<DOC>
[DOCID: f:eaj963cd.wais]

 
CONTRACTORS SAND AND GRAVEL, INC.
EAJ96-3
September 22, 1998



        FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

                1730  K  STREET  NW,  6TH  FLOOR
                    WASHINGTON,  D.C.   20006


                       September 22, 1998

                                :
SECRETARY OF LABOR,             :
MINE SAFETY AND HEALTH          :
  ADMINISTRATION (MSHA)         :
                                :    Docket No. EAJ96-3
                    v.          :
                                :
CONTRACTORS SAND AND            :
  GRAVEL, INC.                  :
                                :

BEFORE:  Jordan, Chairman; Marks, Riley, Verheggen, and Beatty,
         Commissioners


                            DECISION

BY:  Jordan, Chairman; Marks and Beatty, Commissioners

     This is a proceeding involving the recovery of attorney's
fees and expenses under the Equal Access to Justice Act, 5 U.S.C.
 504 (1996) ("EAJA").  Administrative Law Judge August F. Cetti
ordered the Secretary of Labor to pay attorney's fees and
expenses following an application for fees filed by Contractors
Sand and Gravel, Inc. ("CSG"), after CSG prevailed over the Mine
Safety and Health Administration ("MSHA") in a proceeding under
the Federal Mine Safety and Health Act of 1977, 30 U.S.C.  801
et seq. (1994) ("Mine Act" or "Act").  18 FMSHRC 1820 (Oct. 1996)
(ALJ).  The Secretary filed a petition for discretionary review
with the Commission challenging the judge's award and, after the
Commission granted the Secretary's petition, CSG filed a motion
to dismiss for lack of jurisdiction over the Secretary's appeal.

     For the reasons that follow, we reject CSG's contention that
the Commission lacks jurisdiction over the Secretary's appeal,
reverse the judge's holding that the Secretary's legal position
on the merits was not substantially justified, and vacate his
award of attorney's fees and expenses.

                               I.

Factual and Procedural Background

A.   The Mine Act Proceeding

     CSG operated the Montague Plant, a small portable sand and
gravel surface mining operation located near Yreka in north
central California.  Contractors Sand & Gravel Supply, Inc., 18
FMSHRC 384, 384 (Mar. 1996) (ALJ).  The plant employed two
workers and produced 10,000 to 15,000 tons of rock annually.  Id.
CSG's general manager, Eric Schoonmaker, oversaw plant operations
and was responsible for coordinating equipment maintenance and
repair and for ensuring the safety of operations.  Id.
Schoonmaker also oversaw operations at another CSG operation near
Yreka, the Scott River Plant.  Id.

     On March 10, 1993, MSHA conducted an inspection at the
Montague Plant and issued several citations.   Id. at 385.  MSHA
Inspector Ann Frederick observed two electrical motors mounted on
a crusher that she believed were improperly grounded because
"[t]he frame of the crusher was being used as the grounding
conductor."  Id.; Citation No. 3911909.  Inspector Frederick
issued a citation to CSG charging a violation of 30 C.F.R.
 56.12025,[1] in which she stated that "[e]ffective equipment
grounding conductors have not been installed . . . .  Frame
grounding has been forbidden for over fifteen years."  Id.  No
tests were performed at the time the citation was issued to
determine whether the motors were, in fact, grounded.  18 FMSHRC
at 386.  MSHA subsequently proposed a $7,000 penalty against CSG,
and a $6,000 penalty against Schoonmaker pursuant to section
110(c) of the Mine Act.[2]  Id. at 385, 389.  CSG contested the
penalty assessments and the case was assigned to Judge Cetti.

     In July 1994, the judge issued a default order against
CSG.  Order dated July 21, 1994.  Subsequently, CSG requested
relief from the Commission, and the case was remanded to the
judge to determine whether relief from default was warranted.  16
FMSHRC 1645, 1646 (Aug. 1994).  There is no indication that the
judge ever made such a determination.  Following remand, CSG
failed to respond to the judge's September 1, 1994 prehearing
order, and he again issued a show cause order.  Order dated Nov.
16, 1994.  By early December 1994, CSG retained its present
counsel who asked for additional time to respond to the
prehearing order.

     In October 1995, CSG and the Secretary filed cross motions
for summary decision, each arguing that there were no material
facts in dispute.  On March 25, 1996, the judge issued his
Summary Decision in which he vacated the citations and penalties
against CSG and Schoonmaker.  18 FMSHRC at 389.[3]  He explained
that the cited standard "plainly and clearly requires that `metal
enclosing . . . electrical circuits shall be grounded,'" and that
the standard "does not specify or require that the operator
achieve an effective ground in a specific manner."  Id. at 387.
The judge further found that CSG complied with section 56.12025
because, as demonstrated in resistivity tests conducted by CSG,
"the motors in question were connected with the ground to make
the earth part of the circuit.[4]  There is no contrary
evidence."  Id. at 387-88 (footnote added).

     The judge rejected the Secretary's argument that frame
grounding constitutes a per se violation of section 56.12025,
noting that this position amounted to an attempt "through
interpretation to expand the regulation beyond its plain
meaning."  Id. at 388.  He also reasoned that "a reasonable,
prudent person familiar with the mining industry would have
recognized that the two motors . . . were `grounded' and were,
thus, in compliance with [section 56.12025]."  Id.  In support of
his conclusion, the judge cited decisions of two other Commission
judges who had rejected the theory that frame grounding is a per
se violation of section 56.12025.  Id. at 389 (citing Mulzer
Crushed Stone Co., 3 FMSHRC 1238 (May 1981) (ALJ), and McCormick
Sand Corp., 2 FMSHRC 21 (Jan. 1980) (ALJ)).

B.   The EAJA Proceeding

     After the judge rendered his decision, CSG timely
filed with the Commission an application for fees and
expenses pursuant to EAJA.  In its application, CSG stated
that it was the prevailing party in the Mine Act proceeding,
that it had fewer than 500 employees and a net worth
under $7 million, and that the position of the
Secretary in the underlying proceeding was not
substantially justified.  CSG sought attorney's fees
and expenses totaling $20,715.12.  In several
amendments to its application, CSG sought an award of
$41,155.05.

     In response to CSG's application, the Secretary
argued that his position was substantially justified
because it had a reasonable basis in law and fact.  S.
Answer at 2-5. The Secretary further argued that CSG's
fee request was excessive because CSG sought fees in
excess of the maximum rate of $75 per hour set forth in
EAJA and because some of the fees sought were not
attributable to the defense of the case in which CSG
prevailed.  Id. at 6-7.  Finally, the Secretary objected
to some of the costs included in the application, including
various office expenses and interest on unpaid bills.  Id.
at 7.

     The judge granted CSG's application.  18 FMSHRC at
1835. He noted first that it was undisputed that CSG was a
prevailing party in the underlying proceeding and that
it met the eligibility requirements of EAJA.  Id. at
1821.  On the question of whether the Secretary's
position on the merits was substantially justified, the
judge noted that he had "clearly indicated" in his
decision in the underlying proceeding that "the
Secretary's position was unreasonable."  Id. at 1822.
The judge concluded that any interpretation that
"ignores the plain meaning of a cited standard, is per
se unreasonable," and that "there is no reasonable
interpretation of the facts that supports the
Secretary's theory that the motors were not effectively
grounded."  Id. at 1822-23.  Accordingly, the judge
held that the Secretary's position in the underlying
proceeding was not substantially justified.  Id. at
1824.

     The judge adopted the apportionment suggested in
CSG's application to distinguish between fees and expenses
that would be recoverable and those that would not
because they were incurred in defending other
citations.  Id. at 1824-27.  The judge also held that
he had the discretion to increase EAJA's cap on the
hourly rate of fees, and that increases in the cost of
living justified a retroactive increase in the rate
from $75 to $121.50 per hour in the underlying Mine Act
proceeding.  Id. at 1827-30.  With regard to expenses,
the judge determined that the office expenses of CSG's
counsel attributable to the case would ordinarily be
billed to clients and, therefore, should be recoverable
from the government.  Id. at 1830-31.  As to CSG's
request for interest, the judge found it was a
reasonable cost of providing legal services and would
not have been incurred but for the Secretary's
unreasonable enforcement action.  18 FMSHRC at 1831-32.
Finally, the judge held the EAJA proceeding was an
"adversary adjudication," within the meaning of EAJA,
separate and distinct from the underlying merits
proceeding.  Id. at 1834.  He consequently determined
that, because the EAJA proceeding was an adversary
adjudication initiated after the effective date of the
EAJA amendments (Mar. 29, 1996), the higher fee rate of
$125 per hour in the amendments was applicable.  Id. at
1835. Therefore, the judge concluded that CSG was
"entitled to recover fees and expenses incurred in
connection with its EAJA application," and that CSG had
"not unduly or unreasonably protracted [the] EAJA
proceedings."  Id. at 1832-35.  He ordered the
Secretary to pay CSG $41,155.05 in fees and expenses.
Id. at 1835.


