 27 FMSHRC at 266-77
(App. 7-8). The three case law-based
criteria were (1) "[w]hether the production operator, the independent
contractor, or another party was in the best position to affect safety
matters," (2) "[w]hether and to what extent the production operator had
day-to-day involvement in the activities in question," and (3) "[w]hether
the production operator contributed to the violations committed by the
independent contractor." 27 FMSHRC at 267 (App.
8). The Enforcement Guidelines criteria provide that enforcement
action may be taken against a production operator for violations committed
by an independent contractor (1) "when the production-operator has
contributed by either an act or an omission to the occurrence of the
violation in the course of the independent contractor's work, or (2) when
the production-operator has contributed by either an act or omission to the
continued existence of a violation committed by an independent contractor,
or (3) when the production-operator's miners are exposed to the hazard, or
(4) when the production-operator has control over the condition that needs
abatement." 27 FMSHRC at 267 (quoting 45 Fed. Reg. 44494, 44497 (July 1,
1980)) (App. 8).
Significantly,
the Commission majority added a criterion not included in the Enforcement
Guidelines: that for any of the four Guidelines criteria to be met, a
"significant threshold" of production operator involvement must be reached.
27 FMSHRC at 273 (App. 14). In addition, the majority held that the
MSHA inspector’s "subjective conclusion that there was a ‘serious problem’
with independent contractor violations at the mine is not an independent
justification for citing the production operator in this case." 27
FMSHRC at 276 (emphasis in original) (App. 17)
Dissenting, Commissioner
Jordan found that the majority’s standard of review "dramatically departed"
from Commission precedents, which state that an abuse of discretion occurs
only when there is "no evidence" to support a prosecutorial decision, which
give the Secretary broad leeway in deciding whom to cite, and which do not
require that a "significant threshold" of the four criteria in the
Secretary's Enforcement Guidelines be reached. 27 FMSHRC at 278-80
(App. 19-21). Commissioner Jordan also
found that the Commission majority impermissibly second-guessed the ALJ's
factual findings and that substantial evidence supported the ALJ's
determination that the Secretary did not abuse her discretion in citing
Twentymile. 27 FMSHRC at 281-82 (App. 22-23).
Commissioner Jordan found
that there was evidence which satisfied the three criteria which the
Commission traditionally relies on when reviewing the Secretary's
enforcement decisions: (1) that Twentymile was substantially involved in the
day-to-day operations of the mine, (2) that Twentymile was in an excellent
position to affect safety, and (3) that citing Twentymile was consistent
with the purpose and policies of the Mine Act. 27 FMSHRC at 279, 281-82
(App. 20, 22-23). In addition,
Commissioner Jordan found that substantial evidence supported the ALJ's
finding that the first and fourth criteria of the Enforcement Guidelines
were satisfied. 27 FMSHRC at 281-82 (App. 22-23).
The Secretary filed a
timely petition for review of the Commission's decision with the Court on
April 15, 2005. (App. 39-41).
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SUMMARY OF ARGUMENT
1. The Mine Act gives the Secretary the discretion to cite
the owner or production operator, the independent contractor, or both for
violations committed by the independent contractor at the mine. Under
the Mine Act, both the owner or production operator and an independent
contractor can be an "operator" at a mine. In addition, under the Mine
Act's scheme of no-fault liability, an owner or production operator is
jointly liable for the violations committed by its independent contractor.
The Secretary's
enforcement decision as to which operator or operators to cite in a
particular case is unreviewable because the language and structure of the
Mine Act provide no meaningful standards of review. The Act's
enforcement provisions contain no provisions whatsoever suggesting which
operator or operators the Secretary should take action against. In
addition, the overall structure of the Act shows that enforcement of the Act
is vested exclusively with the Secretary. The Secretary's decision
whether to take action against a production operator for violations
committed by its independent contractor is an enforcement decision which
involves a number of "administrative concerns" and, as such, is in an area
in which the courts have traditionally not interfered. Because the
Secretary's Enforcement Guidelines are not binding policy statements, they
likewise do not provide a meaningful standard of review.
The Commission's
conclusion that it may review the Secretary's enforcement decisions under
the general review authority conferred on it under Section 113 of the Mine
Act is fundamentally flawed. Both this Court and the Fourth Circuit have
found that nothing in the Act gives the Commission the authority to intrude
on policy-related decisions entrusted to the Secretary. In addition, even
if the Commission could review the Secretary's policy-based decisions
generally, Section 113 of the Act provides no meaningful standards by which
the Secretary's enforcement decisions at multi-operator cites can be
reviewed.
Similarly flawed is
the Commission's conclusion that the purportedly APA-based case law cited by
the Secretary does not apply to Mine Act proceedings because the Mine Act
provides that the review provisions of the APA do not apply to Commission
proceedings. The traditional principle that a court cannot review agency
action if the statute provides no meaningful standard of review is the basis
of the unreviewability cases the Secretary relies on and the case law
demonstrates that that principle, which predates the enactment of the APA,
is fully applicable in non-APA-based cases.
