Manua's, Inc. v. Eugene Scalia ( 2020 )


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  •  United States Court of Appeals
    FOR THE DISTRICT OF COLUMBIA CIRCUIT
    Argued November 4, 2019           Decided January 28, 2020
    No. 18-1307
    MANUA'S, INC., D/B/A MANUA'S DISCOUNT STORE,
    PETITIONER
    v.
    EUGENE SCALIA, SECRETARY OF LABOR,
    RESPONDENT
    On Petition for Review of a Final Order of the
    Occupational Safety & Health Review Commission
    Daniel E. Mooney argued the cause for petitioner. With
    him on the briefs was John D. Seiver.
    Susannah Maltz, Attorney, U.S. Department of Labor,
    argued the cause for respondent. With her on the brief were
    Edmund C. Baird, Associate Solicitor of Labor for
    Occupational Safety and Health, and Heather R. Phillips,
    Counsel for Appellate Litigation. Louise M. Betts, Attorney,
    entered an appearance.
    Before: ROGERS and SRINIVASAN, Circuit Judges, and
    SILBERMAN, Senior Circuit Judge.
    2
    Opinion for the Court filed by Circuit Judge ROGERS.
    ROGERS, Circuit Judge: The Occupational Safety and
    Health Act delegates to the Secretary of Labor, acting through
    the Occupational Safety and Health Administration (“OSHA”),
    the authority to promulgate and enforce mandatory
    occupational safety and health standards.          29 U.S.C.
    § 651(b)(3). OSHA enforces those standards by inspecting
    workplaces, 
    id. § 657(a),
    and issuing citations and fines to
    employers for violations, 
    id. §§ 658–659.
    An employer may
    contest a citation before an administrative law judge (“ALJ”),
    and either the employer or the Secretary may thereafter petition
    the Occupational Safety and Health Review Commission for
    discretionary review. 
    Id. §§ 659,
    661(j); 29 C.F.R. §
    2200.91(a)–(b).
    Generally, an employer is responsible for ensuring that its
    workplace is safe and, therefore, for any violations of OSHA
    standards. See Sec’y of Labor v. Pride Oil Well Serv., 
    15 O.S.H. Cas. (BNA) 1809
    , at *8 (Rev. Comm’n 1992); see also
    Brock v. City Oil Well Serv. Co., 
    795 F.2d 507
    , 511–12 (5th
    Cir. 1986). The instant case implicates a narrow exception to
    that rule: An employer may rely on a specialty contractor to
    ensure compliance with safety standards within the purview of
    the contractor’s expertise. Sec’y of Labor v. Sasser Elec. &
    Mfg. Co., 
    11 O.S.H. Cas. (BNA) 2133
    , at *3 (Rev. Comm’n
    1984). An employer will be “justified in relying upon the
    specialist to protect against hazards related to the specialist’s
    expertise so long as the reliance is reasonable and the employer
    has no reason to foresee that the work will be performed
    unsafely.” 
    Id. In Sasser,
    the employer hired a crane operator
    to lift a generator off the ground and place it on a trailer. 
    Id. at *1.
    The employer had hired the crane operator for this kind of
    work on roughly six separate past occasions. 
    Id. There were
    overhead power lines at the work site, about which the
    3
    employer warned the crane operator. 
    Id. The crane
    operator
    successfully moved the generator onto the trailer but touched a
    live power line as he was moving the crane back to its starting
    position, causing the death of one Sasser employee and the
    injury of another. 
    Id. Sasser was
    cited for violating the OSHA
    regulation that prohibited bringing the crane within 10 feet of
    a live power line. 
    Id. at *2.
    The Commission decided that
    Sasser’s reliance on the crane operator had been reasonable
    because Sasser had no expertise in operating cranes and only
    the operator was in direct control of the crane. 
    Id. at *4.
    Also,
    the entire job took only a few minutes. See 
    id. at *2.
    This court elaborated on the Sasser exception in Fabi
    Construction Co. v. Secretary of Labor, 
    508 F.3d 1077
    (D.C.
    Cir. 2007). The court explained that reliance is unreasonable
    when “an employer has reason, by way of expertise, control,
    and time, to foresee a danger to its employees.” 
    Id. at 1083.
    In
    Fabi, the employer construction company was hired to build a
    hotel and had hired two contractors to prepare shop drawings
    to provide specific building directions to its construction
    workers. 
    Id. at 1079–80.
    The shop drawings contained errors
    and, after Fabi poured concrete in accord with the drawings,
    several floors of the hotel parking garage collapsed, killing four
    of Fabi’s employees and injuring many others. 
