January 7, 2013
Two recent decisions confirm what many in the mining industry have suspected for a while: the
Mine Safety and Health Administration (MSHA) is branching out from “traditional mining” and seeking new venues and employers to take enforcement actions again, even where their activities are only tangentially related to the actual extraction and production of minerals.
The first case, Standard Gravel Co., was won by MSHA on Nov. 15, 2012, when ALJ Priscilla Rae granted MSHA’s Motion for Summary Judgment, finding that the agency had jurisdiction over an off-site maintenance shop that was used to repair and service mining equipment, as well as provide non-mining repair services to third parties. In Standard Gravel Co. Inc., the repair shop was located off-site from any mines and ranged from 2 to 40 miles away from the mines whose equipment it serviced.
The shop was owned by the mining company but also performed equipment repair services for third parties that were unrelated to mining. However, the ALJ took note that the preponderance of work at the shop was performed for its mines (albeit well-removed from mine property), and service representatives from the mines were MSHA-trained and also performed work on equipment at the mine site. The operator noted that much of the MSHA training had been provided in response to MSHA’s assertion of jurisdiction over the shop, in order to avoid having workers removed while the litigation was pending.
In her decision, ALJ Rae wrote: [Standard Gravel] cannot elude inspection of its fabrication, equipment repair, and service shop which are normally located on the mine site itself simply by moving it off-site . . . . Such a result would frustrate the ability to protect the miners who work in the shop and service the equipment in contravention of the Act.” The judge held that Standard Gravel should have known the site and equipment would be subject to MSHA’s jurisdiction because the equipment was used at mines.
The judge added that the Mine Act’s definition of a “mine” is “sweeping and expansive” and should be given “the broadest possible interpretation” and any conflicts resolved in favor of giving MSHA jurisdiction.
In Jim Walter Resources (FMSHRC 2000), the Commission had also addressed a situation where a general machine shop was located off-premises (but all work was dedicated to work on mining equipment, and no third-party repair services were part of the shop’s business), and overturned an ALJ finding against jurisdiction, adding that “a storage garage shared by a mine and an asphalt company could be a mine” if the equipment stored there was used in mining and the cited conditions “could affect miners in the garage.”
Therefore, in Standard Gravel, the judge agreed that “repair and servicing of mining equipment and fabrication of parts are functions normally performed in daily mining operations at any facility.” In short, as the law now stands, the presence of equipment used in the mining extraction process may be sufficient to confer jurisdiction over repair and supply shops located off-premises.
The operator did raise a “fair notice” argument because MSHA had known of the shop’s existence for years and had even visited it to verify abatement of equipment defect citations, but had declined to inspect it until 2009.
However, after the mine operator contested jurisdiction over the first batch of more than a dozen citations during the initial 2009 inspection, MSHA voluntarily vacated them in a tacit acknowledgement of the operator’s “fair notice/due process” argument, and so this ruling on Summary Judgment involves citations from the second and third inspections where jurisdiction was also disputed. ALJ Rae took note of argument, but held that Standard Gravel should have known the site and equipment would be subject to MSHA’s jurisdiction because the equipment was used at mines.
The decision, which was not appealed, does not constitute binding precedent, but it does set the stage for MSHA to exercise jurisdiction into other off-site shops — such as those maintained by equipment manufacturers such as Caterpillar, Komatsu, and Volvo — where work on mining equipment is also performed under warranty. Until now, MSHA had appeared to refrain from inspecting such shops that also provide services to the general public (as Standard Gravel’s shop also does), but this ruling could provide momentum for MSHA to enter those realms.
Another recent jurisdictional ruling was issued by ALJ Manning on Dec. 6, 2012, relating back to the tragic 2007 fatality at the Crandall Canyon mine in Utah, where six miners perished after the area of the mine where retreat mining was being conducted collapsed and entombed them in the mine. The tragedy was compounded days later when three rescue workers, including an MSHA inspector, were also killed during a subsequent collapse.
While there was no question that MSHA had jurisdiction over the Crandall Canyon operation, which was run by Genwal Resources, Inc., MSHA also extended its jurisdiction to cite the engineering and consulting firm that had advised the mine operator on its mining approach and plan development. The company, Agapito Associates Inc., was fined $220,000 by MSHA, which exercised jurisdiction even though the bulk of the services provided (engineering analyses related to the mine’s ground support plan) were conducted off mine property. MSHA cited Agapito under 30 CFR 75.203(a), which deals with utilization of appropriately sized pillars, because Genwal relied upon Agapito, and it was pillar failure that contributed to the fatalities.
Agapito challenged the citation (which was assessed at the maximum “flagrant” penalty) and claimed that its work was too incidental to coal production to encompass the company as an “independent contractor” and — hence — a “mine operator” under the definitions of the Mine Act. The decision came following competing motions for summary judgment, and the commission has yet to rule upon the merits of the citation and the appropriateness of the $220,000 penalty.
This was not the first time MSHA had taken aim at engineers, however; after the Quecreek mine disaster in 2002 (where all trapped miners were eventually rescued), MSHA cited Musser Engineering, the firm involved. In a 2010 ruling, by a two-to-one vote, the Commission found that Musser was a mine operator because it provided more than de minimis engineering services in relation to the Quecreek No. 1 Mine. Upon remand in 2011, an ALJ upheld a $55,000 penalty against Musser.
In ruling against Agapito on the jurisdictional issue, ALJ Manning analyzed the situation in the following dicta:
The crucial distinction between Musser and this case is the extent to which the operators and MSHA relied upon the analysis of the consulting companies. Musser submitted an unaltered map directly to the state permitting agency and that same map was subsequently submitted to MSHA. The operator also conducted its mining according to that map. Conversely, Agapito did not submit its work to any agency, and GRI did not directly include that work with any filings to any agency. MSHA and GRI altered and disregarded Agapito’s analysis when formulating a roof control plan, showing that Agapito’s services represented the transmission of ideas and nothing further. Ideas do not give rise to Mine Act jurisdiction.
Despite this, the ALJ determined that Agapito engaged in more than de minimis services to Genwal and, therefore, qualified for independent contractor status under the Musser precedent. Although Agapito did not have a regular presence at the mine, its representatives had visited at least twice to take photographs and view the mine as part of the preparatory work for engineering services, and the firm had billed 320 hours of time on the project.
ALJ Manning affirmed that mining services performed off-site will trigger MSHA jurisdiction, if the services relate to the act of mining. A merits hearing on the actual allegations against Agapito has not yet occurred. Whether these rulings will have a chilling effect on the willingness of engineers and other consultants to provide services to mining companies remains to be seen.
About the author: Adele L. Abrams is an attorney, Certified Mine Safety Professional and trained mediator who is president of the Law Office of Adele L. Abrams P.C. in Beltsville, Md., a seven-attorney firm focusing on safety, health, and employment law nationwide. Abrams also provides consultation, safety audits, and training services to MSHA- and OSHA-regulated companies. She is a member of the Maryland, D.C., and Pennsylvania Bars, the U.S. District Courts of Maryland and D.C., the U.S. Court of Appeals, D.C. Circuit and 4th Circuit, and the United States Supreme Court. She is a graduate of the George Washington University’s National Law Center and earned her Bachelor of Science in Journalism from the University of Maryland, College Park. For more information, contact her at firstname.lastname@example.org or visit the The Law Office of Adele L. Abrams on the Web at www.safety-law.com.