Coal industry continues to aggressively appeal fines

November 22, 2011 by Ken Ward Jr.

The blog post yesterday from our friend Rep. George Miller, D-Calif., understandably focused on the clear good news in a new report from the Federal Mine Safety and Health Review Commission and the Department of Labor:

Efforts to reduce the backlog of the thousands of health and safety appeals by mine operators trying to avoid tougher penalties is beginning to work, according to a new report from the Department of Labor sent to Congress last week.

The department said that the number of pending health and safety cases dropped to 17,101 at the end of July 2011, slightly lower than the 17, 591 when extra funding was approved a year earlier and despite having to deal with a flood of 11,412 new appeals.  This is the first time the backlog has gone down year to year since 2004.

But the figure that jumped out at me from the chart contained in the report was that the number of new appeals cases filed by mine operators with the commission to challenge MSHA citations and fines appears to have  continued to rise. Cases filed after July 2010 are up from 8,108 last year to 9,689.

As Rep. Miller also noted in his blog post on this topic:

…Despite this progress, incentives still remain for mine operators to appeal nearly every penalty regardless of merit.

Reading through the Commission/DOL report, I had to wonder if one of those incentives was the ability to get the agencies to settle cases for lower amounts of fines, simply by burying government lawyers in appeals of dozen and dozens of citations and penalties. We’ve written about this issue before here,  and here. And the new Commission/DOL report practically brags about “global settlements,” without giving us much context as to the size of any reduction in penalties that was involved:

In particular, SOL’s ability to coordinate the litigation and preparation for trial of a large number of citations made it possible to negotiate global settlements involving significant numbers of citations and in some cases multiple dockets. One of the backlog reduction offices, for example, was able to reach a proposed settlement with a coal mine operator for several dockets involving more than 425 citations for over $520,000. A settlement of 17 dockets involving just under 200 citations was negotiated for over $280,000. Another global settlement of 12 dockets involving a single operator – and over 225 citations – was negotiated for over $60,000, representing a 20% reduction from the original assessed penalties. Another office proposed a global settlement of six dockets and 88 citations with a total recovery of over $110,000; that settlement, if approved by Commission judges, would affirm 84 of the original 88 citations.

Focused litigation and trial preparation led to case resolutions, with a number of large proposed settlements negotiated on the eve of trial. In one matter, after over 100 citations and orders were set for hearing in August 2011, and SOL attorneys noticed depositions in the matter, the coal mine operator settled for over $200,000, or 71% of the proposed penalties. In another matter, after extensive settlement negotiations and just two weeks before trial, the parties proposed resolution for all 157 citations at issue for a total penalty amount of over $110,000. All but 2 citations remained unchanged, and the operator agreed to pay just under 70% of the original assessment.


It’s also important to remember that, despite the focus on this particular issue by some mine safety advocates (and by the Obama administration), the high rate of appeals by Massey Energy didn’t take away all of the tools MSHA had in its toolbox to keep the Upper Big Branch Mine Disaster from happening. It was MSHA’s inability to properly screen the mine for a Pattern of Violations that kept this particular tool from being used.

And MSHA had a variety of other tools at its disposal that it simply chose not to deploy at the Upper Big Branch Mine. MSHA could have taken Massey to court, seeking a federal judge’s injunction to shut down the mine. The agency could have issued its most serious monetary fines, flagrant penalties, for the mine’s repeated serious violations.

MSHA is said to be finalizing its report on the Upper Big Branch Mine Disaster. But we’ve heard precious little about the progress on its “internal review” of agency actions prior to the April 2010 explosion. What happened to public hearings? Where’s the congressional oversight of MSHA’s role in all of this?

26 Responses to “Coal industry continues to aggressively appeal fines”

  1. Rob says:

    Coal Companies that appeal citations should have to pay for not only the fine, but also the government administrative fees when they loose an appeal. All government legal fees.

    Companies should be charged at least $200 / hr for government legal fees.

    Enforcement only works of the penalties are high enough to deter violations from occurring again. More revenue from fines equals more money for fines should equal more money for enforcement.

  2. Ellen says:

    I cannot express the frustration to see a settlement where absolutely NOTHING has changed. The civil penalty is the same, the findings are the same, but the case settled. How much time, effort, paperwork did this require? There are many of these cases.

