Source: http://www.minesafety.com/author/admin/page/2/
Timestamp: 2019-04-18 14:39:08+00:00

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Today is one of the most important recent cases before the FMSHRC. Oral arguments are being presented in Secretary of Labor v. The American Coal Co., on whether or not the Mine Act grants an ALJ the power to reject and demand additional information when approving a settlement under the Mine Act. Mine Safety and Health News is there, and will report on the case.
Unbeknownst to FMSHRC judges or the mining community, the Secretary issued a secret memo in 2014, written by Heidi Strassler, the Associate Solicitor for Mine Safety and Health, stating that the Solicitor was seeking to overturn 36 years of precedent, and was willing to go to court to change existing settlement procedures. (For the full text of the memo see: 21 MSHN 446).
The Mine Act’s legislative history seems compelling to uphold the role that the ALJs have played since the very first cases before the Commission when the Mine Act and mine disasters were fresh in everyone’s minds. Some of the very first cases were settlement rejections. The Secretary refuses to acknowledge this fact in his briefs filed before the Commission.
The Secretary claims that settlement agreements “cannot be treated as if they were findings of fact and conclusions of law after trial.” If the Secretary is willing to argue this point, is the Secretary also willing to pull every single settled citation off of the DRS? Is the Secretary willing to pull every single citation out of the equation for Pattern of Violations or when determining Violations Per Inspection Day? Afterall, the Secretary is arguing that we should not accept these citations and orders as if they are “findings of fact and conclusions of law.” So therefore, it must be taken to the next step, and remove these thousands up thousands of citations and orders from the DRS — because they don’t count.
The briefs filed in this case indicates the Secretary is willing to take the issue of settlement approval to the U.S. Court of Appeals in the hope of overturning 38 years of case law, and what appeared to be clear Congressional intent that the Commission was established, in part, for the purpose of overseeing contested citations and penalties for the violations found by MSHA inspectors, and for there to be a transparent civil penalty and settlement process.
The Secretary claims that the Commission owes deference to his interpretation of the Mine Act, and what information that should be considered in penalty settlements. In this case, involving a coal mine controlled by Robert E. Murray, the Secretary is offered far less information than the ALJ was demanding.
At issue is the settlement process, penalties, and which agency should have the final say in penalties assessed against an operator that have been contested before the Review Commission under an Act of Congress that called for split enforcement, and apparently leaving the penalty responsibility up to the Review Commission.
The settlement did not change the gravity or negligence of any of the citations – only the penalties.
In denying the motion, Moran said, “The idea that every one of 32 citations could warrant a 30% reduction demonstrates, by that fact alone, that the reductions were more in the nature of yard sale, rather than any individualized review meriting, by some impossibly small odds, that each just happened to have earned such an implausibly uniform reduction” (20 MSHN 116).
The violations in the New Era case occurred between July and August 2009 at the New Era Mine in Illinois. During this time period, the company had a policy of contesting “everything except for de minimis penalties” according to a letter that Murray Energy had sent to the House Labor Committee in October of that year. (Oct. 5, 2009 letter to House Committee on Education and Labor; re: Murray Energy Corp. Notices of Contests of MSHA Citations, Orders and Proposed Civil Penalties.) The company stated this policy was necessary due to changes made in the 2006 MINER Act. In a second, follow-up letter to the Labor Committee, Murray Energy stated that “Many operators (with MEC’s subsidiaries among them) can no longer justify just ‘taking’ whatever MSHA dishes out, regardless of its legitimacy” (emphasis added). (Feb. 3, 2010 follow-up letter to House Committee on Education and Labor re: Follow-up to letter of Oct. 5, 2009 and meeting of Nov. 6, 2009).
▸ On July 20, 2010, MSHA cited the company for coal accumulations up to 20 inches in depth, and 18 feet wide for a distance of 165 feet in violation of §75.400 with a proposed penalty of $1,944, and a similar violation of §75.400 in citation 8424502 with a penalty of $2,678. The mine had been cited 143 times for similar violations in the past 15 months before these violations were found.
▸ A fine of $3,405 was assessed for an S&S roof control violation under §75.202(a) where MSHA found inadequate roof and rib support, a problem which had been cited 74 times at this mine in the 15 month period before this citation (citation 7579878).
