Dayton Tire v. Secretary of Labor

Filing

OPINION filed [1362066] (Pages: 15) for the Court by Judge Brown [10-1362]

USCA Case #10-1362

Document #1362066

Filed: 03/06/2012

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued November 16, 2011

Decided March 6, 2012

No. 10-1362
DAYTON TIRE, A DIVISION OF BRIDGESTONE/FIRESTONE, INC.,
PETITIONER
v.
SECRETARY OF LABOR,
RESPONDENT
UNITED STEEL, PAPER AND FORESTRY, RUBBER,
MANUFACTURING, ENERGY, ALLIED INDUSTRIAL AND SERVICE
WORKERS INTERNATIONAL UNION,
INTERVENOR

On Petition for Review of a Final Order of the
Occupational Safety & Health Review Commission

Willis J. Goldsmith argued the cause for petitioner. With
him on the briefs was Jacqueline M. Holmes.
Gary Stearman, Attorney, U.S. Department of Labor,
argued the cause for respondent. With him on the brief were
Joseph M. Woodward, Associate Solicitor, and Charles F.
James, Counsel.
Andrew D. Roth argued the cause for intervenor. With
him on the brief was Laurence Gold.

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Before: BROWN, GRIFFITH, and KAVANAUGH, Circuit
Judges.
Opinion for the Court filed by Circuit Judge BROWN.
BROWN, Circuit Judge: In 1994, the Secretary of Labor
personally and publically served Dayton Tire with a citation
alleging over 100 willful violations of the Occupational
Safety and Health Act (the “OSH Act”). Dayton contested
the citation, and by 1997, its appeal was before the
Occupational Safety and Health Review Commission. There
it sat, fully briefed and untouched, for over twelve years, until
the Commission issued an order in 2010 affirming nearly all
of the violations and assessing a $1.975 million penalty.
Dayton urges us to set aside the order because of the
Commission’s lengthy delay. We grudgingly decline; the
Commission’s dawdling—while regrettable—did not render
its order inequitable or pointless. We agree with Dayton,
however, that the Commission lacked substantial supporting
evidence for its finding that the violations were willful.
Accordingly, we vacate that portion of the order and remand
for the Commission to reassess Dayton’s level of culpability.
We trust the Commission will act before the decade is out.
I
The “lockout/tagout” standard, or LOTO standard,
“covers the servicing and maintenance of machines and
equipment in which the unexpected energization or start up of
the machines or equipment, or release of stored energy[,]
could cause injury to employees.”
29 C.F.R. §
1910.147(a)(1)(i).
The standard requires employers to
“establish a program . . . for affixing appropriate lockout
devices or tagout devices to energy isolating devices,” id. §

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1910.147(a)(3)(i); conduct periodic inspections to ensure
compliance with the program, id. § 1910.147(c)(6)(i); and
train employees on the “purpose and function of the . . .
program,” id. § 1910.147(c)(7)(i). “Authorized employees,”
who perform service and maintenance on covered equipment,
must receive more rigorous training than “affected
employees,” who simply operate covered equipment. See id.
§§ 1910.147(b), (c)(7)(i)(A), (B).
From 1969 to 2006, Dayton operated a tiremanufacturing facility in Oklahoma City, where it employed a
separate company, Ogden Allied, to service and maintain the
equipment. When the Occupational Safety and Health
Administration (“OSHA”) promulgated the LOTO standard in
1989, Dayton’s safety manager, Phillip McCowan, reviewed
the job tasks at the plant and determined that Dayton
employees were only “affected employees” because Ogden
employees were responsible for all service and maintenance
on site. McCowan’s successor as safety manager, Kelley
Mattocks, reviewed McCowan’s LOTO assessment in 1992
and concluded it was still valid.
In October 1993, a Dayton employee died from injuries
he sustained when a machine activated unexpectedly. The
incident prompted OSHA to send an inspector to the plant to
assess Dayton’s LOTO compliance. Based on that inspection,
then-Secretary of Labor Robert Reich traveled to Oklahoma
City in April 1994 and personally served Dayton with a
citation alleging 107 willful LOTO violations and proposing a
penalty of roughly $7.5 million. Of those 107 violations, 98
were for failing to train individual Dayton employees to the
“authorized” level. The remaining nine violations were for
failing to develop adequate safety procedures for particular
machines, failing to utilize LOTO procedures, failing to