    Another overload to the system are the defaults. An operator challenges the citation/penalty, and then ends up doing nothing. BUT, before that occurs, the case is assigned a docket number, judge, FMSHRC staff. All this for needless work where the company will end up not challenging the citation/penalty and just paying. (I have to go through all of these decisions every month — my guess is around 3,000 pages for the month of September).

    Also, to put some of these settlements into context, we’ve been reporting on penalty reductions of up to 90%. There is a case involving Excel Mining (Docket No. KENT 2008-1277) where the penalties were reduced 16% to 75% for 12 of the 20 citations/orders(the total amount of penalties was assessed at $252,417 and the settlement was for $165,309 — 34% reduction — but some penalties reduced up to 75%).

    Another example: Emerald Coal (Docket No. PENN 2009-203) where the total penalties were $182,452 and reduced to $122,947 in the settlement. The reason listed: “Respondent has presented evidence that supports somewhat of a lower level of negligence than orginally determined.” If I were an inspector, that would not seem like very good instructions for the next time I see the exact same situation.

    What bothers me is the disconnect. What typically drives down the penalties are the “gravity findings” or that the DOL attorney agrees that the finding was not S&S or unwarrantable failure, or that there were not 10 miners affected but 2. The citations themselves are many times upheld, but the gravity etc. affects the penalty calulations.

    In a recent case involving Elk Run Coal (Docket No. WEVA 2009-1905), we don’t even know why there were reductions where a roof control violation penalty went from $12,248 to $6,124. In that case, the ALJ Moran said “It would be helpful and consistent with the Secretary’s obligation and the Court’s responsibilities, for the Secretary to provide more than an assertion that there is uncertainty as to the issues. For example, where the facts support such a claim, the Secretary could provide at least some information as to the reasons for its reevaluation, as opposed to simply reporting its conclusion that ‘uncertainty’ exists.”

    Not knowing why citations were vacated or some of the findings dismissed is a disservice to everyone. The inspectors don’t understand why something that they thought warranted a withdrawal order was later changed by someone in an office to a citation, and the operators don’t understand why they are getting “bad paper.”

    Do inspectors need more leeway to have discussions with operators BEFORE the case goes to the Commission? Is the “conferencing process” working at all?

    Regardless, the settlements seem to document the huge disconnects in the current system, which is completely bogged down.

    — Ellen Smith
    Mine safety and Health News

  3. New Age Miner says:

    I’m of the opinion that companies just don’t want the S&S history (which is part of the POV formula). That’s the real reason for contesting every S&S violation. Once a company concedes to an S&S violation through one of these “global settlements”, and it becomes a “final order” of the Commission, then they are in the cross hairs of MSHA’s scope for a potential POV letter. That’s the reason for a spike in cases filed with the FMSHRC. I don’t think it has anything to do with assessments.

    Rob makes a good point. The same should be applied to MSHA though. Whoever looses the case, should be the one responsible for the others legal fees. This may be the answer to so much back-log.

  4. New Age Miner says:

    I can remember a time back long ago when MSHA would issue a violation on a form that DID NOT have gravity, negligence, persons affected, etc. I’d bet the assessment then was much simplier. The 7000-3 form they use now, I believe, is only designed to give DC some wiggle-room when it comes to negotiating a settlement and give operators more areas to distribute their arguments. The 7000-3 form places a lot more burden on their field inspectors to do investigative work with each citation, which can always be argued. Maybe by returning to that simple format, and putting a uniform monetary assessment to every 104(a) violation (no matter how severe), MSHA and operators might be less apt to tie up the litigation process. I don’t know though.

  5. Does MSHA plan to release its internal review at the same time as its investigation report on the Upper Big Branch disaster?

  6. Ellen says:

    I don’t think that whoever loses should pay legal fees. What’s “losing”? If an S&S is knocked down to non-S&S did the government “lose” and operator “win”? There are two cases where operators followed the Program Policy Manual, and then ended up having an ALJ rule against them because the PPM is not the regulation. Did they lose? And keep in mind that a small operator can rightly have its penalties lowered by an ALJ based on size and ability to continue in business. I do believe that whoever defaults should pay some sort of stipend/fee/penalty ($250? $500?)for wasting everyone’s time and effort.

  7. JP says:

    “Is the “conferencing process” working at all?”

    What process???

