[Federal Register Volume 69, Number 202 (Wednesday, October 20, 2004)]
[Proposed Rules]
[Pages 61617-61631]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-23393]


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DEPARTMENT OF TRANSPORTATION

Federal Motor Carrier Safety Administration

49 CFR Part 386

[FMCSA Docket No. FMCSA-1997-2299]
RIN 2126-AA15


Rules of Practice

AGENCY: Federal Motor Carrier Safety Administration (FMCSA), DOT.

ACTION: Supplemental notice of proposed rulemaking (SNPRM).

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SUMMARY: FMCSA proposes to amend its rules of practice for motor 
carrier safety, hazardous materials, and other enforcement proceedings. 
These rules would increase the efficiency of the procedures, enhance 
due process and the awareness of the public and regulated community, 
and accommodate recent programmatic changes. The rules would apply to 
all motor carriers, other business entities, and individuals involved 
in motor carrier safety and hazardous materials administrative actions 
and proceedings with FMCSA.

DATES: Comments must be received on or before December 6, 2004.

ADDRESSES: You may submit comments, identified by DOT DMS Docket Number

[[Page 61618]]

FMCSA-1997-2299, by any of the following methods:
    <bullet> Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the online instructions for submitting comments.
    <bullet> Agency Web site: http://dms.dot.gov. Follow the 
instructions for submitting comments on the DOT electronic docket site.
    <bullet> Fax: 1-202-493-2251.
    <bullet> Mail: Docket Management Facility, U.S. Department of 
Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, 
Washington, DC 20590-0001.
    <bullet> Hand Delivery: Room PL-401 on the plaza level of the 
Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 
a.m. and 5 p.m., Monday through Friday, except Federal holidays.
    Instructions: All submissions must include the agency name and 
docket number for this notice. All comments received will be posted 
without change to http://dms.dot.gov, including any personal 
information provided. Please see the Privacy Act heading for further 
information.
    Docket: For access to the docket to read background documents 
including those referenced in this document, or to read comments 
received, go to http://dms.dot.gov and/or Room PL-401 on the Plaza 
level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, 
between 9 a.m. and 5 p.m., Monday through Friday, except Federal 
holidays.
    Privacy Act: Anyone may search the electronic form of all comments 
received into any of DOT's dockets by the name of the individual 
submitting the comment (or of the person signing the comment, if 
submitted on behalf of an association, business, labor union, or other 
entity). You may review DOT's complete Privacy Act Statement in the 
Federal Register (65 FR 19477, Apr. 11, 2000). This statement is also 
available at http://dms.dot.gov.

FOR FURTHER INFORMATION CONTACT: Jackie Cho, Office of Chief Counsel, 
(202) 366-0834, Federal Motor Carrier Safety Administration, 400 
Seventh Street SW., Washington, DC 20590. Office hours are from 8 a.m. 
to 5:30 p.m., E.T., Monday through Friday, except Federal holidays.

SUPPLEMENTARY INFORMATION:

History

    On April 29, 1996, the Federal Highway Administration (FHWA), an 
operating administration of the DOT, published a notice of proposed 
rulemaking (NPRM) for Rules of Practice for Motor Carrier Proceedings; 
Investigations; Disqualifications and Penalties (1996 NPRM) (61 FR 
18865). In the 1996 NPRM, the FHWA, the relevant portion of which is 
now the Federal Motor Carrier Safety Administration, proposed entirely 
eliminating the rules of practice contained in part 386 and replacing 
them with new rules of practice in a new part 363.
    The 1996 NPRM was the first effort by the FHWA to comprehensively 
rewrite its rules of practice for motor carrier administrative 
proceedings since 1985. The 1996 NPRM was intended to be the forerunner 
of a comprehensive revision of the Federal Motor Carrier Safety 
Regulations (FMCSRs) following the completion of a zero-based review of 
those regulations then underway in the agency. The proposal would have 
placed the new regulations in previously unused parts of chapter III of 
title 49 of the Code of Federal Regulations (CFR) reserved for the 
FMCSRs. The proposed rulemaking was intended to make administrative 
actions and proceedings more efficient while enhancing the guarantee of 
due process to carriers, individuals, and other entities by 
substantially increasing awareness of the consequences of noncompliance 
with commercial motor vehicle safety and hazardous materials 
regulations.
    On October 21, 1996, the FHWA published a supplemental notice of 
proposed rulemaking (SNPRM) (61 FR 54601), to broaden the scope of the 
1996 NPRM to include proceedings arising under section 103 of the 
Interstate Commerce Commission Termination Act of 1995 (ICCTA) (Public 
Law 104-88, 109 Stat. 803, 852 (Dec. 29, 1995)). In the SNPRM, the FHWA 
proposed to adopt the term ``Commercial Regulations'' to refer to 
requirements imposed on motor carriers as a result of the transfer of 
functions from the former Interstate Commerce Commission (``ICC''). The 
SNPRM also extended the comment period to November 20, 1996. FHWA 
received 127 comments in response to the 1996 NPRM. No comments were 
received in response to the SNPRM. Comments relevant to those portions 
of the 1996 NPRM addressed in this SNPRM are discussed in the 
Discussion of Comments section of this document.
    On February 16, 2000, FMCSA issued a final rule making technical 
amendments to part 386 and incorporated enforcement proceedings for 
Commercial Regulations into part 386 (65 FR 7753). This rule was 
intended to ensure all civil forfeiture and investigation proceedings 
instituted by FMCSA are governed by consistent procedures. In addition, 
FMCSA adopted some technical amendments which reflected recent 
organizational changes, removed obsolete statutory citations, and 
incorporated recent statutory changes which affected the civil penalty 
schedule.
    Given the zero-based review as well as various program changes that 
have been made since FHWA issued the 1996 NPRM and SNPRM, FMCSA is 
publishing this additional SNPRM. Although the 1996 NPRM proposed 
significant reorganization to the FMCSRs,\1\ this SNPRM only proposes 
changes to part 386, Rules of practice for motor carrier, broker, 
freight forwarder, driver and hazardous materials proceedings, 
including our occasional enforcement of the HMRs on shippers.
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    \1\ The 1996 NPRM proposed replacing part 386 with part 363 and 
adding three new parts to title 49, CFR. These new parts were part 
361, Administrative Enforcement, part 362, Safety ratings, and part 
364, Violations, penalties, and collections.
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Statutory Authority

    Congress delegated certain powers to regulate interstate commerce 
to the Department of Transportation in numerous pieces of legislation, 
most notably in section 6 of the Department of Transportation Act (DOT 
Act) (Public Law 85-670, 80 Stat. 931 (1966)). Section 55 of the DOT 
Act transferred the authority of the ICC to regulate the qualifications 
and maximum hours-of-service of employees, the safety of operations, 
and the equipment of motor carriers in interstate commerce to the FHWA. 
See 49 U.S.C. 104. This authority, first granted to the ICC in the 
Motor Carrier Act of 1935 (Public Law 74-255, 49 Stat. 543), now 
appears in chapter 315 of title 49, U.S.C. The regulations issued under 
this authority became known as the FMCSRs, appearing generally at 49 
CFR parts 390-399, including the commercial regulations (49 CFR parts 
360-379) and the Hazardous Materials Regulations (49 CFR parts 171-
180). The administrative powers to enforce chapter 315 were also 
transferred from the ICC to the DOT in 1966, and appear in chapter 5 of 
title 49, U.S.C.
    Between 1966 and 1999 a number of statutes added to the FHWA's 
authority. For a more detailed statutory background, see the preamble 
to the 1996 NPRM (61 FR 18866-67). The various statutory authorities 
authorize the enforcement of the FMCSRs and Hazardous Materials 
Regulations (HMRs) and provide both civil and criminal penalties for 
violations. In practice, when circumstances dictate that an enforcement 
action be instituted, civil penalties are more commonly sought than 
criminal sanctions. The

[[Page 61619]]

administrative rules proposed in this rulemaking apply, among other 
things, to the administrative adjudication of civil penalties assessed 
for violations of the FMCSRs and the HMRs.
    The Motor Carrier Safety Improvement Act of 1999 (MCSIA) (Public 
Law 106-159, 113 Stat. 1748 (Dec. 9, 1999)) established FMCSA as a new 
operating administration within the Department of Transportation, 
effective January 1, 2000. The staff and responsibilities previously 
assigned to FHWA, and reassigned to a new Office of Motor Carrier 
Safety within the Department, are now assigned to FMCSA.

Background

    The goal of the 1996 proposal, which would have replaced part 386 
with part 363, was to improve the then existing rules of procedure for 
motor carrier enforcement proceedings. Various external sources were 
consulted, notably the Model Adjudication Rules of the Administrative 
Conference of the United States (December 1993) and various procedural 
rules of other Federal agencies. In recognition of the importance of 
the historical context of the rules, the predecessors of the current 
rules, and their extensive amendments, were reviewed by the FHWA in 
hopes of identifying shortcomings and determining the underlying 
rationale for certain provisions, which may now seem unnecessary, 
unclear, or unavailing. For a detailed description of the findings of 
this review, see the preamble to the 1996 NPRM (61 FR 18872-75).

Discussion of Comments

    In response to the 1996 NPRM, 127 comments were submitted to the 
docket. Because a number of the policy decisions reflected in this 
SNPRM are an outgrowth of the comments received on the rules of 
practice portion of the 1996 NPRM (essentially proposed part 363), 
those relevant comments are summarized below and reflected in the 
proposed revisions to part 386. Comments to the 1996 NPRM relating to 
other aspects of that proposal are not addressed in this preamble.

Service of Documents

    Jewell Smokeless Coal disagreed with the wording in the preamble 
discussion of proposed Sec.  363.302 (addressed in Sec.  386.32 of 
current rule) regarding computation of time, which states ``service is 
complete upon mailing so that the date of the postmark would control.'' 
The commenter argued that the postal system is not always the most 
expedient way to disseminate important information such as serving 
documents, creating the danger that the timeframes allowed would expire 
before the intended recipient has the opportunity to reply. As an 
alternative, such documents should be sent by certified mail and the 
day the document was received should be the date service is complete. 
If the recipient fails to pick up the certified documents within 10 
days from the date notified by the certified mail, the date the 
documents are returned to the sender should become the date service was 
completed.
    The commenter also suggested that certificates of service should 
accompany all mailings, including the notice of violation (NOV) 
(proposed Sec.  363.102, current Sec.  386.11), the reply form 
(proposed Sec.  363.103), and the notice of determination and letter of 
disqualification (proposed Sec.  363.202, current Sec.  386.11(a)).
    FMCSA's Response. In addressing Jewell Smokeless Coal's comment 
regarding the inefficiency of service by U.S. Mail, new section 386.6 
proposes to include commercial delivery service as well as facsimile 
transmission as alternate methods of completing service. We believe the 
date of receipt is not the most efficient way to compute time, 
especially if respondent fails to accept service.
    As proposed in Sec.  386.6(c), all documents shall be accompanied 
by a certificate of service. The requirement is currently contained in 
Sec.  386.31(b).

