Carson Concrete Corp. v. Secretary of Labor ( 2006 )

Opinions of the United
2006 Decisions States Court of Appeals
for the Third Circuit
2-27-2006
Carson Concrete Corp v. Secretary of Labor
Precedential or Non-Precedential: Non-Precedential
Docket No. 05-2160
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NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 05-2160
CARSON CONCRETE CORPORATION;
CARCO CONSTRUCTION CORPORATION,
Petitioners
v.
*SECRETARY OF LABOR,
Respondent
*(Amended Per Clerk's Order of 5/9/05)
On Petition for Review of a Decision and Order of the
Occupational Safety and Health Review Commission
(OSHRC No. 03-2229)
Submitted Pursuant to Third Circuit LAR 34.1(a)
February 9, 2006
Before: SCIRICA, Chief Judge, BARRY and FISHER, Circuit Judges
(Filed: February 27, 2006)
OPINION OF THE COURT
SCIRICA, Chief Judge.
Petitioners Carson Concrete Corporation and Carco Construction Corporation
challenge an order of the Occupational Safety and Health Review Commission (the
Commission). We have jurisdiction under 29 U.S.C. § 660 and will affirm.
I.
Because we write for the parties, an abbreviated recitation of the facts will suffice.
On November 7, 2003, the Secretary of Labor issued citations alleging Carson violated
numerous Occupational Safety and Health Administration (OSHA) safety standards at a
Philadelphia construction site during summer 2003. After Carson asserted the citations
named the wrong employer, the Secretary of Labor amended them to include Carco
Construction Corporation, whom Carson identified as the correct employer.1
In February 2004, the Secretary of Labor served Carson with interrogatories,
document requests, and requests for admissions. The requests for admissions asked
Carson to admit that the individuals identified in the citations were employed by Carson
and had been exposed to the alleged hazards. Through its representative, James
Sassaman, Carson admitted the alleged violations, but denied an employment relationship
with the identified individuals. In August 2004, the Secretary of Labor filed a motion to
conclusively establish Carson’s responses to the requests for admissions. Carson did not
1
Carco Construction Corporation does not raise any issues in this appeal separate from
those raised by Carson. Following the convention of the parties, we refer to the
petitioners collectively as “Carson.”
2
object, and the ALJ granted the motion. Meanwhile, on June 29, 2004, the ALJ set an
evidentiary hearing date of November 16, 2004.
On November 9, 2004, Sassaman met with Anthony Samango, Carson’s president,
to prepare for the hearing. Samango later testified that just prior to this meeting, he
realized for the first time that Carson had admitted the underlying violations. Sassaman,
in contrast, testified he and Samango had discussed the admissions in April. Sassaman
further testified he had copied Samango on all filed discovery responses. At the
November 9 meeting, Samango disavowed the admissions. He instructed Sassaman to
obtain a continuance of the hearing and to withdraw as Carson’s counsel.
On November 12, 2004, Sassaman filed a motion to withdraw and requested a
thirty day continuance to allow Carson to obtain new counsel. The ALJ concluded
Carson had failed to demonstrate just cause for filing a motion for continuance just four
days prior to the scheduled hearing. Accordingly, the ALJ denied the motion and ordered
both parties to appear at the hearing on November 16, 2004.
At the hearing, Carson’s new counsel, Peter Leyh, renewed the motion for a
continuance. The ALJ heard conflicting testimony from Samango and Sassaman, and
then credited Sassaman’s version of events. He concluded that “[p]rior to April 4, 2004,
Mr. Samango was aware of the strategy to limit Carson’s defense to the claim that
employees of Carco . . . were exposed to hazards. . . . ” Finding it contumacious that
Samango nonetheless waited until November 12 to disavow the admissions, the ALJ
again concluded Carson had not shown good cause for its late filing of a motion for
3
continuance. Accordingly, the ALJ denied the motion and ordered the hearing to
proceed.