▸ A $425 penalty was issued for a violation of §75.370(a)(1) on Aug. 24, 2010. MSHA said it found up to 5 feet of water in a longwall bleeder (citation 8424511), and there had been 67 violations under this standard in the previous 15 month period.
▸ Inspectors found an incompletely installed life line in the primary escapeway in violation of §75.380(d)(7)(I) with a $263 penalty (citation 8424508). The company had five previous violations of the escapeway standard in the previous 15 month period.
▸ On Aug. 16, 2010, MSHA fined the company $585 for an S&S violation of §77.404(a) where a haul truck seriously leaking oil with an engine that could not be shut down (citation 8424013). The company had three other previous violations of that standard in the previous 15 month period.
In fact, 105(a) of the Mine Act clearly speaks of “proposed assessments”, and that an operator has 30 days in which to pay or contest the proposed assessment.
In the previous enforcement agency – MESA – the operator had to pay the penalty assessed, or was given the opportunity to negotiate a settlement with the MESA assessment officer. If no compromise was reached, the Office of the Solicitor filed a Petition for Civil Penalty Assessment with the Office of Hearings and Appeals of the Dept. of the Interior, and the case was set for trial before an ALJ. Before 1977, the operator could, at any time prior to the final decision of the Administrative Law Judge, negotiate a settlement with the Solicitor.
Congress believed that the settlements reduced the effectiveness of the civil penalty as an enforcement tool under the 1969 Coal Act since the penalty reductions did not come under public scrutiny.
“While the reduction of litigation and collection expenses may be a reason for the compromise of assessed penalties, the Committee strongly feels that since the penalty system is not for the purpose of raising revenues for the Government, and is indeed for the purpose of encouraging operator compliance with the Act’s requirements, the need to save litigation and collection expenses should play no role in determining settlement amounts. The Committee strongly feels that the purpose of civil penalties, convincing operators to comply with the Act’s requirements, is best served when the process by which these penalties are assessed and collected is carried out in public, where miners and their representatives, as well as the Congress and other interested parties, can fully observe the process.
Thus, Congress created an independent Commission, insulated from MSHA and the Labor Secretary, whose members cannot be removed by the President except for cause.
On the issue of repeated violations, such as in the case of the New Era Mine, the legislative history was clear in that repeat violations of the same standard should have a higher penalty.
In upholding this enforcement scheme, the D.C. Circuit ruled in 1989 that Congress was intent on assuming that the civil penalties provide an effective deterrent against all offenders, and particularly against offenders with records of past violations. Coal Employment Project v. Dole, 889 F. 2nd 1127 (DC Cir 1989).
The legislative history is silent as to the considerations that should be taken on settlements, but it is worth noting that settled citations are still part of an operator’s history in MSHA’s data base, and used for enforcement purposes.
Commission case law shows that shortly after the Commission was formed, as early as November 1978, in Republic Steel (Docket No. PITT 78-156-P et al., 1 MSHC 1709) the full Commission insisted that ALJs state reasons for approval of settlements. The Republic Steel case was the first test case for settlements, and set the policy for de novo review.
The Commission’s authority over settlements was never challenged.
The Commission at that time was chaired by former Congressman Jerome Waldie, with Richard Backley, Frank Jestrab, A.E. Lawson, and Marian Pearlman Nease. Those first Commissioners stressed that Republic Steel was a novel question of policy, and claimed the ALJ settlement approval did not provide enough facts for then-ALJ William Fauver to approve the settlement.
The case was remanded back to Judge Fauver for him to make a statement of reasons for approving the settlement, and a statement of the facts in the record that supported his determination.
The attorney presenting the case on behalf of the Secretary was present Commission Judge David Barbour, who has also served as the Commission’s Chief Judge from 2000 – 2003.
One of the first ALJ decisions concerning settlements found after Republic Steel, was on Feb. 13, 1979. Judge Joseph Kennedy wrote a scathing rejection of the joint settlement, and chastised then- DOL attorney Edward Fitch where Pomerleau Bros. Inc. (1 MSHC 1770; Docket No. WILK 79-4-PM) and the Secretary wanted to withdraw a case because the operator agreed to the violations as written, and agreed to pay all of the penalties.