**FOOTNOTES**

     [1]:  Section 56.12025 provides:

          All  metal  enclosing  or encasing electrical
          circuits shall be grounded  or  provided with
          equivalent protection.  This requirement does
          not apply to battery-operated equipment.

     [2]:  Section 110(c) provides:

               Whenever a corporate operator violates a
          mandatory   health  or  safety  standard   or
          knowingly violates  or  fails  or  refuses to
          comply with any order issued under this [Act]
          or any order incorporated in a final decision
          issued  under  this  [Act],  except  an order
          incorporated   in  a  decision  issued  under
          subsection (a) of  this  section  or  section
          105(c)  of this title, any director, officer,
          or agent  of  such  corporation who knowingly
          authorized,  ordered,  or  carried  out  such
          violation,  failure,   or  refusal  shall  be
          subject to the same
          civil penalties, fines, and imprisonment that
          may   be   imposed   upon   a  person   under
          subsections (a) and (d) of this section.

30 U.S.C.  820(c).

     [3]:  The judge appended his Summary  Decision  in  the Mine
Act proceeding to his October 28, 1996 EAJA decision.  18 FMSHRC
at 1837.

     [4]:    On   September   15,   1992,  Schoonmaker  conducted
resistivity tests on the circuits that  indicated  that there was
an  effective  path  to  the ground from both of the motors.   18
FMSHRC at 388.

                               II.

Disposition

A.   Jurisdiction

     After the Commission granted the Secretary's petition for
discretionary review, CSG filed a motion to dismiss the petition.
CSG argues in its motion that review of the judge's decision is
contrary to the "distinct and noticeable absence of any provision
for Commission review in the EAJA."  CSG Mot. to Dismiss at 15.
To the contrary, according to CSG, the reference in EAJA section
504(a) to "the adjudicative officer" indicates an intent to
preclude administrative appeals in EAJA cases.  Id. at 12-14.

     CSG further argues that, by not providing for review of EAJA
determinations, Congress intended to encourage agencies to appeal
adverse determinations in underlying proceedings pursuant to
their enabling statutes, rather than use EAJA proceedings to
re-litigate issues on which review was not sought.  Id. at 15-17.
CSG contends that agency review of a judge's EAJA decision
undermines the purpose of the statute by allowing delay of the
payment of fees and expenses without payment of interest, and
that review is not "rational" because the judge's decision is
entitled to deference, leading to only marginal benefits on
review.  Id. at 18-19.  Finally, CSG asserts that the
Commission's EAJA rules preclude the Secretary from appealing an
award because those rules only explicitly require a judge to set
forth in full the reasons for a denial of a fee request.  Id. at
20-22 (citing 29 C.F.R.  2704.307).

     In response, the Secretary argues that CSG's position is
contrary to the language and legislative history of EAJA.  S. Br.
at 7-8.  The Secretary also notes that model agency EAJA rules
developed by the Administrative Conference of the United States,
upon which the Commission rules were based, provided for such
appeals because unreviewable adjudicative officer decisions would
be inconsistent with traditional agency practice.  Id. at 8 n.6.

     We find CSG's arguments unpersuasive.  The language in the
final sentence of EAJA section 504(a)(3), added to EAJA in 1985,
plainly states that the "decision of the agency," as
distinguished from the "adjudicative officer's decision," will be
the "final administrative decision."  See Lion Uniform, Inc. v.
NLRB, 905 F.2d 120, 123 (6th Cir.) ("While the decision on an
application for fees is initially made by the adjudicative
officer, the final administrative decision is that of the
agency."), cert. denied, 498 U.S. 992 (1990).[5]  Moreover, CSG
acknowledges that no other court or administrative decision
supports its position.  CSG Reply Br. at 9.

     We also note that the legislative history accompanying the
1985 re-enactment and amendment of EAJA unambiguously supports
Commission review of EAJA determinations made by our
administrative law judges.  The House Committee Report submitted
with the legislation (there were no Senate or conference reports)
states:  "The legislation allows the agency rather than the
adjudicative officer to make the final decision on fee award at
the agency level."  H.R. Rep. No. 99-120, 99th Cong., 1st Sess. 7
(1985), reprinted in 1985 U.S.C.C.A.N. 132, 135.   In the
section-by-section analysis, regarding section 504(a)(3) the
report further states:

          This provision explicitly adopts the view
          that the agency makes the final decision in
          the award of fees in administrative
          proceedings under section 504.  This follows
          the view adopted by the Administrative
          Conference and recognizes the fact that
          decisions in administrative proceedings are
          generally not final until they have been
          adopted by the agency.

Id. at 142.

     Moreover, we find that policy considerations compel us to
reject CSG's arguments.  Commission review of EAJA decisions by
our judges will lead to the formulation of a uniform body of case
law under the statute.  Administrative review also provides
protection against either arbitrary actions of judges or actions
that could be perceived as arbitrary, and also controls and
regulates the quality of judicial decision-making.  Accordingly,
we deny CSG's motion to dismiss.

B.   Standard of Review

      The Secretary has not addressed the question of which
standard of review the Commission should apply in EAJA
proceedings.  CSG argues, albeit implicitly, that our review of
the judge's factual findings is governed by the substantial
evidence test and that his legal determinations are reviewed as
to whether they are "correct."  CSG Resp. Br. at 4-13.

     EAJA provides for a substantial evidence standard of review
for appellate courts reviewing final agency decisions under the
Act.  5 U.S.C.  504(c)(2).  However, EAJA is silent on the
appropriate standard of review of an administrative law judge's
decision in the course of an internal agency appellate review.
In Pierce v. Underwood, 487 U.S. 552 (1988), the Supreme Court
addressed the standard of review for appellate courts in civil
EAJA actions tried in district courts.  The Court held that a
district court judge's EAJA determination is to be reviewed by a
court of appeals using an abuse of discretion standard.  Id. at
562.

     The holding in Pierce suggests that, by analogy, the
Commission should adopt a similar standard in reviewing the
judge's decision here.  However, our adoption of the more
deferential abuse of discretion standard would lead to the
anomalous result of having our decision reviewed on appeal under
the less deferential substantial evidence standard required by
EAJA.

     In Lion Uniform, the Sixth Circuit considered and rejected
the argument that the abuse of discretion standard approved by
the Supreme Court in Pierce should apply to review by the
National Labor Relations Board ("NLRB") of an administrative law
judge's decision, stating:

               The rationale of the opinion in Pierce
          is, of course, sound in the context of the
          relationship between a court of appeals and a
          district court, where the EAJA litigation
          begins in the district court.  But, where the
          EAJA litigation begins before an agency, with
          appeals contemplated to the courts, a highly
          deferential review by the Board, followed by
          a less deferential review by the courts,
          makes little sense.  In the absence of more
          specific legislative direction, we must
          assume the more logical scheme applies - that
          the standard of deference is heightened as
          the appeal process progresses - de novo
          review at the agency level, and substantial
          evidence review before the courts.

905 F.2d at 124.  The court found de novo review to be the
appropriate standard of review for the NLRB, since making de novo
findings of fact is part of the Board's "normal function."  Id.

     We agree with the court's rationale in Lion Uniform.  Thus,
our standard of review of a judge's EAJA determination should not
be more deferential than the standard of review employed by an
appeals court in reviewing a Commission decision under EAJA.
Unlike the NLRB, however, the Commission does not generally make
de novo findings of fact.  Instead, when reviewing an
administrative law judge's factual determinations, the Commission
is bound by the terms of the Mine Act to apply the substantial
evidence test.[6]  30 U.S.C.  823(d)(2)(A)(ii)(I).  We find this
test to be the more appropriate standard of review for factual
determinations made by our judges in EAJA cases.[7]  Applying the
substantial evidence test to findings of fact, together with de novo
review of questions of law, is consistent with the Commission's
"normal function" under the Mine Act and ensures that our decision
will not be reviewed on appeal under a less deferential standard.

     C.   Substantial Justification

     EAJA provides that a prevailing party may be awarded
attorney's fees unless the position of the United States is
substantially justified.  Cooper v. United States R.R. Retirement
Bd., 24 F.3d 1414, 1416 (D.C. Cir. 1994).  The Supreme Court has
defined a "substantially justified" position as "justified in
substance or in the main" or one that has "a reasonable basis
both in law and fact."  Pierce, 487 U.S. at 565.  In Pierce the
court set forth the test as follows: "a position can be justified
even though it is not correct, and we believe it can be
substantially (i.e., for the most part) justified if a reasonable
person could think it correct, that is, if it has a reasonable
basis in law and fact."  Id. at 566 n.3.  In EAJA proceedings the
agency bears the burden of establishing that its position was
substantially justified.  Lundin v. Mecham, 980 F.2d 1450, 1459
(D.C. Cir. 1992).

