need not be approved by the Administrative Law Judge.” Jd. In order to solve this problem,
Congress emphasized the need for transparency in the penalty settlement process, so that miners,
Congress, and other interested parties could “fully observe the process.” Id. at 633. The
requirements of section 110(k) were “intend[ed] to assure that the abuses involved in the
unwarranted lowering of penalties as a result of off-the-record negotiations are avoided.” Id.
Thus, Congress expressed its “inten[t] that the Commission and the Courts will assure the public
interest is adequately protected before any reduction in penalties.”> Id.

Based on the language of section 110(k) and its legislative history, the Commission has
explained that “Congress authorized the Commission to approve the settlement of contested
penalties in section 110(k) ‘[iJn order to ensure penalties serve as an effective enforcement tool,
prevent abuse, and preserve the public interest.’” AmCoal, 38 FMSHRC at 1976 (quoting Black
Beauty, 34 FMSHRC at 1862). In “effectuating this Congressional mandate, the Commission
and its Judges consider whether the settlement of a proposed penalty is fair, reasonable,
appropriate under the facts, and protects the public interest.” Id. at 1976.

The Commission and its Judges “must have information sufficient to carry out this
responsibility.” Jd. at 1981. Consequently, through its procedural rules, the Commission has
required parties to submit facts supporting a penalty amount agreed to in settlement. Jd. In
particular, Commission Procedural Rule 31 requires that a motion to approve penalty settlement
must include for each violation “the penalty proposed by the Secretary, the amount of the penalty
agreed to in settlement, and facts in support of the penalty agreed to by the parties.” 29 C.F.R.

§ 2700.31(b)(1).

The Commission reviews a Judge’s denial of a proposed settlement under an abuse of
discretion standard. Sec'y of Labor on behalf of Shemwell v. Armstrong Coal Co., 36 FASHRC
1097, 1101 (May 2014). An abuse of discretion may be found where “there is no evidence to
support the Judge’s decision or if the decision is based on an improper understanding of the
law.” Jd. (citation omitted).

As the Commission has repeatedly observed, a Judge’s “front line oversight of the
settlement process is an adjudicative function that necessarily involves wide discretion.” Jd.
(citations omitted). Judges must have sufficient information to fulfill their duty of determining if
a settlement of a penalty is fair, reasonable, appropriate under the facts, and protects the public
interest. Moreover, such information permits a Judge to fulfill the duty of articulating reasons
for the approval so that the process of compromising penalty amounts is transparent, as Congress

5 We have recognized that the Commission has “the job of determining whether a
reduced penalty in settlement serves the public interest.” AmCoal, 38 FMSHRC at 1983. The
Commission’s responsibility for performing this job is not satisfied by conclusory statements in
settlement motions that reduced penalties “serve the public interest.” See, e.g., Asarco, Inc.,

18 FMSHRC 2081, 2082-84 (Dec. 1996) (denying settlement motion where the parties merely
represented that the settlement was consistent with the statutory criteria and in the public
interest).


new justification and again, against all odds, miraculously arrives at . . . a 30% across-the-board
reduction”).

As the Judge acknowledged (39 FMSHRC at 1188), we have stated that uniform penalty
reductions are not improper per se. AmCoal, 38 FMSHRC at 1985. Although monetary
considerations that relate to section 110(i) factors may be amenable to explanation about why a
particular numerical reduction is appropriate for a violation, there may be non-monetary
considerations that also support settlement that are not amenable to such precision.

Indeed, when the Commission considers monetary and non-monetary aspects of a
settlement together, across-the-board penalty reductions may be useful, and consistent with the
Commission’s settlement review standard. Jd. at 1982. The Judge’s requirements for precise
individual adjustments for each citation or order would effectively make across-the-board
percentage reductions impermissible de facto in large settlements involving multiple citations or
in global settlements involving multiple operations or inspections and a voluminous number of
citations. See, e.g., Aracoma Coal Co., 30 FMSHRC 1160 (Dec. 2008) (ALJ), aff'd,

32 FMSHRC 1639 (Dec. 2010) (approving global settlement); Alex Energy, Inc., 39 FASHRC
1458 (July 2017) (ALJ) (approving global settlement); Magma Copper Co. N/K/A BHP Copper,
Inc., 1998 WL 433234 (July 1998) (ALJ) (approving an approximately 50% reduction of 46
penalties).