Judge Kennedy said the Solicitor’s office could not withdraw the case without filing a settlement containing all of the citation information for him to review. Kennedy stressed that the company had contested the violations, and those were now squarely before the Commission.
The Commission’s first “Blue Book” in March 1979 has two settlement rejections – both by then-ALJ Paul Merlin, who went onto become the Chief ALJ. He continued the practice of rejecting settlements not justified by detailed analysis until he retired. In those first Blue Book cases dated March 5, 1979, Merlin said that the Commission ALJs are to carry out “a de novo review of all aspects” of a settlement.
In the case of Gateway Coal Co., (PITT 78-368-P), Merlin was particularly harsh with then-Solicitor Attorney David Barbour, who now is a Commission ALJ. The company was represented by attorney Hank Moore.
In stressing the split enforcement that the Mine Act called for, Judge Merlin told attorneys Barbour and Moore: “I determine the existence of a violation in a hearing such as this based solely upon the record, documentary and testimonial, which is made before me. I conclude a penalty exists. I determine the amount of penalty in accordance with the statutory criteria, based once again, solely upon the record made before me. I note that section 2700.24 requires that the petition for civil penalties include the proposed penalties. This obviously, has to do with the settlement process concerning which, as both counsel well know, Congress expressed serious concern,” Merlin wrote.
On the same day, Merlin wrote another “Disapproval of Settlement” involving a company called Hallmark & Son Coal Co. Similar to the case before ALJ Kennedy, this also involved a company willing to pay the originally assessed amounts. Here, Merlin again chastised the Solicitor’s Office for giving “no reasons beyond the bare statement that the proposed settlement is reasonable in light of the alleged gravity and negligence of each violation.” Merlin wanted more information within 10 days, and said he would issue a “Show Cause Order” if the Solicitor failed to do so.
Throughout the years Judge Merlin rejected a settlement from time-to-time, and noted in one case in May 1987, “Most Solicitors routinely submit satisfactory settlement motions, while a few do not” (9 FMSHRC 926).
The full Commission, on three more occasions after Republic Steel, reaffirmed the authority of its Judges to review and, where necessary, disapprove settlements (Knox County Stone, 3 FMSHRC 2478, Pontiki Coal Corp., 8 FMSHRC 668, and Wilmot Mining, 9 FMSHRC 684).
“Settlement of contested issues and Commission oversight of that process are integral parts of dispute resolution under the Mine Act. 30 U.S.C. § 820(k); see Pontiki Coal Corp., 8 FMSHRC 668, 674 (May 1986). The Commission has held repeatedly that if a judge disagrees with a penalty proposed in a settlement he is free to reject the settlement and direct the matter for hearing. See. e.g., Knox County Stone Co., 3 FMSHRC 2478, 2480-81 (November 1981).
On Feb. 3, 2010, MSHA-head Joe Main was asked about back-logs in cases, penalties and the settlement system in a hearing before the House Committee on Education and Labor.
Main told Congress he was troubled by the current settlement process, which he said favored operators who could send a letter of contest with 40¢ postage, wait two years, and get a 47% penalty reduction in a settlement.
In his testimony Main said that in most contested cases, there is no dispute a violation occurred, but the disputes were generally focused on gravity, negligence or the number of miners that might be affected.
The issue of an ALJ’s role in settlements came to the forefront in Black Beauty Coal Co. (34 FMSHRC 1856, 19 MSHN 489). ALJ Margaret Miller issued an unpublished order rejecting a proposed settlement between the Solicitor’s Office and Peabody’s Black Beauty Coal that would have reduced MSHA’s proposed penalties by more than 80%.
Miller also stated that ALJs are required by Commission precedent to provide a sufficient explanation when a penalty assessment diverges substantially from a proposed penalty, and in the case of Black Beauty, the Secretary did not provide a sufficient explanation for the penalty reductions.
The Solicitor’s Office filed for interlocutory review, claiming that a Commission ALJ may not consider deterrent effects of penalty amounts.
In ruling against the Solicitor, the Commission said the Mine Act’s legislative history, and numerous Commission and federal cases identify deterrence as a central tenet of the Mine Act and its penalty provisions.