Adjudication Procedure

    Transportation Lawyer's Association (TLA) argued that proposed 
Sec.  363.108(c)(2) would limit all potential affirmative answers to 
those actually raised, including those regarding jurisdiction. The 
commenter believed this to be wrong because the defense of lack of 
jurisdiction should be available anytime, as permitted by Rule 12(h)(3) 
of the Federal Rules of Civil Procedure.
    FMCSA's Response. The content of proposed Sec.  363.108(c)(2) is 
now in proposed Sec.  386.14(d)(1)(B). Although the proposed provision 
requires respondents to submit all arguments relating to jurisdiction, 
limitation, and procedure in their reply, respondents are not precluded 
from raising jurisdictional arguments at a later time as per current 
Sec.  386.36 redesignated as Sec.  386.35, Motions to dismiss and 
motions for more definite statements.
    TLA indicated that proposed Sec.  363.108(c)(1) would establish 
that a general denial is sufficient grounds for a finding of default. 
The commenter objected to this provision, arguing that the burden of 
proof must be on the agency once the respondent denies the claims. A 
general denial should prompt the agency to file a Motion for Final 
Agency Order or provide the respondent with an opportunity to correct 
its answer, instead of becoming tantamount to default. Failure of the 
agency to meet its burden should result in a denial of the motion with 
finality.
    FMCSA's Response. A general denial does not assist the 
decisionmaker in determining whether there are material issues of fact 
in dispute. Therefore, in proposed Sec.  386.14(d)(1), the contents of 
a reply must include the grounds for contesting a claim.
    TLA indicated that proposed Sec.  363.109(h) (not currently 
addressed in the FMCSRs) would permit either an attorney or another 
person to represent a respondent before the Assistant Administrator or 
ALJ. The commenter emphasized that the agency should indicate, in its 
notices or regulations, that the seriousness of the potential penalties 
might recommend the employment of legal counsel.
    FMCSA's Response. Recommending the employment of legal counsel 
would be beyond the scope of the agency's authority. In accordance with 
proposed Sec.  386.4, the agency affords the respondent several options 
in representation because the respondent may or may not be able to 
afford legal counsel. The proposal in Sec.  386.4, however, would not 
permit a representative to engage in the unauthorized practice of law 
in violation of standards set by each State for legal representation.
    Jewell Smokeless Coal indicated that the Assistant Administrator 
should not be the only one with the power to refer a case to an ALJ 
under proposed Sec.  363.109 (current Sec.  386.16). The respondent 
should be allowed to refer a matter to an ALJ if he/she believes there 
are sufficient facts for such referral. The commenter also indicated 
that the respondent should have the option to participate or not to 
participate in the referral. If the respondent is comfortable with a 
lesser process (in order to avoid the potential expenses involved in 
adjudication), then he/she should be allowed to take it.
    FMCSA's Response. The respondent may only request that a matter be 
referred to an ALJ for hearing. It is the Assistant Administrator who 
will decide whether a matter is to be referred to the ALJ. See current 
Sec.  386.16(b).

Settlement Agreements

    Proposed Sec.  363.106(b)(2) would have required a settlement 
agreement to contain a finding of facts constituting the violations 
committed, while the current rule, Sec.  386.16(c)(ii), requires ``a

[[Page 61620]]

brief statement of the violations.'' Commenters submitted that the 
current provision has been interpreted to mean alleged violations. 
Crete Carrier et al. sought assurance that the proposed 1996 
requirement would not be construed as an admission, which could be used 
against them in litigation, e.g., if a plaintiff claimed a willful 
violation of the regulations as an element of its claim for punitive 
damages in a crash involving a carrier, and then cited the settlement 
submission as evidence. The commenter also pointed to Federal Rules of 
Evidence 408, that evidence of payment of a disputed claim in 
connection with civil litigation is inadmissible in the proceeding to 
prove liability for the claim.
    FMCSA's Response. In proposed Sec.  386.22, there is no requirement 
that settlements contain admissions of the violation. The parties may 
negotiate whether admissions are a condition of the settlement 
agreement. Respondent's full payment as its reply to the notice of 
claim would constitute an admission of the violation.
    With regard to the comment about the application of the Federal 
Rules of Evidence in civil penalty proceedings, proposed Sec.  386.37 
provides that where an evidentiary matter is not addressed in the 
agency's rules or the APA, the Federal Rules of Evidence will be 
controlling.
    The International Brotherhood of Teamsters (IBT) indicated that 
employees or their selected representatives should be entitled to 
participate in settlement negotiations.
    FMCSA's Response. A party would be able to choose its 
representative under proposed Sec.  386.4.
    TLA opposed proposed Sec.  363.107 (not currently addressed in the 
FMCSRs), which would establish a 90-day limit for settlement 
negotiations if no resolution is achieved, because it provides an 
opportunity for FMCSA staff to avoid negotiating by causing delay or 
mere inaction.
    FMCSA's Response. There is nothing in the proposed regulation that 
would allow the agency to delay the process. After the 90-day 
settlement period, the respondent can seek administrative adjudication 
or binding arbitration if it decides to not make payment.

Enforcement

    Overnite Express and Silvereagle Arnold indicated that a carrier 
should be given opportunity to respond and correct the violation before 
a fine is imposed.
    FMCSA's Response. The Field Administrator has a range of actions 
available to address violations, including administrative handling 
without resort to civil penalties. If a notice of claim is issued and 
civil penalty assessed, the respondent may always argue corrective 
action has been taken, as a means of mitigating the amount of the civil 
penalty.

The Administrative Claim Process

    The majority of the proposed changes to this SNPRM are briefly 
discussed in the Section-by-Section Analysis portion of this preamble. 
Many of the proposed changes are technical in nature to eliminate 
inconsistencies or increase the efficiency of the procedures. For 
example, in proposed Sec.  386.8, entitled ``Compution of time,'' we 
eliminated the word ``shall'' in the current regulations and replaced 
it with such words as ``will'' or ``must'' to provide more definite 
delivery times for motions and replies to the decisionmaker. Because 
these changes are not substantive in nature, we will not discuss them 
in the Section-by-Section Analysis.
    We are proposing to change the time within which respondents must 
reply to the notice of claim. Current Sec.  386.14 provides 15 days 
from the date of service of the notice of claim for respondent to 
reply. Under proposed Sec.  386.14, the reply period would be 30 days 
from the date of service of the notice of claim.
    This proposed revision reflects a change from the Agency's previous 
interpretation of 49 U.S.C 521(b)(1)(A), which states: ``The notice 
shall indicate that the violator may, within 15 days of service, notify 
the Secretary of the violator's intention to contest the matter.'' Our 
previous interpretation, contained in both the current part 386 and the 
Agency's civil penalty enforcement decisions, was that motor carriers 
charged with violations had only 15 days in which to contest those 
charges. We ask for comment as to whether the word ``may'' in the 
statute permits the Agency to expand the period of time for the motor 
carrier to contest the charges.
    Proposed Sec.  386.14 is taken from Sec.  363.108 of the 1996 NPRM 
and proposes procedures for contested claims. The procedures would 
apply if settlement negotiations fail to result in a settlement 
agreement, or when the respondent chooses administrative adjudication. 
A contested claim would be resolved in an administrative proceeding 
adjudicated by a neutral third party provided by the agency. Depending 
on the choice of the respondent and the existence of a dispute of a 
material fact at issue in the case, the third party may be an informal 
hearing officer, a Department of Transportation Administrative Law 
Judge, or the Assistant Administrator (agency decisionmaker).
    The content of the reply in proposed Sec.  386.14(b) would be 
similar to what is currently required in replies under part 386. If the 
respondent fails to reply to the notice of claim, Sec.  386.14(c) would 
provide that the Field Administrator may issue a notice declaring that 
the notice of claim has become the final agency order. The final agency 
order would become effective 5 days following service of the notice of 
final agency order.
    If respondent serves a reply that does not meet the requirements of 
Sec.  386.14, respondent may be found in default at the discretion of 
the Assistant Administrator. Default would have the same effect as a 
failure to reply. In both situations, a final agency order would issue 
without inquiry as to the charged violations.
    FMCSA has proposed in Sec.  386.16 to provide an informal oral 
hearing as a new adjudication option. Section 386.16(c)(2) describes 
the process we are proposing. Using a hearing officer, this process 
would provide expedited consideration of a civil penalty case without 
the formalities attendant to a hearing before an ALJ. The agency 
invites comment on the addition of the informal oral hearing option. We 
are particularly interested in comments regarding the efficacy of 
instituting such a process, hearing officer's qualifications, 
procedural rules that should govern the informal hearing process, and 
any other relevant issues commenters would like us to consider.
    This SNPRM does not substantially change the current process for 
formal oral hearings. An overview of the formal oral hearing process 
follows:
    1. Within 30 days of service of the notice of claim, respondent 
submits a reply in which it elects to pay (payment must be included), 
to negotiate, to adjudicate, or to submit to binding arbitration.
    2. If the respondent requests administrative adjudication, it must 
submit a reply that conforms to Sec.  386.14(a)(1). If respondent 
requests a formal oral evidentiary hearing and the Assistant 
Administrator concludes there is a disputed issue of material fact, the 
Assistant Administrator refers the matter to the Department's Office of 
Hearings to be assigned to an ALJ.
    3. An administrative law judge will preside over the hearing and 
findings of fact and conclusions of law and issue a decision. Under the 
Administrative Procedure Act (5 U.S.C. 557), an ALJ decision under this 
procedure is considered an initial decision and a

[[Page 61621]]

decision of the Assistant Administrator is considered an agency 
decision.
    4. Also, if respondent initially chooses negotiation and 
negotiation fails, the respondent can request a hearing and the 
foregoing process applies.

Section-by-Section Analysis

    This section-by-section analysis describes the changes to current 
part 386 being proposed by this SNPRM. For the convenience of the 
reader, it references relevant sections in proposed part 363 of the 
1996 NPRM and also specifically states current sections for which there 
are no proposed changes.

