Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-12-01244/USCOURTS-caDC-12-01244-0/pdf.json

Parties Involved:
Millard Refrigerated Services, Inc.
Petitioner
Secretary of Labor
Respondent

Document Text:

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 8, 2013 Decided June 7, 2013

No. 12-1244

MILLARD REFRIGERATED SERVICES, INC.,

PETITIONER

v.

SECRETARY OF LABOR,

RESPONDENT

On Petition for Review of an Order of the Occupational

Safety & Health Review Commission

Kathryn M. Willis argued the cause for petitioner. With her

on the brief was Marcel L. Debruge.

Ronald J. Gottlieb, Attorney, U.S. Department of Labor,

argued the cause for respondent. With him on the brief were

Joseph M. Woodward, Associate Solicitor and Heather R.

Phillips, Counsel for Appellate Litigation. Charles F. James,

Attorney, entered an appearance.

Before: GARLAND, Chief Judge, GRIFFITH, Circuit Judge,

and SILBERMAN, Senior Circuit Judge.

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Opinion for the Court filed by Chief Judge GARLAND.

GARLAND,Chief Judge: In August 2010, more than 30,000

pounds of anhydrous ammonia escaped from one of the

petitioner’s refrigerated storage facilities. After an

investigation, the Occupational Safety and Health

Administration cited the petitioner for committing violations of

emergency response, training, record-keeping, and other

requirements. The Occupational Safety and Health Review

Commission affirmed the citations, and the petitioner now seeks

review in this court. Concluding that the petitioner’s challenges

are without merit, we deny the petition for review.

I

Anhydrous ammonia (NH3) is a corrosive chemical that can

burn the eyes and skin and, when inhaled, can damage the nose,

throat, and lungs. At sufficient levels of exposure, anhydrous

ammonia can kill a person almost immediately. For these

reasons, the Occupational Safety and Health Administration

(OSHA) classifies anhydrous ammonia as a “toxic and reactive

highly hazardous chemical[].” 29 C.F.R. § 1910.119 app. A. 

Employers that operate a process involving at least 10,000

pounds of anhydrous ammonia must conform to training,

monitoring, and record-keeping requirements devised by OSHA

-- known as “process safety management” practices. See id.

§ 1910.119(a)(1)(i). Of particular relevance to this case, such

employers must create and regularly update a report -- called a

“process hazard analysis” -- that addresses risks involved in the

process that uses anhydrous ammonia and identifies any

“previous incident which had a likely potential for catastrophic

consequences in the workplace.” Id. at (e)(1), (3). Employers

must also provide training to employees “involved in operating

a process” that uses anhydrous ammonia and must keep a record

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showing that those employees “ha[ve] received and understood”

that training. Id. at (g)(1), (3). 

Millard Refrigerated Services operates a refrigerated

storage facility in Theodore, Alabama. The refrigeration system

at the Theodore plant uses anhydrous ammonia in quantities that

trigger the process safety management regulations found at 29

C.F.R. § 1910.119. Although Millard’s refrigeration equipment

is designed to prevent releases from occurring, cracks or other

defects in the equipment can allow vaporized anhydrous

ammonia to escape from the refrigeration system into the

ambient air. 

On the evening of August 22, 2010, Allen White, the

Theodore facility’s plant engineer, was notified at home that the

plant had lost power. White went to the facility and, after the

plant regained power, surveyed the refrigeration system. He

was unable, however, to get one of its pumps running before he

returned home.

The next morning, an employee working on a shipping dock

approximately 200 feet from the plant smelled ammonia coming

from the facility. Further investigation revealed a strong smell

of ammonia in one of the plant’s freezers and a visible ammonia

cloud rising from cracked piping on the plant’s roof. Two

employees under White’s supervision went to the roof to close

the valves that were allowing anhydrous ammonia to enter the

leaking segments of piping. Neither employee wore a selfcontained breathing apparatus, despite the fact that they came

within 15 feet of the ammonia cloud. Nor had either employee

been trained in the use of a respirator or in emergency response

procedures. 