     The standard CSG was charged with violating in this case
requires that "[a]ll metal enclosing or encasing electrical
circuits shall be grounded . . . ."  30 C.F.R.  56.12025.
Electrical grounding is defined elsewhere in Part 56 as "to
connect with the ground to make the earth part of the circuit."
30 C.F.R.  56.2.  At issue, therefore, is whether the
Secretary's position regarding CSG's compliance with this
regulation was substantially justified.  For the reasons
discussed below, we conclude that the Secretary's position had a
reasonable basis in law and fact, and therefore reverse the
judge's EAJA determination.

1.     The Judge Failed to Independently Evaluate the
Secretary's Legal Position

     As stated above, the issue in this case is not the success
or failure of the Secretary's underlying case on the merits, but
instead whether or not the Secretary's position was substantially
justified. To determine substantial justification, a judge is
required to independently ascertain in his or her EAJA decision
whether the Secretary's position had a reasonable basis in
law and fact.  In this case, however, the judge based his EAJA
decision entirely on his determination of the standard's "plain
meaning" in the underlying merits proceeding, finding again that
the Secretary's interpretation ignored the plain meaning of the
standard and thus was per se unreasonable.  18 FMSHRC at 1822-23.
This approach is incorrect as a matter of law.  See F. J. Vollmer
Co. v. Magaw, 102 F.3d 591, 596 (D.C. Cir. 1996) (reviewing
court's role in reviewing lower court's EAJA award is to
ascertain whether court relied on proper legal standard).  The
D.C. Circuit has held that "the inquiry into reasonableness for
EAJA purposes may not be collapsed into [the] antecedent
evaluation of the merits, for EAJA sets forth a `distinct legal
standard.'" Cooper, 24 F.3d at 1416 (citation omitted).  As the
First Circuit has noted, while there may be overlap between the
merits determination and the substantial justification
determination under EAJA, "[a]n exercise of independent judgment
is essential to determine whether an EAJA award is warranted; the
answer is not `wedded to the underlying judgment on the merits.'
. . .  Any other approach would demean the precise language of
the [EAJA]."  Sierra Club v. Secretary of the Army, 820 F.2d 513,
517 (1st Cir. 1987) (emphasis added) (citation omitted).  Under
an EAJA analysis, "[t]he government's failure to prevail does not
raise a presumption that its position was not substantially
justified."  Kali v. Bowen, 854 F.2d 329, 332 (9th Cir. 1988).

     A review of the record in this case indicates that the
judge's determination regarding the scope and meaning of section
56.12025 hopelessly tainted his EAJA decision because he simply
carried over his analysis from the merits proceeding into the
EAJA proceeding.[8]  As the judge stated:

          In the underlying proceeding, I clearly
          indicated that the Secretary's position was
          unreasonable. . . .  I again find that the
          Secretary's legal theory was not reasonable
          and that there was no reasonable connection
          between the Secretary's legal theory and the
          undisputed facts.

18 FMSHRC at 1822 (emphasis added).

     Of course, in disposing of the citation in the underlying
proceeding, the judge did not reach the issue of substantial
justification of the Secretary's position, nor should he have.
However, the judge's failure to independently review the
Secretary's position in the EAJA proceeding and apply a distinct
analysis under the appropriate EAJA standard was erroneous and,
in itself, precludes affirmance of the judge's determination.
Indeed, as the D.C. Circuit has noted in the context of EAJA
litigation, "[m]echanical jurisprudence will not do."  FEC v.
Rose, 806 F.2d 1081, 1089 (D.C. Cir. 1986).  As we discuss below,
an independent examination of the Secretary's legal position,
uncoupled from the underlying merits decision, leads to the
ineluctable conclusion that the Secretary's position was
"reasonable in law and fact," and as such substantially justified
under EAJA.[9]

2.     The Secretary's Position Had a Reasonable Basis in Law

     We begin our analysis of whether the Secretary's position
was substantially justified by examining whether her position had
a reasonable basis in law.  For purposes of this case, we need
not decide whether MSHA was correct; rather, we must only
ascertain whether its view was a reasonable one.

     MSHA cited CSG because of the operator's undisputed use of
the crusher frame as a ground path.  In MSHA's view, frame
grounding violated the standard because it was an inherently
unreliable system which exposes miners to the risk of
electrocution.  The Secretary argued that the wiring on the
unsheltered equipment at CSG's rock quarry was exposed to the
elements and subject to extreme vibration.  Therefore, under the
Secretary's theory, using the frame to ground the electrical
equipment carried a risk that metal-to-metal, metal-to-bolt, and
metal-to-wire connections would deteriorate or come loose.  S.
Cross Mot. for Sum. Dec. at 6; Decl. of Paul Price, Oct. 27, 1995
("Price Decl.") at 4.  The Secretary's litigation position was
supported by its expert, Paul Price.  Further, according to
MSHA's expert, no nationally recognized industry association
accepted the use of an equipment structure or frame on an outdoor
portable crusher to serve as a grounding conductor.  S. Cross
Mot. for Sum. Dec. at 10;
Price Decl. at 5-6.

     The judge determined that the Secretary's legal position
(that frame grounding was prohibited under the regulation) was
unreasonable because it "expand[ed] the regulation beyond its
plain meaning."  18 FMSHRC at 1822 (quoting 18 FMSHRC at 388)
(emphasis omitted).  According to the judge, "[a]ny
interpretation that `impermissibly' ignores the plain meaning of
a cited standard, is per se unreasonable."  Id. at 1822-23.  In
the judge's view, since the two motors in question "were
connected to earth through a series of metal frame and wire
connections, [they] were grounded and were, thus, in compliance
with [the] requirement of the cited regulation."  Id. at 1823
(quoting 18 FMSHRC at 388) (emphasis in original).

     During the EAJA proceeding, the judge erred in not looking
beyond the merits of the underlying case, and in failing to
consider whether the Secretary's interpretation was substantially
justified and consistent with the Mine Act.  He improperly
considered the Secretary's position unreasonable because in his
merits decision he had found section 56.12025 satisfied so long
as the electrical equipment was connected to earth.  The judge's
approach failed to consider the reasonableness of the Secretary's
argument as to the importance of an effective grounding
connection.  In fact, the judge did not discuss the Secretary's
theory as to the reliability of the grounding technique employed
by CSG, even though GSG conceded that the regulation required an
effective path to ground.  CSG Mot. for Sum. Dec. at 6 n.6.

     From our review of the record, we conclude that MSHA's
interpretation of the standard requiring effective grounding had
a reasonable basis in law, because restricting the standard to
its literal terms could expose individuals to the harm the
standard was designed to prevent.[10]  See Arch of Kentucky,
Inc., 13 FMSHRC 753, 756 (May 1991) (rejecting operator's
argument that its procedure fell within the literal terms of the
standard because procedure was unsafe and did not comport with
the safety goals of the regulation and the Act).  In fact, a
narrow reading of section 56.12025 could create a situation where
an individual could be fatally injured before a problem in the
grounding system is detected.  This is because under a literal
approach, an unreliable system would not violate the standard
until the connection with the ground was severed.[11]  But as
MSHA's expert explained:

          You must have an effective path for the
          ground fault to flow.  It's essentially the
          lifeline of the guy standing there touching
          it.  The worker's - if that's poor, he's just
          going to die.  Just as simple as that.

Deposition of Paul Price, July 25, 1995 ("Price Dep.") at 47
(emphasis added).  The protective purpose of the standard is to
prevent injury from electrocution caused by a malfunctioning or
improper grounding system.  The Secretary's interpretation
certainly is consistent with this goal.

     Historically, the Commission has rejected a narrow,
technical interpretation of a regulation that "thwarts the
standard's protective purpose and does not serve the safety
objectives recognized in the legislative history." Pyramid Mining
Inc., 16 FMSHRC 2037, 2040 (Oct. 1994).  For example, in
Consolidation Coal Co., 15 FMSHRC 1555 (Aug. 1993), the
Commission considered whether an escapeway was separated from a
belt and trolley haulage entry, because the stopping between the
two had a substantial hole.  The judge had found that a
"separation" existed, despite the existence of the hole.  In
reversing that determination, the Commission concluded that a
construction of the standard requiring physical separation but
allowing free movement of air current thwarted the standard's
purpose of permitting only intake air in escapeways, and could
lead to "absurd results," because in the event of a fire, the
hole could permit contaminated air to enter the escapeway.  Id.
at 1557.  In Western-Fuels Utah, Inc., 19 FMSHRC at 998-1000, the
Commission reversed the judge's conclusion that a regulation
requiring a conveyor be "equipped with slippage and sequence
switches" was not violated as long as the belt contained the
requisite switches and that any malfunction of those switches was
"irrelevant."  The Commission agreed with the Secretary that the
standard must be construed to require that the belt be equipped
with "functional" slippage and sequence switches.  Id.  See also
Fluor Daniel, Inc., 18 FMSHRC 1143, 1145-46 (July 1996)
(rejecting, sub silentio, operator's claim that 30 C.F.R. 
56.14101(a)(1) did not require brakes to be maintained in
functional condition); Mettiki Coal Corp., 13 FMSHRC 760, 768
(May 1991) (construing 30 C.F.R.  77.507 to require that
switches be installed with functioning lockout devices).
The Secretary's interpretation requiring effective grounding is
consistent with this line of Commission authority.  The judge,
by adhering to the analysis of his merits decision, which relied
on a literal approach, erred by disregarding Commission precedent
holding that if a regulation requires specified equipment, that
equipment must be functional, effective, and safe.