In addition, the Commission said that Congress intended that the settlement of a penalty be open to scrutiny in order to better serve the purpose of civil penalties, that is, to encourage operators’ compliance with mandatory standards. Black Beauty Coal Co., 8/20/2012, Docket No. LAKE 2008-327 et al., 34 FMSHRC 1856, 19 MSHN 489.
Following Black Beauty, in a separate opinion, ALJ Thomas McCarthy sent a stern warning to the Solicitor’s Office on Oct. 15, 2012, saying that the Secretary of Labor may not “continue to act in blatant disregard of the Mine Act,” in refusing to provide information required for settlements. Judge McCarthy threatened disciplinary proceedings.
ALJ Priscilla Rae wrote an equally harsh opinion, two days after Judge McCarthy, although she stopped short of threatening disciplinary action against the Solicitor involved in the case before her (19 MSHN 590).
In a Nov. 1, 2012, conference call regarding the settlement of a penalty case involving Dickenson- Russell Coal Co. before Judge McCarthy, more information was sought by the ALJ where the Solicitor agreed to a 49% penalty reduction. In addition, the Secretary sought to remove an S&S finding. The Secretary argued he could find that a hazard was reasonably likely to cause a fatal injury, but under the Secretary’s prosecutorial discretion, could also remove the S&S finding in a settlement.
According to the transcript, Solicitor’s Office attorney Doug White told McCarthy’s counsel, “We accept that the Commission and these judges have authority to approve settlements of the penalty – there’s no question. This is long settled law,” White said. But, White did not believe that the judge had the authority “whatsoever” to review MSHA’s modification of a citation once it was contested, because the citation is not a penalty. White asserted that the reasons to modify a citation should not be included in a penalty settlement proposal, even though the two are intertwined.
White said he accepted the fact that the Mine Act was different, and the legislative history set a different standard.
Of course it could also be argued that because of the ALJ oversight, abuses have not occurred.
In his motion for reconsideration of the New Era case, the Secretary argues that the Excel Mining case of 2003, and the Mutual Mining case of 1996, give the Secretary the right to interpret the Mine Act. Cited in the Excel case, although not by the Secretary, is the Cannelton case of 1989.
While all cases state that the Secretary is entitled to deference, the cases speak to the Secretary’s right to interpret its own standards – not the Commission’s Congressional and Mine Act mandate to determine final penalties, and approve settlements.
In addition, clearly under the Mine Act’s split enforcement scheme, it’s the Commission that is charged with administering the Mine Act’s Sect. 110(k).
Excel Mining dealt with multiple dust samples taken over a single shift, and Cannelton dealt with the transfer of a Part 90 miner without loss of pay. Also cited by the Secretary was a discrimination case involving Mutual Mining, and whether unemployment benefits should be deducted from a miner’s back pay in a reinstatement case.
The Secretary claims in the New Era brief that these cases give the Secretary the exclusive authority to enforce and interpret the Mine Act.
“The Commission is the equivalent of a court – it is responsible for adjudication and has no policy role,” the Secretary wrote in quoting from Excel.
Both cases cite Chevron U.S.A. Inc. v. Natural Res. Defense Council, Inc., 467 U.S. 837, 842 (1984), also cited by the Secretary in the New Era motion. The issue in Chevron was what standard of review should be applied by a court to a government agency’s own reading of a statute that it is charged with administering.
Chevron, however, doesn’t address the question of which agency is owed deference when there is split enforcement.
The first inquiry or step in Chevron is “whether Congress has directly spoken to the precise question at issue.” If a statute is clear and unambiguous, effect must be given to its language. Moreover, “in ascertaining the plain meaning of the statute, the court must look to the particular statutory language at issue, as well as the language and design of the statute as a whole.” K Mart Corp. v. Cartier, Inc., 486 U.S. 281, 291 (1988) (citations omitted).
As noted in Coal Employment Project v. Dole, 889 F.2d 1127, 1131 (D.C. Cir. 1989), traditional tools of construction, including examination of a statute’s text and legislative history, may be employed to determine whether “Congress had an intention on the precise question at issue,” which must be given effect.
