Jacobs Field Services North America, Inc. v. Perez

Case: 15-60342 Document: 00513644146 Page: 1 Date Filed: 08/19/2016

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit

FILED
No. 15-60342 August 19, 2016
Lyle W. Cayce
Clerk
JACOBS FIELD SERVICES NORTH AMERICA, INCORPORATED,

Petitioner

v.

THOMAS E. PEREZ, SECRETARY, DEPARTMENT OF LABOR,

Respondent

Petition for Review of an Order of the
Occupational Safety and Health Review Commission

Before BENAVIDES, DENNIS, and SOUTHWICK, Circuit Judges.
PER CURIAM:*
Jacobs Field Services North America, Inc., petitions for review of an
order of the Occupational Safety and Health Review Commission citing Jacobs
for violations of the process safety management standards, 29 CFR
§§ 1910.119(j)(2) and (3). The petition for review is DENIED.
I
Jacobs Field Services North America, Inc. (Jacobs) is a maintenance
contractor that provides skilled labor to perform electrical and
instrumentation work, pipe-fitting work, millwright work, material handling,

* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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No. 15-60342
and warehouse work. Jacobs is the resident maintenance contractor at a
chemical plant in La Porte, Texas, owned and operated by Akzo Nobel Polymer
Chemicals (Akzo). Akzo’s La Porte facility manufactures organometallic
specialty chemicals used in the plastics industry. To transform raw materials
into new products, Akzo uses a pressure-rated process vessel called a reactor.
The reactor is connected to six settler tanks, pressure-rated process vessels
that are used to separate chemicals into heavier and lighter compounds. Each
tank is a vertical structure with six “decant valves” mounted to its side and
connected to pipes. Employees use the valves to regulate and direct the flow
of chemical fluid. To open and close the valves, Akzo uses automated devices
known as actuators, which are mounted to brackets on top of each valve.
Actuators at the La Porte facility are mounted using two different methods: in
the “old style,” four bolts connect the actuator to the top of the bracket and four
additional, longer bolts hold the bottom of the bracket, the valve bonnet, and
the valve body together; in the “new style,” the bottom four bolts connect the
bottom of the bracket to the flange of the valve, a rim that projects from the
valve body. All eight of the bolts can be removed from a new style mounting
system, but removing the bottom four bolts from an old-style mounting system
causes a loss of containment.
On March 4, 2013, David Atcheson, Jacobs’s instrument and electrical
supervisor, instructed Jacobs employee Toyo Gonzalez to troubleshoot four
actuated decant valves on the T-802 BEM settler tank, which contained
approximately 9,500 gallons of butylethylmagnesium-heptane mixture (BEM).
BEM is pyrophoric, meaning that it ignites when exposed to air. Gonzalez
checked the air flow on the malfunctioning actuators and replaced the fittings
and air lines, which resolved the problem with three of the four. When
replacing these components did not resolve the problem with the fourth valve,
Gonzalez attempted to remove the actuator from the bracket mounting it to
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No. 15-60342
valve. This actuator was mounted in the old style. After removing several of
the bolts that attached the actuator to the top part of the bracket, Gonzalez
was still unable to remove the actuator. He then attempted to remove the
actuator bracket by loosening the bottom four bolts. This caused a loss of
containment: BEM was released from valve and splashed onto Gonzalez,
causing first- and second-degree burns to his face, wrists, and neck.
The following day, the Occupational Safety and Health Administration
(OSHA) conducted an inspection of the La Porte facility. OSHA issued Jacobs
a citation alleging six violations of the Occupational Safety and Health Act
(OSH Act) and its process safety management (PSM) standards:
- Item 1 alleged a serious violations of 29 C.F.R. § 1910.119(d)(3) for
failing to make information available to employees pertaining to
equipment in the process;
- Item 2a alleged a serious violation of § 1910.119(f)(4) for failing to
develop and implement safe work practices to provide for the control of
hazards;
- Item 2b alleged a serious violation of § 1910.147(c)(4)(i) for failing to
ensure procedures were developed, documented, and utilized for the
control of potentially hazardous energy when employees were engaged
in maintenance activities;
- Item 3 alleged a serious violation of § 1910.119(j)(2) for failing to
establish and implement written procedures for maintaining the ongoing
integrity of process equipment;
- Item 4 alleged a serious violation of § 1910.119(j)(3) for failing to train
Gonzalez in an overview of the process and its hazards and in the
procedures applicable to his tasks; and