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provide necessary locks and tags to authorized employees,
and failing to conduct periodic inspections.
Dayton appealed the citation to the Occupational Safety
and Health Review Commission, where it was referred to an
administrative law judge. After hearing from 90 witnesses
over 31 days of trial, the ALJ issued a decision in 1997 that
affirmed each violation that had not been withdrawn by the
Secretary. And though the ALJ found that Dayton’s “actions
were consistent with a good faith belief and effort to comply
with the LOTO standard throughout the Oklahoma City
plant,” he characterized 37 of the violations as willful because
Dayton knew its corporate parent, Bridgestone, had
previously been cited under the LOTO standard for similar
violations. Dayton Tire, 1997 WL 152083 (No. 94-1374,
1997) (ALJ), at *22–23 (“ALJ Ruling”). The ALJ assessed a
total penalty of $518,000. Id. at *63.
Both Dayton and the Secretary petitioned the
Commission for review, and the Commission granted the
petitions in March 1997. Then the parties waited, and waited,
until September 2010, when a divided Commission affirmed
all but one of the violations, and went beyond the ALJ ruling
to find all of the violations willful. Dayton Tire, 2010 CCH
OSHD ¶ 33,098 (No. 94-1374, 2010) (“Commission Ruling”).
The Commission did not rely on the Bridgestone citation to
reach its willfulness determination. Id. at *18 n.12. Instead,
it found that, “over a period of years, Dayton consciously
disregarded the LOTO standard by operating . . . in a manner
that was patently inconsistent with the requirements of the
standard, and by failing to reexamine its violative practices
despite receiving information and inquiries that should have
led it to do so.” Id. at *18. The Commission generally
assessed larger per-violation penalties than the ALJ—in part

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to reflect its broader willfulness determination—and imposed
a total penalty of $1.975 million.1 Id. at *26.
II
The Administrative Procedure Act (APA) obligates an
agency “to conclude a matter presented to it” “within a
reasonable time.” 5 U.S.C. § 555(b). Dayton acknowledges
that an agency’s failure to abide by Section 555(b) does not
“require its order[] to be set aside in every or even most
cases.” Pet. Reply Br. 17. But it submits that the order here
should be set aside because the “Commission’s egregious
delay in adjudicating [the] matter defeat[ed] the entire
purpose of the underlying enforcement action,” and “equity
should intervene to prevent enforcement of a senseless order.”
Id.
The Secretary claims Dayton’s argument stumbles out of
the gate. She asserts that the APA remedy for a party
aggrieved by agency delay is a petition to “compel agency
action unlawfully withheld or unreasonably delayed,” 5
U.S.C. § 706(1), and Dayton’s failure to pursue that remedy
during the pendency of its appeal precludes it from
challenging the timeliness of the Commission’s order now.
That reading of the APA is unsupportable. Section 706(1)
does not state that a petition to compel is a party’s only option
in the face of agency delay. Nor does it state that a petition to
1

The Commission also stated its “affirmance of each cited violation will
result in an abatement order directing Dayton to develop, document, and
utilize distinct LOTO procedures for the unique equipment covered by
each citation item.” Commission Ruling, 2010 CCH OSHD ¶ 33,098, at
*16 n.10. It is not clear from the record whether the Commission actually
issued an abatement order. In any event, such an abatement order would
be moot because it would be directed at Dayton’s Oklahoma City plant,
and Bridgestone closed that plant in 2006. Therefore, we will focus only
on the Commission’s assessment of civil penalties.