    Id. at 1080.
    Fabi was cited for several violations of OSHA standards and
    defended on the ground that it was not responsible for them
    because it reasonably relied on the contractor that provided the
    shop drawings. 
    Id. This court
    disagreed, because Fabi’s
    reliance had not been reasonable. 
    Id. at 1083.
    In Sasser, the
    employer had no experience in crane operations, the operator
    had sole control over the crane, and the violation was quite
    sudden, as the job itself took only a few minutes. 
    Id. In Fabi,
    in contrast, the employer had expertise in shop drawings, and
    it had reviewed and revised the drawings. 
    Id. Furthermore, the
    evidence showed that the contractor was not in sole control;
    4
    Fabi shared control, because it interpreted the shop drawings
    and its employees were responsible for executing the plans
    directed by the drawings. 
    Id. The court
    also noted that the
    hazard in Fabi — that is, concrete poured pursuant to the
    incorrect drawings — was present for weeks, which gave Fabi
    ample time to recognize and abate the hazard. 
    Id. Manua’s, Inc.
    (“the Company”) petitions for review of an
    order of the Commission finding that it violated regulations
    promulgated by OSHA. In January 2017, the Company hired
    APECS, a construction contractor with which it had done
    business in the past, to remove steel beams from four shipping
    containers by crane. During the unloading, the APECS crane
    operator touched an overhead power line with the crane,
    causing the electrocution of three Company employees and
    injury to several others. Relying on Sasser, the Company
    contends that the Commission erred in failing to rule that the
    Company was not responsible for the cited violations because
    it reasonably relied on APECS. For the reasons that follow, we
    disagree.
    I.
    The Company operates several retail stores in American
    Samoa. In January 2017, the Company was expanding one of
    its stores and purchased construction materials for the project,
    including steel beams. At the Company’s direction, the
    shipping containers were placed on the empty lot adjacent to
    the store that was being expanded.
    Connie Corpuz, the Company’s human resources
    manager, contacted multiple construction contractors to inquire
    about hiring a crane to remove the beams from the shipping
    containers. Corpuz and Glenhall Chen, the owner and CEO of
    the Company, decided to hire APECS, a contractor known to
    5
    them. Corpuz discussed the job with Bonnie Glenn Sabio, an
    APECS project manager who had been involved with past
    projects that APECS had performed for the Company. Corpuz
    and Sabio agreed that APECS would provide a boom truck and
    a crane operator, and that the Company would pay $125 per
    hour. Sabio also informed Corpuz that the Company needed to
    provide employees to assist with the project by attaching the
    steel beams to the crane while in the containers and then
    detaching them once they had been removed and were on the
    ground.      APECS memorialized the agreement in a
    “Confirmation Letter” specifying only the price of the
    “equipment rental.” Neither Corpuz nor anyone else from the
    Company inquired about the safety measures that APECS
    would take, and no internal discussions about safety were held
    by the Company.
    On January 11, 2017, the first day of the job, the APECS
    crane operator, Melchor Sunier, drove the boom truck to the
    vacant lot. He was accompanied by Sabio and a handful of
    other APECS employees. Sabio and Sunier noticed a power
    line running above the vacant lot and decided it did not present
    a safety hazard, but apparently never measured the distance
    from the boom truck to the power line. Several of the
    Company’s maintenance and warehouse workers were present
    and were told to rig the beams — that is, assist with attaching
    them to the crane, as the Company had instructed them in
    advance. Managers from the Company were also present at the
    work site, but never inquired about the safety measures that
    APECS would be taking for the unloading project. APECS
    employees showed the Company employees how to do the
    rigging work, but did not provide safety information or training
    to the Company’s on-site employees. APECS also took no
    safety measures of its own, such as marking the boundaries of
    the work zone or determining whether the crane could come
    within twenty feet of a power line. During the day, when
    6
    APECS’s signal person, who gave hand or voice signals to the
    crane operator guiding his operation of the crane, left the job
    site, a Company employee, Misi Fa’amoana, assumed those
    responsibilities. Otherwise, the work proceeded without
    incident.
    The job continued on January 14. Again, Sunier drove the
    boom truck to the job site, accompanied by Sabio and one other
    APECS employee. As on the first day, Fa’amoana gave basic
    signals to Sunier, and Company employees rigged the steel
    beams. Late in the morning, while unloading the beams, the
    crane touched a live overhead power line. Three Company
    employees were electrocuted and several others were injured.
    II.