2. Assuming
arguendo that the Secretary's decision to cite Twentymile was
reviewable, the Commission majority erred in finding that the Secretary's
decision was an abuse of discretion. The Commission majority committed two
distinct but interrelated legal errors. It substituted its own enforcement
judgment for that of the Secretary, and it substituted its own evidentiary
evaluation for that of the ALJ.
The evidence
demonstrates that the Commission should have affirmed the ALJ's review of
the Secretary's enforcement decision because substantial evidence supports
the ALJ's decision. The Commission majority, however, simply
second-guessed the ALJ's findings in order to reach a different result.
In addition, the
evidence establishes no abuse of discretion by the Secretary. The evidence
establishes that there was a rational connection between the facts found and
the Secretary's enforcement decision. The Commission, however, imposed an
unusually demanding and nondeferential standard on the Secretary that is a
significant departure from its own case law and contrary to the case law of
this Circuit.
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ARGUMENT
THE COMMISSION ERRED IN
VACATING THE CITATIONS ISSUED TO TWENTYMILE ON THE GROUND THAT THE SECRETARY
ABUSED HER DISCRETION IN CITING TWENTYMILE FOR VIOLATIONS COMMITTED BY AN
INDEPENDENT CONTRACTOR ENGAGED BY TWENTYMILE TO PERFORM SERVICES AT
TWENTYMILE'S MINE
A.
Standard of Review
The first question
presented -– whether the Mine Act gives the Secretary unreviewable
discretion to cite an operator for violations caused by its independent
contractor -– is a legal question. A court decides legal matters under a
de novo standard of review. Secretary of Labor v. Keystone
Coal Mining Corp., 151 F.3d 1096, 1099 (D.C. Cir. 1998). When a legal
matter turns on an agency's construction of its governing statute, however,
a court must apply the deferential standard of review required by Chevron
USA, Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837,
842-43 (1984). See Secretary of Labor v. FMSHRC, 111 F.3d
913, 917 (D.C. Cir. 1997). Under that standard, if "Congress has directly
spoken to the precise question at issue, we must give effect to Congress'
unambiguously expressed intent." Id. (quoting Chevron, 467
U.S. at 842-43 (internal quotations omitted)). "If the statute is silent or
ambiguous with respect to the specific issue, we ask whether the agency's
position rests on a permissible construction of the statute." Id.
(quoting Chevron, 467 U.S. at 843 (internal quotations omitted));
Secretary of Labor v. Excel Mining, LLC, 334 F.3d 1, 6 (D.C. Cir.
2003). The Court should defer to "a reasonable interpretation" by the
agency. Excel, 334 F.3d at 6 (quoting Chevron, 467 U.S. at
844). "Moreover, in the statutory scheme of the Mine Act, 'the Secretary's
litigation position before [the Commission] is as much an exercise of
delegated lawmaking powers as is the Secretary's promulgation of a ...
health and safety standard,' and is therefore deserving of deference."
Excel, 334 F.3d at 6 (quoting RAG Cumberland Resources LP v. FMSHRC,
272 F.3d 590, 596 n.9. (D.C. Cir. 2001) (internal quotation marks
omitted)). Accord Secretary of Labor v. Twentymile Coal Co.,
411 F.3d 256, 261 (D.C. Cir. 2005).
The second question
presented -– whether, if reviewable, the Secretary properly exercised her
discretion in this case -– is subject to an abuse of discretion standard.
Under an abuse of discretion standard, an agency's decision will be upheld
"if the agency's path may reasonably be discerned." Dickson v. Secretary
of Defense, 68 F.3d 1396, 1404 (D.C. Cir. 1995) (citation and internal
quotation marks omitted). "[A]n agency's explanation must minimally contain
a rational connection between the facts found and the choice made." Ibid.
The abuse of discretion standard is a "highly
deferential” standard,
Davis v. Latschar,
202 F.3d 359, 365 (D.C. Cir. 2000), and a reviewing court
is not to “substitute its judgment for that of the agency.” Sioux Valley
Rural Television, Inc. v. FCC, 349 F.3d 667, 674 (D.C. Cir. 2003)
(citation and internal quotation marks omitted).
The reviewing court presumes the validity of the agency's action, see,
e.g.,
Davis,
202 F.3d at 365, and must affirm the action unless the
decisionmaker below failed to consider relevant factors or made a clear
error in judgment. See, e.g., Citizens to Preserve Overton
Park v. Volpe,
401 U.S. 402, 416 (1971). Even if the agency's decision
is reviewable, the abuse of discretion standard should be especially
deferential where, as here, the decision pertains to "an agency's exercise
of its enforcement discretion -- an area in which the courts have
traditionally been most reluctant to interfere." Cathedral Bluffs,
796 F.2d at 538.
[8]
In addition, when
reviewing an ALJ’s factual findings, the Commission is required, under
Section 113(d)(2)(A)(ii) of the Mine Act, to affirm the ALJ's findings if
they are supported by "substantial evidence.” Substantial evidence is "such
relevant evidence as a reasonable mind might accept as adequate to support a
conclusion." Donnelly v. FAA, 411 F.3d 267, 270-71 (D.C. Cir.