Given these errors, we vacate the Judge’s denial and remand for further proceedings. The
Judge shall provide the parties with 30 days to submit facts supporting the proposed penalty
reductions, which may be submitted individually or collectively pursuant to Commission
Procedural Rule 31. Consistent with this decision, the Judge shall consider the proposed
settlement, including monetary and non-monetary aspects, in determining whether the proposed
settlement is fair, reasonable, appropriate under the facts, and protects the public interest.

10


The Judge recognized that the Commission has previously explained that standards for
factual support for a penalty reduction in settlement may be found in section 1 10(i).2 AmCoal,
38 FMSHRC at 1981; Black Beauty, 34 FMSHRC at 1864. However, we have also stated that
“parties may submit facts supporting a settlement that fall outside of the section 110(i) factors
but that support settlement.” 38 FMSHRC at 1982. We explained that “section 110(k) ‘contains
no explicit restrictions on what a Commission Judge may consider when reviewing a settlement
proposal,” and that the lack of restrictions does not mean that the Commission’s review is
unbounded. Jd. (quoting Black Beauty, 34 FMSHRC at 1865). “Rather, it means that there may
be considerations beyond the six statutory criteria of section 110(i) that are relevant to whether a
settlement proposal is fair, reasonable, appropriate under the facts, and protects the public
interest.” Id. Thus, the Judge erred in restricting the factual submissions to facts relating to only
the section 110(i) criteria.

In this regard, the Judge erred in discounting that the operator had agreed to accept all of
the citations as written. The Secretary makes a valid point that the fact that the proposed
settlement preserves all of the citations as written could assist the Secretary in future
enforcement efforts against this operator by ensuring that the paper record reflects the
Secretary’s views regarding gravity and negligence stated in the citations. The Judge improperly
rejected the value of accepting the citations as written on future enforcement actions as “pure
blather.” 39 FMSHRC at 1191.

The Commission has recognized that “[t]he ‘affirmative duty’ that section 110(k) places
on the Commission and its judges to ‘oversee settlements,’ . . . necessarily requires the judge to
accord due consideration to the entirety of the proposed settlement package, including both its
monetary and nonmonetary aspects.” Shemwell, 36 FMSHRC 1103 (quoting Madison Branch
Mgmt, 17 FMSHRC 859, 867-68 (June 1995)). Although the Judge appropriately determined
that the submission of additional substantive facts to support the proposed penalty reductions
was necessary,” he erred in not giving any weight to the non-monetary value of accepting the
citations as written.'°

5 The amended motion to approve settlement provided stipulations of fact relating to
three of the section 110(i) criteria, that is, AmCoal’s history of prior violations, AmCoal’s size,
and the effect on AmCoal’s ability to stay in business. Mot. to Approve Settlement and Dismiss
Proceeding at { 10.

° We emphasize that our conclusion that the Judge appropriately determined that the
submission of additional substantive facts was necessary applies only to the confines of the
instant proceeding.

‘© Commissioner Cohen asserts that while facts which fall outside the section 1 10(i)
factors may be relevant, Rule 31(b)(1) also requires the parties to identify substantive facts that
support the penalty agreed to by the parties for each violation. The Secretary represented here
that after a hearing a judge might reduce the level of negligence or gravity with respect to 14 of
the 32 citations, and might vacate another citation because of an undisclosed legal dispute with
the operator, and that in a worst case scenario, the total penalties might be reduced by
approximately 50% using the Part 100 penalty tables. S. Br. at 4. These representations did not

7


intended. A Judge who properly determines that a settlement motion lacks sufficient information
may permissibly request further facts from the parties. See Black Beauty, 34 FMSHRC at 1863.