     In line with this authority, we can only conclude that the
Secretary's interpretation of the regulation to require a
grounding system "of adequate design so as to be expected to
provide the necessary ground path on a continuing basis" ( Price
Decl.  9 (emphasis added)) had a reasonable basis in law and
furthered the safety protective purposes of the Act.

     Our dissenting colleagues, citing Pierce, seek to rely on
"objective indicia"[12] in an attempt to support their view that
the Secretary's position was unreasonable.  Slip op. at 23.  The
dissent seizes on the language in Pierce which identifies the
"views of other courts on the merits" as a factor in determining
the reasonableness of the government's position.  Id.  To support
its argument the dissent relies on four unreviewed administrative
law judge decisions that have disagreed with the Secretary's
interpretation of section 56.12025.  Slip op. at 24.[13]

     The dissent's reliance on these cases is misplaced for
several reasons.  The most obvious one is that, pursuant to
Commission Procedural Rule 72, 29 C.F.R.  2700.72, unreviewed
administrative law judge decisions have no binding precedential
impact.  It is, therefore, erroneous to portray these rulings as
having any appreciable relevance to the current status of the law
regarding the issue of frame grounding.  They cannot be found to
constitute the type of "string of losses" referred to by the
Supreme Court in Pierce as bearing on whether an agency's
position lacks substantial justification.  487 U.S. at 569.

     The Kali case underscores this point.  In Kali, an EAJA case
in which the plaintiffs had successfully challenged a government
welfare regulation in the merits proceeding, every court that had
ruled on the issue (generally federal district courts) had
rejected the Secretary's position.  854 F.2d at 334.
Nonetheless, the Ninth Circuit found that the district court in
the EAJA case had not abused its discretion in finding the
government's position substantially justified.

     Moreover, when federal courts inquire as to whether the
government's position was substantially justified on legal
grounds, they generally look to federal court of appeals
precedent.   United States v. One 1984 Ford Van, 873 F.2d 1281,
1282 (9th Cir. 1989) (government did not have a reasonable basis
in law because there was no distinction between this case and an
earlier Ninth Circuit case); Fraction v. Bowen, 859 F.2d 574, 575
(8th Cir. 1988) (government's position was not substantially
justified because the government's mistakes were "contrary to
clearly established circuit precedent").  Similarly, in the
administrative law context, Commission decisions serve as legal
precedent, since the role of the Commission as a reviewing body
is similar to that of a federal circuit court in the judicial
setting.  But, as we have discussed, the Commission has never
addressed the issue of frame grounding, and therefore no binding
precedent exists to establish a meaningful interpretation of
section 56.12025.

     Our dissenting colleagues also take exception to the
Secretary's decision not to appeal any of the aforementioned
cases.  Slip op. at 25.  However, we note that, in Pierce, the
Supreme Court held  that "[t]he unfavorable terms of a settlement
agreement, [which the Court also considered as "objective
indicia" of whether the government's position was substantially
justified] without inquiry into the reasons for settlement,
cannot conclusively establish the weakness of the Government's
position."  487 U.S. at 568 (emphasis added).  In the same vein,
the Commission, as a reviewing body, should likewise be extremely
cautious about concluding that the Secretary's position was
unreasonable if the support for such a finding would involve
second-guessing her decision of whether to appeal a case.  This
is particularly important because we are not privy to the complex
legal, factual, and policy reasons underlying the Secretary's
decision not to appeal.  Furthermore, to suggest that the
Secretary's underlying position in a case was unreasonable based
on her decision not to appeal an adverse ruling could result in
the filing of needless appeals by the Secretary to avoid the
threat of liability for attorney's fees under the EAJA.

3.   The Secretary's Position Had a Reasonable Basis in
     Fact

     We now turn to the question of whether the Secretary's
position had a reasonable basis in fact.  Pierce, 487 U.S. at
565.  To ascertain the answer, we review the record before us
with the understanding that the Secretary need not prove in this
EAJA proceeding by a preponderance of the evidence that frame
grounding is ineffective.  Rather, she need only demonstrate that
her position was a reasonable one.  Our review of the entire
record compels the conclusion that her position that frame
grounding is not effective is reasonable in fact.[14]

     The purpose of section 56.12025 is to protect individuals
from the threat of electrocution.  In the event of a fault in the
electrical current, such as a broken wire or worn insulation in
the cable carrying the electrical power supply to the motor, or
excessive moisture, undirected electrical current must be carried
by way of a grounding conductor back to the power source.  When
the system is properly grounded, fault current will pass through
a circuit breaker, trip the switch and de-energize the system,
and then pass to the ground.  S. Cross Mot. for Sum. Dec. at 4;
CSG Mot. for Sum. Dec. at 6.  If the fault current does not have
an effective ground conductor, the breaker may not trip quickly,
allowing the equipment frame to become energized.  When this
occurs, an individual who comes into contact with an energized
frame faces the hazard of electrical shock or death by
electrocution.  S. Cross Mot. for Sum. Dec. at 4.

     In asserting that the frame grounding method employed by CSG
     was so inherently unreliable that it could not provide
     reasonable assurance that the miners would be protected from
     electrocution, the Secretary relied on the fact that CSG's
     frame grounding system depends on the integrity of many
     connections (metal to bolt, metal to metal, metal to wire)
     to move the fault current to the breaker.  Id. at 10.
     MSHA's expert, Paul Price, was emphatic about the hazard
     posed by such a system:

          Crushers, screens, conveyors and other steel
          structures vibrate and rust resulting in the
          loosening of the connections of the frame and
          thereby increasing the resistance of the
          grounding path . . . .  The connections at
          the motors and other electrical enclosures
          depend on bolts which are also subject to
          rust and vibration.  Thus, the use of the
          crusher and conveyor frames as the grounding
          conductor, as was attempted here, is
          extremely unreliable as any increase in
          resistance anywhere along the ground path
          (motor to bolt to frame part to adjoining
          frame part to jumper, etc.) could subject
          anyone touching any of the metal frames
          during a ground fault condition to a
          potentially fatal shock.  Accordingly, the
          frame is wholly unreliable as a conductor and
          does not provide for an effective path to
          ground.

Price Decl. at 4-5.

     MSHA's expert Price was unshakeable in his conviction that
problems with rusty bolts and vibration were insurmountable, and
caused this system to be fundamentally flawed.  He testified that
"it's impossible to maintain them in a low impedance[15] cause
you have to grind the rust off every day and it's kind of
essentially impossible to maintain them like that."  Price Dep.
at 22.  See also Price Dep. at 24 ("[T]he conveyors all vibrate .
. . The bolts are . . . all rusty because they're outside . . . .
You can't maintain them . . . unless you check them every hour.
They're essentially impossible to maintain."); Price Dep. at 55-
56  ("The reason we do not accept grounding by frames or
conveyors is it's impossible to maintain the thing . . . It can't
be done . . . [I]t can vibrate loose within just a few seconds").

     The declaration of Gordon Vincent, an electrical contractor
who was retained by CSG, in the fall of 1992, to perform
grounding and continuity tests, also supports the reasonableness
of the Secretary's position.  Decl. of Gordon Vincent dated Oct.
26, 1995 ("Vincent Decl.") at 1-2; see also Deposition of Eric
Schoonmaker, General Manager of CSG Montague plant, dated July
14, 1995 ("Schoonmaker Dep.") at 39.  When Vincent arrived at the
plant and found only 3-conductor leads without a fourth grounding
conductor, he determined that the grounding was inadequate and
ended his inspection.  Vincent Decl. at 3; Schoonmaker Dep. at
41, 50.  He informed the operator that the plant was not properly
grounded, and that he would not certify to MSHA that it was,
whereupon CSG terminated his contract.  Vincent Decl. at 4.[16]

     CSG provided no expert testimony.  In the merits case before
the ALJ, it based its factual case almost completely on the
affidavit and deposition of Eric Schoonmaker.  He asserted that
when the motors were serviced, they were inspected to ensure that
they were securely bolted to the frame and that the bolts were
not rusted.  Schoonmaker Aff. at 3.  He also stated that the
grounding system was periodically tested, and that it passed the
test in September 1992.  Id. at 4.  The operator relied on the
fact that MSHA could not produce test results that showed
excessive resistance and that the mandatory testing conducted
annually by CSG always indicated a  sufficiently low resistance
path to ground.[17]  CSG's evidence does not undermine the
reasonableness of MSHA's position that frame grounding fails to
satisfy the standard's grounding requirement.  The fact that a
feared accident has not yet occurred, or that the system could
pass resistance tests on a particular day does not render
unreasonable the Secretary's charge that CSG's grounding was
ineffective and violative of the standard.  See Ace Drilling Coal
Co., 2 FMSHRC 790, 791 (Apr. 1980) ("It is not necessary. . .
that a condition contribute to an accident before the standard is
violated.  The Act does not condition the existence of a
violation upon the occurrence of an event it is designed to
prevent.").  See also Western Fuels, 19 FMSHRC at 997-1000 (an
unexpected malfunction of switches would constitute a violation,
notwithstanding the fact that the switches were in proper working
order 3 days before the fire that triggered the MSHA inspection
at issue, the cause of the malfunction was never determined, and
the switches were still functional 2 years afterwards, at the
time of the hearing).   Finally, even Schoonmaker admitted that a
four-wire grounding system (as opposed to frame grounding) would
provide "better protection."  Schoonmaker Dep. at 53.

