Opinion ID: 737388
Heading Depth: 2
Heading Rank: 2

Heading: Yancik and Merrifield

Text: 16 Section 110(c) of the Mine Act provides that, whenever a corporate operator violates the Act or its standards, any director, officer, or agent ... who knowingly authorized, ordered, or carried out such violation may be held liable. 30 U.S.C. § 820(c). Yancik and Merrifield challenge the ALJ's finding that they knowingly caused or permitted a safety violation in this case, arguing that the ALJ found merely negligence or high negligence, and that the record evidence cannot support a finding of knowing violation. At the heart of this claim is a dispute over the Commission's interpretation of the term knowingly in section 110(c). 17 The Commission has defined the term knowingly as follows:[323 U.S.App.D.C. 309] Knowingly, as used in the Act, does not have any meaning of bad faith or evil purpose or criminal intent. Its meaning is rather that used in contract law, where it means knowing or having reason to know. A person has reason to know when he has such information as would lead a person exercising reasonable care to acquire knowledge of the fact in question or to infer its existence. 18 Secretary of Labor v. Richardson, 3 F.M.S.H.R.C. 8, 16 (1981) (emphasis added, internal quotations omitted), aff'd, 689 F.2d 632 (6th Cir.1982). Accord Secretary of Labor v. BethEnergy Mines, 14 F.M.S.H.R.C. 1232, 1245 (1992); Secretary of Labor v. Warren Steen Constr., 14 F.M.S.H.R.C. 1125, 1131 (1992); Secretary of Labor v. Glenn, 6 F.M.S.H.R.C. 1583, 1585 (1984). In Richardson, the Commission specifically held that a finding of a knowing violation does not require a showing that the person in question willfully violated the Mine Act or Mine Act standards. See Richardson, 3 F.M.S.H.R.C. at 15. Rather, the Commission held that it need only be shown that a person in a position to protect employee safety and health fail[ed] to act on the basis of information that [gave] him knowledge or reason to know of the existence of a violative condition. Id. at 16. However, negligence is not enough to establish liability. The Commission has held that section 110(c) liability requires a showing that the person in question demonstrated aggravated conduct, as distinguished from ordinary negligence. BethEnergy, 14 F.M.S.H.R.C. at 1245. 19 Petitioners challenge this interpretation of section 110(c), arguing that the term knowingly requires a showing of actual knowledge and specific intent to violate the act. We reject this contention, first, because the plain terms of the statute do not compel the construction advanced by petitioners, and second, because the Commission's interpretation is reasonable and permissible and thus entitled to deference. See Chevron, 467 U.S. at 842-45, 104 S.Ct. at 2781-83. 20 In reaching this conclusion, we turn first to the statutory language itself. Knowingly may convey any of a number of meanings. This court has found the term knowingly to include actual knowledge, deliberate ignorance, and reckless disregard. See United States v. TDC Management Corp. Inc., 24 F.3d 292, 297-98 (D.C.Cir.1994) (interpreting knowingly within the meaning of the False Claims Act). Other courts have also found that knowingly encompasses more than actual knowledge. See, e.g., United States v. DiSanto, 86 F.3d 1238, 1257 (1st Cir.1996) (noting that the meaning of knowledge depends upon context and that a continuum of meaning stretches from constructive knowledge to actual knowledge with various gradations between), petition for cert. filed, 65 U.S.L.W. 3531 (U.S. Nov. 12, 1996) (No. 96-1176); Suzuki of Orange Park, Inc. v. Shubert, 86 F.3d 1060, 1064 (11th Cir.1996) (knowledge under Limitation of Vessel Owner's Liability Act includes actual and constructive knowledge); JCC, Inc. v. CFTC, 63 F.3d 1557, 1567-68 (11th Cir.1995) (under the Commodity Exchange Act, individual knowingly induced violation if he had actual or constructive knowledge of the core activities that constitute the violation at issue and allowed them to continue (internal quotations omitted)); United States v. Hester, 880 F.2d 799, 802 (4th Cir.1989) (defendant knowingly makes false statement in connection with the acquisition of a firearm in violation of 18 U.S.C. § 922(a)(6) if he acts with actual knowledge or deliberate disregard for the truth or falsity of his statements). 21 Given the range of meanings ascribed to the statutory term knowingly in these varied contexts, we cannot conclude, as petitioners contend, that the language of section 110(c) unambiguously requires a showing of actual knowledge and specific intent to violate the Act. 1 Nor can we conclude that Congress has definitively resolved the issue of what mens rea is required to support a finding of individual liability. As a result, the Commission's interpretation of section 110(c) is entitled to deference so long as it is reasonable. 22 [323 U.S.App.D.C. 310] The Commission's interpretation of section 110(c), as we understand it, is a fair interpretation of the statutory language. In essence, the Commission has defined knowledge for purposes of section 110(c) to include both actual and constructive knowledge of a violative condition. That definition falls well within the range of interpretations given to the term knowingly in other contexts. Significantly, we do not understand the Commission to allow individual liability on the basis of any form of negligence. See BethEnergy, 14 F.M.S.H.R.C. at 1245 (Section 110(c) liability requires a showing that the person in question demonstrated aggravated conduct rather than ordinary negligence.). 23 In this case, however, the ALJ did not find that Yancik or Merrifield knowingly violated 30 C.F.R. § 77.200. Rather, the ALJ found high negligence. See J.A. 76 (I find that the violations of § 77.200 by the individual Respondents were due to high negligence....). So far as we can tell, high negligence is a concept that has relevance only to the determination of the amount of a civil penalty to be imposed once liability has been determined. See 30 C.F.R. 100.3(d) (1996) (degree of negligence--no negligence, low negligence, moderate negligence, high negligence, or reckless disregard--is one factor in penalty formula); 30 C.F.R. § 100.5(h) (1996) (special assessment of penalty may be warranted if violation involved extraordinarily high degree of negligence). High negligence, which is apparently negligence without mitigating circumstances, see 30 C.F.R. § 100.3, tbl. VIII, is not a permissible basis upon which an individual agent may be found liable for knowingly violating a safety standard under section 110(c) of the Mine Act. 24 The proper inquiry is whether Yancik or Merrifield knew or had reason to know of the hazardous level of deterioration of the walkway beam that collapsed, i.e., whether either had actual or constructive knowledge of the violative condition. The record does not support the conclusion that either did. Certainly both men knew of the risk that corrosion of support beams in the old plant could cause structural instability. But they were addressing that risk responsibly by conducting regular inspections and repairs. In addition, there were numerous inspections conducted by the MSHA, state regulators, and the union, and no one ever reported concern regarding the walkway beam at issue or suggested to Freeman that its inspection and rehabilitation program was inadequate. Under these circumstances, it cannot be said that Yancik or Merrifield knowingly caused a violation of 30 C.F.R. § 77.200. Accordingly, we grant Yancik's and Merrifield's petitions for review and reverse the Commission's findings of individual liability.