2005). Under Section 113(d)(2)(A)(ii), the Commission may not substitute
its own view of the facts "for the view the judge reasonably reached."
Donovan v. Phelps Dodge Corp., 709 F.2d 86, 90-91 (D.C. Cir. 1983).
Instead, if the ALJ's findings are supported by substantial evidence, they
must be affirmed by the Commission because the Commission is bound to uphold
the ALJ's factual determinations even if its own views are also supported by
the record. Id. at 92.
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B. The Secretary's
Decision to Cite Twentymile Was Not Reviewable
1. The Mine Act gives
the Secretary discretionary authority to cite the owner or production
operator of a mine for violations committed by an independent contractor
performing services at the mine
The Commission
decision runs counter to several established legal principles. First, it is
settled law that, under the Mine Act, there can be more than one “operator”
at a mine -- that is, that both the owner or production operator of a mine,
and an independent contractor performing services at the mine, can be an
“operator” under the Act. Int’l Union, UMWA v. FMSHRC, 840 F.2d 77,
82-84 (D.C. Cir. 1988) (discussing cases). Accord Cathedral
Bluffs, 796 F.2d at 535.
Second, it is also
settled law that “multiple operators are jointly liable under the Act” --
or, put differently, that “the owner of a mine is liable without regard to
its own fault for violations committed by or dangers created by its
independent contractor.” UMWA, 840 F.2d at 83-84 (discussing
cases). The Act’s scheme of no-fault liability reflects the reality that
“the owner is generally in continuous control of conditions at the entire
mine” and, “[i]f the Secretary could not cite the owner, the owner could
evade responsibility for safety and health requirements by using independent
contractors for most of the work.” Cyprus Industrial Minerals Co. v.
FMSHRC, 664 F.2d 1116, 1119 (9th Cir. 1981). Accord Republic
Steel Corp., 1 FMSHRC 5, 11 (April 1979) (“[a] mine owner cannot be
allowed to exonerate itself from its statutory responsibility for the safety
and health of miners merely by establishing a private contractual
relationship in which miners are not its employees and the ability to
control the safety of the workplace is restricted”), quoted in
Cyprus Industrial, 664 F.2d at 1120.
Finally, and
dispositively, it is settled law that the Mine Act gives the Secretary
discretionary authority to cite the owner or production operator, the
independent contractor, or both for violations committed by the independent
contractor. Cathedral Bluffs, 796 F.2d at 534 (discussing cases);
Cyprus Industrial, 664 F.2d at 1119; National Industrial Sand Ass’n
v. Marshall, 601 F.2d 689, 702-03 (3d Cir. 1979). Indeed, in finding
that the Secretary’s Enforcement Guidelines are not binding on the
Secretary, this Court stated:
Our decision on this point
is reinforced by the fact that the statement here in question pertains to an
agency’s exercise of its enforcement discretion -- an area in which the
courts have been most reluctant to interfere. We think the policies
underlying
that restraint extend as
well to interference by a quasi-judicial agency that has no enforcement
responsibilities, such as the [Commission].
Cathedral Bluffs,
796 F.2d at 538 (Scalia, Cir. J.).
Thus, the Commission was not writing on a clean slate when it decided that
the Secretary’s exercise of her enforcement discretion at multi-operator
mine sites is reviewable. That decision was wrong because, as the
Secretary submits, there are no meaningful standards by which the
Secretary's enforcement decisions at such sites can be reviewed.
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2.
There are no
meaningful standards by which the Secretary's decision to cite Twentymile
can be reviewed
Although agency
action is generally presumed to be reviewable, see Abbott
Laboratories v. Gardner, 387 U.S. 136, 140 (1967), the APA recognizes
two exceptions to that principle: (1) where "statutes preclude judicial
review," or (2) where "agency action is committed to agency discretion by
law." 5 U.S.C. § 701(a). The second exception applies here.
In Overton Park,
401 U.S. at 410, the Supreme Court held that agency action is committed to
agency discretion by law under Section 701(a)(2) of the APA in "those rare
instances where statutes are drawn in such broad terms that in a given case
there is no law to apply." In Heckler v. Chaney, 470 U.S. 821, 830
(1985), the Supreme Court explained its decision in Overton Park by
stating that, under Section 701(a)(2) of the APA, "review is not to be had
if the statute is drawn so that a court would have no meaningful standard
against which to judge the agency's exercise of discretion." “In such a
case, the statute (‘law’) can be taken to have ‘committed’ the
decisionmaking to the agency’s judgment absolutely.” Ibid.
Heckler
involved a decision not to take enforcement action, and the Supreme Court
held that, when a decision not to take action is involved, a
presumption of unreviewability applies. Heckler, 470 U.S. at
831-32. This Court has declined to extend the Heckler presumption of
unreviewability to a decision to take action. Hall v. Clinton,
285 F.3d 74, 79 (D.C. Cir. 2002) (Department of Justice's affirmative
decision to represent First Lady).