    MSHA has pretty much given up on conferences and has modified their policy in total disregard of 30CFR. There is no longer any close-out “conference” with the inspector as many wrongfully think. There is no longer any informal “conference” at the district office with the inspector’s supervisor, a CLR or the district manager. If you should formally request a “conference”, you receive a boiler plate document stating your request will be considered after the penalty has been assessed. Once the assessment has been received, the operator is pretty much left with no recourse but to file a “CONTEST” since failure to contest the penalties will result in your conference request being cancelled.

    Maybe the big operators along with their lawyers and the DOL lawyers can navigate this process daily but for the smaller operators this “conference” process is broken, pure and simple. If the system is “bogged down” as many would have you believe, it is of MSHA’s own doing.

    I’m sorry, but I don’t view the right to be heard as “aggressively appealing fines” and needless work!

    “I’m of the opinion that companies just don’t want the S&S history…”

    You are correct, in a way. What is the first thing you hear when any accident in the mining industry occurs? The company’s safety record, or rather their “conviction record” – how many “significant and substantial” {emphasis added} violations of the “Safety and Health” laws. To the layman this statistical reporting is enough to convince them that the company is a lawless, greedy entity that will sacrifice the health and lives of their workers for money. Meanwhile MSHA touts their latest success of Special Impact Inspections, citing the number of citations and orders issued, reinforcing this belief.

    “Maybe by returning to that simple format, and putting a uniform monetary assessment to every 104(a) violation…”

    There used to be a “Single Penalty Assessment” for a minimal penalty amount that could be assessed for non-S&S citations. That was done away with and now every citation is subject to the same assessment calculation. What happens now is any citation can suddenly bring about a hugely disproportionate penalty assessment. Perhaps that is also a cause for part of the contest backlog?

  8. Ken Ward Jr. says:


    Of course, coal operators could simply spend their time, money and effort complying with the rules as MSHA defines them — they’ve never tried that … maybe it’s time.


  9. Ken Ward Jr. says:


    I’m told that the internal review will not be released at the same time as the accident investigation report.


  10. BG says:


    You just stated the problem. Comply with the rules “as MSHA defines them”. That is part of the problem. There are a lot of regulations that are written in an ambiguous manner and inspectors and operators read these definitions differently.

    I’ve said this before and I’ll say it again for those who missed it. We have inspectors write citations and then tell us “I don’t know if this is correct but you can always conference it.” Also, inspectors have been told in their Beckley training, “Write the citation as high as you can, that way we have room to negotiate when the operator contests it”. Both of these actions do little for safety and health.

    The inspectors contribute to the backlog by writing citations on suspect issues, and then by writing them to a higher gravity and negligence than is appropriate. The district office and CLR contribute to the backlog by not allowing any conferencing. Then the HQ guys get to complain about the backlog and blame the bad operator.

    Sure, it’s easy to sit back and tell operators to comply with the rules but when MSHA has a quota system, backed up and supported by the review commission, then citations will be written. Write them fairly and we won’t have to contest them.

    Sorry Ken, but operators in some parts of the country are more concerned with safety than you think. “they’ve never tried that”, nice quote from an obviously biased source.

  11. Ken Ward Jr. says:


    Thanks for your comment … among other things, you wrote:

    “There are a lot of regulations that are written in an ambiguous manner and inspectors and operators read these definitions differently.”

    Could you provide a couple of specific examples, including the CFR number for the standard you’re talking about, and explain what your interpretation is and how a specific inspector has in the past defined it differently?

    That would help me — and I’m sure others — understand your point.


  12. BG says:

    ROB – I’m all for it as long as the government has to play by the same rules. When their bad paper gets thrown out, MSHA should have to pay for all of the operator’s costs.

    Regardles of whether the paper is bad or not, the operator always corrects the problem within a short amount of time.

    When bad paper is written and only comes to light after years of litigation, do you think there is any recourse on that inspector? Not a chance. Operators don’t want a backlog, we’d much prefer instant answers. That way an inspector is held accountable for what he writes. Under the system today, inspectors are not accountable for anything.

  13. BG says:


    How about the most common citation of all, 75.400. How much coal dust constitutes an accumulation? Is a white glove test appropriate? How about an amount of dust as thin as a sheet of paper?