The Commission’s settlement procedures have resulted in a near perfect approval rate for
motions to approve settlement. In fact, as the Secretary agreed, Oral Arg. Tr. 19, from fiscal
year 2015 through approximately seven months of fiscal year 2018, 99.8% of proposed
settlements have been approved.’

Against this backdrop, we review the Judge’s denial of the proposed settlement in his
May 2 and May 19 orders. The Judge identified the “essential problem” with the Secretary’s
amended motion to approve settlement as a failure to “provide a penalty-factor related
explanation to support the uniform 30% reduction for each citation.” 39 FMSHRC at 1178. The
Judge added that “even if plausible facts were presented and the Secretary admitted those facts
presented genuine disputes,” it would be unlikely for each citation to end up with a 30%
reduction. 39 FMSHRC at 1188.

We conclude that the Judge made prejudicial errors in the determinations supporting his
denial of the proposed settlement, which amounted to an abuse of discretion.

First, the Judge did not refer to the standard we articulated for evaluating penalty
reductions in settlement in our first interlocutory decision, i.e., whether the proposed penalty
reduction is fair, reasonable, appropriate under the facts, and protects the public interest. Neither
is there any indication that the Judge attempted to apply that standard.

Second, the Judge erred by applying the criteria in section 110(i) of the Mine Act in an
overly rigid manner, resulting in determinations that conflict with Commission precedent. The
Judge stated that the facts supporting the settlement “must be tied to the six statutory criteria in
[s]ection 110(i),” and concluded that the Secretary provided “no facts to support the reduction
sought.” 39 FMSHRC at 1176, 1177.

5 It appears that some Commission Judges have a practice of seeking additional
information from parties when evaluating a proposed settlement, and that this procedure works
effectively. Oral Arg. Tr. 21-22, 31-32, 34-35, 50, 75-76. Ifa party believes that a Judge has
overstepped his or her authority or otherwise committed an abuse of discretion in requesting such
facts, a party may appeal that matter to the Commission on an interlocutory basis. See Solar
Sources, Inc., Unpublished Order dated May 16, 2018 (granting interlocutory review of 39
FMSHRC 2052 (Nov. 2017) (ALJ).

7 Indeed, during oral argument, counsel for the intervenors pointedly reiterated the
description of the Secretary’s and AmCoal’s position in challenging the Commission’s authority
to require factual support of settlement as a “solution . . . in search of a problem.” Oral Arg. Tr.
55.


Facts alleged in a proposed settlement need not demonstrate a “legitimate” disagreement
that can only be resolved by a hearing. The Commission’s Procedural Rules and standing
precedent do not contain such a requirement. Rather, the Commission has recognized that
parties may submit facts that reflect a mutual position that the parties have agreed is acceptable
to them in lieu of the hearing process. See Amax Lead Co. of MO, 4 FMSHRC 975, 977-78
(June 1982) (“Inherent in the concept of settlement is that the parties find and agree upon a
mutually acceptable position that resolves the dispute and obviates the need for further
proceedings.”). Put another way, the facts required by Rule 31 may include a description of an
issue on which the parties have agreed to disagree. The Commission does not require
concessions from parties in settlement as long as the parties provide mutually acceptable facts
that demonstrate the proposed penalty reduction is fair, reasonable, appropriate under the facts,
and protects the public interest.

The Judge’s requirement for “legitimate” questions of fact or facts that present “genuine”
disputes (39 FMSHRC at 1188) is further flawed in that it appears that the Judge has assigned
probative value to some facts without the benefit of an evidentiary hearing. We have recognized
that, in reviewing information supporting a reduced penalty in settlement, a Judge “need not
make factual findings with respect to each of the section 110(i) factors as a Judge would in the
assessment of a penalty after hearing.” AmCoal, 38 FMSHRC at 1982. Ina final disposition
after a hearing, a Judge must make findings on each section 110(i) factor in assessing a penalty,
while a Judge’s decision approving settlement need only “set forth the reasons for approval
and . . . be supported by the record.”!? 29 C.F.R. § 2700.31(g); Cantera Green, 22 FMSHRC
616, 622-26 (May 2000).