     Under the approach of the judge and the dissent, MSHA could
only cite an ineffective path to ground after it discovers the
condition based on results of continuity and resistance tests on
a particular piece of equipment.  MSHA's theory of violation,
however, was that a design that was inherently unreliable, such
as frame grounding, failed to comply with the standard's
grounding requirement, regardless of what test results may show
at any particular point in time.[18] Under the facts of this
case, this was a reasonable view and one that furthered the
safety purposes of the Act.

     In conclusion, the record as a whole indicates that the
Secretary's position regarding the inherent unreliability of
CSG's frame grounding system had a reasonable basis in fact.  As
we set forth in the preceding section, her position also had a
reasonable basis in law.  Accordingly, we find that her position
was substantially justified, and we therefore vacate the judge's
order awarding fees and other expenses to CSG.[19]


**FOOTNOTES**

     [5]:  Even if EAJA were  silent  as to administrative review
of judges' decisions, the Commission could establish such review.
The Commission has created a right of administrative  appeal from
judges  decisions  on  applications  for  temporary reinstatement
under section 105(c) of the Mine Act, 30 U.S.C.    815(c),  even
though  the  Act does not provide for such review.  See 29 C.F.R.
 2700.45(f).

     [6]:  "Substantial  evidence" means "`such relevant evidence
as a reasonable mind might  accept  as  adequate  to support [the
judge's]  conclusion.'"   Rochester  &  Pittsburgh Coal  Co.,  11
FMSHRC 2159, 2163 (Nov. 1989) (quoting Consolidated Edison Co. v.
NLRB, 305 U.S. 197, 229 (1938)).  In reviewing  the whole record,
an appellate tribunal must consider anything in the  record  that
"fairly detracts" from the weight of the evidence that supports a
challenged  finding.   Midwest Material Co., 19 FMSHRC 30, 34 n.5
(Jan. 1997) (quoting Universal  Camera  Corp.  v.  NLRB, 340 U.S.
474, 488 (1951)).

     [7]:  In this case, however there are no factual findings to
review,  as  the  judge, finding that "[b]oth parties agree  that
there is no dispute  as  to any material fact," 18 FMSHRC at 386,
ruled  on  summary  judgment   motions.   He  therefore  made  no
independent findings of material  fact  in  the merits proceeding
and did not even reach the question of whether frame grounding is
effective.  This issue, which was essential to  a  resolution  of
the  underlying  proceeding,  was  never resolved, and remains in
dispute.   Thus,  the  case  on  the  merits   was  actually  not
appropriate  for  summary  judgment,  and the judge  should  have
resolved this factual disagreement.

     Generally, such a lack of factual  findings would lead us to
remand.  See Western Fuels-Utah, Inc., 19  FMSHRC 994, 1000 (June
1997).  In this EAJA proceeding, however, remand is not necessary
since the record (in this case, depositions the parties submitted
in  support  of  their motions) compels the conclusion  that  the
Secretary's position had a reasonable basis in fact.

     [8]:  In fact, the judge attached his decision on the merits
to the EAJA decision.  18 FMSHRC at 1837-42.

     [9]:  The D.C.  Circuit  explained  that  the   "fresh  look
occasioned  by   application  of  the  `substantially  justified'
standard" is required  to honor Congress' intent "not to permit a
prevailing  party automatically  to  recover  fees"  under  EAJA.
Rose, 806 F.2d at 1087 (citation omitted).

     [10]:  Our dissenting colleagues wrongly assert that we have
somehow transformed  the  issue  in  this case into whether frame
grounding  is effective.  Slip op. at 20-22.   What  the  dissent
overlooks is  that the issue before us is whether the Secretary's
position was substantially justified and the Secretary's position
was that frame  grounding was ineffective.  See S. Cross Mot. for
Sum. Dec. at 5 ("[t]o  satisfy the standard, the ground path must
be effective").

     [11]:  Our dissenting colleagues appear to have also adopted
the  judge's  mistaken  theory,   finding  that  the  Secretary's
interpretation of the regulation is  inconsistent  with its plain
meaning  because  "[it]  simply  requires  .  . . that electrical
circuits  be  grounded."   Slip op. at 20.  Like the  judge,  our
colleagues' also fail to address  the  essential  question before
us: whether the Secretary's position was substantially justified,
not whether the Secretary should have prevailed on the merits.

     [12]:  In Pierce, the court noted  that certain  " objective
indicia' such  as  the terms of a settlement agreement, the stage
in the proceedings at  which  the  merits  were  decided, and the
views  of  other  courts  on the merits" can be relevant  to  the
inquiry of whether the government's  position  was  substantially
justified.  487 U.S. at 568.

     [13]:  The two decisions which predate the judge's  decision
on  the  merits  in  this  case  are  distinguishable.  In Mulzer
Crushed  Stone  Co.,  the issue of whether  frame  grounding  was
permissible under section  56.1205  was  never  squarely decided.
Rather, the case centered on the fact-based question  of  whether
bolts used to connect the motor frame to the conveyor belt  frame
were  rusted.   3  FMSHRC at 1241.  The judge never discussed the
regulatory interpretation  question  at issue here.  In addition,
McCormick Sand Corp. is distinguishable  because in that case the
judge  found  that  the  circuit met the National  Electric  Code
("NEC") grounding requirements.   2  FMSHRC at 24.  The two other
cases relied on by the dissent (Tide Creek  Rock, Inc., 18 FMSHRC
390 (Mar. 1996) (ALJ), and F. Palumbo Sand &  Gravel,  19  FMSHRC
1440 (Aug. 1997) (ALJ)) were decided after the judge's ruling  in
the underlying decision on the merits in this case, and therefore
are  not relevant in determining whether the Secretary's position
was substantially  justified.  As the Supreme Court made clear in
Pierce, the legal question  on  an  appeal from an attorney's fee
award is "not what the law now is, but  what  the  Government was
substantially justified in believing it to have been."   487 U.S.
at  561.  Of course, even now these cases do not represent  "what
the law  .  .  .  is"  because  they are administrative law judge
decisions, which are not legal precedent.  Id.

     [14]:  Our dissenting  colleagues  describe  the  statements
made  by MSHA safety  expert  Paul  Price  in  a  deposition  and
declaration   as   "allegations."    Slip   op.   at   22.   This
characterization is incorrect, however, since these were not mere
allegations  by the Secretary but rather statements submitted  by
both  CSG  and  the   Secretary   with  their  summary  judgement
pleadings.  CSG had the opportunity  to cross-examine Price about
his statements during his deposition and  to  rebut  them through
the  introduction  of competing views submitted in affidavits  at
the summary judgement  stage.   Accordingly,  the Secretary could
appropriately  rely  on  Price's  statements  in  the  underlying
proceeding to support her position, and we are not precluded from
considering them in determining whether the Secretary's  position
was substantially justified.

     [15]:  CSG  concedes  that low impedence is critical to  an
effective grounding system.  Reply to S. Cross Mot. for Sum. Dec.
at 6.

     [16]:  The  dissent's  dismissive   appraisal  of  Vincent's
declaration (slip op. at 22-23) appears to be based on a possible
misunderstanding of what kind of evidence is relevant in making a
determination that the government's  position  was  substantially
justified.  His statement represents the views of the  operator's
own  contractor  who quickly determined (without even needing  to
examine the crusher  motors)  from  his  review  of  the  starter
control box that the absence of a fourth grounding conductor  was
unacceptable.   Vincent  Decl.  at  3.   This  is relevant to the
question  of  whether  the  operator  had  instituted  "effective
grounding,"   which  even  CSG  concedes  is  required   by   the
regulation.  Vincent's views strongly corroborate the Secretary's
position, which  she  long  ago  arrived at independently and has
consistently enforced.