Subpart A--Scope of Rules; Definitions

    The title of Subpart A would be revised to Scope of Rules; 
Definitions and General Provisions to reflect the inclusion of several 
preliminary procedural rules.
Definitions (Sec.  386.2)
    Proposed Sec.  386.2 would add, revise, and remove definitions in 
current Sec.  386.2 to reflect our proposed revisions of part 386.
Separation of Functions (Sec.  386.3)
    FMCSA is proposing to add Sec.  386.3 to delineate the separation 
of functions between enforcement staff and the agency decisionmaker.
Appearances and Rights of Parties (Sec.  386.4)
    FMCSA is proposing to add Sec.  386.4, which includes current Sec.  
386.50 in its entirety, and the additional procedural requirement to 
file a notice of appearance in the action before participating in the 
proceedings.
Form of Filings and Extensions of Time (Sec.  386.5)
    FMCSA is proposing to add Sec.  386.5, which incorporates current 
Sec.  386.33, and establishes length and content limits, and other 
administrative requirements and details for filing documents. In 
addition, the time period for responses to motions for continuance 
would be changed from 7 to 20 days, to remain consistent with the 
proposed change of the general requirement for serving all motions and 
responses.
Service (Sec.  386.6)
    FMCSA is proposing to add Sec.  386.6, which incorporates current 
Sec.  386.31, and adds the following elements: (1) It specifies that 
the agency must ensure service of the notice of claim; (2) it includes 
commercial delivery services and facsimile (with consent of the 
parties) as additional options for effecting service; and (3) it 
specifies other administrative provisions regarding service.
Filing of Documents (Sec.  386.7)
    Proposed Sec.  386.7 contains details relating to the filing of 
documents to establish standards relating to form and content.
Computation of Time (Sec.  386.8)
    Proposed Sec.  386.8 contains current Sec.  386.32 in its entirety. 
This provision has been moved to Subpart A to locate it with other 
preliminary procedural requirements. The text has been edited but no 
substantive changes are intended.
Commencement of Proceedings (Sec.  386.11, 1996 NPRM proposed as Sec.  
363.103)
    Section 386.11 describes the commencement of proceedings. The 
proposed revisions do not affect the driver qualification proceedings 
in paragraph (a). Proposed paragraph (b) removes references to notice 
of investigation (NOI) and introduces a new document, the notice of 
violation. As proposed, FMCSA would use the notice of violation as a 
means of notifying any person subject to the rules in this part that 
the agency has received information indicating that the person has 
violated provisions of the FMCSRs, HMRs, or Commercial Regulations, 
without assessing a civil penalty. This information may come from 
investigations, audits, or any other source of information. The notice 
of violation would address issues such as: Specific alleged violations 
and actions that a person might take to remedy problems identified by 
the agency; and other relevant information. The notice of violation 
would not be used to assert civil penalties.
    The content of current Sec.  386.11(b) would be redesignated as 
paragraph (c).
Complaint (Sec.  386.12, 1996 NPRM Proposed as Sec.  363.102)
    FMCSA is proposing to remove paragraphs (a) and (b) and to 
redesignate paragraphs (c)-(e) as (a)-(c). This change is proposed to 
make it consistent with the elimination of the notice of investigation.
Petition To Review and Request for Hearing: Driver Qualification 
Proceedings (Sec.  386.13)
    FMCSA is not proposing any changes to the language in current Sec.  
386.13.
Reply (Sec.  386.14, 1996 NPRM Proposed as Sec. Sec.  363.103)
    The title of this section would be revised to Reply. Proposed 
paragraph (a) changes the time period for a reply to the notice of 
claim from 15 days to 30 days. Proposed paragraph (b) provides the 
contents of a reply to a notice of claim. Respondent may choose to pay 
the civil penalty, enter into settlement negotiations, request 
administrative adjudication, or seek binding arbitration. Proposed 
paragraph (c) describes what happens in the event of respondent's 
failure to reply. Proposed paragraph (d) describes the contents of a 
reply when requesting administrative adjudication. The reply must 
include admission or denial of each allegation, all affirmative 
defenses, including those relating to jurisdiction, limitations, and 
procedure, and state whether or not respondent seeks a hearing or 
chooses to submit evidence without a hearing.
Action on Replies to the Notice of Claim (Sec.  386.16)
    The title of this section would be revised to Action on replies to 
the notice of claim. Proposed paragraph (a), Settlement negotiations, 
provides a 90-day period for settlement negotiations unless either 
party seeks to discontinue negotiations earlier. If negotiations fail 
to produce a settlement agreement, respondent must serve a reply under 
Sec.  386.14(b)(1), (3), or (4).
    Proposed paragraph (b), Requests to submit written evidence without 
oral hearing, changes the sequence and time during which the parties 
must serve all written evidence. The Field Administrator will have 45 
days following service of respondent's reply in which to submit 
evidence and argument. The respondent will then have 30 days following 
service of the Field Administrator's submission to serve its own 
evidence and argument.
    Proposed paragraph (c), Requests for hearing, provides that the 
Assistant Administrator will determine whether there exists a dispute 
of material fact at issue in the case that warrants a hearing. If a 
respondent requests a formal or informal oral hearing, the Field 
Administrator must serve a notice of consent or objection within 20 
days of service of respondent's reply. If he/she objects, the Field 
Administrator must serve a motion for final agency order within 30 days 
of service of the objection. Respondent must serve its response to the 
Field Administrator's motion within 30 days of service.
    If the Field Administrator objects to the request for an informal 
oral hearing, he or she must serve the objection, the

[[Page 61622]]

notice of claim, and respondent's reply. Based on these documents, the 
Assistant Administrator will determine whether there exists a dispute 
of a material fact and whether to grant or deny the request for an 
informal hearing. If the hearing is granted, a hearing officer will be 
assigned to the matter, and no further motions or discovery will be 
permitted. At the conclusion of the hearing, the hearing officer will 
issue a report to the Assistant Administrator with findings of fact and 
recommended disposition. Respondent waives its right to a formal oral 
hearing by participating in an informal hearing. If an informal oral 
hearing is denied, the Field Administrator must serve a motion for 
final agency order to which respondent will have an opportunity to 
answer. After reviewing the record, the Assistant Administrator may 
refer the matter to an Administrative Law Judge, assign the matter for 
informal oral hearing, or issue a final agency order based upon the 
submissions.
    Proposed Sec.  386.16(c)(2)(B) reserves the Assistant 
Administrator's authority to refer any matter for formal oral hearing 
even in instances where respondent has requested an informal oral 
hearing.
Intervention (Sec.  386.17)
    FMCSA is not proposing any changes to the language in current Sec.  
386.17.
Payment of the Claim (Sec.  386.18)
    Current part 386 does not specifically address payment of claims. 
This SNPRM proposes to add new Sec.  386.18, Payment of claim.
    Proposed paragraphs (a) and (b) state that payment may be made at 
any time before the issuance of a final agency order. If however, 
payment is not served upon the agency within 30 days of service of the 
notice of claim, the notice of claim becomes the final agency order.
    Proposed paragraph (c) makes it clear that, unless the parties 
otherwise agree in writing, respondent's payment of the full claim 
amount as its reply to the notice of claim constitutes an admission of 
all facts alleged, waives respondent's opportunity to further contest 
the claim, and will result in the notice of claim becoming the final 
agency order. This is important because certain future agency 
enforcement actions may be based on, and certain consequences may flow 
from, prior and continued violations of the safety regulations. 
Therefore, compliance with proposed paragraph (c) will identify the 
implications of prior enforcement actions as related to maximum civil 
penalty cases under section 222 of the MCSIA. See 49 U.S.C. 521 note.

Subpart C--Consent Orders

    The title of Subpart C would be revised to be Settlement 
Agreements.
Compliance Order (Sec.  386.21)
    Current Sec.  386.21 would be deleted in its entirety.
Consent Order (Sec.  386.22)
    The title of this section would be revised to Settlement agreements 
and their contents. Proposed paragraph (a) describes the contents for 
settlement agreements and the binding effect they have on the parties. 
Proposed paragraph (b) addresses settlement agreements before the case 
comes before the agency decisionmaker. Proposed paragraph (c) sets 
forth procedures for settling a case pending before the agency 
decisionmaker. Proposed paragraph (d) describes procedures for settling 
a civil forfeiture case pending before and agency hearing officer.
Content of Consent Order (Sec.  386.23)
    This section would be deleted in its entirety.

Subpart D--General Rules and Hearings

Service (Sec.  386.31, 1996 NPRM Proposed as Sec.  363.303)
    This section would be deleted in its entirety as superseded by 
Sec.  386.6.
Computation of Time (Sec.  386.32, 1996 NPRM proposed as Sec.  363.302)
    This section would be deleted in its entirety as superseded by 
Sec.  386.8.
Extension of Time (Sec.  386.33, 1996 NPRM proposed as Sec.  363.304)
    This section would be deleted in its entirety as superseded by 
Sec.  386.5.
Official Notice (Sec.  386.34)
    This section would be revised to streamline the use of official 
notice by the Assistant Administrator and Administrative Law Judge and 
redesignated as Sec.  386.31.
Motions (Sec.  386.35)
    Current paragraph (c) of Sec.  386.35 would be amended to allow 20 
days rather than 7 days for a reply to be served after a motion that is 
applying for an order or ruling not otherwise covered in part 386. This 
section would then be redesignated as Sec.  386.34.
Motions To Dismiss and Motions for a More Definite Statement (Sec.  
386.36, 1996 NPRM Proposed as Sec.  363.108(c)(4))
    This section would be redesignated as Sec.  386.35.
    We would add a new Sec.  386.36, entitled Motions for Final Agency 
Order to describe the procedures governing motions for final agency 
order.
Discovery Methods (Sec.  386.37, 1996 NPRM proposed as Sec.  363.109)
    The contents of current Sec.  386.37 remain, with the exception of 
the last sentence, and will now be located in proposed paragraph (a). 
Proposed paragraph (b) would be included to clarify that where an 
evidentiary matter is not addressed in the agency's rules or the APA, 
the Federal Rules of Evidence will be controlling.
Scope of Discovery (Sec.  386.38)
    FMCSA is not proposing any changes to the language in current Sec.  
386.38.
Protective Orders (Sec.  386.39)
    FMCSA is not proposing any changes to the language in current Sec.  
386.39.
Supplementation of Responses (Sec.  386.40)
    FMCSA is not proposing any changes to the language in current Sec.  
386.40.
Stipulations Regarding Discovery (Sec.  386.41)
    FMCSA is not proposing any changes to the language in current Sec.  
386.41.
Written Interrogatories to Parties (Sec.  386.42)
    This revised section includes the substance of current Sec.  386.42 
and adds provisions regarding page limits and time periods in which to 
exchange interrogatories.
Production of Documents and Other Evidence (Sec.  386.43)
    FMCSA is not proposing any changes to the language in current Sec.  
386.43.
Request for Admissions (Sec.  386.44)
    FMCSA is not proposing any changes to the language in current Sec.  
386.44.
Motion To Compel Discovery (Sec.  386.45)
    FMCSA is not proposing any changes to the language in current Sec.  
386.45.
Depositions (Sec.  386.46)
    This revised section provides procedures governing depositions in 
civil penalty proceedings. Depositions would only be allowed after 
appointment of an ALJ. Prior to assignment of an ALJ, either party 
could petition the Assistant Administrator to conduct depositions on a 
showing of good cause. Proposed paragraph (e) includes a witness limit 
of no more than 5 witnesses without leave from the agency 
decisionmaker, and the deposition itself may not exceed 8 hours for any 
one witness. Current Sec.  386.46(e)