Fifth and finally, the Judge erred in requiring the Secretary to provide an explanation for
the specific numerical percentage reduction of each penalty.'? The Judge determined that facts
were lacking that would explain “the uniform 30% reduction for each citation,” and observed
that “it would be highly questionable if, through some magic, each citation ended up with an
odds-defying 30% reduction.” 39 FMSHRC at 1178; 39 FMSHRC at 1188. He reasoned that “a
one-size-fits-all 30% reduction is not likely to be satisfactory because each violation is fact-
specific.” 39 FMSHRC at 1188; see also 39 FMSHRC at 1177 (“the Secretary sets forth this

'2 Indeed, in 1980, the Commission amended Rule 31 to delete a requirement that
decisions approving settlement must include a discussion of the section 110(i) criteria in order
“to enhance the flexibility of the judges to approve settlements.” 45 Fed. Reg. 44301, 44302
(1980); see also Black Beauty, 34 FMSHRC at 1866.

'3 The Judge found that the uniform percentage reduction for all 32 citations was
additionally problematic because “at least 5 (five) of the citations were specially assessed.” 39
FMSHRC at 1188. Contrary to the Judge’s finding, the subject proposed settlement involves no
penalties that were specially assessed. The five specially assessed penalties referred to by the
Judge were the subject of a separate docket, Docket No. LAKE 2011-12. A decision approving
settlement in LAKE 2011-12 was issued by this Judge on September 13, 2013, and became a
final order of the Commission 40 days after its issuance. 30 U.S.C. § 823(d)(1).


FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

1331 PENNSYLVANIA AVENUE, NW, SUITE 520N
WASHINGTON, DC 20004-1710

AUG 0 2201R
SECRETARY OF LABOR, :
MINE SAFETY AND HEALTH
ADMINISTRATION (MSHA)

v. ; Docket No. LAKE 2011-13
THE AMERICAN COAL COMPANY
and

UNITED MINE WORKERS
Of AMERICA

and

UNITED STEEL, PAPER and FORESTRY,
RUBBER MANUFACTURING, ENERGY,
ALLIED INDUSTRIAL and SERVICE
WORKERS INTERNATIONAL UNION

BEFORE: Althen, Acting Chairman; Jordan, Young, and Cohen, Commissioners

DECISION

BY THE COMMISSION:

This civil penalty proceeding, arising under the Federal Mine Safety and Act of 1977,
30 U.S.C. § 801 et seq. (2012) (“Mine Act” or “Act”), is before us for a second time on
interlocutory review. At issue is whether the Commission’s Administrative Law Judge erred in
denying a motion to approve a settlement between The American Coal Company (“AmCoal”)
and the Secretary of Labor.

In our first decision on review, we affirmed in all respects the Judge’s denial of the
proposed settlement. American Coal Co., 38 FMSHRC 1972, 1986 (Aug. 2016). We noted that
the Secretary had chosen this proceeding as a “test case” for advancing his position that the
Commission’s authority to review settlements of contested civil penalties under section 110(k) of


Distribution:

Laura P, Karr

Arthur Traynor

United Mine Workers of America

18354 Quantico Gateway Drive, Suite 200
Triangle, VA 22172

Daniel Kovalik
United Steelworkers
5 Gateway Center
Pittsburgh, PA 15222

Jason Hardin, Esq.

Artemis D. Vamianakis

FABIAN VANCOTT

215 South State Street, Suite 1200
Salt Lake City, UT 84111-2323

Suzanne F. Dunne, Esq.

U.S. Department of Labor

230 S. Dearborn Street, Room 844
Chicago, IL 60604

Edward Waldman, Esq.
Office of the Solicitor

US Department of Labor
201 12th St. South, Suite 401
Arlington, VA 22202-5450

April Nelson, Esq.

Office of the Solicitor

US Department of Labor
201 12th St. South, Suite 401
Arlington, VA 22202-5450

Ali Beydoun, Esq.