     [17]:  We note that CSG's annual  test results may not be an
entirely  accurate  indicator  of  how well  the  system  usually
performs if, prior to such testing,  the  connections are cleaned
and tightened.  Commenting on a test administered  by  MSHA after
the citation had been issued, Price stated that "every one of . .
.  [the bolts] . . . had been cleaned recently.  They were  still
shiny."  Price Dep. at 24.

     [18]:  The  judge  mistakenly relied  on post-citation tests
for  the  proposition  that  the  Secretary's  position  was  not
substantially justified.  See  18 FMSHRC at 1824.  The Secretary,
however, pointed out the distinction between one or more isolated
satisfactory test results and an  effective grounding design.  As
MSHA's expert explained, "a faulty  design  can in fact provide a
sufficient  ground  for  an  instant  in  time,  but  will  offer
insufficient protection at the next moment." Price  Decl.  at  5.
Thus,  the  fact that the system passed post-citation resistivity
tests is in no  way  conclusive of whether MSHA's position in the
underlying case was reasonable.

     [19]:  To support  their position, our dissenting colleagues
rely  on the Secretary's proposed  penalty  assessments  and  the
charges of section 110(c) liability in the underlying proceeding.
Slip op.  at  25-26.   These  issues  were  not raised before nor
argued to the Commission in this EAJA case.   Further, the record
evidence on these issues was not fully developed because the case
on the merits was decided on summary judgement.   Accordingly, we
will refrain from reaching these issues, especially since we have
before  us neither the benefit of argument from the  parties  nor
analysis by the judge.
                              III.

                           Conclusion

     For the foregoing reasons, we reverse the judge's EAJA
decision and vacate the EAJA award.

___________________________________
Mary Lu Jordan,
Chairman

___________________________________
Marc Lincoln Marks,
Commissioner

___________________________________
Robert H. Beatty, Jr.,
Commissioner

Commissioners Riley and Verheggen, dissenting:

     This case stands out as an unfortunate example of
unreasonable regulatory enforcement, especially when
viewed in the context of the Secretary's position on frame
grounding over the past 17 years - a long history of
regulatory inaction that reveals the Secretary's
unwillingness to address an issue that she herself
emphatically pronounces to involve a serious safety risk
to miners.  Viewing the record as a whole in this context, we
find that the Secretary's litigation position was not
substantially justified. Therefore, although we join
with our colleagues in Sections I, II.A, and II.B of
their opinion (with the exception of footnote 7,
Section II.B), we dissent from their reversal of the judge's
award of fees to CSG in Section II.C.

     Under EAJA, an eligible party engaged in litigation with a
federal agency may, upon prevailing over the agency and filing
a timely application, recover attorney's fees and related
expenses unless the agency can prove that its position was
"substantially justified" or special circumstances would render
such an award "unjust."  5 U.S.C.  504(a)(1).  There is no
in this case that CSG is a prevailing party eligible for an award
under EAJA, and that its application was timely filed.  Nor has
the Secretary alleged that any special circumstances exist that
would render an award unjust.  Solely at issue is whether the
Secretary has proven that her litigation position was
substantially justified and, if not, the propriety of the award
made by the judge.  See F.J. Vollmer Co. v. Magaw, 102 F.3d 591,
595 (D.C. Cir. 1996) ("The Government bears the burden of
establishing that its position was substantially justified.").

     An agency position that is substantially justified has a
"reasonable basis both in law and fact" and is "justified to
a degree that could satisfy a reasonable person."  Pierce v.
Underwood, 487 U.S. 552, 565 (1988).  Here, the Secretary
asserts that her position on the citation in the underlying
merits proceeding was reasonable in light of industry practice
and because it furthered the goal of protecting the health and
safety of miners.  S. Br. at 9-14.  The Secretary also
argues that the judge erred by relying in his EAJA decision
only on his reasoning for rejecting the Secretary's
position in the merits proceeding.  Id. at 13-16.  In
response, CSG argues that the judge correctly concluded that
the Secretary's position was not substantially justified
because the Secretary's interpretation of the cited
standard was unreasonable, her litigation position was not
supported by the evidence, and a reasonable person familiar
with the mining industry would have concluded that the cited
motors were effectively grounded.  CSG Resp. Br. at
4-17.

     We begin our review of this case with the Secretary's
interpretation of section 56.12025, which - like the
judge - we find to be at odds with the plain meaning of the
regulation.[1]  The equirements of section 56.12025 are clear and
unambiguous.  The regulation requires that "[a]ll metal
enclosing or encasing electrical circuits . . . be
grounded or provided with equivalent protection."  It
does not contain any requirements for grounding
design, nor does it prohibit any particular method of
grounding.  The regulation simply requires, in the
context of this case, that electrical circuits be
grounded.  Electrical grounding is defined elsewhere
in Part 56 as "to connect with the ground to make the earth
part of the circuit."  30 C.F.R.  56.2.  Since the
meaning of section 56.12025 is clear and unambiguous, the
judge properly refused to grant deference to the
Secretary's interpretation of the regulation as constituting
a per se prohibition against frame grounding.  Contractors
Sand & Gravel Supply, Inc., 18 FMSHRC 384, 387-88 (Mar. 1996)
(ALJ); see Pfizer Inc. v. Heckler, 735 F.2d 1502, 1509
(D.C. Cir. 1984) (deference is considered "only when the
plain meaning of the rule itself is doubtful or ambiguous")
(emphasis in original).

    The judge properly noted that, under the plain meaning of
section 56.12025, the  Secretary failed to establish  that CSG
violated the regulation.  18 FMSHRC at  387-88.  The Secretary
offered  no evidence to show that the  motors in question were
not, in fact, grounded as required by the regulation.  Indeed,
no tests were conducted by MSHA  at the time the citation was
issued to determine whether the stacker or crusher motors
were grounded.  Id. at 386. CSG's own continuity and
resistance test, conducted as required under 30 C.F.R.
 56.12028, indicated the motors were properly grounded
6 months prior to MSHA's investigation.  Id. at 388.
Post-citation tests conducted by MSHA also showed that the
motors were grounded, evidence which, as the judge noted, the
Secretary chose to ignore. Id.  Given this singular lack
of evidence, we find amply supported by the record the
judge's conclusion that the Secretary's position on the
merits was unreasonable and without justification.

    Our colleagues state that the judge "made no independent
findings of material fact in the merits proceeding and did
not even reach the question of whether frame grounding is
effective," which they characterize as an "issue. . . essential
to a resolution of the underlying proceeding" that "remains in
dispute."  Slip op. at 7-8 n.7.  This statement reveals a
fundamental misapprehension of the issue before the Commission.
Our colleagues go to great lengths to justify the Secretary's
position based on the alleged inherent ineffectiveness of frame
grounding.  Slip op. at 10-17. As explained further below, we
view this case differently, and believe that the.majority's
approach is an invalid exercise of de novo fact finding.  Island
Creek Coal Co., 15 FMSHRC 339, 347 (Mar. 1993) ("It would be
inappropriate for the Commission to reweigh the evidence in
[any] case or to enter de novo findings based on an independent
evaluation of the record."); see also Wellmore Coal Corp. v.
FMSHRC, No. 97-1280, 1997 WL 794132 at *3 (4th Cir. Dec. 30,
1997) ("`[T]he ALJ has sole power to. . . resolve
inconsistencies in the evidence'") (citations omitted).

     This case began when MSHA Inspector Ann Frederick alleged
that CSG was using "[t]he frame of the crusher . . . as
the grounding conductor."  18 FMSHRC at 385 (quoting
Citation No. 3911909).  She went on to describe the ground
in some detail, then stated that "[f]rame grounding has
been forbidden for over fifteen years."  Id.  Agreeing
that there was no dispute as to any material fact, the
parties filed cross motions for summary decision "on the
single legal issue of whether [CSG's] reliance on the
crusher and stacker frames to serve as the path to ground
for the electric current violates the provisions of
30 C.F.R.  56.12025."  Id. at 386 (emphasis added).  In
support of their positions, both parties filed extensive
discovery documents to be made part of the record.  Among the
Secretary's submissions were various allegations of Paul
Price, contained in a declaration and deposition
transcript, regarding the effectiveness - or lack
thereof - of frame grounding. Here, it is important to
take note of just what was before the judge.  In essence, the
parties asked the judge to dispose of the threshold legal
question of whether frame grounding was per se prohibited by
section.56.12025.  This was a central part of the Secretary's
theory.  The inspector's statement that "[f]rame grounding has
been forbidden for over fifteen years" (18 FMSHRC at 385), and
her subsequent failure to collect any evidence as to whether the
cited ground was, in fact, functioning can only be explained
logically in the context of the application of a per se rule.
The record reveals that the Secretary was not concerned with
proving.that the particular equipment in question was not
grounded. Instead, she argued that, as a general proposition,
frame grounding is inherently ineffective and, therefore,
illegal under section 56.12025.  S. Cross Mot. for Sum. Dec. at
4-6.