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compel is a prerequisite for any future challenge to longdelayed agency action. As such, Section 706(1) does not
restrict our authority to “set aside agency action . . . found to
be . . . not in accordance with law,” id. § 706(2)(A), including
agency action that does not conclude a matter “within a
reasonable time,” id. § 555(b).
Although we are empowered to set aside the
Commission’s order on the basis of delay, we decline to do so
here. Yes, in the words of the Secretary herself, the
Commission’s twelve-year delay was “excessive and
deplorable.” Resp. Br. 43. But as Dayton admits—and its
cited cases demonstrate—delay alone is not enough; it is the
“consequence[s] of the Commission’s delay” that dictate
whether corrective action is needed. Pet. Reply Br. 18. And
in this instance, the consequences of the Commission’s delay
do not justify setting aside its chosen penalty.
Unlike the petitioner in TNS, Inc. v. NLRB, 296 F.3d 384
(6th Cir. 2002), Dayton cannot show that enforcement of the
Commission’s order would be inequitable. In TNS, the court
set aside a National Labor Relations Board (NLRB) backpay
award because the award “ha[d] potentially been mounting”
during the agency’s eighteen-year delay, and there was no
“reasonable way to hold the [employer] responsible for
damages accruing over all of this time.” Id. at 404. Here, the
Commission’s delay did not increase Dayton’s liability. If
anything, it decreased it by giving Dayton more than a decade
to earn interest on the money it would have to use to pay the
penalty. As for Dayton’s assertions of non-financial prejudice
from the Commission’s delay—that it lacked clear guidance
on how to conform to the LOTO standard and could not
benefit from a remand to the ALJ because the ALJ had
retired—they are factually dubious, and, in any event, not

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dependent on whether we enforce the Commission’s penalty
or not.
Dayton also fails to demonstrate that enforcement of the
Commission’s penalty would be futile or nonsensical. Dayton
relies on NLRB v. Mountain Country Food Store, Inc., 931
F.2d 21 (8th Cir. 1991), and Emhart Indus. v. NLRB, 907 F.2d
372 (2d Cir. 1990), but in both cases, the court set aside
orders of injunctive relief that had become pointless with the
passage of time: in Emhart, an order directing an employer to
change its method for reinstating striking workers at a
particular plant had become useless because the parties had
already signed two new collective bargaining agreements
addressing reinstatement, and the plant in question had been
shut down, 907 F.2d at 380; and in Mountain Country, an
order directing an employer to permit union members to pass
out handbills at its stores had become useless because the
union had since been decertified, one of the stores at issue had
been relocated, and the number of affected employees had
changed, 931 F.2d at 22. Unlike the injunctive relief ordered
in those cases, which addressed “ongoing or future
violations,” the civil penalty assessed here “address[es] past
violations,” and is based on “the employer’s status at the time
of the violation.” Reich v. OSHRC, 102 F.3d 1200, 1202
(11th Cir. 1997). As a result, it has not become outdated
because of the Commission’s delay.
Dayton maintains enforcement of the penalty would be
pointless because “OSHA penalties are meant to inflict
pocket-book deterrence,” Kaspar Wire Works, Inc. v. Sec’y of
Labor, 268 F.3d 1123, 1132 (D.C. Cir. 2001), and the penalty
here no longer has any deterrent effect: Dayton cannot be
deterred from future violations because it no longer exists as a
separate entity; Dayton’s corporate parent, Bridgestone, need
not be deterred because it encouraged Dayton to comply with

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its LOTO obligations before the underlying citation issued,
and generally has a stellar safety record; and other employers
already have been deterred because the deterrent effect
occurred “when the citation first issue[d],” Pet. Reply Br. 7.
While the deterrent effect of a single penalty is difficult
to assess with much precision, we are confident that
enforcement of this penalty will have some effect on
Bridgestone and employers in general. True, Bridgestone
encouraged Dayton to review its LOTO compliance over a
year before Dayton received its citation. But if Bridgestone
must pay a penalty for LOTO violations committed by one of
its divisions, perhaps in the future it will be more insistent
when it encourages compliance with health and safety
regulations. Although Bridgestone has a strong safety record,
there is always room for improvement. As for other
employers, the issuance of the underlying citation may well
have had a deterrent effect, but the enforcement of the penalty
will send the additional message that LOTO violators should
expect to pay even when the Commission drags its feet.
Our willingness to enforce the Commission’s penalty
should not be mistaken for approval of its “deplorable”
conduct. Resp. Br. 43. The Commission does a disservice to
both employers and employees when it fails to clarify health
and safety standards promptly. Nevertheless, in this instance,
the Commission’s delay did not render its penalty inequitable
or inconsistent with the goals of the OSH Act, and we will not
set aside an order without a compelling reason to do so.
III
Dayton argues in the alternative that the Commission’s
finding of willfulness should be vacated because it lacks