[[Page 61623]]

would now be redesignated as proposed Sec.  386.46(f).
Use of Deposition at Hearings (Sec.  386.47)
    FMCSA is not proposing any changes to the language in current Sec.  
386.47.
Medical Records and Physicians' Reports (Sec.  386.48)
    FMCSA is not proposing any changes to the language in current Sec.  
386.48.
Form of Written Evidence (Sec.  386.49)
    FMCSA is not proposing any changes to the language in current Sec.  
386.49.
Appearances and Rights of Witnesses (Sec.  386.50)
    This section would be deleted in its entirety as superseded by 
Sec.  386.4.
Amendment and Withdrawal of Proceedings (Sec.  386.51, 1996 NPRM 
Proposed as Sec.  363.109(i))
    Proposed Sec.  386.51(b) would revise current Sec.  386.51(b) by 
allowing a party to withdraw his or her pleadings more than 15 days 
prior to the scheduled hearing without the approval of the Assistant 
Administrator or the Administrative Law Judge. Withdrawal within the 15 
days prior to the scheduled hearing would still require approval of the 
decisionmaker. The decisionmaker would grant the request for withdrawal 
unless it would result in injustice, irreparable harm, or prejudice to 
the non-moving party. This proposed change would make paragraph (b) of 
this section consistent with the requirements in paragraph (a) of this 
section.
Appeals From Interlocutory Rulings (Sec.  386.52, 1996 NPRM Proposed as 
Sec.  363.307)
    This revised section would set forth detailed procedures governing 
interlocutory appeals. It delineates interlocutory appeals for cause 
and defines all instances of interlocutory appeals of right. This 
section also notes that decisions regarding interlocutory appeals may 
not be appealed to the Assistant Administrator until the decision has 
been entered on the record. Decisions by the Assistant Administrator on 
interlocutory appeals do not constitute final agency orders for 
purposes of judicial review.
Subpoena, Witness Fees (Sec.  386.53)
    FMCSA is not proposing any changes to the language in current Sec.  
386.53.
Administrative Law Judges (Sec.  386.54, 1996 NPRM Proposed as Sec.  
363.305)
    This section would eliminate existing paragraph (a). This section 
would enumerate the powers of the ALJs, as well as the limitations on 
those powers. It would also provide for the disqualification of ALJs.
Prehearing Conferences (Sec.  386.55)
    FMCSA is not proposing any changes to the language in current Sec.  
386.55.
Hearings (Sec.  386.56)
    FMCSA is not proposing any changes to the language in current Sec.  
386.56.
Proposed Findings of Fact, Conclusions of Law (Sec.  386.57)
    FMCSA is not proposing any changes to the language in current Sec.  
386.57.
Burden of Proof (Sec.  386.58)
    FMCSA is not proposing any changes to the language in current Sec.  
386.58.
Decision (Sec.  386.61)
    FMCSA is not proposing any changes to the language in current Sec.  
386.61.
Review of Administrative Law Judge's Decision (Sec.  386.62)
    FMCSA is not proposing any changes to the language in current Sec.  
386.62.
Decision on Review (Sec.  386.63)
    FMCSA is not proposing any changes to the language in current Sec.  
386.63.
Reconsideration (Sec.  386.64, 1996 NPRM proposed as Sec.  363.114)
    As proposed, most of the existing text in Sec.  386.64 would become 
paragraph (a). We would also add a new provision stating that a 
petition for reconsideration stays only the payment of a civil penalty. 
No other aspects of the final agency order would be stayed unless 
ordered by the Assistant Administrator. The revised section also 
includes proposed new paragraphs (b)-(e). Proposed paragraph (b) would 
codify current case law regarding petitions for reconsideration of 
final agency orders issued due to default by the respondent. This 
change would clarify that the only issue that will be considered under 
the petition for reconsideration of a final agency order based on 
default is whether a default occurred. Having this information in the 
regulations should relieve parties, as well as the decisionmaker, of 
the burden of addressing other issues in these petitions for 
reconsideration. Proposed paragraphs (c)-(e) provide timelines for 
serving answers and when a decision must be made by the Assistant 
Administrator.
Failure To Comply With Final Agency Order (Sec.  386.65)
    FMCSA is not proposing any changes to the language in current Sec.  
386.65.
Motions for Rehearing or for Modification (Sec.  386.66)
    This section would be deleted in its entirety and all motions 
served in accordance with proposed Sec.  386.34.
Appeal (Sec.  386.67, 1996 NPRM Proposed as Sec.  363.115)
    Section 386.67 would be revised to adopt the changes proposed for 
Sec.  363.115 in the 1996 NPRM. The heading for Sec.  386.67 would be 
changed from ``Appeal'' to ``Judicial review.'' Current Sec.  386.67 
would be divided into two paragraphs, (a) and (b). The word 
``hearings'' would be replaced with ``administrative adjudication'' and 
in the second half of the section, ``final agency order'' would replace 
``order.'' The effect of these changes would be to liberally interpret 
49 U.S.C. 521(b)(8) to allow judicial review for contested claims 
resulting in a final agency order, but not for those claims that are 
resolved through settlement agreement or in which respondent failed to 
timely reply. The statute provides that judicial review is only 
available after a hearing. FMCSA believes, however, its interpretation 
is appropriate in this instance because these proposed rules provide 
for resolution of contested claims in an administrative adjudication 
without formal hearing.

Subpart F--Injunctions and Imminent Hazards

    FMCSA is not proposing any changes to the language in current 
Sec. Sec.  386.71-386.72.

Subpart G--Penalties

    FMCSA is not proposing any changes to the language in current 
Sec. Sec.  386.81-386.84.

Appendices

    FMCSA is not proposing any changes to the language in current 
appendix A or appendix B.

Rulemaking Analyses and Notices

Executive Order 12866 (Regulatory Planning and Review) and DOT 
Regulatory Policies and Procedures

    FMCSA has determined that this action is not a significant 
regulatory action within the meaning of Executive Order 12866 or 
significant within the meaning of Department of Transportation 
regulatory policies and procedures. The proposals contained in this 
document would not result in an annual effect on the economy of $100 
million or more, or lead to a major increase in costs or prices, or 
have significant adverse effects on the United States economy. This 
proposal would

[[Page 61624]]

augment, replace, or amend existing procedures and practices. Moreover, 
the agency's inclusion of an informal hearing process would add 
flexibility and less expense for smaller businesses. Any economic 
consequences flowing from the procedures in the proposal are primarily 
mandated by statute. A regulatory evaluation is not required because of 
the ministerial nature of this action.

Regulatory Flexibility Act

    In compliance with the Regulatory Flexibility Act (5 U.S.C. 601 et 
seq.), the agency has evaluated the effects of this SNPRM on small 
entities. No economic impacts of this rulemaking are foreseen, as the 
rule would impose no additional substantive burdens that are not 
already required by the regulations to which these procedural rules 
would serve. Therefore, FMCSA certifies that this proposed rule would 
not have a significant economic impact on a substantial number of small 
entities.

Executive Order 13132 (Federalism Assessment)

    This action has been analyzed in accordance with the principles and 
criteria contained in Executive Order 13132. The rules proposed herein 
in no way preempt State authority or jurisdiction, nor do they 
establish any conflicts with existing State role in the regulation and 
enforcement of commercial motor vehicle safety. It has therefore been 
determined that the SNPRM does not have sufficient federalism 
implications to warrant the preparation of a federalism assessment.

Unfunded Mandates Reform Act of 1995

    This proposed rule would not impose a Federal mandate resulting in 
the expenditure by State, local, and tribal governments, in the 
aggregate, or by the private sector, of $100 million or more in any one 
year.

National Environmental Policy Act

    This rulemaking is categorically excluded from environmental 
studies under paragraph 6.u. of FMCSA Environmental Order 5610.1C.

Executive Order 13211 (Energy Supply, Distribution, or Use)

    This action is not a significant energy action within the meaning 
of section 4(b) of the Executive Order because as a procedural action 
it is not economically significant and will not have a significant 
adverse effect on the supply, distribution, or use of energy.

Executive Order 13045 (Protection of Children)

    This proposed action is not economically significant and does not 
concern an environmental risk to health or safety that would 
disproportionately affect children. The agency has determined that this 
rule is not a ``covered regulatory action'' as defined under Executive 
Order 13045. First, this rule is not economically significant under 
Executive Order 12866 because FMCSA has determined that the changes in 
this rulemaking would not have an impact of $100 million or more in any 
one year. Second, the agency has no reason to believe that the rule 
would result in an environmental health risk or safety risk that would 
disproportionately affect children.

Executive Order 12630 (Taking of Private Property)

    This proposed rule would not effect a taking of private property or 
otherwise have taking implications under Executive Order 12630, 
Governmental Actions and Interference with Constitutionally Protected 
Property Rights.

Executive Order 12988 (Civil Justice Reform)

    This action meets applicable standards in sections 3(a) and 3(b)(2) 
of Executive Order 12988, Civil Justice Reform, to minimize litigation, 
eliminate ambiguity, and reduce burden.

Executive Order 12372 (Intergovernmental Review)

    Catalog of Federal Domestic Assistance Program Number 20.217, Motor 
Carrier Safety. The regulations implementing Executive Order 12372 
regarding intergovernmental consultation of Federal programs and 
activities do not apply to this program.

Paperwork Reduction Act

    This proposed rule does not contain a collection of information 
requirement for purposes of the Paperwork Reduction Act of 1980. 44 
U.S.C. 3501 et seq.

Regulation Identification Number

    A regulation identification number (RIN) is assigned to each 
regulatory action listed in the Unified Agenda of Federal Regulations. 
The Regulatory Information Service Center publishes the Unified Agenda 
in April and October of each year. The RIN contained in the heading of 
this document can be used to cross-reference this action with the 
Unified Agenda.

List of Subjects in 49 CFR Part 386

    Administrative practice and procedure, Brokers, Freight forwarders, 
Hazardous materials transportation, Highway safety, Motor carriers, 
Motor vehicle safety, Penalties.