    Why do inspectors continue to write citations for 75.323 when they come into any area and find methane? That standard clearly lists the action that must be taken when methane is found. Even the PPM states that the mere presence of methane is not a violation per se, yet inspectors continue to write it every time they find it.

    75.363(a) Hazardous conditions – that covers a large area don’t you think? Anything could be hazardous. How about an accumulation of water in front of the toes of a longwall shield 5 to 13 inches deep? Ok, I agree that if someone was able to fall into that space and be knocked unconscious, that there is a drowning hazard. But to mark the box fatal, 8 men affected? Don’t you think when the first guy falls in that there will be no room for the other 7 men?

    Just a few examples.

  14. Ken Ward Jr. says:


    Let’s talk about your first example … The standard says:

    “Coal dust, including float coal dust deposited on rock-dusted surfaces, loose coal, and other combustible materials, shall be cleaned up and not be permitted to accumulate in active workings, or on diesel- powered and electric equipment therein.”

    As per my original question, what do you think that means? Can you provide some specific examples of inspectors defining it differently? Were those cases appealed and if so, how did they turn out?


  15. Casey says:

    If you read the definition of an S&S violation and that of an immenient danger you will see that that are very close. An S&S has a high standard to meet in that it is REASONABLY likely that if the violation is allowed to continue to exist that it WILL result in an injury of a serious nature. There are too many violations written as S&S that should be non-S&S and therefore they are challenged.

    Ken states “Of course, coal operators could simply spend their time, money and effort complying with the rules as MSHA defines them — they’ve never tried that … maybe it’s time.” Ken, what facts do you have to support that blanket statement of the coal industry? I think it is a reckless statement and that you are wrong.

  16. New Age Miner says:

    Great topic for discussion Ken Ward.

    Let’s use this scenario;
    Inspector writes an S&S citation to a company for float coal dust that is deposited on a belt conveyor entry for 100 feet. The company can choose to clean it up or ask for an expedited hearing. Let’s say they clean it up and choose to conference it. The violation is now terminated by the inspector since the float dust has been removed.
    During the conference at the District level, the company can’t get the citation lessened so they prepair for trial. They spend thousands of dollars hiring a lawyer and spend countless hours in preparation. After the trial, the ALJ agrees to modify the citation back to a non-S&S citation which is what the company argued with the inspector to begin with (5 years ago). Wouldn’t it only be fair if the District would repremand the inspector for costing so much time and money and shouldn’t they also be responsible for paying the companies legal fees. I don’t mean our inspectors should be law judges but looks like this action might reduce so much back-log of cases filed with the FMSHRC.

    I’m of the opinion (and it may just be mine), ANY accumulations shouldn’t be allowed, no matter how small. You can have spillage of coal on a working section and it not be accumulations. Every mine has a clean-up plan by which accumulations will be removed. (75.400-2) What I’ve seen happen is spillage occurrs on belts, section or wherever, and someone fails to clean it up. Thats when we get a citation.

    It’s not a violation to have methane (unless found in an explosive range), it’s a violation to NOT take action to remove it. So if this standard has been sited, it’s probably because someone has failed to take action to remove the methane.

    ANY hazardous condition shall be corrected immediately or remain posted until the hazardous condition is corrected. I’ve seen this numerous times. If a mine examiner fails to do his job (which is to look for hazards) and MSHA finds them, that’s when this standard is sited. I don’t see how 8 persons could die at once from falling into a water hole.

    After daily reading these posts I see how fortunate I am to have some of the most fair, intelligent, and informative inspectors where we mine. Our inspectors offer pre, interim, and post inspection conferences and show us why they mark each block of each citation in an effort to help us understand how to prevent them from occurring in the future.

  17. Walnutcove says:

    OK Gentlemen, I have to comment here! I have first hand knowledge of the instruction new Inspectors receive at the NMHSA. #1 There are NO implications at NMHSA to write the the citation very high, just to negotiate it down, that is simply NOT true. #2 You speak of different inspectors and areas that assessments are quite different than other places( Not much consistancy) Again I have first hand knowledge, Inspectors are advised at the beginning of each training session.” The training you receive here today is National Enforcement Policy, but you must keep in mind when you travel back to your District your District Manager may NOT agree with this training, You as an Inspector must follow that District Managers direction, then as you travel on to your field office your immediate supervisor may tell you he doesn’t agree with the Distrct Managers interpretation of the enforcement procedure and that the inspector again may need to modify yet again the enforcement procedure, reason being on the last directive the field office supervisor is required to do the inspectors performance evaluation, you don’t follow his guide your evaluation may suffer.” At this point in time the new inspector is so confused he may likely not enforce much of anything for fear of not complying with someones wishes, then taking a hit on his performance evaluation. As I said I have first hand knowledge of these procedures. The front line inspector is NOT the problem!