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substantial supporting evidence. See 29 U.S.C. § 660(a). We
agree.
A violation of the OSH Act can be “serious,” “not
serious,” or “willful.” 29 U.S.C. § 666(a)–(c). For a willful
violation, the OSH Act authorizes the Secretary to impose a
maximum penalty of $70,000—ten times the maximum
penalty for a serious or a not serious violation. Id. Yet
despite defining what a serious violation is (and by negative
implication, what a not serious violation is), see id. § 666(k),
the OSH Act does not define what a willful violation is. See
Am. Wrecking Corp. v. Sec’y of Labor, 351 F.3d 1254, 1262
(D.C. Cir. 2003) (“[N]either the [OSH] Act nor Commission
regulations define the term ‘willful’ . . .”).
We have defined “willful,” however, and our narrow
definition reflects the potential severity of the OSH Act’s
penalty. A willful violation is “an act done voluntarily with
either an intentional disregard of, or plain indifference to, the
Act’s requirements.” Ensign-Bickford Co. v. OSHRC, 717
F.2d 1419, 1422 (D.C. Cir. 1983); see also AJP Constr., Inc.
v. Sec’y of Labor, 357 F.3d 70, 74 (D.C. Cir. 2004); A.J.
McNulty & Co., Inc. v. Sec’y of Labor, 283 F.3d 328, 337–38
(D.C. Cir. 2002). As the Commission has elaborated, to
sustain a willful violation, “‘[t]he Secretary must show that
the employer was actually aware, at the time of the violative
act, that the act was unlawful, or that it possessed a state of
mind such that if it were informed of the standard, it would
not care.’” AJP Constr., 357 F.3d at 74 (quoting Sec’y of
Labor v. Propellex Corp., 1999 CCH OSHD ¶ 31,792 (No.
96-0265, 1999), at *8). A “good faith, reasonable belief by an
employer that its conduct conformed to the law negates a
finding of willfulness.” A.J. McNulty, 283 F.3d at 338.

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Here, the Secretary argued before the ALJ that Dayton
“either intentionally disregarded or was plainly indifferent to
the requirements of the LOTO standard as a matter of
corporate policy throughout the Oklahoma City facility.”
ALJ Ruling, 1997 WL 152083, at *16. Dayton countered that
it had “attempted in good faith to comply with the provisions
of the LOTO standard.” Id. at *18. After reviewing the
relevant testimony and evidence at some length, id. at *18–21
the ALJ sided with Dayton, finding that the actions of
Dayton’s safety managers, Phillip McCowan and Kelley
Mattocks, demonstrated that “an effort was made to comply
with the standard on a plant wide basis.” Id. at *21. The ALJ
did deem some of Dayton’s violations willful, however,
because Dayton’s apparent failure to review a LOTO citation
for another Bridgestone facility and correct similar
deficiencies at the Oklahoma City plant showed “plain[]
indifferen[ce] to the requirements of the LOTO standard for
the activities and machines listed in the [Bridgestone]
citation.” Id. at *23.
On appeal, the Commission found that Dayton acted
willfully, albeit on different grounds than did the ALJ. It
found the “evidence [did] not support the [ALJ]’s decision to
characterize . . . particular citation items as willful” because
the record was “silent regarding the actions of plant
management after receiving the . . . [Bridgestone] citation.”
Commission Ruling, 2010 CCH OSHD ¶ 33,098, at *18 n.12.
Yet it found sufficient evidence to conclude that Dayton had
willfully violated the OSH Act as a matter of corporate
policy. In the Commission’s telling, McCowan’s initial
assessment that only Ogden employees performed tasks
covered by the LOTO standard was “plainly erroneous,” id. at
*19; Mattocks “adopted and perpetuated [McCowan’s]
approach without ever conducting her own assessment,” id. at
*20; and Mattocks ignored five separate warnings to review