The Mutual Mining case of 1996, cited by the Secretary, dealt with a discrimination case – specifically the entitlements of miners and if unemployment should be deducted from back pay. In this decision, the court ruled that the Secretary was owed deference on the deductibility of unemployment benefits. The court noted that the deductibility/ entitlement issue, unlike the settlement issue, was not dealt with in the legislative history or final language of the 1977 Act.
“The Secretary and the Commission thus flatly disagree on the question before us [deducting unemployment benefits from a backpay award]. Determining which interpretation is owed deference requires a close examination of the Act. Under the ‘split-enforcement’ arrangement envisioned by the Act, the Secretary and the Commission perform distinct regulatory responsibilities…. The Act charges the Secretary with the development and enforcement of health and safety standards ‘for the protection of life and prevention of injuries in coal or other mines.’ 30 U.S.C. § 811(a). The Secretary develops these standards by rulemaking, id., and enforces them by conducting inspections, issuing citations and proposing civil penalties for violations, 30 U.S.C. §§ 813, 814(a), 815(a), 820(a). If a party contests the Secretary’s actions, the Commission adjudicates the claims and “issue[s] an order, based on findings of fact, affirming, modifying, or vacating the Secretary’s citation, order, or proposed (emphasis added) penalty, or directing other appropriate relief.” 30 U.S.C. § 815(d).
As an example, the Secretary cited a case involving the use of lethal injection drugs, Heckler v. Chaney, where death row inmates said the use of lethal injection drugs violated the Federal Food, Drug, and Cosmetic Act (FDCA), and requested that the FDA take various enforcement actions to prevent those violations. The FDA refused the request. The inmates then brought an action in Federal District Court against the Secretary of Health and Human Services, making the same claim and seeking the same enforcement actions, but HHS also refused to take any action.
The U.S. Supreme Court ruled in this case that an agency’s decision not to take enforcement action is presumed immune from judicial review under §701(a)(2). Such a decision has traditionally been “committed to agency discretion,” and it does not appear that Congress, in enacting the APA, intended to alter that tradition. Accordingly, such a decision is unreviewable unless Congress has indicated an intent to circumscribe agency enforcement discretion, and has provided meaningful standards for defining the limits of that discretion.
However, in the case of New Era, MSHA was required by law to take action, and did in fact take action, and New Era did in fact contest the cases before the Commission, which could then only be compromised, mitigated, or settled with the approval of the Commission, according to Sec. 110(k) of the Mine Act.
The Secretary also argues that he must have the “unreviewable authority to withdraw citations and settle cases under the analogous Occupational Safety and Health Act to avoid a commingling of [prosecutorial and adjudicatory] roles that Congress did not intend.” The Secretary of course can withdraw citations before a contest is filed with the Commission.
The Secretary also argues that a settlement is not the time for an ALJ to engage in fact-finding.
The Secretary compares settlements to consent decrees where there are no findings that a company has engaged in illegal practices.
However, the Secretary does not address the fact that settled citations remain on the DRS, and are used as part of an operator’s history.
Oddly, in his brief, the Secretary actually reversed clauses within one sentence in the legislative history, which changes the meaning of the section cited by the Secretary.
The Secretary states, “…the legislative history’s statements about the consideration of litigation and collection expenses contradict each other, and therefore do not provide any meaningful guidance about what factors the Secretary or the Commission should consider when evaluating settlements.
A very different meaning emerges when the clauses are read in proper order.
The Secretary also stated that the Commission has a history of approving percentage reduction settlements in the past, citing cases beginning in 2011 when the Commission had an 18,000-case backlog.
The Secretary said that in these global settlements, “When the operator accepts the violations as issued, and all agency findings are affirmed, the operator is on notice of expected future compliance, and a history of violations is established for future enforcement actions,” the Secretary wrote.
Typically “global settlements” deal with larger controllers, multiple fines, with high contest rates, and multiple operators of one controller. In addition, the penalty reductions are not “across-the-board” as in this current case, but any decrease in the citation’s penalty amount has been determined individually.