Office of the Solicitor

US Department of Labor
201 12th St. South-Suite 401
Arlington, VA 22202-5450


il.

Conclusion

For the reasons set forth above, we vacate the Judge’s denial of the amended proposed
settlement. We remand to the Judge for further submissions and consideration consistent with

this decision.

11

Lethe Dt he-

William I. Althen, Acting Chairman

Wt bE

Mary Lu J orfan, Comppsione

Li .
MChael G. ove fComrfi¥sioner

Robert F. Cohen, Jr., Commissioner



Third, after determining that additional facts pertinent to the six statutory criteria were
necessary to support the penalty reduction, the Judge erred by not permitting the operator to
submit those facts. The Judge noted that the operator’s counsel offered to provide facts to
support the settlement motion. 39 FMSHRC at 1 188"!

However, there is no requirement that facts supporting a proposed settlement must
necessarily be submitted by the Secretary. Facts supporting a penalty reduction in a settlement
motion may be provided by any party individually or by parties collectively as long as there is a
certification by the filing party that any non-filing party has consented to the granting of the
settlement motion. See 29 C.F.R. § 2700.31(b)(2).

Fourth, in rejecting the operator’s offer to submit factual support for the proposed
settlement, the Judge stated that the “settlement must express from the Secretary that the
Respondent’s assertions present /egitimate questions of fact which can only be resolved through
the hearing process.” 39 FMSHRC at 1188 (emphasis in original); see also 39 FMSHRC at 1188
(“even if plausible facts were presented and the Secretary admitted that those facts presented
genuine disputes, it would be highly questionable if . . . each citation ended up with . . . [a] 30%
reduction”); 39 FMSHRC at 1176 (“facts which are in dispute need to be identified.”).

provide the Judge with sufficient detail to permit the Judge to have an understanding of why the
penalties were being reduced. The Secretary’s boilerplate recitations of having evaluated the
value of the compromise, the prospects of coming out better or worse after a trial, and
“maximizing his prosecutorial impact” add nothing. As succinctly stated by counsel for the
intervenor UMWA, “by requiring the Secretary to provide some basic justification based on
substantive fact, it creates a record so that interested parties like Congress, like the mine workers,
like the steel workers can observe the process and make sure that we haven’t reverted to the state
of affairs that existed prior to enactment of the current legislation in section 110(k).” Oral Arg.
Tr. 63. By bundling 32 citations into a single proposed settlement and reducing each penalty by
the same percentage, the Secretary seems to be trying to avoid the scrutiny which Congress has
required of the Commission. See S. Rep. No. 95-181 at 45, Legis. Hist. at 633.

Commissioner Cohen further notes that the Commission’s recognition of the importance
of substantive facts in a settlement agreement (and the Secretary’s ability to provide them) is
illustrated by the issuance this day of a decision in another case involving the denial of a
proposed settlement, The Ohio County Coal Co., No. WEVA 2018-0165. In the Ohio County
Coal settlement motion, the Secretary proposed to reduce the penalty for Citation No. 9090883, a
violation of 30 C.F.R. § 75.202(b) caused by a miner working under unsupported roof, based on
a reduction in the level of the operator’s negligence from “moderate” to “low.” The Secretary
explained that the operator was contending that the violation was caused by an hourly employee
and that it was unaware of the violation, an alleged fact supported by the MSHA inspector’s
notes that the foreman was not present when the violation occurred. Based on the Secretary’s
description of these disputed facts, the Commission in Ohio County Coal is reversing the Judge
and approving the proposed settlement.

'! Indeed, AmCoal’s counsel repeated this offer that the operator was “ready” and
“willing” to provide such facts, including during oral argument before us. Oral Arg. Tr. 27.

8


On May 2, 2017, the Judge issued an order denying the Secretary’s motion. 39 FMSHRC
1173 (May 2017) (ALJ). The Judge concluded that the Secretary had again failed to provide
adequate facts to support the 30% across-the-board reduction for each citation agreed to in
settlement. Jd. at 1178. The Secretary subsequently sought interlocutory review of the Judge’s
denial.