The efforts of White and the other employees succeeded in

containing the August 2010 leak, but only after more than

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30,000 pounds of anhydrous ammonia escaped into the air. That

release, the largest in company history, destroyed $4 million

worth of products stored at the plant, required the plant’s

evacuation, and sent approximately 150 people to the hospital --

including White himself. A month later, an internal

investigation report prepared by Millard identified White’s

failure to “achiev[e] a safe operation on all systems” following

the power outage as a contributing cause of the ammonia leak. 

Braga Memorandum at 2 (Sept. 21, 2010) (J.A. 425).

On August 24, 2010, after local fire authorities allowed the

Theodore plant to re-open, OSHA commenced an inspection. 

Over the course of multiple visits, OSHA broadened its focus

from the August 2010 release to a more comprehensive

inspection of the entire plant. At the end of the inspection,

OSHA issued two citations for 18 separate regulatory violations.

After a hearing, an administrative law judge (ALJ) affirmed as

to 13 of those violations, including two regarding process safety

management regulations: failure to keep an adequate record of

past releases of anhydrous ammonia, in violation of 29 C.F.R.

§ 1910.119(e)(3)(ii); and failure to ensure that plant engineer

White received adequate training, in violation of 29 C.F.R.

§ 1910.119(g)(3). Among the other violations found by the ALJ

was one for failing to install swinging gates on an open

ladderway on the roof, in violation of 29 C.F.R.

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§ 1910.23(a)(2).1 The ALJ assessed a total penalty of $15,250

against Millard. 

Millard filed an administrative petition for discretionary

review. The Occupational Safety and Health Review

Commission denied the petition, noting that the decision of the

ALJ thereby became the final order of the Commission. Notice

of Final Order at 1 (J.A. 1792). In this court, Millard seeks

review of all 13 findings of violations as well as review of the

total penalty. 

II

We consider Millard’s challenges under “[f]amiliar

principles of administrative law.” A.J. McNulty & Co. v. Sec’y

of Labor, 283 F.3d 328, 331 (D.C. Cir. 2002). “A reviewing

court must uphold the factual findings of the Commission if they

are ‘supported by substantial evidence on the record considered

as a whole,’ 29 U.S.C. § 660(a), and must uphold its other

conclusions as long as they are not arbitrary, capricious, an

abuse of discretion, or otherwise contrary to law, 5 U.S.C.

§ 706(2)(A).” A.E. Staley Mfg. Co. v. Sec’y of Labor, 295 F.3d

1341, 1345 (D.C. Cir. 2002). “Moreover, ‘[w]e defer to

1

 The remaining regulatory violations upheld by the ALJ

included: failure of employees to wear self-contained breathing

apparatuses while working on the roof to contain the anhydrous

ammonia leak, in violation of 29 C.F.R. § 1910.120(q)(3)(iv); failure

to have provided those employees training in the use of respirators, in

violation of 29 C.F.R. § 1910.134(k)(3), and training in emergency

response operations, in violation of 29 C.F.R. § 1910.120(q)(6)(iii);

and numerous record-keeping violations, including two violations of

29 C.F.R. § 1904.7(b)(1), two violations of 29 C.F.R. § 1904.29(b)(1),

and one violation each of 29 C.F.R. § 1904.29(b)(3), § 1904.32(b)(3),

and § 1910.147(c)(6)(i). 

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[OSHA’s] interpretation of the [Occupational Safety and Health]

Act and regulations, upholding such interpretations so long as

they are consistent with the statutory language and otherwise

reasonable.’” Id. (quoting Anthony Crane Rental, Inc. v. Reich,

70 F.3d 1298, 1302 (D.C. Cir. 1995)).2 

In the following sections, we address Millard’s challenges

to the two process safety management violations, which

Millard’s counsel describes as the company’s most important

concerns. Oral Arg. Recording at 18:00 - 18:06. We also

address Millard’s contention that OSHA was estopped from

asserting that the company violated agency regulations by

failing to install swinging gates on an open ladderway. We find

no merit in any of these challenges. Although we have carefully

considered each of the remaining ten challenges, as well as

Millard’s challenge to the $15,250 penalty, we have concluded

that they merit neither reversal nor further discussion.