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- Item 5 alleged a serious violation of § 1910.132(d)(1)(i) for failing to
assess hazards in the workplace and select and require affected
employees to use appropriate personal protective equipment.
Proposed penalties totaled $33,000.00.
Jacobs contested the citation and a hearing was held before an
administrative law judge (ALJ) on April 16-17, 2014. Jacobs asserted that as
the owner and operator of the plant, Akzo was the appropriate “employer”
responsible for fulfilling the requirements set forth in the cited PSM standards
and that the cited standards did not apply to Jacobs. Jacobs also argued that
the lockout/tagout standard, § 1910.147(c)(4)(i), did not apply to the cited
activity, and that Gonzalez was wearing appropriate personal protective
equipment under § 1910.132(d)(1)(i). Finally, Jacobs asserted the affirmative
defense of unpreventable employee misconduct. On September 4, 2013, the
Secretary of Labor (Secretary) withdrew Item 1 of the Citation.
On February 5, 2015, the ALJ issued an order vacating Items 2a, 2b, and
5 of the citation, 1 affirming Items 3 and 4, and assessing a penalty of $7,000
for each affirmed violation. In affirming Items 3 and 4, the ALJ expressly
rejected Jacobs’s argument that §§ 1910.119(j)(2) and (3) do not apply to
contract employers, finding that, under OSHA’s multi-employer policy, the
cited standard applied “to the cited conditions, not to the cited employer.”
Because Jacobs was the “exposing employer,” it was responsible “for all
violative conditions to which its employee had access.” The ALJ also expressly
rejected Jacobs’s argument that standard did not apply because the actuator

The ALJ found that Items 2a and 2b were duplicative and therefore struck Item 2a.
1