“In addition to the delay in assessing and collecting penalties, another factor which reduces the effectiveness of the civil penalty as an enforcement tool under the Coal Act is the compromising of the amounts of penalties actually paid. In its investigation of the penalty collection system under the Coal Act, the Committee learned that to a great extent the compromising of assessed penalties does not come under public scrutiny. Negotiations between operators and Conference Officers of MESA are not on the record. Even after a Petition for Civil Penalty Assessment has been filed by the Solicitor with the Office of Hearings and Appeals, settlement efforts between the operator and the Solicitor are not on the record, and a settlement need not be approved by the Administrative Law Judge. Similarly, there is considerable opportunity for off the record settlement negotiations with representatives of the Department of Justice while cases are pending in the district courts.
Section 111(j) provides that the civil penalties are to be assessed by the Mine Safety and Health Review Commission rather than by the Secretary as prevails under the Coal Act (Sec. 109(a)(3)).
Sec. 110(i): The Commission shall have authority to assess all civil penalties provided in this Act. 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. In proposing civil penalties under this Act, the Secretary may rely upon a summary review of the information available to him and shall not be required to make findings of fact concerning the above factors.
Sec. 110(k): 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.
The federal government’s enforcement of mine safety and health is shared by two independent agencies—MSHA and the Commission — in a split-enforcement model that is relatively uncommon in the federal government. While MSHA is responsible for inspecting mines for safety and health violations, the Mine Act grants authority to the Commission to assess all civil penalties for violations found by MSHA. In practical terms, MSHA proposes the initial penalty based on the findings of its inspectors. However, these proposals are subject to review by the Commission, and no proposed penalty that has been contested by a mine operator can be settled without the approval of the Commission. The Commission includes five members appointed by the President and confirmed by the Senate. ALJs assist in carrying out the responsibilities of the Commission and are authorized by the Administrative Procedures Act (APA) and the Mine Act to independently review MSHA’s enforcement actions.
6. the demonstrated good faith of the mine operator charged in quickly remedying the situation after being notified of a violation.
You can see the most recent delinquent fines as reported by MSHA. If you believe your company has been improperly included on this list, please contact the MSHA Office of Assessments at:202-693-9700. Mine Safety and Health News is NOT responsible for the accuracy of this list.
Two men are still missing this morning at Green Brothers Gravel Co. in Crystal Springs, Miss. On Friday, June 3, the two men working in the pit were trapped in their equipment by a wall of 10 – 12 feet of mud and debris.
MSHA said the agency was informed at 1 p.m. of the accident. An announcement was made on Saturday that the operation to get the two men had turned into a “recovery effort” and not a rescue.
As of yesterday, workers were constructing a road to allow the crane to reach the recovery site and hopefully locate the missing miners. MSHA family liaisons are currently on site with family members.
The area has received a lot of rain, which may have contributed to the fatal collapse.
Coal baron Don Blankenship lost his bid for freedom while he appeals his conviction and now gets to spend the next year in a federal prison. But trust me, it’s not the kind of prison you think.
Blankenship reported to Taft Correctional Institute, a minimum-security federal prison camp located near Bakersfield, Calif.
No word on whether he will have air conditioning — a luxury denied in the infamous tent prisons of Arizona’s Joe Arpaio, but the website for the prison assures us that he will have “quality health care,” which will include “Medical, dental, mental, and wellness services are provided to promote healthy lifestyles,” according to the prison’s website.
The camp is minimum security, and there are no security fences or armed posts. In fact, news stories as recently as December 2015 indicate that prisoners “escape” by walking away.
Visiting hours are from 8:00 AM to 3:00 PM on Friday, Saturday and Sunday, as well as every federally recognized holiday, which will still be a four hour trip for his friends in Las Vegas, unless they can borrow a private plane and fly in to Bakersfield.
We understand that there are also sports teams and music lessons!
While he may be missing his dogs and friends and good times in his Las Vegas home, it won’t be as harsh as what the UBB families are going through for the rest of their lives.
Who owes what? We can tell you that. The “Debt By Age” link below will let you look at delinquent civil penalties owed to the Mine Safety and Health Administration. If you believe your company, or you as an individual, is incorrectly on this list, please contact the MSHA Office of Assessments at: 202-693-9700.
Former Massey Energy Co. executive Donald L. Blankenship has been sentenced to one year in prison, a $250,000 fine and one year of supervised released. Blankenship’s motion for continued release pending appeal was denied.

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