Carson withdrew from the proceedings. The ALJ entered a judgment of default
against Carson in the amount of the fines and penalties proposed in the original
citations—$176,000. The Commission denied Carson’s petition for review, and the
ALJ’s decision became the Commission’s final order. Carson appeals the order,
challenging the ALJ’s denial of a continuance and entry of default against Carson.
II.
We review the ALJ’s denial of a continuance and entry of default for abuse of
discretion. See United States v. Fisher, 10 F.3d 115, 117 (3d Cir. 1993) (continuance);
Hoxworth v. Blinder, Robinson & Co., 980 F.2d 912, 919 (3d Cir. 1992) (judgment of
default). We ask whether the ALJ acted reasonably in light of the facts presented, not
whether we would have reached the same conclusion in the first instance. See Yeboah v.
U.S. Dep’t of Justice, 345 F.3d 216, 223 (3d Cir. 2003).
The ALJ’s findings of fact will be conclusive if they are supported by substantial
evidence on the record, considered as a whole. 29 U.S.C. § 660(a). Legal conclusions
will be set aside if they are arbitrary, capricious, an abuse of discretion, or otherwise not
in accordance with the law. See E & R Erectors v. Sec’y of Labor, 107 F.3d 157, 160 (3d
Cir. 1997).
4
III.
Carson contends the ALJ abused his discretion and infringed upon Carson’s due
process rights in denying Carson a continuance. The Commission’s rules provide that a
motion to postpone, received less than seven days prior to a hearing, will generally be
denied unless good cause is shown for late filing. See 29 C.F.R. § 2200.62(c). Carson
contends its need for new counsel constituted good cause. We note substitution of
counsel sometimes justifies a continuance. See Hern Iron Works, Inc., 13 O.S.H. Cas.
(BNA) 2186, *2 n.1 (1989). But we conclude the ALJ did not abuse his discretion or
deny Carson due process of law by determining that here, it did not.
The ALJ noted the Secretary of Labor prepared her case in reliance on the order
conclusively establishing Carson’s admissions. Granting the continuance would unduly
delay the proceedings by necessitating additional discovery in order to prove the
underlying allegations.2 The ALJ also noted granting a continuance might prejudice the
Secretary of Labor, because the compliance officer might be unavailable to testify in a
month’s time due to back surgery. In light of the undue delay and potential prejudice, the
2
Carson contends the ALJ could have granted the continuance without allowing
Carson to withdraw the admissions, in which case additional discovery would not be
needed. Carson never suggested this course to the ALJ. Furthermore, Leyh repeatedly
emphasized that Carson could not move forward on the basis of a record in which it
admitted the alleged violations. Accordingly, it was reasonable for the ALJ to conclude
additional discovery would have been necessary.
5
ALJ concluded Carson’s desire for new counsel, not acted upon until four days prior to
the hearing, did not constitute good cause.3
At the hearing on November 16, 2004, Carson renewed its motion for a
continuance. The ALJ heard conflicting testimony from Sassaman and Samango and
concluded Sassaman’s was credible, while Samango’s was not.4 Because the ALJ had the
opportunity to observe the demeanor and hear the testimony of both witnesses, we accept
his credibility determination. See Atlantic Limousine, Inc. v. NLRB, 243 F.3d 711, 718
(3d Cir. 2001). We also accept the ALJ’s inference—based on his credibility
determination and supported by substantial evidence—that Samango was aware of the
admissions well in advance of his November 9 meeting with Sassaman. It is unlikely
Sassaman filed discovery responses without consulting Carson’s president, or failed to
inform the president of the order conclusively establishing Carson’s responses to the
3
Carson notes Sassaman was instructed to obtain a continuance on Tuesday, November
9, but waited until Friday to file the motion. Since we accept the ALJ’s determination
that Samango became aware of the admissions well in advance of the November meeting,
we conclude he had plenty of time to obtain new counsel. He cannot avoid responsibility
for the late filing by alleging negligence on the part of Sassaman.