After analyzing Item 2b, he determined that the Secretary had failed to establish that Jacobs
had actual or constructive knowledge that its employee would have access to the release of
chemical energy and thus failed to prove a violation of § 1910.147(c)(4)(i). The ALJ vacated
Item 5 after determining that the Secretary’s citation incorrectly focused on “the adequacy of
the PEE used by Gonzalez, [rather than] the lack of a hazard assessment.”
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No. 15-60342
was not a part of the “process equipment” covered by §§ 1910.119(j)(2) and (3).
Finding that “Jacobs’s focus on the actuator as the component to which sections
1910.119(j)(2) and (3) apply is too narrow,” the ALJ concluded that the
standard applied “to the bracket and bolts used to mount to actuator to the
valve bonnet,” and thus to the cited condition.
On March 2, 2015, Jacobs filed a petition for discretionary review with
the Occupational Safety and Health Review Commission (OSHRC or
Commission). In its petition, Jacobs argued that the ALJ erred in affirming
Items 3 and 4 because “Jacobs was not tasked by Akzo Novel with performing
mechanical integrity work, and Jacobs did not otherwise task its employee to
perform mechanical integrity work.” The Commission did not direct the case
for review, and the ALJ decision became the final order of the Commission on
March 23, 2015. On May 12, 2015, Jacobs filed a timely petition for review
with this court.
II
The Commission’s factual findings are conclusive on review if they are
supported by substantial evidence in the record as a whole. 29 U.S.C. § 660(a);
MICA Corp. v. OSHRC, 295 F.3d 447, 449 (5th Cir. 2002). We will uphold the
Commission’s legal conclusions unless they are arbitrary, capricious, an abuse
of discretion, or otherwise not in accordance with law. MICA Corp., 295 F.3d
449. We apply these same standards to an unreviewed ALJ decision. Austin
Indus. Specialty Servs., L.P. v. OSHRC, 765 F.3d 434, 438-39 (5th Cir. 2014).
The Secretary’s interpretation of his own standard must be upheld if it is
reasonable, that is, if it “sensibly conforms to the purpose and wording of the”
standard. Martin v. OSHRC (CF&I Steel Corp.), 499 U.S. 144, 150-52 (1991);
MICA Corp., 295 F.3d at 449. The Secretary’s reasonable interpretation of the
OSH Act is likewise entitled to deference. National Ass’n of Home Builders v.
OSHA, 602 F.3d 464, 468 (D.C. Cir. 2010).
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III
Jacobs raises three challenges to the Commission’s final order. First, it
argues that the ALJ erred in applying the requirements of §§ 1910.119(j)(2)
and (3) to it, a contract employer. Second, it argues that, even if it were subject
to the requirements of §§ 1910.119(j)(2) and (3), the ALJ erred in determining
that the injured employee was tasked with performing “mechanical integrity”
work such that those requirements applied. Finally, in its reply brief, Jacobs
argues that the ALJ erred in determining that it knew or should have known
of the hazardous condition. We find that the first and third arguments are
forfeited, and we reject the second.
A
Section 11(a) of the OSH Act states that “[n]o objection that has not been
urged before the Commission shall be considered by the court, unless the
failure or neglect to urge such objection shall be excused because of
extraordinary circumstances.” 29 U.S.C. § 660(a). “The language of section
660(a) indicates that proceedings targeted towards the Commission, not those
before the administrative law judges, are the predicate to judicial review.”
McGowan v. Marshall, 604 F.2d 885, 890 (5th Cir. 1979). “While great
specificity is not required in a review petition, this court may not consider an
argument unless the Commission has been alerted to the issues.” Power Plant
Div., Brown & Root, Inc. v. Occupational Safety & Health Review Comm’n, 659
F.2d 1291, 1294 (5th Cir. 1981) reh’g granted, opinion modified on other
grounds, 673 F.2d 111 (5th Cir. 1982). Our sister circuits have explained that
to preserve an argument for appellate review, the employer’s petition for
discretionary review must “offer a modicum of developed argumentation in
support of” the objection, P. Gioioso & Sons, Inc. v. OSHRC, 115 F.3d 100, 107
(1st Cir. 1997), and that an employer’s “abbreviated mention of its challenge
to the validity of the [cited] Standard is ‘wholly inadequate to satisfy the
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requirement of § 660(a) that an objection be urged before the Commission,’”
Durez Div. of Occidental Chem. Corp. v. OSHA, 906 F.2d 1, 5 (D.C. Cir. 1990)
(quoting Brown & Root, 659 F.2d at 1293).
In its petition for discretionary review, Jacobs did not urge an objection
to the ALJ’s finding that 29 C.F.R. §§ 1910.119(j)(2) and (3) properly applied
to it as a contract employer. The petition expressly “takes exception” to only
two portions of the ALJ’s Decision and Order: (1) that “wherein the [ALJ] finds
as a fact that ‘the same bolts hold the valve bonnet and valve together also
connect the actuator to the valve,” and (2) that “wherein the [ALJ] concluded
that the actuator is ‘process equipment.’” Jacobs’s only mention of the ALJ’s
finding that the standard is applicable to it as a contract employer occurred in
the context of the second objection. The company wrote:
The ALJ rejected Jacobs’ argument that under the circumstances,
the requirements of paragraph (j) were intended to apply to Akzo
Nobel as the host employer, and not to Jacbos, a contract[]
employer. Even assuming the ALJ is correct and the requirements
of paragraph (j) are applicable to Jacobs under the circumstances,
then Jacobs’ determination that the actuator was not critical
process equipment controls.
At best, this is an “abbreviated mention” of Jacobs’s challenge to the
application of the standard; plainly read, the objection fails to contest the ALJ’s
determination.
In its reply brief, Jacobs asserts that “[t]he issue is the applicability of
(j)(1) and (j)(3) to Jacobs, a contractor” and that “[i]n supporting its position
that those provisions do not apply, Jacobs is not precluded from arguing each
of the multiple reasons these requirements do not apply to Jacobs under the
circumstances of this case.” But this argument proves too much; extending its
logic, the issue in any petition for discretionary review could be framed as “the
impropriety of the OSHA citation” and any reason could then be presented as
an objection in a petition for appellate review. Furthermore, Jacobs’s attempt
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to distinguish an “issue” from a “reason” is inconsistent with the language of
29 U.S.C. § 660(a), which speaks of “objections,” and with this court’s
precedent. See Brown & Root, 659 F.2d at 1294 (finding the petition for
discretionary review “insufficient to alert the Commission to the arguments it
now seeks to raise”) (emphasis added).
Because the contention that 29 C.F.R. §§ 1910.119(j)(2) and (3) were not
properly applicable to Jacobs as a contract employer was not urged before the
Commission in a petition for discretionary review, we find that this argument
was forfeited and thus hold that this court lacks jurisdiction to consider it. See
McGowan, 604 F.2d at 889 (characterizing the requirements of 29 U.S.C.
§ 660(a) as jurisdictional in nature).
B
Jacobs argues that, even if §§ 1910.119(j)(2) and (3) do apply to contract
employers, the ALJ erred in applying them in this case because the actuator
was not “process equipment” within the meaning of § 1910.119(j)(1). In its
Compliance Guidelines and Recommendations for Process Safety
Management, OSHA observes that “[e]quipment used to process, store, or
handle highly hazardous chemicals needs to be designed, constructed, installed
and maintained to minimize the risk of releases of such chemicals.” § 1910.119
App’x C (Feb. 8, 2013). The preamble to the final PSM rule explains:
[T]he goal of the mechanical integrity provisions is to ensure that
highly hazardous chemicals covered by the standard are contained
within the process and not released in an uncontrolled manner.
The equipment OSHA has listed in proposed paragraph (j)(1)
constitutes process equipment that the Agency considers critical in
achieving this goal.
57 FR at 6389. Section 1910.119(j)(1) lists six types of process equipment to
which the mechanical integrity requirements apply: pressure vessels and
storage tanks; piping systems (including piping components such as valves);
relief and vent systems and devices; emergency shutdown systems; controls
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(including monitoring devices and sensors, alarms, and interlocks); and
pumps.
The citation alleged that Jacobs failed to have written procedures, in
violation of § 1910.119(j)(2), and failed to provide training, in violation of
§ 1910.119(j)(3), to maintain the on-going integrity of process equipment with
regard to “separating the valve and actuator to repair the valves in the piping
of the BEM Settlers.” After hearing testimony on the issue from Ronald
Wilson, Akzo’s safety manager; Tony Cornwell, Jacobs’s expert in chemical
engineering and process safety management; and James Johnstone, the
Secretary’s expert, the ALJ agreed with the Secretary and found that
§ 1910.119(j)(2) and (3) “apply to the bracket and bolts used to mount the
actuator to the valve bonnet.” He therefore concluded that the cited standards
applied to the cited condition.
Jacobs argues that the Secretary failed to establish that the mechanical
integrity standards applied to Gonzalez’s work on the actuated valves. It
argues that the actuator is not covered process equipment. However, in
making its argument, Jacobs misinterprets the regulation and misreads the
ALJ’s decision. Jacobs asserts that “to establish the applicability of
subparagraphs (j)(2) and (j)(3), the Secretary must establish that the actuator
is on the enumerated list of process equipment identified in paragraph (j)(1).”
This is not strictly accurate; in fact, the Secretary must establish that Gonzalez
was “involved in maintaining the on-going integrity of process equipment.”
§ 1910.119(j)(3). And the regulatory definition of piping systems, one of the
listed types of process equipment, is expressly open-ended: “piping systems
(including piping components such as valves).” § 1910.119(j)(1)(ii) (emphasis
added). As previously noted, the ALJ observed that “Jacobs’s focus on the
actuator as the component to which sections 1910.119(j)(2) and (3) apply is too