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Dayton’s LOTO compliance in the year or so following her
adoption of McCowan’s approach, id. at *20–23. On the
strength of those findings, the Commission proclaimed that
“Mattocks either knew that her predecessor’s LOTO analysis
was incorrect or chose to avoid such knowledge by refusing to
conduct her own assessment.” Id. at *24. And because
“Dayton’s failure to comply with the cited provisions hinge[d]
on its reliance on Mattocks’s unfounded determination,” all of
Dayton’s violations were willful. Id.
The linchpin of the Commission’s willfulness
determination is its finding that Mattocks either knew Dayton
was non-compliant or was unwilling to investigate for fear of
uncovering Dayton’s non-compliance. We think that finding
is based more on speculation than evidence. Accordingly, the
Commission’s willfulness characterization does not withstand
our review.
The Commission does not cite a single piece of evidence
indicating that Mattocks “was actually aware, at the time of
the violative act, that the act was unlawful.” AJP Constr., 357
F.3d at 74. Its statements about Mattocks invariably focus on
her failure to investigate Dayton’s compliance, rather than her
actual knowledge of Dayton’s non-compliance. See, e.g.,
Commission Ruling, 2010 CCH OSHD ¶ 33,098, at *24
(“Mattocks’s steadfast refusal to reassess the basis of . . .
McCowan’s decision to exempt Dayton from the bulk of the
standard’s requirements was nothing short of obstinate.”).
Indeed, the Commission quotes Mattocks’ testimony that she
“believed that we [Dayton] were within full compliance.” Id.
at *21 n.16. Thus, the Commission is left only with its
finding that Mattocks “chose to avoid such knowledge [of
Dayton’s non-compliance] by refusing to conduct her own
assessment,” id. at *24—that Mattocks was, in other words,

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“plain[ly] indifferen[t] to . . . the Act’s requirements.”
Ensign-Bickford, 717 F.2d at 1422.
Although there is some supporting evidence, there is not
enough, particularly “when contradictory evidence is taken
into account.” Am. Wrecking Corp., 351 F.3d at 1261. As
our cases demonstrate, it takes a lot to be plainly indifferent.
We have affirmed the Commission’s finding of plain
indifference when there was evidence the company had
disregarded repeated warnings from an employee that it was
in violation of safety standards, and had failed to “make any
effort to address the safety problems.” AJP Constr., 357 F.3d
at 74 (emphasis added). We have also affirmed a finding of
plain indifference on the basis of evidence that a company had
ignored repeated reports from its own safety engineer that its
facilities contained “hundreds of safety type violations.” A.E.
Staley Mfg. Co. v. Sec’y of Labor, 295 F.3d 1341, 1346 (D.C.
Cir. 2002). Here, the Commission relies primarily on
Mattocks’ responses to five incidents to show that she was
plainly indifferent. But those responses evince negligence at
most.
The first two incidents occurred in 1992. After a safety
training session, certain Dayton employees raised concerns
about whether they should be treated as authorized employees
instead of affected employees.
A few months later,
Bridgestone’s new safety director sent a memo to all
Bridgestone safety personnel encouraging them to “revisit”
their LOTO practices. Commission Ruling, 2010 CCH
OSHD ¶ 33,098, at *21. In response to these two events,
Mattocks (in the Commission’s words) “asked Dayton’s
various production supervisors whether the nature of any of
the jobs performed by Dayton employees had changed since
McCowan had first determined that all of those employees
should be classified as affected.” Id. When she did not