    Issued on: October 13, 2004.
Annette M. Sandberg,
Administrator.
    In consideration of the foregoing, FMCSA proposes to amend 49 CFR 
part 386, as follows:

PART 386--RULES OF PRACTICE FOR MOTOR CARRIER, BROKER, FREIGHT 
FORWARDER, AND HAZARDOUS MATERIALS PROCEEDINGS

    1. The authority citation for part 386 continues to read as 
follows:

    Authority: 49 U.S.C. 13301, 13902, 31132-31133, 31136, 31502, 
31504; sec. 204, Pub. L. 104-88, 109 Stat. 803, 941 (49 U.S.C. 701 
note); sec. 217, Pub. L. 105-159, 113 Stat. 1748, 1767; and 49 CFR 
1.73.

    2. Revise the heading of Subpart A to read as follows:

Subpart A--Scope of Rules; Definitions and General Provisions

    3. Amend Sec.  386.2 by removing the definitions for Compliance 
Order and Consent Order in their entirety.
    4. Amend Sec.  386.2 by revising definitions for Administration and 
Final agency order; and by adding definitions for Administrative 
adjudication, Agency, Agency Counsel, Decisionmaker, Default, 
Department, FMCSRs, Formal hearing, Hearing officer, HMRs, Informal 
hearing, Interstate commerce, Mail, Notice of Claim, Notice of 
Violation, Person, Reply, Secretary, Service, State, and Submission of 
written evidence without hearing to read as follows:


Sec.  386.2  Definitions.

* * * * *
    Administration means the Federal Motor Carrier Safety 
Administration.
    Administrative adjudication means a process or proceeding to 
resolve contested claims in conformity with the Administrative 
Procedure Act, 5 U.S.C. 554-558.
    Agency means the Federal Motor Carrier Safety Administration.
    Agency Counsel means the attorney who prosecutes a civil penalty 
matter on behalf of the Field Administrator.
* * * * *
    Decisionmaker means the Assistant Administrator of the Federal 
Motor Carrier Safety Administration, acting in the capacity of the 
decisionmaker or any person to whom the Assistant Administrator has 
delegated his/her

[[Page 61625]]

decisionmaking authority in a civil penalty proceeding. As used in this 
subpart, the agency decisionmaker is the official authorized to issue a 
final decision and order of the agency in a civil penalty proceeding.
    Default means any failure to reply in the time required or failure 
to submit an adequate reply in accordance with the requirements of this 
part, which may lead to a final agency order or additional penalties.
    Department means the Department of Transportation.
* * * * *
    Final agency order means a notice of final agency action issued 
pursuant to this part by either the appropriate agency Field 
Administrator (for default judgments under Sec.  386.15), or the agency 
Assistant Administrator, typically requiring payment of a civil penalty 
by a broker, freight forwarder, driver, shipper, or motor carrier.
    FMCSRs means the Federal Motor Carrier Safety Regulations.
    Formal hearing means the full opportunity by respondent to present 
relevant discovery, facts, and evidence, including the right of cross-
examination of witnesses and the preparation of a written record.
    Hearing officer means a neutral agency employee designated by the 
Assistant Administrator to preside over an informal hearing.
    HMRs means Hazardous Materials Regulations.
    Informal hearing means a full opportunity by respondent to present 
relevant facts and evidence before a hearing officer, who then prepares 
findings of fact and recommendations to the decisionmaker.
    Interstate commerce means trade, traffic, or transportation in the 
United States--
    (1) Between a place in a State and a place outside of such State 
(including a place outside of the United States);
    (2) Between two places in a State through another State or a place 
outside of the United States; or
    (3) Between two places in a State as part of trade, traffic, or 
transportation originating or terminating outside the State or the 
United States.
    Mail means U.S. first class mail, U.S. registered or certified 
mail, or use of a commercial delivery service.
* * * * *
    Notice of Claim (NOC) means a document alleging a violation of the 
FMCSRs, HMRs, or Commercial Regulations, for which a proposed civil 
penalty has been assessed.
    Notice of Violation (NOV) means a document alleging a violation of 
the FMCSRs, HMRs, or Commercial Regulations, for which a warning or 
other corrective action, other than payment of a civil penalty, is 
recommended.
    Person means any individual, partnership, association, corporation, 
business trust, or any other organized group of individuals.
    Reply means a written response to a notice of claim, admitting or 
denying the allegations contained within the Notice of Claim. In 
addition, the reply provides the mechanism for determining whether the 
respondent seeks to pay, settle, contest, or seek binding arbitration 
of the claim. See Sec.  386.14. If contesting the allegations, the 
reply must also set forth all known affirmative defenses and factors in 
mitigation to the claim.
* * * * *
    Secretary means the Secretary of Transportation.
    Service means to cause delivery of a document, motion, or pleading.
    State means a State of the United States, the District of Columbia, 
the Commonwealth of Puerto Rico, the Commonwealth of the Northern 
Mariana Islands, American Samoa, Guam, and the Virgin Islands.
    Submission of written evidence without hearing means the right of 
respondent to present written evidence and legal argument to the agency 
decisionmaker, or his/her representative, in lieu of an oral hearing.
    5. Add Sec.  386.3 to Subpart A to read as follows:


Sec.  386.3  Separation of functions.

    (a) Civil penalty proceedings, including hearings, will be 
prosecuted by agency counsel who represents the Field Administrator.
    (b) An agency employee, including those listed in paragraph (c) of 
this section, engaged in the performance of investigative or 
prosecutorial functions in a civil penalty action may not, in that case 
or a factually-related case, discuss or communicate the facts or issues 
involved with the agency decisionmaker, administrative law judge, 
hearing officer or others listed in paragraph (d) of this section, 
except as counsel or a witness in the public proceedings.
    (c) The Deputy Chief Counsel, Assistant Chief Counsel for 
Enforcement and Litigation, attorneys on their staff, and field 
enforcement attorneys serve as enforcement counsel in the prosecution 
of all cases brought under this part.
    (d) The Chief Counsel, the Special Counsel to the Chief Counsel, 
attorneys serving as Adjudications Counsel, and attorneys on the staff 
of the Chief Counsel advise the decisionmaker regarding civil penalty 
proceedings under this part.
    6. Add Sec.  386.4 to Subpart A to read as follows:


Sec.  386.4  Appearances and rights of parties.

    (a) Any party may be heard either in person, by counsel, or by 
other representatives, as the party elects.
    (b) Any party may be accompanied, represented, or advised by an 
attorney or representative designated by the party. An attorney or 
representative who represents a party must file a notice of appearance 
in the action, in the manner provided in Sec.  386.7 of this subpart, 
and will serve a copy of the notice of appearance on each party, in the 
manner provided in Sec.  386.6 of this subpart, before participating in 
any proceeding governed by this subpart. The attorney or representative 
will include his/her name, address, telephone number, and facsimile 
number in the notice of appearance.
    7. Add Sec.  386.5 to Subpart A to read as follows:


Sec.  386.5  Form of filings and extensions of time.

    (a) Length and content. Except for the Notice of Claim and Reply, 
motions, briefs, and other filings may not exceed 20 pages except as 
permitted by Order following a motion to exceed the page limitation 
based upon good cause shown. Exhibits or attachments in support of the 
relevant filing are not included in the page limit.
    (b) Paper and margins. Briefs must be printed on 8\1/2\'' by 11'' 
paper with a one-inch margin on all four sides of text, to include 
pagination and footnotes.
    (c) Spacing, type, and font minimal. Briefs will use the following 
line format: single spacing for the caption and footnotes, and double-
spacing for the main text. All printed matter must appear in at least 
12-point type.
    (d) Extensions of time. Only those requests showing good cause will 
be granted. No motion for continuance or postponement of a hearing date 
filed within 15 days of the date set for a hearing will be granted 
unless accompanied by an affidavit showing extraordinary circumstances 
warrant a continuance. Unless directed otherwise by the Assistant 
Administrator, Administrative Law Judge or Hearing Officer before whom 
a matter is pending, the parties may stipulate to reasonable extensions 
of time by filing the stipulation in the official docket and serving 
copies on all parties on the certificate of service. All requests for 
extensions of time must be filed with:

[[Page 61626]]

    (1) The Assistant Administrator if the matter is pending before the 
agency decisionmaker; or
    (2) The Hearing Officer if the matter has been assigned to a 
hearing officer for informal hearing; or
    (3) The Administrative Law Judge if the matter has been called for 
formal hearing; or
    (4) The Field Administrator if the matter is not yet before the 
agency decisionmaker.
    8. Add Sec.  386.6 to Subpart A to read as follows:


Sec.  386.6  Service.

    (a) General. All documents must be served upon the party or the 
party's registered agent. If a notice of appearance has been filed in 
the specific case in question accordance with Sec.  386.4, service is 
to be made on the party's attorney of record or their designated 
representative.
    (b) Type of service. A person may serve documents by personal 
delivery utilizing governmental or commercial entities, U.S. mail, 
commercial mail delivery, and upon prior written consent of the 
parties, facsimile. Written consent for facsimile service must specify 
the facsimile number where service will be accepted. When service is 
made by facsimile, a copy will also be served by any other method 
permitted by this section. Facsimile service occurs when transmission 
is complete.
    (c) Certificate of service. A certificate of service will accompany 
all documents served in an administrative proceeding. It must consist 
of a certificate of personal delivery or a certificate of mailing, 
facsimile, or commercial delivery service, signed by the person making 
the personal delivery or mailing the document, the date the service 
occurred, and must include a list of persons to be served in accordance 
with Sec.  386.7.
    (d) Date of service. A document will be considered served on the 
date of personal delivery; or if mailed, the mailing date shown on the 
certificate of service, the date shown on the postmark if there is no 
certificate of service, or other mailing date shown by other evidence 
if there is no certificate of service or postmark.
    (e) Service by the administrative law judge. The administrative law 
judge will serve a copy of each document including, but not limited to, 
notices of prehearing conferences and hearings, rulings on motions, 
decisions, and orders, upon each party to the proceedings by personal 
delivery or by mail, provide a courtesy copy to the agency 
decisionmaker via the agency's adjudications counsel, and forward the 
original to DOT Dockets.
    (f) Valid service. A properly addressed document, sent in 
accordance with this subpart, which was returned, not claimed, or 
refused, is deemed to have been served in accordance with this subpart. 
The service will be considered valid as of the date and the time the 
document was mailed, or the date personal delivery of the document was 
refused. Service by delivery after 5 p.m. is deemed to have been made 
on the next day that is not a Saturday, Sunday, or legal holiday.
    (g) Presumption of service. There shall be a presumption of service 
if the document is served where a party or a person customarily 
receives mail.
    9. Add Sec.  386.7 to Subpart A to read as follows:


Sec.  386.7  Filing of documents.