On May 19, 2017, the Judge issued an order denying the Secretary’s motion for
interlocutory review. 39 FMSHRC 1187 (May 2017) (ALJ). The Judge reiterated his finding
that a “one-size-fits-all 30% reduction is not likely to be satisfactory because each violation is
fact-specific.” Id. at 1188. The Judge emphasized his view that the facts required are facts about
the alleged violations. The Judge also explained that only “Jegitimate disputes of fact” are
usually sufficient to support a proposed reduction. Jd.

The Secretary again filed a petition for interlocutory review with the Commission, which
AmCoal subsequently joined. The Commission granted interlocutory review and heard oral
argument. As they did below, the United Mine Workers of America (“UMWA”) and the United
Steel, Paper and Forestry, Rubber Manufacturing, Energy, Allied Industrial and Service Workers
International Union intervened in this proceeding and participated in oral argument.

On review, the Secretary and AmCoal argue that the Judge applied an erroneous legal
standard in concluding that the Secretary failed to provide facts in support of the proposed
settlement. They submit that such facts are not limited to facts related to the section 110(i)
penalty criteria or to the alleged violations. The Secretary and operator further contend that the
Commission’s Procedural Rules do not preclude a settlement of multiple penalties for a uniform
percentage reduction for each penalty and that the Judge’s denial essentially makes such
reductions impermissible. Finally, AmCoal argues that the Commission should not require a
settling party to concede “legitimate” questions of fact during the settlement approval process, as
the Judge required. The intervenor unions respond that the Commission should affirm the
Judge’s order as a proper exercise of his discretion.

Il.

Disposition

Our disposition of the first interlocutory appeal of this proceeding, as law of the case, is
the basis upon which this decision stands. See Dolan v. F&E Erection Co.,23 FMSHRC 235,
240 (Mar. 2001). We briefly reiterate only those portions of the decision necessary for
disposition of the instant review.

Section 110(k) of the Mine Act sets forth in relevant part that a proposed penalty that has
been contested shall only be settled if approved by the Commission or court. See n.1, supra.

The legislative history of section 110(k) describes the Congressional intent behind this
provision. The Senate Report states that the “compromising of the amounts of penalties actually
paid” had reduced “the effectiveness of the civil penalty as an enforcement tool.” S. Rep. No.
95-181, at 44 (1977), reprinted in Senate Subcomm. on Labor, Comm. on Human Res.,
Legislative History of the Federal Mine Safety and Health Act of 1977, at 632 (1978) (“Legis.
Hist.”). The Committee noted that settlement efforts were “not on the record, and a settlement

4


through settlement must be submitted in accordance with Commission Procedural Rule 31, 29
C.F.R. § 2700.31, and Commission precedent. Because the Secretary had not provided facts to
support the proposed penalty reduction, we concluded that the Judge had not abused his
discretion in denying the settlement motion. Accordingly, we affirmed the denial and remanded
for further proceedings.

The Secretary then filed a petition for review of the Commission’s decision with the
United States Court of Appeals for the D.C. Circuit. On March 17, 2017, the Secretary filed a
motion to withdraw his petition from the D.C. Circuit, and the court granted the motion.®

The Secretary subsequently submitted an amended motion to approve the settlement to
the Judge.

In the motion, the Secretary provided additional information. This information did not
include additional facts specifically tied to the six penalty criteria listed in section 110(i) of the
Mine Act, 30 U.S.C. § 820(i),' for each of the 32 citations. Rather, the Secretary made general
allegations, including that there was a substantial risk that the court could reduce the degree of
negligence or gravity with respect to 14 of the 32 citations, and that one additional citation ran
the risk of being vacated because of a legal dispute between the operator and the Secretary
regarding the standard cited. The Secretary further stated that after trial, if each of the citations
at risk received a worst-case outcome, the resulting penalties would reflect an approximately
50% reduction from the penalties originally proposed by the Secretary, based on the penalty
tables contained in 30 C.F.R. Part 100. Given this, the Secretary asserted that an across-the-
board 30% reduction reflected an appropriate compromise. The Secretary further submitted that
he considered the fact that the proposed settlement preserved all of the citations as written to be a
significant advantage for future enforcement purposes.