    We find it significant that the Secretary did not ask in her
cross motion for leave toproceed further to prove a violation
under an alternative theory if the judge refused to accept her
interpretation of section 56.12025.  For example, the Secretary
could have attempted to prove that the cited ground was, in
fact, ineffective - which would have been an admittedly
difficult case for the Secretary to prove given the paucity of
evidence she collected on the actual performance of the
cited ground.  This may explain why she did not style
her motion as one for "Partial Summary Decision."

    But when the judge rejected the Secretary's interpretation
of section 56.12025, the Secretary's case failed as a
matter of law.  The judge was not obliged to go any further.
We are thus left with a merits decision made on a minimal
factual record[2] - and.justifiably so given the dispositive
nature of the judge's decision under the circumstances.  We also
note that the Secretary opted not to appeal the judge's decision
to the Commission.  She placed all her litigation eggs in the
basket of a per se rule that frame grounding violates section
56.12025.  And that is the posture in which the Secretary's
litigation position arrived before us in this EAJA proceeding.

     As mightily as our colleagues try to transform this case
into one involving the issue of whether frame grounding is
effective, that is simply not the issue before us on review.
Instead, we must decide whether the Secretary has.proven that
her litigation position - that frame grounding is per se illegal
under section 56.12025 - was substantially justified. Thus, this
case does not require us to determine whether frame grounding is
inherently ineffective, a question the judge did not have to
reach, and which we thus should not reach.  Yet this is
precisely what the majority does based on the Secretary's
unsubstantiated factual allegations.  In so.many words, they
conclude that CSG's grounding method was inherently ineffective,
based primarily on their acceptance of allegations made by
Price, and that, therefore, the Secretary was justified in
proceeding against CSG (in this respect, the majority
merely follows the Secretary's lead - the Secretary's EAJA
pleadings also rest primarily on Price's allegations).

    The problem with the majority's reliance on the Secretary's
allegations to decide this case is easily illustrated. For
example, the majority highlights Price's "unshakeable . . .
conviction[[3]] that problems with rusty bolts and vibration
were insurmountable, and caused [CSG's] system to be
fundamentally flawed."  Slip op. at 15.  Yet they fail to
mention that Schoonmaker testified that there was no
corrosion or rust between the stacker motor and the frame,
that a bolt had never "come loose" due to vibration
("Motors are pretty stable. They don't make a lot of noise
or bumps."), and that during its 12 years of operation, the
motor and frame had always provided a sufficiently low
resistance path to ground. Schoonmaker Dep. at 46-49.
The Secretary failed to rebut this testimony.  In fact,
Price agreed on cross- examination that the bolts did
not affect the grounding path when he tested them after the
citation had been issued. Price Dep. at 24.

    We note that MSHA requires regular annual testing of all
types of grounding conductors. See 30 C.F.R.  56.12028.  In
fact, this is so even where "grounding conductors . . .
are exposed or subjected to vibration, flexing or
corrosive environments."  IV.MSHA, U.S. Dep't of Labor,
Program Policy Manual, Part 56/57, at 51 (1996).  This
leads us to question whether lack of continuity and high
resistence due to vibration and corrosion may be inherent
dangers in virtually any grounding system on heavy
machinery or equipment.

    The majority also quotes Price's statement that to maintain
a ground such as used by CSG, "`you have to grind the rust
off every day.'"  Slip op. at 15 (quoting Price Dep. at 22).
Yet nowhere in the record can we find any data to
substantiate this statement..CSG's Montague Plant is
located near Yreka, California.  18 FMSHRC at 384.
The record is devoid of any evidence regarding Yreka's
weather or how machinery maintained outdoors holds up
to the elements in Yreka.[4] Based on the record before us,
we find it impossible to conclude that conditions in
Yreka would require daily de- rusting of outdoor ground
connections.

    The majority also relies on the declaration of Gordon
Vincent to argue in support of the reasonableness of the
Secretary's position.  Slip op. at 15-16.  In his
declaration, Vincent opined that CSG's plant was not
properly grounded "[b]ecause.the use of 3-conductor leads
without a fourth grounding conductor does not meet the
requirements of the National Electric Code [NEC]."  Vincent
Decl. at 3.  Vincent stated that he "would not certify to
MSHA or anyone else that [CSG's] electrical system was
properly grounded."  Id at 4. There are several problems
with Vincent's declaration. First, we note that, as a
matter of law, Vincent's opinion is "not an
authoritative interpretation.of [MSHA's] regulation" on
grounding.  Gates & Fox Co. v. OSHRC, 790 F.2d 154, 157 (D.C.
Cir. 1986).  In addition, the record contains no indication
that any MSHA personnel knew of Vincent's inspection at the
time Inspector Frederick issued the citation at issue
in the underlying proceeding. Vincent's opinion is thus
irrelevant to whether the Secretary's decision to cite
CSG was reasonable.  Insofar as the declaration might be
relevant at all to this.proceeding - and we do not
believe that it is - it is based on an inspection of a
"starter control box," not the
cited equipment.  In fact, there is no indication in the
record that Vincent ever
looked at the cited crusher
motors.

    These examples illustrate how unwise it is to accept the
Secretary's unsubstantiated allegations on their face, as
the majority has done.  Had the case proceeded beyond
summary decision, the judge could have reached the issue
of whether frame grounding is.effective, and could have
resolved any factual inconsistencies in the record
before him.  But given the posture of the merits case, he
did not have to reach this issue and thus made no factual
findings on either the Secretary's or CSG's factual
allegations.  They remain mere allegations.  We thus find the
majority's treatment of the Secretary's allegations as if
they were record facts inappropriate.[5]

    The posture in which this EAJA case arrived at the
Commission dictates that we look elsewhere to determine
whether the Secretary's position had a reasonable
basis in law and fact.  We have already found that the
judge properly determined that.the Secretary's interpretation
of section 56.12025 was unreasonable.  But there are
other "objective indicia" of the unreasonableness of the
government's case.  See Pierce, 487 U.S. at 568
(noting that certain "`objective indicia' such as
the terms of a settlement agreement, the stage . . . at
which the merits were decided, and the views of other courts
on the merits . . . can be relevant" to the inquiry of
whether the government's.position was substantially
justified).  In keeping with Pierce, we thus look to other
relevant "extraneous circumstances" that may have a
bearing on the reasonableness of the Secretary's position.
Oregon Natural Resources Council v. Madigan, 980 F.2d
1330, 1331 (9th Cir. 1992); see also FEC v. Rose, 806 F.2d
1081, 1090 (D.C. Cir. 1986). As the court in Oregon Natural
Resources Council stated:

         Examination of the government's litigation
         position encompasses examination of the
         position on the merits, then focuses upon
         "extraneous circumstances bearing upon the
         reasonableness of the government's decision
         to take a case to trial."  Extraneous
         circumstances include relevant legal or
         factual precedents.

980 F.2d at 1331-32 (citations omitted).

     The Supreme Court has noted that "a string of losses," while
not determinative, "can be indicative" that an agency's position
lacks substantial justification.  Pierce, 487 U.S. at 569.  Here,
the judge correctly noted in his EAJA decision that "all the
other administrative law judges that have considered the
Secretary's legal theory have concluded that it is not
reasonable."  18 FMSHRC at 1823-24 (citing Tide Creek Rock, Inc.,
18 FMSHRC 390 (Mar. 1996) (ALJ); Mulzer Crushed Stone Co., 3
FMSHRC 1238 (May 1981) (ALJ); and McCormick Sand Corp., 2 FMSHRC
21 (Jan. 1980) (ALJ)).  These cases illustrate the Secretary's
inability to convince any trier of fact that section 56.12025
requires particular types of grounds.[6]  It is just the sort of
"string of losses" to which the Supreme Court referred in Pierce.

     The majority's statement that "no binding [Commission]
precedent exists to establish a meaningful interpretation of
section 56.12025" (slip op. at 13) misses the point.  At issue in
this EAJA proceeding is not determining authoritatively what
section 56.12025 means as applied to CSG's frame grounded crusher
motor.  Instead, at issue here is the reasonableness of the
Secretary's position that such frame grounding was per se
prohibited under section 56.12025.  Moreover, the absence of any
binding Commission decision on this question should not prevent
us from considering how Commission judges have ruled on the
Secretary's efforts "to require performance which is not
specified in [section 56.12025]."  McCormick Sand, 2 FMSHRC at
23.