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receive any “indication from supervisors that any of the jobs
had changed, she ended her inquiry.” Id. While Mattocks
could have done more, she did not do nothing.
The third incident took place in 1993.
In the
Commission’s telling, Mattocks did nothing after Faye
Kearney, an OSHA ergonomics inspector, toured the
Oklahoma City plant and expressed her concerns about
Dayton’s LOTO compliance for certain machines. Id. at *21–
22. Setting aside the Commission’s decision to credit
Kearney’s testimony over Mattocks’, see id. at *32–33
(Thompson, Comm’r, dissenting) (arguing Commission erred
in this respect), and assuming Kearney told Mattocks what
she claimed to have told her, Mattocks’ inaction was
reasonable. Kearney was “an industrial hygienist” who
“admitted that she specialized in health-related inspections,
not safety-related inspections.” Id. at *33. Even Kearney’s
OSHA supervisor discounted her concerns about Dayton’s
LOTO compliance because he was uncomfortable with her
level of expertise. Id. We cannot find Mattocks plainly
indifferent for doing the same.
In response to the fourth event—the death of a Dayton
employee in October 1993—Dayton managers “investigated
how the accident occurred” and determined “LOTO was not .
. . relevant,” but “committed to reexamining the application of
LOTO to Dayton’s entire operation.” Id. at *23. When the
managers reminded Mattocks of this commitment, she
conducted “some review of the LOTO standard” and
concluded that Dayton was still in compliance. Id. Again,
while Mattocks’ review may not have been as thorough as the
Commission would have liked, it did not display plain
indifference.

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The fifth and final incident occurred in November 1993,
when OSHA inspector George McCown came to the
Oklahoma City plant to review Dayton’s LOTO compliance.
Following the inspection, McCown “reviewed with
[Mattocks] the alleged LOTO violations” in various
departments, and “Mattocks never acted on McCown’s
admonitions” before OSHA issued the underlying citation in
April 1994. Id. at *23. Mattocks’ inaction in the face of
McCown’s views is not sufficient proof of indifference. In an
analogous situation, the Commission stated that “an employer
is entitled to have a good faith opinion that his conduct
conforms to regulatory requirements,” and “such conduct
should not be construed as constituting a willful violation of
the [OSH] Act merely because Labor holds a contrary opinion
on the facts and advises the employer of that opinion.” C.N.
Flagg & Co., Inc., 2 BNA OSHC 1539 (No. 1409, 1975), at
*2.
Indeed, what the ALJ acknowledged and the Commission
dismissed was the possibility of good faith. The LOTO
standard covered servicing and maintenance and exempted
production processes. Because service and maintenance at
the Oklahoma City plant was the responsibility of an
independent company, McCowan concluded Dayton
employees were not covered. Mattocks followed his lead.
Dayton and the Secretary clearly disagreed about the scope of
the exemption and the Secretary’s view prevailed. But a
difference in interpretation—even a persistent one—is not
synonymous with willfulness, particularly when, as here, the
Commission relies on rulings issued after the underlying
citation to resolve the interpretive dispute. See Commission
Ruling, 2010 CCH OSHD ¶ 33,098, at *5–7; see also
McLaughlin v. Union Oil Co., 869 F.2d 1039, 1047 (7th Cir.
1989) (holding that a willful violation “would have to be
apparent at the time committed,” and that a “violation is not

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willful when it is based on a nonfrivolous interpretation of
OSHA’s regulations”).
Mattocks may not have displayed the kind of initiative
we would expect when lives and limbs are at stake. But the
evidence before the Commission did not establish that
Mattocks “possessed a state of mind such that if [she] were
informed of the standard, [she] would not care.” AJP Constr.,
357 F.3d at 74. Mattocks made some effort to ensure
Dayton’s LOTO compliance, and under these circumstances,
some effort is enough to save Dayton from a willfulness
determination.
IV
The Commission lacked substantial supporting evidence
for its finding that Dayton’s violations were willful.
Accordingly, we vacate that portion of the Commission’s
order and remand for the Commission to reassess the nature
of Dayton’s violations and recalculate the appropriate penalty.
We affirm the Commission’s order in all other respects.
So ordered.

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