A

According to its counsel, Millard’s “number one issue” on

appeal is its challenge to the finding that it violated 29 C.F.R.

§ 1910.119(e)(3)(ii) by failing to disclose a previous, smaller

release of anhydrous ammonia in a mandatory report completed

just months before the August 2010 release. Oral Arg.

Recording at 18:07 - 18:39. 

In the course of the 2010 inspection, OSHA examined

Millard’s inventory of actual and potential hazards associated

with processes that use anhydrous ammonia -- the “process

2

 These principles of review apply equally in cases where the

Commission makes independent findings and where it declines review

and thereby adopts the ALJ’s findings as its own. See Fabi Constr.

Co. v. Sec’y of Labor, 508 F.3d 1077, 1080-81 (D.C. Cir. 2007).

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hazard analysis” report required by 29 C.F.R. § 1910.119(e). In

May 2010, a little more than three months before the August

2010 release, Millard had completed a mandatory five-year

review of its process hazard analysis reporting. By regulation,

Millard’s May 2010 report was required to include “[t]he

identification of any previous incident” within the past five

years that “had a likely potential for catastrophic consequences

in the workplace.” 29 C.F.R. § 1910.119(e)(3)(ii); see id. at

(e)(6). OSHA investigators cited Millard for failing to mention

in that report that 110 pounds of anhydrous ammonia gas had

been released from the Theodore plant’s refrigeration system in

2007. According to Millard’s internal summary of the 2007

incident, the earlier release, like the August 2010 release, was

caused in part by hydraulic shock within the system. Incident

Investigation (Apr. 25, 2007) (J.A. 426); see ALJ Decision at 4

(J.A. 1743). 

Before the ALJ, Millard contended that its May 2010 report

was adequate because a sentence in the report mentioned a

“PHA Addendum.” See PHA Review Certification Letter (May

5, 2010) (J.A. 492). According to Millard, that mention served

to incorporate by reference a document labeled “PHA

Addendum” that Millard had completed three years earlier, in

May 2007, following the 2007 release. PHA Study Team

Session Documentation (May 4, 2007) (J.A. 434). The May

2010 report did not indicate that the “Addendum” it referred to

was a 2007 document. And the 2007 document contained no

description or discussion of the April 2007 release of anhydrous

ammonia. Instead, it contained -- without explanation or

description -- a six-digit number, see id., that was also listed at

the top of a different internal document describing the April

2007 release, see Incident Investigation (Apr. 25, 2007) (J.A.

426). 

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The ALJ found that there was “no dispute that the 2007

incident needed to be identified” in the 2010 report because the

2007 incident “had a ‘likely potential for catastrophic

consequences’ based on the release of 110 pounds of ammonia

caused by hydraulic shock under circumstances similar to [the]

August 2010 ammonia release.” ALJ Decision at 9 (J.A. 1748). 

According to the ALJ, the May 2010 report failed to meet the

identification requirement because it “contain[ed] no

information about the 2007 incident,” and its alleged reference

to the May 2007 document was unclear. Id. at 9-10. 

Millard concedes that it has waived any argument that the

2007 release was not a potentially catastrophic incident

triggering 29 C.F.R. § 1910.119(e)(3)(ii), by failing to raise such

an argument before the Commission. Oral Arg. Recording at

31:10 - 31:49; see 29 U.S.C. § 660(a) (“No objection that has

not been urged before the Commission shall be considered by

the court, unless the failure or neglect to urge such objection

shall be excused because of extraordinary circumstances.”). 

Accordingly, the only issue before us is whether the May 2010

report “identified” the 2007 release as required by that

regulation.

There is no dispute that the May 2010 report did not itself

mention the 2007 release. Nonetheless, Millard contends that

the May 2010 report satisfied § 1910.119(e)(3)(ii) because it

incorporated by reference the May 2007 addendum, which in

turn identified the April 2007 release. This contention has

problems at two levels. First, the claim that the 2010 report

incorporated the May 2007 addendum rests on a single sentence

in the former stating that “all changes” to an earlier process

hazard analysis report “have been addressed in the PHA

Addendum.” PHA Review Certification Letter (May 5, 2010)

(J.A. 492). It would be charitable to call that statement opaque. 