[9]
Whether a presumption of unreviewability does or does not apply, however,
“the end analysis” is the same: an agency’s action is unreviewable if “there
is no law to apply.” Drake v. FAA, 291 F.3d 59, 71-72 (D.C. Cir.
2002) (citing Claybrook v. Slater, 111 F.3d 904, 908-09 (D.C. Cir.
1997)). The appropriate analysis requires careful examination of both the
language and the overall structure of the statute in question. Webster
v. Doe, 486 U.S. 592, 600-01 (1988); Drake, 291 F.3d at
420-21.
The language of the
Mine Act provides no meaningful standards by which the Secretary’s
enforcement decisions at multi-operator mine sites can be reviewed, thus
meeting the "no law to apply" test. Section 104(a) of the Act merely states
that, if an MSHA inspector believes that “an operator” subject to the Act
has violated the Act, he shall issue a citation to “the operator.” Section
105(a) of the Act merely states that, if the Secretary issues a citation (or
an ensuing order) under Section 104, he shall notify “the operator” of the
proposed penalty. Section 3(d) of the Act affirmatively states that an
"operator" means "any owner, lessee, or other person who operates, controls,
or supervises a ... mine or any independent contractor performing
services ... at such mine." 30 U.S.C. § 802(d) (emphasis added). The Act’s
enforcement provisions, which have consistently been construed as
authorizing the Secretary to take enforcement action against more than one
operator at a multiple-operator site, say nothing about which
operator or operators the Secretary should take action against in a
particular case. They are entirely silent on the point. See
Lincoln v. Vigil, 508 U.S. 182, 193-94 (1993) (decision to discontinue
funding a program was unreviewable where the statute “[did] not so much as
mention” the program); Swift v. United States, 318 F.3d 250, 253
(D.C. Cir. 2003) (decision to dismiss an action was unreviewable where the
statute contained nothing setting “‘substantive priorities’” or
“circumscrib[ing] the government’s ‘power to discriminate among issues or
cases it will pursue’” (quoting Heckler, 470 U.S. at 833));
[10]
Baltimore Gas & Electric Co. v. FERC, 252 F.3d 456, 461 (D.C. Cir.
2001) (decision to settle an action was unreviewable where the statute was
“utterly silent on the manner in which the [agency] is to proceed against a
particular transgressor”).
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Similarly, the
overall structure of the Mine Act provides no meaningful standards by which
the Secretary’s enforcement decisions at multi-operator sites can be
reviewed. On the contrary, the overall structure of the Act supports the
conclusion that the Secretary’s enforcement decisions cannot be reviewed.
The authority to enforce the Act is vested exclusively with the Secretary.
Cathedral Bluffs, 796 F.2d at 533; Mutual Mining, 80 F.3d at
113-15. In deciding which operator or operators to cite in a particular
case, the Secretary must engage in the same sort of “complicated balancing”
of factors described by the Supreme Court in Heckler: “the agency
must assess not only whether a violation has occurred, but whether agency
resources are best spent on this violation or another, whether the agency is
likely to succeed if it acts, whether the particular enforcement action
requested best fits the agency’s overall policies, and indeed, whether the
agency has enough resources to undertake the action at all.” Heckler,
470 U.S. at 831.
Such “administrative
concerns” (id. at 832) -- which constituted the primary basis for the
Court’s finding of unreviewability in Heckler -- are implicated
regardless of whether the Secretary decides not to act against a particular
operator or, as in this case, decides to act against that operator. See
Moog Industries, Inc. v. FTC, 355 U.S. 411, 413 (1958) (decision
whether to act against one entity before acting against other entities
similarly situated “depend[ed] on a variety of factors peculiarly within the
expert understanding of the [FTC]”). See also Lincoln,
508 U.S. at 193 (agency allocation of funds among programs was unreviewable
because, inter alia, such a decision “requires ‘a complicated
balancing of factors,’” including “‘whether a particular program best fits
the agency’s overall policies,’” which “‘are peculiarly within [the
agency’s] expertise’”) (quoting Heckler, 470 U.S. at 831)). Because
the question whether to act against the production operator for violations
committed by the independent contractor in a particular case “pertains to an
agency’s exercise of its enforcement discretion -- an area in which the
courts have traditionally been most reluctant to interfere,” Cathedral
Bluffs, 796 F.3d at 538 (citing Heckler and Moog) -- the
fact that the Act vests enforcement authority exclusively with the Secretary
supports the conclusion that the Secretary’s resolution of that question is
not reviewable.
The Supreme Court and
this Court have recognized that, even if the statute in question does not
provide meaningful standards to apply, an agency’s actions may be reviewable
if the agency itself has provided such standards in binding statements.
Heckler, 470 U.S. at 836-37; Steenholdt v. FAA, 314 F.3d 633, 638
(D.C. Cir. 2003); Padula v. Webster, 822 F.2d 97, 100 (D.C. Cir.
1987). Such statements provide such standards, however, only if the
agency’s statements are binding on the agency. Ibid. This Court has
held that the Secretary’s Enforcement Guidelines are not binding on the
Secretary. Cathedral Bluffs, 796 F.2d at 536-39. See RX-34
(App. 228-29).