4
The ALJ stated:
I do not credit [Samango’s] testimony, as it requires one to accept either of
two very unlikely scenarios. Either Mr. Sassaman acted as a “rogue”
representative, making major litigation decisions and filing significant
documents without informing his client, or the president of a company
facing several OSHA citations with substantial penalties was totally
incurious or completely oblivious to a serious matter facing his company. In
contrast, having observed Mr. Sassaman’s demeanor, I found his testimony
to be both credible and consistent with common experience.
6
requests for admission. Furthermore, the record supports Sassaman’s testimony that he
copied Samango on the filed responses to the requests for admission.
Taking into account these circumstances, in addition to the fact that witnesses had
been subpoenaed and were present for the hearing, the ALJ concluded a continuance
would necessitate additional discovery and unduly delay the hearings. The ALJ did not
abuse his discretion in concluding Carson had not shown good cause, which would justify
this delay. Nor did the ALJ infringe upon Carson’s due process rights. Carson was
afforded an “opportunity to be heard at a meaningful time and in a meaningful manner,”
Rogal v. Am. Broad. Cos., Inc., 74 F.3d 40, 44 (3d Cir. 1996), and was represented by
counsel of its choice. The denial of a continuance did not rise to the level of a due
process violation. See Ungar v. Safarite, 376 U.S. 575, 589 (1964) (“The matter of
continuance is traditionally within the discretion of the trial judge, and it is not every
denial of a request for more time that violates due process. . . ”).
IV.
Carson also contends the ALJ abused his discretion in the entry of default. Before
an ultimate sanction like default is appropriate, there must be a clear record of
contumacious conduct or prejudice.5 See Sec. of Labor v. Sealtite Corp., 15 O.S.H. Cas.
(BNA) 1130, *4 (1991). A failure to comply with Commission rules and orders aimed at
delaying proceedings constitutes contumacious behavior. See id. As noted, the ALJ
5
Because we accept the ALJ’s finding that Carson’s conduct was contumacious, we
need not address prejudice to the Secretary of Labor.
7
weighed Sassaman’s testimony against conflicting testimony from Samango and
concluded Samango was aware of Carson’s admissions prior to April 4.6 Accepting this
conclusion, we believe it was within the ALJ’s discretion to characterize Carson’s
behavior as contumacious. Despite his actual knowledge, Samango never sought to
disavow the company’s admissions in the months leading up to the scheduled hearing
date. Instead, he falsely testified he was unaware of the admission until early November.
When viewed in conjunction with his refusal to proceed with the hearing as ordered by
the ALJ, we conclude it was not an abuse of discretion to determine that this pattern of
misconduct represented an attempt to delay proceedings and expand the scope of
contested issues and was, therefore, contumacious.
In light of Carson’s contumacious behavior, entry of default was an appropriate
response and was not an abuse of discretion. The Commission’s rules give the ALJ
authority to enter a default order against a party who failed to plead or otherwise proceed
6
Carson contends the testimony shows that a serious misunderstanding developed late
in the proceedings between Samango and Sassaman, and not that one witness was lying.
Regardless of the plausibility of Carson’s interpretation, we are not reviewing the case de
novo. We will accept the ALJ’s credibility determinations and fact-finding, including
inferences, unless substantial evidence shows the ALJ reached the wrong result. See Am.
Iron & Steel Inst. v. OSHA, 577 F.2d 825, 831 (3d Cir. 1978). We conclude the ALJ’s
credibility determinations and resulting inferences are reasonable on the record, and
supported by substantial evidence.
8
as required by the ALJ. See 29 C.F.R. § 2200.101. Samango was on notice that the
hearing would go forward as scheduled, but refused to take part.7
V.
For the reasons set forth, we will affirm the order of the Commission.
7
Carson further contends the ALJ erred by failing to consider lesser sanctions. We
question whether this claim was properly preserved for review on appeal. Regardless, an
ALJ is not required to consider lesser sanctions where a litigant refuses to participate in a
scheduled evidentiary hearing.
9