    (a) Address and method of filing. A person serving or tendering a 
document for filing must personally deliver or mail one copy of each 
document to all parties and counsel or their designated representative 
of record if represented. If the matter has been transferred to the DOT 
Docket, the original of all documents subsequently served in the matter 
must also be filed as follows: U.S. DOT Dockets (FMCSA), 400 7th 
Street, SW., Room PL-401, Washington, DC 20590, Attention: Hearing 
Docket Clerk. A person will serve a copy of each document on each party 
in accordance with Sec.  386.6 of this subpart.
    (b) Form. Each document must be typewritten or legibly handwritten.
    (c) Contents. Unless otherwise specified in this part, each 
document must contain a short, plain statement of the facts on which 
the person's case rests and a brief statement of the action requested 
in the document.
    10. Add Sec.  386.8 to Subpart A to read as follows:


Sec.  386.8  Computation of time.

    (a) Generally. In computing any time period set out in these rules 
or in an order issued hereunder, the time computation begins with the 
day following the act, event, or default. The last day of the period is 
included unless it is a Saturday, Sunday, or legal Federal holiday in 
which case the time period will run to the end of the next day that is 
not a Saturday, Sunday, or legal Federal holiday. All Saturdays, 
Sundays, and legal Federal holidays except those falling on the last 
day of the period will be computed.
    (b) Date of entry of orders. In computing any period of time 
involving the date of the entry of an order, the date of entry is the 
date the order is served.
    (c) Computation of time for delivery by mail. (1) Service of all 
documents is deemed effected at the time of mailing.
    (2) Documents are not deemed filed until received by the docket 
clerk.
    (3) Whenever a party has a right or a duty to act or to make any 
response within a prescribed period after service by mail, or on a date 
certain after service by mail, 5 days will be added to the prescribed 
period.
    11. Amend Sec.  386.11 by revising paragraphs (b) and (c) to read 
as follows:


Sec.  386.11  Commencement of proceedings.

* * * * *
    (b) Notice of violation. The agency may issue a notice of violation 
as a means of notifying any person subject to the rules in this part 
that it has received information (i.e., from an investigation, audit, 
or any other source) wherein it has been alleged that the person has 
violated provisions of the FMCSRs, HMRs, or Commercial Regulations. The 
notice of violation serves as an informal mechanism to address 
compliance deficiencies. If the alleged deficiency is not addressed to 
the satisfaction of the agency, formal enforcement action may be taken 
in accordance with paragraph (c) of this section. The notice of 
violation will address the following issues, as appropriate:
    (1) The specific alleged violations.
    (2) Any specific actions that the agency determines are appropriate 
to remedy the identified problems.
    (3) The means by which the notified person can inform the agency 
that it has received the notice of violation and either has addressed 
the alleged violation or does not agree with the agency's assertions in 
the notice of violation.
    (4) Any other relevant information.
    (c) Civil penalty proceedings. These proceedings are commenced by 
the issuance of a notice of claim.
    (1) Each notice of claim contains the following:
    (i) A statement setting forth the facts alleged.
    (ii) Any regulation allegedly violated by the respondent.
    (iii) The proposed civil penalty and notice of the maximum amount 
authorized to be claimed under statute.
    (iv) The time, form and manner whereby the respondent may pay, 
contest or otherwise seek resolution of the claim.
    (2) In addition to the information required by paragraph (c)(1) of 
this section, the notice of claim may contain such other matters as the 
agency deems appropriate.

[[Page 61627]]

    (3) In proceedings for collection of civil penalties for violations 
of the motor carrier safety regulations under the Motor Carrier Safety 
Act of 1984, the agency may require the respondent to post a copy of 
the notice of claim in such place or places and for such duration as 
the agency may determine appropriate to aid in the enforcement of the 
law and regulations.


Sec.  386.12  [Amended]

    12. Remove Sec.  386.12(a) and (b) in their entirety. Then 
redesignate current Sec.  386.12 (c) through (e) as proposed Sec.  
386.12 (a) through (c) respectively.
    13. Revise Sec.  386.14 to read as follows:


Sec.  386.14  Reply.

    (a) Time for reply to the notice of claim. Respondent must reply to 
the notice of claim in writing within 30 days following service. The 
reply is to be served in accordance with Sec.  386.6 upon the service 
center who issued the notice.
    (b) Contents of reply. The respondent must reply to the notice of 
claim within the time allotted by choosing one of the following:
    (1) Paying the full amount claimed in the notice of claim in 
accordance with Sec.  386.18 of this part;
    (2) Entering into settlement negotiations (while preserving the 
right to contest the claim at a later date). This option is not 
available if the notice of claim is based upon an enhanced penalty 
pursuant to the Motor Carrier Safety Improvement Act of 1999 (MCSIA) 
Sec.  222, 49 U.S.C. 521 note;
    (3) Contesting the claim by requesting administrative adjudication 
pursuant to paragraph (d) of this section; or
    (4) Seeking binding arbitration in accordance with the agency's 
program. Although the amount of the proposed penalty may be disputed, 
referral is contingent upon an admission of liability that the 
violations occurred.
    (c) Failure to reply to the notice of claim. (1) Respondent's 
failure to reply in accordance with paragraph (a) may result in the 
issuance of a notice of final agency order by the Field Administrator. 
The notice will declare respondent to be in default and further declare 
the notice of claim, including the civil penalty assessed in the notice 
of claim, to be the final agency order in the proceeding. The final 
agency order will be effective five days following service of the 
notice of final agency order.
    (2) The default constitutes an admission of all facts alleged in 
the notice of claim and a waiver of respondent's opportunity to contest 
the claim. Under very limited circumstances, the default may be 
reviewed by the Assistant Administrator in accordance with Sec.  
386.64(b) where a respondent can demonstrate excusable neglect, a 
meritorious defense, and due diligence in seeking relief.
    (3) Failure to pay the civil penalty as directed in a final agency 
order constitutes a violation of that order subjecting the respondent 
to an additional penalty as prescribed in subpart G of this part.
    (d) Request for administrative adjudication. The respondent may, 
contest the claim and request administrative adjudication pursuant to 
paragraph (b)(3) of this section. An administrative adjudication is a 
process to resolve contested claims before the Assistant Administrator, 
Administrative Law Judge, or agency hearing officer.
    (1) Contents. In addition to the general requirements of this 
section, the reply must state the grounds for contesting the claim and 
must raise any affirmative defenses the respondent intends to assert. 
Specifically, the reply:
    (i) Must admit or deny each separately stated and numbered 
allegation of violation in the claim. A statement that the person is 
without sufficient knowledge or information to admit or deny will have 
the effect of a denial. Any allegation in the claim not specifically 
denied in the reply is deemed admitted. A mere general denial of the 
claim is insufficient and may result in a default being entered by the 
agency decisionmaker upon motion by Claimant.
    (ii) Must include all affirmative defenses, including those 
relating to jurisdiction, limitations, and procedure.
    (iii) Must state which one of the following respondent seeks:
    (A) To submit written evidence without hearing.
    (B) An informal oral evidentiary hearing.
    (C) A formal oral evidentiary hearing.
    14. Revise Sec.  386.16 to read as follows:


Sec.  386.16  Action on replies to the notice of claim.

    (a) Settlement negotiations.
    (1) Settlement negotiations must be concluded within 90 days of 
service of the notice of claim. If a settlement has not been reached 
prior to the end of this period, agency counsel will file a notice of 
impasse, which automatically triggers respondent's obligation to 
proceed under Sec.  386.14(b)(1),(3), or (4).
    (2) Either party may, at any time, discontinue settlement 
negotiations by filing a notice with the other party. Respondent must, 
within 30 days following service of the notice, serve a reply under 
Sec.  386.14(b)(1),(3), or (4).
    (3) Nothing in this subsection is intended to prohibit the parties 
from entering into settlement negotiations at any time during the 
administrative adjudication process. If however the matter is before 
the agency decisionmaker, settlement between the parties is contingent 
upon approval of the agency decisionmaker pursuant to Sec.  386.22(c).
    (b) Requests to submit written evidence without oral hearing. Where 
respondent has elected to submit written evidence in accordance with 
Sec.  386.14(d)(1)(D)(i):
    (1) Agency counsel must, not later than 45 days following service 
of respondent's reply, serve all written evidence and argument in 
support of the notice of claim to the Assistant Administrator via DOT 
Dockets in accordance with Sec. Sec.  386.6 and 386.7. The submission 
must include all pleadings, notices, and other filings in the case to 
date.
    (2) Respondent will, not later than 30 days following service of 
agency counsel's written evidence and argument, serve its written 
evidence and argument with the Assistant Administrator via DOT Dockets 
in accordance with Sec. Sec.  386.6 and 386.7.
    (3) All written evidence submitted by the parties must conform to 
the requirements of Sec.  386.49.
    (4) Following submission of evidence and argument as outlined in 
this section, the Assistant Administrator may issue a final decision 
and order based on the evidence and arguments submitted, or may issue 
any other order as may be necessary to adjudicate the matter.
    (c) Requests for hearing.
    (1) If a request for an oral hearing has been filed, the Assistant 
Administrator will determine whether there exists a dispute of a 
material fact at issue in the matter. If so, the matter will be set for 
hearing in accordance with respondent's reply. If it is determined that 
there does not exist a dispute of a material fact at issue in the 
matter, the Assistant Administrator may issue a decision based on the 
written record.
    (2) If a respondent requests a formal or informal oral evidentiary 
hearing in its reply, the Field Administrator must serve upon the 
Assistant Administrator and respondent a notice of consent or objection 
to the request within 20 days of service of respondent's reply.
    (3) Requests for formal oral hearing. If the Field Administrator 
objects to a request for formal oral hearing, he/she must serve a 
motion for final agency order pursuant to Sec.  386.36 within 30 days 
of service of the objection. The motion must set forth the reasons why 
claimant is entitled to judgment as a matter of law. Respondent must, 
within

[[Page 61628]]

30 days of service of the objection and motion, submit and serve a 
response to rebut movant's objection. After reviewing the record, the 
Assistant Administrator will either set the matter for hearing by 
referral to a Department of Transportation Administrative Law Judge or 
issue a final agency order based upon the submissions.
    (4) Requests for informal oral hearing.
    (i) If the Field Administrator objects to a request for an informal 
oral hearing, he/she must serve the objection, a copy of the Notice of 
Claim, and a copy of respondent's reply, on the respondent and 
Assistant Administrator, pursuant to paragraph (c)(2) of this section. 
Based upon the notice of claim, the reply, and the objection, the 
Assistant Administrator will issue an order granting or denying the 
request for informal hearing.
    (A) Informal hearing granted. If the request for informal oral 
hearing is granted by the Assistant Administrator, a hearing officer 
will be assigned to hear the matter and will set forth the date, time 
and location for hearing. No further motions will be entertained, and 
no discovery will be allowed. At hearing, all parties may present 
evidence, written and oral, to the hearing officer following which, the 
hearing officer will issue a report to the Assistant Administrator 
containing findings of fact and recommending a disposition of the 
matter. By participating in an informal hearing, respondent waives its 
right to a formal oral hearing.
    (B) Informal hearing denied. If the request for informal oral 
hearing is denied, the Field Administrator must serve a motion for 
final agency order pursuant to Sec.  386.36 within 30 days. The motion 
must set forth the reasons why claimant is entitled to judgment as a 
matter of law. Respondent must, within 30 days of service of the 
objection and motion, submit and serve a response to rebut movant's 
objection. After reviewing the record, the Assistant Administrator will 
set the matter for formal hearing by referral to a Department of 
Transportation Administrative Law Judge, will assign the matter for 
informal oral hearing, or will issue a final agency order based upon 
the submissions.
    (ii) Nothing in this section shall limit the Assistant 
Administrator's authority to refer any matter for formal oral hearing, 
even in instances where respondent seeks only an informal oral hearing.
    15. Add Sec.  386.18 to Subpart B to read as follows:


Sec.  386.18  Payment of the claim.