The Commission held
that it can review the Secretary’s enforcement decisions at multi-operator
sites because Section 113 of the Mine Act, 30 U.S.C. § 823, gives the
Commission broad authority to review an ALJ’s decision if “a substantial
question of law, policy, or discretion” is involved. 27 FMSHRC at 266-67
(citing, inter alia, 30 U.S.C. § 823(d)(2)(A)(ii)(IV)) (App.
7-8). Both this Court and the Fourth Circuit, however, have rejected the
notion that Section 113 gives the Commission a policymaking role authorizing
it to second-guess the Secretary’s policy-based decisions. Energy West
Mining Co. v. FMSHRC, 40 F.3d 457, 463-464 (D.C. Cir. 1996); Mutual
Mining, 80 F.3d at 114 n.3 ("[T]o say that the Commission reviews cases
involving questions of policy is not to say that is the final arbiter of
such policies. . . . The Commission's jurisdiction is fully consistent with
the deference that it, and this court, owe to the Secretary's reasonable
interpretations of the Act."). Instead, both courts have concluded that the
Commission is required to give the Secretary’s litigation positions the same
deference courts traditionally give enforcement agencies’ litigation
positions. Ibid.
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In any event, even if
Section 113 gives the Commission the authority to review the Secretary’s
policy decisions generally, it gives the Commission no meaningful standards
by which to review the Secretary’s enforcement decisions at multi-operator
sites. A provision that provides for review generally does not render a
particular decision reviewable if there are no meaningful standards by which
that decision can be reviewed. Steenholdt, 314 F.3d at 638-39. And
because the Mine Act provides no standards at all by which to judge the
Secretary's exercise of discretion to cite both the mine operator and an
independent contractor, the exercise is unreviewable. Therefore, Section
113 (30 U.S.C. § 823) cannot mean what the Commission says it means -- which
is, in effect, that the Commission has carte blanche to review every
decision the Secretary makes, and substitute its own judgment for the
Secretary’s judgment, solely on the basis of what it believes “policy”
should be.
The Commission also
held that the reviewability principles set forth in Heckler and its
progeny do not apply to Mine Act proceedings because Section 507 of the Mine
Act provides that Section 701 of the APA does not apply to Mine Act
proceedings. 27 FMSHRC at 266 (citing 30 U.S.C. § 956) (App. 7).
[11]
The Commission fundamentally misconstrues the basis for Heckler and
the other reviewability cases discussed above. The Supreme Court made it
clear in Heckler itself that the APA was intended to codify, and not
to alter, the traditional principles regarding reviewability -- including
the principles under which an agency’s decision is unreviewable because
there are no meaningful standards by which it can be reviewed. Heckler,
470 U.S. at 832 (a decision not to take action “has traditionally 'been
committed to agency discretion,' and we believe that the Congress enacting
the APA did not intend to alter that tradition”). Accord ICC v.
Brotherhood of Locomotive Engineers, 482 U.S. 270, 281 (1987) (“the APA
codifies the nature and attributes of judicial review,” including both the
tradition of unreviewability recognized in Heckler and the tradition
of unreviewability with regard to an agency’s refusal to reconsider a
decision for material error). See Steenholdt, 314 F.3d at
638-39 (although review was sought not under the APA, but under a provision
of the Federal Aviation Act specifically providing for review of FAA
decisions like the one in question, the decision was unreviewable because
there was “‘no judicially-manageable standard’” by which it could be
reviewed) (quoting Adams v. FAA, 1 F.3d 955, 956 (9th Cir. 1993)).
See also Sierra Club v. Whitman, 268 F.3d 898, 902 (9th
Cir. 2001) (finding unreviewability under Heckler principles in a
non-APA context). Because the Secretary’s decision whether to cite a
production operator for violations committed by an independent contractor
pertains to “an area in which the courts have traditionally been
most reluctant to interfere,” Cathedral Bluffs, 796 F.3d at 528
(emphasis added), it is unreviewable under principles predating the APA
regardless of whether the APA applies.
Because
the Mine Act provides no meaningful standards by which the Secretary’s
enforcement decisions at multi-operator mine sites can be reviewed, the
Commission lacks authority to review such a Secretarial decision and thereby
substitute its judgment for the Secretary’s judgment. Yet, as we show
below, that is precisely what the Commission did here.
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B.
If the Secretary’s
Decision to Cite Twentymile Was Reviewable, the Commission Erred in Finding
That the Secretary's Decision Was an Abuse of Discretion
As previously indicated,
if the Secretary's decision to cite the operator was reviewable at all, it
was subject to an abuse of discretion standard of review, and the ALJ's
findings upholding it were subject to a substantial evidence standard.
Accordingly, the Commission majority committed two distinct but interrelated
legal errors when, applying a de novo standard, it substituted
its own enforcement judgment for that of the Secretary, and substituted its
own evidentiary judgment for that of the ALJ.
The Secretary set forth a
discernible rationale for her decision to issue citations to the owner or
production operator, Twentymile, for violations committed by the independent
contractor, Precision. That rationale is multi-factored.