  18. New Age Miner says:

    My Inspectors have said the same Walnutcove. But one would think MSHA should be more consistant. Understandably every citation must be evaluated on it’s own merit and theres just so many different variables (the issuing Inspectors attitude, his boss, his bosses boss, which District you mine in, etc) that it’s most likely the mining community will never see a constant enforcement agenda. Thus, litigation is undoubtably the only relief some operators have.

  19. Ken Ward Jr. says:


    You don’t have to look very far to see that the coal industry simply does not comply with the standards as MSHA defines them — look at the charges on MSHA’s website here, and see the large numbers of violations cited by inspectors every year.

    That shows clearly that the industry simply doesn’t comply — violations are a routine part of doing business in this industry.


  20. JP says:

    Blanket statements are probably not necessarily proper from either side of this debate.

    But I don’t know where these conferences are being held by inspectors, with pre-, interim and post inspection conferences, let alone conferences at the District level.

    New Age Miner, you are blessed you have inspectors you consider fair, intelligent and informative.

    Am I jaded?


    Ken, violations are NOT a part of doing business where I work. Despite the best of efforts by management and the workforce, citations are still issued and (dare I say it) often inflated in the “inspector’s evaluation” portion to achieve S&S status.

    In my opinion, the inspectors are “coached” by the solicitor’s legal team to maximize assessment level and provide overhead for future negotiation and litigation. I have personally seen the blatant “boilerplate” content in citations as of late compared to not so many years ago.

  21. old one says:

    I agree with JP it is almost impossible to operate a mine with out a violation of 30cfr. An inspector must break his time down to surface of undergroung and mmu time. it is or was at one time an unspoken rule of 1 citation per 8hrs. mmu time. the evaulation does take into account how much time is spent on the surface and how much time is mmu time. Also the amount of citations issued when evaulation time comes around. No one in MSHA will tell you that there is a quato and the higher the number of S&S citation matters. Now Ken you have never been on the inside of MSHA or an active coal miner have you?

  22. Ken Ward Jr. says:

    Old One,

    You are correct — I have never worked for MSHA and I have never been a coal miner.


  23. Casey says:

    Old one is correct in that it is nearly impossible to operate mines without having violations of the law. I’d say anyone that has experience at mines will know this. That is just how strict the laws are.

    So to state that companies are not “spending their time, money and effort complying with the rules” is not correct. Any company that is in business is spending time, money and effort or they would not still be in business. And some are absolutely committed to the effort of eliminating violations and injuries and expend more efforts that others. The fact that MSHA is writing violations is not a fact that backs up your statement. If you investigated the industry or certain companies closely I think you would be surprised with the time, money and effort.

  24. Ken Ward Jr. says:


    perhaps a different proposal then —

    Why don’t all coal companies immediately agree to spend the time, money and effort that they spend appealing citations they don’t agree instead on additional work to comply with the law?


  25. Casey says:

    Certainly appealing citations and staying focused on safety including violation reduction and eliminating injuries are not mutually exclusive. In matters of law, individuals and companies sometimes agree to a charge when they do not feel guilty but at a point, principle may prevent that from occurring. Often the consequences of accepting S&S violations that are not deemed justified can be too negative to just accept. Hey you may disagree but the point is there is a tremendous amount of resources expended in the industry to eliminate violations and injuries. I’d invite you to research this, get some face time and you might be impressed.

  26. TB says:


    I think that is the greatest idea I have ever heard, and I would bet you would have the full support of the industry. Lets take all the time and money that operator’s have spent in 2011 appealing citations, place it in escrow to be used to comply with MSHA’s definition of 30 CFR. However, this would mean that MSHA would have to stop writing citations is 2012. Any issue they find during the next year would could be fixed with the money set aside by the operator, but when the money is gone, the money is gone. I would even go so far as to say that on December 31, 2012, if there is money is left in the account, it could be given to MSHA to help support thier efforts.

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