    Following the January 2017 accident, an OSHA inspector
    conducted an inspection and cited the Company for four
    “serious” violations of OSHA regulations, see Citation and
    Notification of Penalty, No. 1203732, at 6–9 (June 19, 2017),
    namely failing to: (1) define the work area, in violation of 29
    C.F.R. § 1926.1408(a)(1); (2) take precautions necessitated by
    the fact that the crane could come within 20 feet of the power
    line, in violation of 29 C.F.R. § 1926.1408(a)(2); (3) train the
    employees assigned to the rigging work on safety hazards and
    proper procedures while working near power lines, in violation
    of 29 C.F.R. § 1926.1408(g)(1); and (4) ensure that Fa’amoana
    met training and qualification requirements for a signal person,
    in violation 29 C.F.R. § 1926.1428(a). OSHA assessed the
    Company a penalty of $35,492.
    Rejecting the Company’s objections to the citations, the
    Secretary of Labor filed a complaint before the Commission
    seeking affirmance of the citations. Following discovery, the
    Secretary moved for summary judgment. In opposing
    7
    summary judgment, the Company did not contest that the
    violations had occurred but instead relied on Sasser to argue
    that it was not responsible for the violations because it had no
    experience in crane operations and had reasonably relied on
    APECS to be responsible for the safety measures associated
    with the job.
    An ALJ concluded that the Company’s reliance on APECS
    had not been reasonable and granted summary judgment for the
    Secretary.     The three-member Commission granted the
    Company’s petition for discretionary review and, over one
    dissent, affirmed the grant of summary judgment for the
    Secretary. The Commission agreed that the Company’s
    reliance on APECS had not been reasonable because this was
    the first time that the Company had hired APECS to do crane
    work and it had assumed, without inquiry, that APECS would
    be responsible for safety precautions. Sec’y of Labor v.
    Manua’s, Inc., O.S.H.R.C. No. 18-1059, at 4–5 (Sept. 28,
    2018) (“Comm’n Dec.”). The Company now petitions for
    review of the Commission’s decision.
    III.
    The Company makes several arguments, none of which is
    persuasive on this record. First, it argues that the Commission
    erred as a matter of law in failing to treat Sasser as controlling
    the outcome here, rendering the Commission’s decision
    arbitrary and capricious. The Company points to several
    factual similarities with Sasser. In both cases, a crane operator
    was hired “under a broad and undefined scope of work.”
    Appellant’s Br. 31. Neither Sasser nor the Company inquired
    about the safety measures that would be used, and the
    respective agreements with the crane operators did not mention
    safety measures. Both Sasser’s employees and the Company’s
    employees worked on the job at the direction of the crane
    8
    operator. A Sasser employee and a Company employee both
    gave signals to the crane operator. The Company contends that
    the Commission “arbitrarily disregarded” these factual
    similarities and instead improperly relied on this court’s
    decision in Fabi. Appellant’s Br. 35.
    The court deferentially reviews decisions of the
    Commission to ensure they are supported by substantial
    evidence, 29 U.S.C. § 660(a), and are not “arbitrary, capricious,
    an abuse of discretion, or otherwise not in accordance with the
    law,” AJP Constr., Inc. v. Sec’y of Labor, 
    357 F.3d 70
    , 72–73
    (D.C. Cir. 2004) (quoting 5 U.S.C. § 706(2)(A)). The
    Commission acts arbitrarily and capriciously if it fails to adhere
    to its own precedent, see Jicarilla Apache Nation v. U.S. Dep’t
    of Interior, 
    613 F.3d 1112
    , 1120 (D.C. Cir. 2010), or treats
    similar cases dissimilarly, see Westar Energy, Inc. v. FERC,
    
    473 F.3d 1239
    , 1241 (D.C. Cir. 2007), or fails to offer a
    reasoned basis for departing from or distinguishing its
    precedent, see Brusco Tug & Barge Co. v. NLRB, 
    247 F.3d 273
    ,
    278 (D.C. Cir. 2001); see also Nat’l Cable & Telecomm. Ass’n
    v. Brand X Internet Servs., 
    545 U.S. 967
    , 981 (2005).
    Doubtless there are similarities between the instant case
    and Sasser, but the Commission adequately explained why it
    viewed the circumstances here as different from Sasser and
    more akin to Fabi. The Commission found that the Company
    employees were more “intimately involved in the work” and
    that “Manua’s and its employees shared responsibility for
    safety.” Comm’n Dec. at 5. The Commission explained that,
    unlike in Sasser, this was the first time that the Company had
    hired APECS to perform crane work, so “there was no history
    of safe crane practices in compliance with the Act upon which
    to base reasonable reliance.” 