3 Prior to the Secretary’s withdrawal of the appeal, the Commission was informed that
the Department of Justice (“DOJ”) had initiated a process to consider whether it was appropriate
for the Department of Labor to pursue that petition and, if so, what position the United States
should take in the matter. The DOJ requested the Commission to provide its views on the
matter. On January 27, 2017, the Commission submitted to the DOJ its views, which were
consistent with its first interlocutory decision.

* Section 110(i) provides in part:

In assessing civil monetary penalties, the Commission shall
consider the operator’s history of previous violations, the
appropriateness of such penalty to the size of the business of the
operator charged, whether the operator was negligent, the effect on
the operator’s ability to continue in business, the gravity of the
violation, and the demonstrated good faith of the person charged in
attempting to achieve rapid compliance after notification of a
violation.

30 U.S.C. § 820(i).


the Mine Act, 30 U.S.C. § 820(k),! is much more limited than that described in Black Beauty
Coal Co., 34 FMSHRC 1856, 1860-64 (Aug. 2012).? We reaffirmed our settlement authority
stated in Black Beauty and concluded that the Judge did not abuse his discretion in denying
settlement approval when, contrary to the Commission’s procedural rules and precedent, the
Secretary refused to provide any facts to support the penalty reduction agreed to in settlement.
We remanded the matter to the Judge, and the Secretary ultimately submitted an amended
motion to approve settlement.

In this decision, we consider a different question: whether the Judge applied an incorrect
legal standard in denying the amended settlement motion. For the reasons discussed below, we
conclude that the Judge erred, vacate his denial, and remand for further proceedings consistent
with this opinion.

I.

Factual and Procedural Background

This case involves 32 contested citations issued to AmCoal in 2010. In 2013, the
Secretary filed a motion to approve a proposed settlement that involved a 30% across-the-board
penalty reduction for each citation, while preserving all citations as written. The Judge issued a
decision denying the motion because the motion had failed to provide any factual support for the
penalty reduction. Rather than provide such facts, the Secretary essentially represented to the
Judge that the proposed settlement was in the public interest and compatible with the
enforcement goals of the Department of Labor’s Mine Safety and Health Administration
(“MSHA”).

We granted interlocutory review of the Judge’s denial. In our decision, noting the rare
split-enforcement model that the Commission shares with MSHA and the unique settlement
review authorized by section 110(k), we stated that “although Congress gave the Secretary most
of the enforcement powers under the Act, it expressly chose to give to the Commission the
authority to assess penalties and approve settlements.” 38 FMSHRC at 1979. We explained that
the Commission applies the standard of whether a proposed penalty reduction is fair, reasonable,
appropriate under the facts, and protects the public interest in evaluating whether a settlement
should be approved. We further stated that factual information supporting the penalty agreed to

" Section 110(k) provides:

No proposed penalty which has been contested before the
Commission under section 105(a) shall be compromised,
mitigated, or settled except with the approval of the Commission.
No penalty assessment which has become a final order of the
Commission shall be compromised, mitigated or settled except
with the approval of the court.

30 U.S.C. § 820(k).

2 See AmCoal, 38 FMSHRC at 1972-73 (Memorandum from Heidi Strassler, Assoc.
Solicitor for Mine Safety and Health, to Regional Solicitors, May 2, 2014).

2


Melanie Garris

Office of Civil Penalty Compliance, MSHA
U.S. Department of Labor

201 12th Street South, Suite 401

Arlington, VA 22202-5450

Administrative Law William B. Moran

Federal Mine Safety and Health Review Commission
Office of Administrative Law Judges

1331 Pennsylvania Avenue, N. W., Suite 520N
Washington, D.C. 20001