As the ALJ noted, there is no way to know that the sentence

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referred to the May 2007 document; it mentioned nothing more

than an undated “Addendum.” ALJ Decision at 10 (J.A. 1749). 

Moreover, even if it were crystal clear that the statement

referred to the May 2007 document, that document’s reference

to the April 2007 ammonia release was itself opaque. The May

2007 document contained no mention of the April 2007

ammonia release; all it contained was an unexplained, six-digit

number that was the same as the number on Millard’s internal

report of the April 2007 release. PHA Study Team Session

Documentation (May 4, 2007) (J.A. 434); see Incident

Investigation (Apr. 25, 2007) (J.A. 426). Given these missing

links, the ALJ was hardly unreasonable in concluding that

Millard’s May 2010 process hazard analysis report failed to

satisfy the identification requirement of 29 C.F.R.

§ 1910.119(e)(3)(ii). 

B

Millard’s “number two” issue on appeal is its challenge to

the finding that it violated 29 C.F.R. § 1910.119(g)(3) by failing

to ensure that Allen White, Millard’s plant engineer, was

adequately trained in the safe operation of an anhydrous

ammonia refrigeration system. Oral Arg. Recording at 18:40 -

18:54. 

Following the August 2010 ammonia leak, OSHA

inspectors interviewed White. According to one inspector, they

“question[ed] [White] about basic concepts of process safety

management.” Hr’g Tr. at 128 (Aug. 29, 2011) (J.A. 105). 

Finding that White could not articulate basic concepts and

procedures relevant to safely operating an anhydrous ammonia

refrigeration system, they issued Millard a citation for violating

§ 1910.119(g)(3).

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Before the ALJ, Millard argued that White’s inability to

recite technical terms on command -- without an opportunity to

refer to manuals or consult other employees -- did not prove he

was unfamiliar with safe system operation. Millard also

maintained that, at the time of the August 2010 release, the

recently-promoted White was still in training, and was under the

supervision of a regional engineer who oversaw operations at

nine other plants across the southern states. 

Drawing on “the OSHA interviews . . . and [White’s]

testimony at hearing,” the ALJ found that White was not merely

unable to recall technical details, but was “unable to express or

show any understanding of [process safety management]’s basic

principles.” ALJ Decision at 15 (J.A. 1753). Moreover, he

“was unable to describe his training or demonstrate an

understanding of the topics on which he allegedly was trained.” 

Id. The ALJ further found that the regional manager’s oversight

of White did not excuse the violation because the training

requirements are “not restricted to personnel who have ‘overall

control’ such as the regional engineer,” and because “[t]he

regional engineer was not expected to supervise the plant’s daily

activities.” Id. at 14. The ALJ acknowledged that White had

recently been promoted, but held that “[t]he issue is the lack of

understanding of the training already received.” Id. at 15. 

“Even a plant engineer in training who has responsibility for

[Millard’s] processes should know basic [process safety

management] principles.” Id. at 14. Finally, the ALJ noted that

the paperwork regarding White’s training provided no

“documentation explaining how the employer determined the

trainee understood the training,” as required by the regulations. 

Id. at 15. For these reasons, the ALJ found that OSHA had

established a violation of 29 C.F.R. § 1910.119(g)(3).

On review, Millard urges many of the same arguments it

raised before the agency. Although we, like the ALJ, take

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Millard’s point that White was still in training in August 2010,

we note that he had been an operator since 2008 and, by 2010,

had been in training for several years. ALJ Decision at 14-15

(J.A. 1753-54). We conclude that there was substantial evidence

to support the ALJ’s findings -- in particular, that White did not

understand the training he had already received.

Finally, we reject Millard’s claim that it should be held

faultless because it did not know that White did not understand

his training. The regulation places the burden to “ascertain that

each employee involved in operating a process has received and

understood the training required” on the employer. 29 C.F.R.