First, the MSHA inspector
believed that the contractor violations might have signaled another increase
in contractor violations at Twentymile's mine. Tr. 33-35 (App. 101-03).
Inspector Havrilla testified that, during 1998 and 1999, the number of
contractor violations at the Foidel Creek Mine increased. Tr. 33 (App.
101). Havrilla told Twentymile at that time that the high number of
contractor violations needed to be reduced or it would be held responsible
for future contractor violations. Tr. 34 (App. 102). Havrilla testified
that, during 2000, the number of contractor violations decreased, but that
the number of contractor violations he observed during the August 2001
inspection indicated to him that the number of contractor violations might
again be increasing. Tr. 35 (App. 103). Havrilla testified that he did not
perform an "analysis" of the history of contractor violations at the mine,
but he did review the history of violations at the mine to determine if
there was a problem. Tr. 52 (App. 114). Havrilla testified that he was
personally familiar with the general pattern of contractor violations at the
mine because he had been inspecting the mine approximately once a year since
1996. Tr. 13, 33-35, 52 (App. 85, 101-03, 114).
Twentymile Safety Manager
Robert Derick's own testimony supports the inspector's testimony that
Twentymile had a problem with contractor violations at the mine. Derick's
testimony shows that 42 citations were issued to various contractors working
at the mine from September 13, 1999, to March 26, 2003. Tr. 130-38 (App.
159-67); RX-30 (App. 200-19).
Second, as the owner
operator, Twentymile either controlled or supervised or had the right and
ability to control or supervise the mining operation, including the
contractor's work practices. There was undisputed evidence that, by
contract, Twentymile could stop the contractor's work if a hazard was
detected, terminate the contract for a safety violation, and conduct
periodic safety and health inspections of the contractor's work area and
equipment. Tr. 37-38, 74, 78-80, 102, 104-05, 109, 120, 144 (App. 105-06,
124, 128-30, 139, 141-42, 146, 154, 171); RX-26 (App. 179-89), RX-27 (App.
190-98).
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Third, as the owner
operator, Twentymile conducted periodic inspections of the mine, and it
provided site-specific hazard training to the contractor's employees and
ensured that those employees had MSHA-required training. Tr. 94-95, 102,
106-07, 111-12, 115-17, 120, 141-44 (App. 137-38, 139, 143-44, 147-48,
149-51, 154, 168-171).
Fourth, Twentymile
contributed to the occurrence of the violations, or to the continued
existence of the violations, by failing to inspect the contractor's
equipment or verify that the contractor inspected the equipment. Tr. 39-41,
121-122 (App. 107-09, 155-56).
Finally, there is no
dispute that Twentymile had control over the violative conditions that
required abatement because it could have required the contractor to fix or
remove the contractor's equipment if the equipment did not comply with
MSHA's safety standards. Tr. 75, 95, 104-05, 109, 111 (App. 125, 138,
141-42, 146, 147).
The ALJ found that
the foregoing evidence established that the Secretary did not abuse her
discretion in citing Twentymile. 25 FMSHRC at 359 (App. 33). The ALJ found
that the MSHA inspector perceived an increase in the number of contractor
violations at the mine; that Twentymile contributed to the violations
committed by the contractor because the MSHA inspector observed a number of
obvious violations involving the contractor's equipment and, on inquiring
further, discovered that neither Twentymile nor the contractor inspected the
equipment prior to or during its use at the mine; and that Twentymile
exercised sufficient control over the contractor's equipment because it
could have taken the equipment out of service if it was not in compliance
with MSHA's safety standards. 25 FMSHRC at 359-61 (App. 33-35). The ALJ
applied the correct legal standard in finding that the Secretary did not
abuse her enforcement discretion, and that finding is supported by
substantial evidence. The ALJ’s decision, therefore, should have been
affirmed.
In reversing the ALJ’s
decision, the Commission majority relied on four facts: (1) that the
equipment that served as a basis for the violations was owned and operated
solely by the contractor; (2) that the contractor was contractually required
to comply with all safety regulations and inspect its equipment; (3) that
Twentymile provided the contractor with a safety guide that included
specific provisions for examining and repairing equipment; and (4) that
Twentymile employees were not exposed to hazards resulting from the
violative equipment. 27 FMSHRC at 268-72 (App. 9-13).
In addition, the
Commission majority found that the ALJ erred in relying on the MSHA
inspector's belief that there may have been a "serious problem” with
contractor violations -- a belief the majority acknowledged was the
inspector's "specific rationale" for citing Twentymile -- because the
inspector’s "subjective conclusion" was not a factor "traditionally applied
by the Commission.” 27 FMSHRC at 276 (App. 17).
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The Commission
majority's reliance on the four facts set forth above demonstrates that the
Commission did not apply a substantial evidence standard of review to the
ALJ’s factual findings. Rather, the majority discounted the valid and
relevant evidence the ALJ relied on and substituted its own competing view
of the facts. In addition, the ALJ’s reliance on the MSHA inspector’s
subjective belief that Twentymile may have had a serious problem with
contractor violations was perfectly consistent with Commission case law.