     Notwithstanding the statement on the face of the citation at
issue here that frame grounding had been forbidden for 15 years,
it has never been found by any adjudicator to be forbidden under
section 56.12025.  In fact, as recently as August 1997, well
after the judge in this case granted CSG's EAJA application, yet
another Commission judge flatly rejected the Secretary's theory
that section 56.12025 per se prohibits frame grounding.  F.
Palumbo Sand & Gravel, 19 FMSHRC 1440 (Aug. 1997) (ALJ).  In
Palumbo, Judge David F. Barbour quoted Judge Cetti's suggestion
made in the merits decision of the instant case that "`[i]f the
Secretary believes frame grounding should be prohibited, the
Secretary should initiate appropriate rule making to achieve this
goal.'"  Id. at 1444 (quoting 18 FMSHRC at 388).  Judge Barbour
concluded:  "It is a good suggestion."  19 FMSHRC at 1444.  We
agree.

     We are troubled by the Secretary's apparent indifference to
the hazards she forcefully alleges are associated with frame
grounding.  She has inexplicably failed to seek review of four
decisions by Commission judges which have declined to accept her
position on frame grounding.  Nor has she published an
information bulletin or interpretive memorandum setting forth her
interpretation of section 56.12025, much less made any effort to
engage in rulemaking to clarify the requirements of the standard.
The Secretary has simply been unwilling to clarify the scope and
meaning of section 56.12025, even though she herself pronounces
frame grounding to be a serious safety risk to miners.  We find
this to be a compelling indicator of the unreasonableness of the
Secretary's position.  If the consequences of relying on frame
grounding are as dire as the Secretary suggests, we find it
baffling that the Secretary has so utterly failed to clarify the
scope and meaning of section 56.12025 as applied to such
grounding.  We can take her no more seriously than the fabled boy
who cried wolf.

     The Secretary's litigation strategy also illustrates the
unreasonableness of her litigation position.  Regarding cases
decided on the pleadings, Congress warned:

               Certain types of case dispositions may
          indicate that the Government action was not
          substantially justified.  A court should look
          closely at cases, for example, where there
          has been a judgment on the pleadings or where
          there is a directed verdict or where a prior
          suit on the same claim has been dismissed.
          Such cases clearly raise the possibility that
          the Government was unreasonable in pursuing
          the litigation.

H.R. Rep. No. 96-1418, 96th Cong., 2d Sess. 11 (1980), reprinted
in 1980 U.S.C.C.A.N. 4953, 4989-90.  Here, the Secretary argued
for application of a per se rule that frame grounding violated
section 56.12025 on the pleadings, without leaving open the
possibility of pursuing her case under any alternative theories.
The judge rejected her arguments on a narrow and dispositive
question of law, in accord with two judges before him.  The
Secretary then failed to appeal the judge's decision.  In the
face of two prior losses, we find the Secretary's pursuit of such
a strategy unreasonable.[7]

     We also find MSHA's proposed penalties in this case ($6,000
against Schoonmaker individually and $7,000 against CSG) to be
particularly excessive, given that the alleged violation was
based on an interpretation of the regulation that had been
rejected twice before by Commission judges at the time the
citation was issued.  As a standard of comparison, the Secretary
has proposed only nominal penalties in other attempts to enforce
her, so far, unpersuasive interpretation of section 56.12025.  We
have determined administratively that in the 1981 Mulzer Crushed
Stone case, the Secretary proposed a penalty of $67.  In the two
section 56.12025 cases that have been decided since the instant
case, nominal penalties were also proposed:  $50 in Tide Creek
Rock and $81 in Palumbo.  The excessive increase in penalties
proposed in the instant case over an average penalty of $66
proposed in the other section 56.12025 cases is left completely
unexplained by the Secretary and unquestioned by the majority.
This penalty escalation, coupled with the deliberate
personalization of sanctions under section 110(c), leads us to
wonder why the Secretary failed to litigate such a "significant"
case beyond summary decision.

     Finally, we note that, because the burden of showing
substantial justification rests with the Secretary, it is
incumbent upon her to provide additional support for her position
beyond what was argued on the merits.  Oregon Natural Resources
Council, 980 F.2d at 1332.  On this question, the judge found:

          The Secretary offered nothing in this [EAJA]
          proceeding to persuade me that my findings of
          unreasonableness in the underlying proceeding
          were incorrect.  The Secretary merely
          reiterates arguments that I have previously
          considered and rejected.

18 FMSHRC at 1823 (emphasis added).  And again, on appeal, the
Secretary has offered no additional support for her position.
She "only reasserts [her] position on the merits, and supplies
nothing new to justify [her] position and meet [her] burden."
Oregon Natural Resources Council, 980 F.2d at 1332.  Similarly,
the majority collapses their EAJA analysis into an endorsement of
the Secretary's allegations made in the merits proceeding.[8]
Their primary focus is on the issue of whether frame grounding is
effective - an issue not before us.

     Accordingly, for the foregoing reasons, we find that the
judge correctly determined that the Secretary failed to meet her
burden of establishing that her position in the underlying
proceeding was substantially justified.[9]

James C. Riley, Commissioner

Theodore F. Verheggen, Commissioner

Distribution


C. Gregory Ruffennach, Esq.
450 East 3rd Avenue Durango, CO 81301

Cheryl Blair-Kijewski, Esq.
Office of the Solicitor U.S. Department of Labor
4015 Wilson Blvd., Suite 400
Arlington, VA 22203

Administrative Law Judge August Cetti
Federal Mine Safety & Health Review
Commission Office of Administrative Law Judges
1244 Speer Blvd., Suite 280
Denver, CO 80204

**FOOTNOTES**

     [1]:  Where the language of a regulatory provision is clear,
the terms of that provision must be enforced as they are written.
Utah Power & Light Co., 11 FMSHRC 1926, 1930 (Oct. 1989).

     [2]:   On  this  point,  our  colleagues go so far as to say
"there are no factual findings to review"  in  this  EAJA appeal.
Slip op. at 7 n.7.

     [3]:   Interestingly,  this  is just the sort of credibility
determination that is within the sole province of an ALJ to make.
Brock v. Roadway Express, Inc., 481  U.S. 252, 266 (1987) ("Final
assessments  of  the  credibility  of  supporting  witnesses  are
appropriately reserved for the administrative law judge.").

     [4]:  Yreka's average annual precipitation  is approximately
19  inches  -  arid in comparison to Crescent City (approximately
100 miles west of  Yreka), where the average annual precipitation
is approximately 65  inches.  See http://www.weatherpost.com.  In
light  of  these  data,  we  view  Price's  statement  with  some
skepticism.

     [5]:   Although  the  majority   regards   the   Secretary's
submissions  in  the  underlying  summary decision proceeding  as
something more than allegations (slip  op.  at  14 n.14), until a
trier of fact resolves conflicts between the factual  allegations
made by litigants, the litigants' conflicting submissions  remain
allegations.  See Wellmore, 1997 WL 794132 at *3 ("`[T]he ALJ has
sole  power  to  . . . resolve inconsistencies in the evidence'")
(citations omitted).  But more to the point, given the posture of
this case and the  fact  that  the  Secretary lost the underlying
proceeding on a narrow question of law, we find it unnecessary to
reach the Secretary's factual allegations at all.

     [6]:  In all three cases we cite, Commission judges rejected
the Secretary's attempts to expand the  requirements  of  section
56.12025 and its predecessor, section 56.12-25, well beyond their
plain meaning.

     [7]:   Nor did the Secretary plead in this case any "special
circumstances [that] would make an [EAJA] award unjust," 5 U.S.C.
 504(a)(1),  among  which  Congress  noted is "advancing in good
faith the novel but credible extensions  and  interpretations  of
the  law that often underlie vigorous enforcement efforts."  H.R.
Rep. No. 96-1418, at 11.

     [8]:   We  reject  the  majority's conclusion that the judge
incorrectly  collapsed  his  decision  on  the  merits  into  his
evaluation of the reasonableness  of the Secretary's position for
purposes of the EAJA proceeding.  Slip  op.  at 9-10. The judge's
decision clearly indicates he took a fresh look  at  the  record.
18  FMSHRC  at  1822-23  ("Having considered both aspects of this
argument, I again find . . ."; "Again, on review of the record, I
find  . . .").   Moreover,  given   that   the  Secretary  merely
reiterated her merits arguments in the EAJA  proceeding  (id.  at
1823),  with  so little to respond to, we find it hard to imagine
what more the judge  could have done.  But even assuming arguendo
that the judge inadequately  set  forth the reasons and bases for
his EAJA decision, we believe that  the  majority  is required to
remand the case for further development.  It is well  established
that  Commission  judges  must  analyze  and  weigh all probative
record  evidence,  make  appropriate  findings, and  explain  the
reasons for their decisions,  Mid-Continent  Resources,  Inc., 16
FMSHRC 1218, 1222 (June 1994) - which, by the way, we believe the
judge did here adequately.

     [9]:   In  light  of  the  majority's disposition, we do not
reach the issues of whether the judge's award of fees was legally
correct and supported by substantial  evidence.   See  S.  PDR at
11-14 (raising the issue of whether judge erred in increasing the
cap on fees above the maximum specified in EAJA); 14 (raising the
issue  of  whether  the  judge  erred in awarding to CSG interest
costs incurred on unpaid legal bills).