§ 1910.119(g)(3). Substantial evidence supports the ALJ’s

conclusion that Millard did not meet that burden. 

C

We briefly address one final challenge. During a December

2010 inspection of the Theodore facility, OSHA inspectors

noticed 15-foot ladders leading from the roof of the plant to

several raised platforms. While the raised platforms were

mostly surrounded by guardrails, the openings in the platforms

through which the ladders rose were completely open, exposing

employees to a 15-foot fall if they stepped through. In February

2011, at the conclusion of their inspection, the inspectors cited

Millard for violating 29 C.F.R. § 1910.23(a)(2), which requires

that “[e]very ladderway floor opening or platform shall be

guarded by a standard railing . . . with the passage through the

railing either provided with a swinging gate or so offset that a

person cannot walk directly into the opening.” The ALJ and

Commission upheld the citation.

Millard raises a host of challenges to the citation, none of

which are availing and only one of which warrants further

discussion: Millard’s contention that OSHA was estopped from

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issuing the citation. We first note the Supreme Court’s repeated

admonition, “from [its] earliest cases,” that “equitable estoppel

will not lie against the Government as it lies against private

litigants.” OPM v. Richmond, 496 U.S. 414, 419 (1990) (citing

cases). And although the Court has declined to hold that there

are no circumstances in which estoppel may run against the

government, id. at 423, it has made clear that the bar for

succeeding on such a claim is high, see id. at 421-22 (noting that

the Court’s opinions have “mention[ed] the possibility, in the

course of rejecting estoppel arguments, that some type of

‘affirmative misconduct’ might give rise to estoppel against the

Government.”). See Morris Commc’ns, Inc. v. FCC, 566 F.3d

184, 191-92 (D.C. Cir. 2009). Millard’s argument does not

come close to reaching that bar.

Millard argues that OSHA was estopped from finding

violations in December 2010 because its inspectors had failed to

cite Millard for the absence of gates during previous inspections

in 2007 and August 2010. But the mere failure to cite Millard

previously can hardly be enough to estop later government

enforcement. “[U]nless Congress has indicated otherwise,”

agencies charged with enforcing the law retain discretion not to

prosecute every violation that comes to their attention. Heckler

v. Chaney, 470 U.S. 821, 838 (1985). This broad discretion

would be considerably constrained if declining to prosecute an

offender in one instance by itself prevented an agency from ever

demanding that the offender come into compliance. Indeed, if

that were the law, an agency like OSHA could preserve its

future enforcement authority only by requiring its inspectors to

cite every regulated party for every violation discovered during

every inspection.

In any event, as the ALJ found, “there is no evidence that

the caged ladders or platforms were the subject of prior OSHA

inspections or even observed by the OSHA inspectors prior to

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December 2010.” ALJ Decision at 7 (J.A. 1746). There is

certainly “no showing of detrimental reliance by [Millard] or

that OSHA misled it regarding the swing gates.” Id. And

detrimental reliance is an essential element of any conceivable

estoppel defense. See Keating v. FERC, 569 F.3d 427, 434

(D.C. Cir. 2009).

Millard maintains that there is more here than merely a

failure to previously cite it for a violation. The company

contends that, during the December 2010 inspection, an

inspector noted that the ladder openings lacked swinging gates

but stated that OSHA would not cite Millard for their absence. 

Millard Br. 26. Even if the inspector had made such a remark

(which is contested), it would not suffice to establish an estoppel

defense. In the first place, by drawing Millard’s attention to the

fact that the company was in violation of the regulation, the

remark could hardly have lulled Millard into believing that it

was in compliance with the law. More important, the citation at

issue expressly charged Millard with having failed to provide

protection “prior” to the date the inspector allegedly made the

remark, including during the period before the December

inspection even began. Citation and Notification of Penalty at

6 (J.A. 11). Hence, because Millard could not have relied on the

inspector’s remark in deciding not to provide fall protection, it

cannot make out even a traditional defense of estoppel.

III

For the foregoing reasons, the petition for review is

Denied.

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