The Commission has often found that the MSHA inspector's personal judgment
must be given significant weight. Maple Creek Mining Co., 27 FMSHRC
, slip op. at 9 n.6 (Aug. 2005) (relying on inspector’s judgment)
(citing Mathies Coal Co., 6 FMSHRC 1 (Jan. 1994)); Harlan
Cumberland Coal Co., 20 FMSHRC 1275, 1277 (Dec. 1998) (crediting opinion
of MSHA inspector); Cyprus Emerald Resources Corp., 20 FMSHRC 790,
817 (Aug. 1998) (same); Buck Creek Coal Co., 17 FMSHRC 8, 14 (Jan.
1995) (crediting opinion of experienced MSHA inspector), aff’d 53
F.3d 133 (7th Cir. 1995). The Commission cannot justify substituting its
enforcement judgment for the inspector’s enforcement judgment simply by
characterizing the inspector’s judgment as “subjective.”
Similarly, the Commission
majority did not apply an abuse of discretion standard of review to the
Secretary's enforcement decision. Rather, the Commission majority applied
its own "general test” under the guise of an abuse of discretion standard of
review. 27 FMSHRC at 266-67 (App. 7-8). A survey of the Commission case
law over the years shows that, in reviewing the Secretary’s decision to cite
an owner or production operator for violations committed by an independent
contractor, the Commission initially asked “whether the Secretary’s decision
to proceed against an owner for a contractor’s violation was made for
reasons consistent with the purpose and policies of the [Mine] Act.” Old
Ben Coal Co., 1 FMSHRC 1480, 1485 (Oct. 1979). In subsequent cases, the
Commission added additional factors to its review:
[I]n choosing the entity
against whom to proceed, the Secretary should look to such factors as the
size and mining experience of the independent contractor, the nature of the
task performed by the contractor, which parties contributed to the
violation, and the party in the best position to eliminate the hazard and
prevent it from recurring.
Calvin Black Enterprises,
7 FMSHRC 1151, 1155 (Aug. 1985); see also Phillips Uranium
Corp., 4 FMSHRC 549, 552-553 (Apr. 1982) (vacating citations against an
owner-operator after considering similar factors).
[12]
In 1989, the Commission began labeling its review an “abuse of discretion”
standard of review. Consolidation Coal Co., 11 FMSHRC 1439, 1443
(Aug. 1989). In 1991, the Commission added the Secretary’s Enforcement
Guidelines as a factor to be considered in determining whether the
Secretary's enforcement decision was an abuse of discretion. Bulk
Transportation Services, Inc., 13 FMSHRC 1354, 1360-61 (Sept. 1991).
Finally, in this case, the Commission majority treated the Enforcement
Guidelines as mandatory factors, and indeed held that an Enforcement
Guideline is “satisfied only if a significant threshold has been reached.”
27 FMSHRC at 272-73 & n.19 (App. 13-14).
The foregoing
discussion demonstrates that the Commission majority's review in this case
went far beyond the abuse of discretion standard of review the majority
assertedly applied. The majority’s review consisted of more than an inquiry
into whether there is a rational connection between the facts found and the
Secretary’s enforcement decision. Instead, the majority’s review consisted
of a number of factors the Secretary is required to meet -- factors which,
as shown above, have increased over the years depending on the circumstances
of the case. In addition, in this case, the Commission is now requiring the
Secretary to have established that a "significant threshold" has been
reached with respect to each of the four criteria in the Secretary’s
Enforcement Guidelines -- notwithstanding the fact that this Court has held
that the Enforcement Guidelines are not binding on the Secretary and that
the Secretary’s failure to comply with them cannot constitute a basis for
overturning a Secretarial enforcement decision. Cathedral Bluffs,
796 F.2d at 538-39. The demanding and nondeferential standard applied by
the Commission majority in this case is a far cry from an abuse of
discretion standard of review.
In sum, the Commission majority committed legal error both because it
applied an incorrect standard of review to the Secretary’s enforcement
decision and because it applied an incorrect standard of review to the ALJ’s
decision upholding the Secretary’s decision. Because the ALJ’s
decision applied the correct legal standard and is supported by substantial
evidence, the ALJ’s decision should have been affirmed.
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CONCLUSION
For the reasons
stated above, the Secretary requests that the Court reverse the portion of
the decision of the Commission finding that the Secretary's enforcement
decision was reviewable. If the Court declines to do so, the Secretary
requests that it reverse that portion of the Commission's decision finding
that the Secretary abused her discretion in citing Twentymile for the
violations committed by Precision. In either event, the Secretary
requests that the Court vacate the Commission's decision so as to leave the
ALJ's decision standing as affirmed.
Respectfully
submitted,
HOWARD M. RADZELY
Solicitor of Labor
EDWARD P. CLAIR
Associate Solicitor
W. CHRISTIAN SCHUMANN
Counsel,
Appellate Litigation
JACK POWASNIK
Attorney
U.S. Department of Labor
Office of the Solicitor
1100 Wilson Boulevard
Suite 2200
Arlington, VA 22209-2296
Telephone: (202) 693-9335
CERTIFICATE OF
COMPLIANCE
Pursuant to
Fed. R. App. P. 32(a)(7)(B), (C), D.C. Cir. Rules 28(d) and 32(a)(2), I
certify that this Brief for the Secretary of Labor contains 9,623 words as
determined by Word, the processing system used to prepare the brief.
