This month I’d like to tell you about a problem that really shouldn’t be a problem. I’m talking about the current tempest-in-a-teapot that is approval of settlement motions in Mine Act enforcement cases.
I’ll bet you already know this, but the vast majority of penalty cases that are filed with the Federal Mine Safety and Health Review Commission (which I’m just going to call “the Commission” moving forward) get settled without ever having to go to trial. There are lots of reasons for this, but my (admittedly unscientific) explanation is that in most cases it’s just too expensive to take a case to a hearing.
Cases that can’t settle require a significant investment in time and money. Even when lawyers aren’t involved, getting ready for trial takes a lot of work. There are documents to review, witnesses to prepare, legal research to be done. Pretty much any trial is going to take at least one day and possibly longer, tying up witnesses and keeping them from doing the work they’re actually being paid to do.
Somebody has to be the point person at the trial, speaking on behalf of the company and managing the witnesses and their testimony. There may well be travel involved, and expenses for meals and hotel rooms. And on top of the expense, there’s the uncertainty that automatically creeps in when you put your case in the hands of an administrative law judge. (Not to put too fine a point on it, but even the best and strongest case can go south unexpectedly, and even the best judges occasionally have a bad day.) You might not get exactly what you want when you settle a case, but very often a settlement just makes more sense than, as the expression goes, paying your money and taking your chances.
Penalty cases under the Mine Act can only be settled with the approval of the Commission, by way of an administrative law judge. The Mine Act itself says that “[n]o proposed penalty which has been contested…shall be compromised, mitigated, or settled except with the approval of the Commission.” This means that to make the settlement effective, you have to get a judge to sign off. Of important note, this language only gives the Commission the authority to review the penalty, not modification to the citations themselves.
Now back to the process. To get the judge’s sign-off, you have to file two documents. The first is a motion for settlement. The second is a proposed order – a document that you want the judge to sign to approve your agreement. Before you panic, let me tell you that drafting the motion and proposed order pretty much always falls to MSHA, whether it’s someone from the Solicitor’s Office or the Conference and Litigation representative you’ve been working with. They’re the ones who actually write the documents, although they’ll send drafts over to you for your review before they’re actually filed at the Commission.
Just because you file a motion and proposed order, it doesn’t mean that you’re going to get your settlement approved, though. The Commission’s rules explicitly state that “[i]n determining the amount of penalty, neither the Judge nor the Commission shall be bound by a penalty proposed by the Secretary or by any offer of settlement made by a party.”
Wait…what? Yes, you read that right. Just because you and MSHA have settled the case, that doesn’t necessarily mean that the judge is going to approve the settlement. There are some limitations on what the judge can legally do. The judge has to review the settlement motion and decide independently whether the proposed settlement is appropriate under the Mine Act. Part of this review involves looking at the six penalty criteria set out in § 110(i) of the Act (violation history, the size of the operator, the level of negligence, the penalty’s effect on the operator’s ability to stay in business, gravity, and good faith in abatement) to determine whether the settlement is appropriate. According to Commission case law, the judge also has to consider “whether a settlement proposal is fair, reasonable, appropriate under the facts, and protects the public interest.” To make that happen, the Commission’s rules say that in addition to information about the penalty, both the settlement motion and the proposed order have to include “facts in support of the penalty agreed to by the parties.”
I’m a little sorry to tell you that in the past few years, some judges at the Commission have gotten a little more…oh, what’s the word?…energetic in their review of proposed settlements. It used to be a rarity, but now it’s not at all uncommon for a judge to reject a settlement and send it back, sometimes more than once, so the parties can do a more thorough job of explaining exactly why the settlement is appropriate under the Mine Act.
But sometimes it hasn’t even ended there. There are two sets of cases pending on appeal from the Commission to the U.S. Courts of Appeal in which the administrative law judge balked at approving settlements where MSHA was trying to exercise its enforcement discretion. In one group of cases, the administrative law judge would not approve settlements where MSHA agreed to modify citations from S&S to non-S&S. In another set of cases, the administrative law judge refused to approve settlements where MSHA agreed to vacate settlements altogether.
To be sure, the judge’s problem in those situations was not necessarily with the proposed settlements themselves; rather, it was that the parties were unwilling to give the judge the factual background he thought he needed before he would greenlight the settlements. But it also seems that not approving settlements because of these modifications could go beyond the Commission’s authority. We won’t get court decisions in those appeals for months yet, which means that for the time being, judges can still feel emboldened to kick back agreements if they don’t think the parties have justified them sufficiently.
Okay, so what does this mean for you? I mean, you’re going to keep settling cases when you can, right? And, of course, you want to get those settlements approved so you can pay the penalties and move on. Quite simply, it means that when you’re working with a CLR or with a lawyer for MSHA, you need to be as detailed as you can in explaining to the judge why, exactly, the settlement is “fair, reasonable, appropriate under the facts, and protects the public interest.”
This isn’t a case where less is more. In this case, more is more. Give the judge as many facts as you possibly can to justify your agreement with MSHA that the level of negligence should be reduced, or that the inspector overestimated the likelihood or the seriousness of the injury that might be expected to happen if the alleged violation is allowed to continue unabated. Don’t hold back, because the more time you have to spend going back and forth with a judge about whether the factual justification you and MSHA send over is sufficient, the more it will cut into any savings you’re realizing by settling the case in the first place.
Willa Perlmutter is chair of Stoel Rives’ OSHA group and co-chair of the firm’s mining group. She can be reached at
[email protected].