    Id. Further, the
    Commission
    stated the potential duration of exposure to the violative
    condition was different. In Sasser, the work site was compliant
    9
    with OSHA regulations until the moment that the crane came
    into contact with the power line. Here, there were several
    violative conditions — the failure from the outset of the project
    to identify the work zone or to determine whether the boom
    truck could come within twenty feet of a power line. Also, in
    Sasser, only two of the employer’s employees were assisting
    the contractor, while here, the Company “had assigned a crew
    consisting of approximately a dozen employees” who “were
    integrally involved in the rigging and unloading work” “to
    work with APECS for two days.” 
    Id. at 7.
    The Commission
    reasoned that “when very few employees are involved for only
    a brief period, the[ir] work is likely to be incidental in nature
    and a more limited inquiry by the employer may be
    reasonable,” 
    id. at 6,
    but those were not the circumstances in
    the instant case.
    The Commission’s treatment of this case as
    distinguishable from Sasser was thus reasoned and the
    Commission has not failed to adhere to its own precedent, see
    Jicarilla Apache 
    Nation, 613 F.3d at 1120
    . The Commission’s
    decision not to treat Sasser as dictating the outcome here was
    therefore not arbitrary.
    The Company next argues that the Commission
    misapplied the summary judgment standard by failing to
    acknowledge genuine disputes of material fact. Summary
    judgment is appropriate only when there is no genuine dispute
    of material fact, and the moving party is entitled to judgment
    as a matter of law. Sec’y of Labor v. Van Buren–Madawaska
    Corp., 
    13 O.S.H. Cas. (BNA) 2157
    , at *2 (Rev. Comm’n
    1989).
    The Company contends that the Commission disregarded
    disputed material facts regarding the scope of its agreement
    with APECS, whether its prior dealings with APECS were
    10
    sufficient to render its reliance reasonable, who was
    responsible for determining the position of the shipping
    containers, and whether the safe completion of the first day of
    work justified the Company’s reliance on APECS. But there is
    no genuine dispute about the scope of the agreement between
    the Company and APECS. Rather, the evidence shows, at
    most, that the Company had a unilateral and unjustified
    expectation — not an agreement — that APECS would be
    responsible for the safety of the project. Similarly, the
    Company’s prior dealings with APECS and the fact that the
    work proceeded without incident on the first day are not
    disputed factual issues; rather, the Company simply objects to
    the significance the Commission attached to undisputed
    evidence. And the Company’s argument that it decided on the
    placement of the shipping containers in consultation with
    APECS, not unilaterally, concerns an immaterial factual
    dispute because the analysis would not be changed even if the
    Company’s version of events were true. The significance of
    the Company’s role in placing the shipping containers is that it
    shows that the Company shared control over the project with
    APECS. See 
    Fabi, 508 F.3d at 1083
    . That fact remains
    regardless of whether the Company alone decided where to
    place the containers or did so in consultation with APECS.
    The Company also contends that the Commission’s
    suggestion that the accident was foreseeable implicitly and
    impermissibly decided disputed factual questions. The
    Company points to the OSHA inspector’s testimony that the
    cause of the accident was not easily explained. In the
    Company’s view, this suggests that it could not have foreseen
    the accident. APECS never informed it of the boom truck’s
    maximum working radius, information essential to determining
    the work zone. Yet again, neither of these arguments
    implicates a factual dispute, and these facts are immaterial
    11
    because, even if true, the Commission’s decision, and its
    distinction of Sasser, was nevertheless reasonable.
    Finally, the Company contends that the Commission
    improperly decided that Fa’amoana was “signaling” within the
    meaning of the OSHA regulation. Specifically, the Company
    argues that the Commission disregarded the testimony of the
    OSHA inspector suggesting that a signal person was not
    needed. This argument does not implicate a factual dispute
    because it is undisputed what Fa’amoana did: The Company
    conceded in the agency proceedings that Fa’amoana “gave
    basic signals to the crane operator.” Resp. to Req. for Admis.
    at 7 (O.S.H.R.C. No. 17-12089). Consequently, “[w]hether
    this made the cited signal requirements of the standard
    applicable or not is a legal, not factual[,] issue,” Comm’n Dec.
    at 6 n.5, and is therefore not a basis for denying a motion for
    summary judgment.
    Accordingly, because the Commission reasonably
    distinguished Sasser and properly applied the summary
    judgment standard, we deny the Company’s petition for
    review.