______________________
Jack Powasnik
Attorney
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CERTIFICATE OF
SERVICE
I certify that two copies
of the Brief for the Secretary of Labor were served by overnight delivery on
October 13, 2005, on:
R. Henry Moore, Esq.
Jackson Kelly
Three Gateway Center
401 Liberty Avenue, Suite
1340
Pittsburgh, Pennsylvania
15222
Thomas Stock, General Counsel
Federal Mine Safety and Health
Review Commission
601
New Jersey Ave., Suite 9500
Washington, D.C. 20001
________________________
Jack Powasnik
Attorney
ADDENDUM
Addendum not available.
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________________________________
Footnotes:
[1] MSHA proposed a total
penalty of $ 900 against Twentymile for the six citations. 25 FMSHRC
at 362 (App. 36Addendum not available.
[2] The independent
contractor did not contest the citations, and paid the total penalty of $
352 MSHA proposed against it for the six citations it received. See
RX-2 (App. 232-35).
[3] Twentymile is also
known as a “production operator” under MSHA's regulations and Enforcement
Guidelines. A "production operator" is defined as “any owner, lessee, or
other person who operates, controls or supervises a coal or other mine." 30
C.F.R. § 45.2(d). See RX-34 (App. 227).
[4]
Five of the citations involved the service truck
and one citation involved the pan scraper. GX-2 (App. 42-64). The
citations alleged the following violations: (1) a violation of 30 C.F.R. §
77.412 consisting of an inoperable pressure gauge in the air compressor on
the truck, (2) a violation of 30 C.F.R. § 77.400(a) consisting of a
ten-by-ten inch opening on the truck's compressor which would allow contact
with the drive belts and pulley, (3) a violation of 30 C.F.R. § 77.1110
consisting of failure to examine a fire extinguisher on the truck at least
once every six months, (4) a violation of 30 C.F.R. § 77.404 consisting of
the scraper being operated in an unsafe condition because the diesel fuel
tank was leaking, (5) a violation of 30 C.F.R. § 77.1103(a) consisting of
three unlabeled metal containers of gasoline on the truck, and (6) a
violation of 30 C.F.R. § 77.1103(a) consisting of a plastic container of
gasoline on the truck which did not meet National Fire Protection
Association requirements. Tr. 14, 21-31 (App. 86, 89-99); GX-2 (App.
42-64).
[5] In finding that the
Secretary did not abuse her discretion, the ALJ did not make any findings
with respect to the Secretary's argument that the Secretary's decision to
cite Twentymile was unreviewable.
[6] The ALJ agreed with
Twentymile that its employees were not exposed to the hazards created. 25
FMSHRC at 360 n.2 (App. 34).
[7] On March 28, 2005, the
Secretary filed a petition for reconsideration of this aspect of the
Commission's decision. The Commission denied the petition on March 30,
2005. (App. 38).
[8] The Commission itself
has repeatedly recognized that "it may find an abuse [of discretion] only
if there is no evidence to
support the [Secretary's] decision ...." 27 FMSHRC
at 279 (emphasis by Commissioner Jordan, dissenting) (quoting Mingo Logan
Coal Co., 19 FMSHRC 246, 249-50 n.5 (Feb. 1997), aff'd, 133 F.3d
916 (4th Cir. 1998) (table)) (App. 20).
[9] It is important to note
that the reason a decision to take action is not presumptively
unreviewable is that “the action itself provides a focus for judicial
review, inasmuch as the agency must have exercised its power in some
manner[,]” and "[t]he action can at least be reviewed to determine whether
the action agency exceeded its statutory powers.” Heckler, 470 U.S.
at 832, quoted in Hall, 285 F.3d at 79. Under the
settled case law previously discussed, there can be no question that the
Secretary acted within her statutory powers in citing the production
operator in this case. Nor can there be any question that the Secretary
violated any constitutional right or protection of the production operator
in this case. See Heckler, 470 U.S. at 838; Drake v. FAA,
291 F.3d 59, 72 (D.C. Cir. 2002).
[10] It should be noted
that, in Swift, this Court applied the general rationale of
Heckler even though it indicated that a decision to dismiss an action
may be more amenable to review than a decision not to initiate an action.
Swift, 318 F.3d at 253.
[11] Section 507 of the
Mine Act provides:
Except as otherwise
provided in this chapter, the provisions of sections 501 to 559 and sections
701-706 of Title 5 shall not apply to the making of any order, notice, or
decision made pursuant to this chapter, or to any proceeding for the review
thereof.
30 U.S.C. § 956.
[12] The Commission’s 1982 decision in Phillips Uranium represents the
last time, and indeed the only time, the Commission has actually overturned
a Secretarial enforcement decision at a multi-operator site.
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