    (a) Payment of the full amount claimed may be made at any time 
before issuance of a final agency order. After the issuance of a final 
agency order, claims are subject to interest, penalties, and 
administrative charges in accordance with 4 CFR part 103.
    (b) If respondent elects to pay the full amount in its reply, 
payment must be postmarked within 30 days following service of the 
notice of claim. Failure to serve payment within 30 days of service of 
the notice of claim will constitute a default and may result in the 
notice of claim, including the civil penalty assessed by the notice of 
claim, becoming the final agency order in the proceeding pursuant to 
Sec.  386.14(c).
    (c) Unless objected to in writing, payment of the full amount in 
its reply constitutes an admission by the respondent of all facts 
alleged in the notice of claim. Payment waives respondent's opportunity 
to further contest the claim, and will result in the notice of claim 
becoming the final agency order.
    16. Revise heading of Subpart C to read as follows:

Subpart C--Settlement Agreements


Sec.  386.21  [Removed]

    17. Remove Sec.  386.21.
    18. Revise Sec.  386.22 to read as follows:


Sec.  386.22  Settlement agreements and their contents.

    (a) Settlement agreements.
    (1) When negotiations produce an agreement as to the amount or 
terms of payment of a civil penalty or the terms and conditions of an 
order, a settlement agreement shall be drawn and signed by the 
respondent and the Assistant Administrator or designee. Such settlement 
agreement must contain the following:
    (i) The statutory basis of the claim;
    (ii) A brief statement of the violations;
    (iii) The amount claimed and the amount paid;
    (iv) The date, time, and place and form of payment;
    (v) A statement that the agreement is not binding on the agency 
until executed by the Assistant Administrator or his/her designee;
    (vi) A statement that failure to pay in accordance with the terms 
of the agreement which has been adopted as a Final Order will result in 
the loss of any reductions in penalties for claims found to be valid, 
and the original amount claimed will be due immediately; and
    (vii) A statement that the agreement is the final agency order.
    (2) A settlement agreement may contain any conditions, actions, or 
provisions agreed by the parties to redress the violations cited in the 
notice of claim or notice of violation.
    (3) An executed settlement agreement is a final agency order and is 
binding on the respondent and the agency according to its terms. The 
respondent's consent to a settlement agreement that has not been 
executed by the Assistant Administrator or his/her designee may not be 
withdrawn for a period of 30 days after it is executed by the 
respondent.
    (b) Civil forfeiture proceedings not before agency decisionmaker. 
When a respondent has agreed to a settlement at any time prior to the 
case coming before the agency decisionmaker, the parties may execute an 
appropriate agreement for disposing of the case. The agreement does not 
require approval by the agency decisionmaker.
    (c) Civil forfeiture proceedings before agency decisionmaker. When 
a respondent has agreed to a settlement of a civil forfeiture before a 
final order has been issued, the parties may execute an appropriate 
agreement for disposing of the case by consent for the consideration of 
the Assistant Administrator. The agreement is filed with the Assistant 
Administrator who may accept it, reject it and direct that proceedings 
in the case continue, or take such other action as he/she deems 
appropriate. If the Assistant Administrator accepts the agreement, he/
she shall enter an order in accordance with its terms.
    (d) Civil forfeiture proceedings before administrative law judge. 
When a respondent has agreed to a settlement of a civil forfeiture 
before the hearing is concluded, the parties may execute an appropriate 
agreement for disposing of the case by consent for the consideration of 
the ALJ. The agreement is filed with the ALJ who may accept it, reject 
it and direct that proceedings in the case continue, or take such other 
action as he/she deems appropriate. If the ALJ accepts the agreement, 
he/she shall enter an order in accordance with its terms.
    (e) Civil forfeiture proceedings before agency hearing officer. 
When a respondent has agreed to a settlement of a civil forfeiture 
before the hearing is concluded, the parties may execute an appropriate 
agreement for disposing of the case for the consideration of the 
hearing officer. The agreement is filed with the hearing officer who, 
within 20 days of receipt will make a report and recommendation to the 
Assistant Administrator who may accept it, reject it and direct that 
proceedings in the case continue, or take such other action as he/she 
deems appropriate. If the

[[Page 61629]]

Assistant Administrator accepts the agreement, he/she will enter an 
order in accordance with its terms.


Sec.  386.23  [Removed]

    19. Remove Sec.  386.23 in its entirety.
    20. Revise Sec.  386.31 to read as follows:


Sec.  386.31  Official notice.

    The Assistant Administrator or administrative law judge may take 
official notice of any fact not appearing in evidence in the record. 
Where the decision rests on a material and disputable fact of which the 
agency has taken official notice, a party is entitled to an opportunity 
to demonstrate the contrary. If a final agency order has been issued, 
the request will be in accordance with Sec.  386.64 of this part. If 
official notice is taken prior to the issuance of a final agency order, 
the request must comply with Sec.  386.63 of this part.


Sec.  386.32  [Removed]

    21. Remove Sec.  386.32 in its entirety.


Sec.  386.33  [Removed]

    22. Remove Sec.  386.33 in its entirety.


Sec.  386.34  [Removed]

    23. Remove Sec.  386.34 in its entirety.


Sec.  386.35  [Redesignated as Sec.  386.34]

    24. Redesignate Sec.  386.35 as Sec.  386.34.
    25. Amend redesignated Sec.  386.34(c) by removing the number ``7'' 
and adding, in its place, the number ``20.''


Sec.  386.36  [Redesignated as Sec.  386.35]

    26. Redesignate Sec.  386.36 as Sec.  386.35.
    27. Add new Sec.  386.36.


Sec.  386.36  Motions for final agency order

    (a) Generally. Unless otherwise provided in this section, the 
motion and answer will be governed by Sec.  386.34. If the matter is 
pending before a Field Administrator when the motion is made, the 
filing is to be served in accordance with Sec. Sec.  386.6 and 386.7. 
Movant's filing must contain a motion and memorandum of law, which may 
be separate or combined and must include all responsive pleadings, 
notices, and other filings in the case to date. Upon filing, the matter 
is officially transferred from the service center to the agency 
decisionmaker who will then preside over the matter.
    (b) Form and content. The motion will state with particularity the 
grounds upon which it is based and the substantial matters of law to be 
argued. The judgment sought will be rendered forthwith if, after 
reviewing the record in a light most favorable to the non-moving party, 
shows no genuine issue exists as to any material fact.
    (c) Answer to Motion. The non-moving party will, within 30 days of 
service of the motion for final order, submit and serve a response to 
rebut movant's motion.
    28. Revise Sec.  386.37 to read as follows:


Sec.  386.37  Discovery methods.

    (a) Parties may obtain discovery by one or more of the following 
methods: Depositions upon oral examination or written questions; 
written interrogatories; production of documents or other evidence for 
inspection and other purposes; physical and mental examinations; and 
requests for admission.
    (b) Except as otherwise provided in these rules, in the 
Administrative Procedure Act, 5 U.S.C. 551 et seq., or by the Assistant 
Administrator or Administrative Law Judge, the Federal Rules of 
Evidence apply in all administrative adjudications.
    29. Revise Sec.  386.42 to read as follows:


Sec.  386.42  Written interrogatories to parties.

    (a) Without leave, any party may serve upon any other party written 
interrogatories to be answered by the party to whom the interrogatories 
are directed; or, if that party is a public or private corporation or 
partnership or association or governmental agency, by any officer or 
agent, who will furnish the information available to that party. 
Interrogatories may be served on the claimant after commencement of the 
action and on any other party with or after service of the process and 
initial pleading upon that party.
    (b) A maximum number of interrogatories served will not exceed 30, 
including all subparts, unless the Assistant Administrator or 
Administrative Law Judge permits a larger number on motion and for good 
cause shown. Other interrogatories may be added without leave, so long 
as the total number of approved and additional interrogatories does not 
exceed 30.
    (c) Each interrogatory shall be answered separately and fully in 
writing under oath unless it is objected to, in which event the grounds 
for objection shall be stated and signed by the party, or counsel for 
the party if represented making the response. The party to whom the 
interrogatories are directed shall serve the answers and any objections 
within 30 days after the service of the interrogatories, except that a 
respondent may serve upon claimaint its answers or objections within 45 
days after service of the notice of claim or within such shortened or 
longer period as the Assistant Administrator or the administrative law 
judge may allow.
    (d) Motions to compel may be made in accordance with Sec.  386.45.
    (e) A copy of the interrogatories, answers, and all related 
pleadings must be served on the Assistant Administrator or, in cases 
that have been called to a hearing, on the administrative law judge, 
and upon all parties to the proceeding.
    (f) An interrogatory otherwise proper is not necessarily 
objectionable merely because an answer to the interrogatory involves an 
opinion or contention that relates to fact or the application of law to 
fact, but the Assistant Administrator or administrative law judge may 
order that such an interrogatory need not be answered until after 
designated discovery has been completed or until a prehearing 
conference or other later time.
    30. Revise Sec.  386.46 to read as follows:


Sec.  386.46  Depositions.

    (a) When, how, and by whom taken. The deposition of any witness may 
be taken at reasonable times subsequent to the appointment of an 
Administrative Law Judge. Prior to appointment of an Administrative Law 
Judge, a party may petition the Assistant Administrator, in accordance 
with Sec.  386.37, for leave to conduct a deposition based on good 
cause shown. Depositions may be taken by oral examination or upon 
written interrogatories before any person having power to administer 
oaths.
    (b) Application. Any party desiring to take the deposition of a 
witness must indicate to the witness and all other parties the time 
when, the place where, and the name and post office address of the 
person before whom the deposition is to be taken; the name and address 
of each witness; and the subject matter concerning which each such 
witness is expected to testify.
    (c) Notice. A party desiring to take a deposition must give notice 
to the witness and all other parties. Notice must be in writing. Notice 
of the deposition must be given not less than 20 days from when the 
deposition is to be taken if the deposition is to be held within the 
continental United States and not less than 30 days from when the 
deposition is to be taken if the deposition is to be held elsewhere 
unless a shorter time is agreed to by the parties or by leave of the 
Assistant Administrator or Administrative law judge by motion for good 
cause shown.
    (d) Taking and receiving in evidence. Each witness testifying upon 
deposition must be sworn, and any other party must be given the right 
to cross-examine. The questions propounded and the answers to them, 
together with all objections made, must be reduced to writing; read by 
or to, and subscribed by the witness; and certified by the person

[[Page 61630]]

administering the oath. The person who took the deposition must seal 
the deposition in an envelope and mail it by certified mail to the 
Assistant Administrator or the Administrative Law Judge, if one has 
been appointed. Subject to objections to the questions and answers as 
were noted at the time of taking the deposition and which would have 
been valid if the witness were personally present and testifying, the 
deposition may be read and offered in evidence by the party taking it 
as against any party who was present or represented at the taking of 
the deposition or who had due notice of it.
    (e) Witness limit. No party may seek deposition testimony of more 
than 5 witnesses per side without leave of the decisionmaker or 
Administrative Law Judge for good cause shown. Individual depositions 
are not to exceed 8 hours for any one witness.
    (f) Motion to terminate or limit examination. During the taking of 
a deposition, a party or deponent may request suspension of the 
deposition on grounds of bad faith in the conduct of the examination, 
oppression of a deponent or party or improper questions propounded. The 
deposition will then be adjourned. The objecting party or deponent must 
however, immediately move for a ruling on his or her objections to the 
deposition conduct or proceedings before the Assistant Administrator or 
Administrative Law Judge, who then may limit the scope or manner of the 
taking of the deposition.


Sec.  386.50  [Removed]

    31. Remove Sec.  386.50 in its entirety.
    32. Amend Sec.  386.51 by revising paragraph (b) to read as 
follows:


Sec.  386.51  Amendment and withdrawal of pleadings.

* * * * *
    (b) A party may withdraw his/her pleading any time more than 15 
days prior to the hearing by serving a notice of withdrawal on the 
Assistant Administrator or the Administrative Law Judge. Within 15 days 
prior to the hearing a withdrawal may be made only at the discretion of 
the Assistant Administrator or the Administrative Law Judge. The 
withdrawal will be granted absent a showing of injustice, prejudice, or 
irreparable harm to the non-moving party.
    33. Revise Sec.  386.52 to read as follows:


Sec.  386.52  Appeals from interlocutory rulings.

    (a) General. Unless otherwise provided in this subpart, a party may 
not appeal a ruling or decision of the Administrative Law Judge to the 
Assistant Administrator until the Administrative Law Judge's decision 
has been entered on the record. A decision or order of the Assistant 
Administrator on the interlocutory appeal does not constitute a final 
agency order for the purposes of judicial review under Sec.  386.67.
    (b) Interlocutory appeal for cause. If a party files a written 
request for an interlocutory appeal for cause with the Administrative 
Law Judge, or orally requests an interlocutory appeal for cause, the 
proceedings are stayed until the Administrative Law Judge issues a 
decision on the request. If the Administrative Law Judge grants the 
request, the proceedings are stayed until the Assistant Administrator 
issues a decision on the interlocutory appeal. The Administrative Law 
Judge must grant an interlocutory appeal for cause if a party shows 
that delay of the appeal would be detrimental to the public interest or 
would result in undue prejudice to any party.
    (c) Interlocutory appeals of right. If a party notifies the 
Administrative Law Judge of an interlocutory appeal of right, the 
proceedings are stayed until the Assistant Administrator issues a 
decision on the interlocutory appeal. A party may file an interlocutory 
appeal with the Assistant Administrator, without the consent of the 
Administrative Law Judge, before the Administrative Law Judge has made 
a decision, in any of the following situations:
    (1) A ruling or order by the Administrative Law Judge barring a 
person from the proceedings.
    (2) Failure of the Administrative Law Judge to dismiss the 
proceedings in accordance with Sec.  386.51(b).
    (3) A ruling or order by the Administrative Law Judge in violation 
of Sec.  386.54(b).
    (4) Denial by the Administrative Law Judge of a motion to 
disqualify under Sec.  363.54(c).
    (d) Procedure. A party must file a notice of interlocutory appeal, 
with any supporting documents, with the Assistant Administrator, and 
serve copies on each party and the Administrative Law Judge, not later 
than 10 days after the Administrative Law Judge's decision forming the 
basis of an interlocutory appeal of right or not later than 10 days 
after the Administrative Law Judge's decision granting an interlocutory 
appeal for cause, whichever is appropriate. A party must file a reply 
brief, if any, with the Assistant Administrator and serve a copy of the 
reply brief on each party, not later than 10 days after service of the 
appeal brief. The Assistant Administrator will render a decision on the 
interlocutory appeal, on the record and as a party of the decision in 
the proceedings, within a reasonable time after receipt of the 
interlocutory appeal.
    (e) The Assistant Administrator may reject frivolous, repetitive, 
or dilatory appeals, and may issue an order precluding one or more 
parties from making further interlocutory appeals, and may order such 
further relief as required.
    34. Revise Sec.  386.54 to read as follows:


Sec.  386.54  Administrative Law Judge.

    (a) Powers of an Administrative Law Judge. In accordance with the 
rules in this subchapter, an Administrative Law Judge may do the 
following:
    (1) Give notice of and hold prehearing conferences and hearings.
    (2) Administer oaths and affirmations.
    (3) Issue subpoenas authorized by law.
    (4) Rule on offers of proof.
    (5) Receive relevant and material evidence.
    (6) Regulate the course of the administrative adjudication in 
accordance with the rules of this subchapter.
    (7) Hold conferences to settle or simplify the issues by the 
consent of the parties.
    (8) Dispose of procedural motions and requests, except motions that 
under this part are made directly to the Assistant Administrator.
    (9) Issue orders permitting inspection and examination of lands, 
buildings, equipment, and any other physical thing and the copying of 
any document.
    (10) Make findings of fact and conclusions of law, and issue 
decisions.
    (b) Limitations on the power of the Administrative Law Judge. The 
Administrative Law Judge is bound by the procedural requirements of 
this part and the precedent opinions of the agency. If the 
Administrative Law Judge imposes any sanction not specified in this 
part, a party may file an interlocutory appeal of right with the 
Assistant Administrator pursuant to Sec.  386.52. This section does not 
preclude an Administrative Law Judge from barring a person from a 
specific proceeding based on a finding of obstreperous or disruptive 
behavior in that proceeding.
    (c) Disqualification. The Administrative Law Judge may disqualify 
himself or herself at any time, either at the request of any party or 
upon his or her own initiative. Assignments of Administrative Law 
Judges are made by the Chief Administrative Law Judge upon the request 
of the Assistant Administrator.

[[Page 61631]]

Any request for a change in such assignment, including 
disqualification, will be considered only for good cause which would 
unduly prejudice the proceeding.
    35. Revise Sec.  386.64 to read as follows:


Sec.  386.64  Reconsideration.

    (a) Within 20 days following the issuance of the Assistant 
Administrator's final agency order, any party may petition the 
Assistant Administrator for reconsideration of his/her findings of 
fact, conclusions of law, or final agency order. If a civil penalty was 
imposed, the filing of a petition for reconsideration stays only the 
payment of the penalty. No other aspects of the final agency order are 
stayed unless the Assistant Administrator so orders.
    (b) In the event a Notice of Final Agency Order is issued by a 
Service Center as a result of the respondent's failure to file any 
reply in accordance with Sec.  386.14, the only issue that will be 
considered upon reconsideration is whether a default has occurred under 
Sec.  386.14(c).
    (c) Either party may serve an answer to a petition for 
reconsideration within 30 days of the service date of the petition.
    (d) Following the close of the 30-day period, the Assistant 
Administrator will rule on the petition.
    (e) The ruling on the petition will be the final agency order. A 
petition for reconsideration of the Assistant Administrator's ruling 
will not be permitted.


Sec.  386.66  [Removed]

    36. Remove Sec.  386.66.
    37. Revise Sec.  386.67 to read as follows:


Sec.  386.67  Judicial review.

    (a) Any aggrieved person, who, after an administrative 
adjudication, is adversely affected by a final agency order issued 
under 49 U.S.C. 521 may, within 30 days, petition for review of the 
order in the United States Court of Appeals in the circuit where the 
violation is alleged to have occurred, or where the violator has its 
principal place of business or residence, or in the United States Court 
of Appeals for the District of Columbia Circuit.
    (b) Judicial review will be based on a determination of whether or 
not the findings and conclusions in the final agency order were 
supported by substantial evidence or otherwise in accordance with law. 
No objection that has not been raised before the agency will be 
considered by the court, unless reasonable grounds existed for failure 
or neglect to do so. The commencement of proceedings under this section 
will not, unless ordered by the court, operate as a stay of the final 
agency order of the agency.
    38. In Appendix A to Part 386:
    Revise section I, remove and reserve section II, and revise section 
III to read as follows:

Appendix A to Part 386--Penalty Schedule; Violations of Notices and 
Orders

I. Notice to Abate

    Violation--Failure to cease violations of the regulations in the 
time prescribed in the notice. (The time within to comply with a 
notice to abate shall not begin to run with respect to contested 
violations, i.e., where there are material issues in dispute under 
Sec.  386.14, until such time as the violation has been 
established.)
    Penalty--reinstatement of any deferred assessment or payment of 
a penalty or portion thereof.
* * * * *

III. Final Order

    Violation--Failure to comply with final agency order.
    Penalty--Automatic waiver of any reduction in the original claim 
found to be valid, and immediate restoration to the full amount 
assessed in the notice of claim.
* * * * *
[FR Doc. 04-23393 Filed 10-18-04; 8:53 am]
BILLING CODE 4910-EX-P