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narrow,” and concluded that the standard in fact applied to the actuator’s
mounting system.
Jacobs also attacks the ALJ’s observation that “[t]he same bolts that hold
the [valve] bonnet and valve together also connect the actuator to the valve.”
According to testimony at the hearing, the four bolts attaching the actuator to
its bracket were distinct from the four bolts that attached the bracket, the
valve, and the valve bonnet. Jacobs contends that the ALJ’s suggestion
otherwise is “a critical error of fact that contributed to the ALJ’s erroneous
conclusions of law.” However, the ALJ’s observation is not clearly inaccurate.
The actuator bracket is designed to hold the actuator in place, and the bottom
four bolts were necessary to hold the bracket to the valve. Furthermore, this
finding is not critical to the ALJ’s conclusion that the § 1910.119(j)(2) and (3)
apply to the actuator’s mounting system. The same bolts connect the bracket,
the valve, and the valve bonnet, and removing the bracket would both remove
the actuator and “break the line.” And Johnstone testified that “the bracket is
as much of the piping system as the bonnet is on the valve . . . it has to be there
for that valve to work.” The conclusion that the bracket and bolts used to
mount the actuator to the valve bonnet are process equipment within the
meaning of § 1910.199(j)(1) was thus not arbitrary, capricious, an abuse of
discretion, or otherwise not in accordance with law.
Finally, Jacobs argues that the standard should not apply because
Gonzalez went beyond his assigned task when he removed the bottom four
bolts. 2 Jacobs contends that “[t]he release resulted when the employee went

2 Jacobs’s argument is based on the ALJ’s dismissal of Item 2(b) on the grounds that
“[t]he task assigned to the employee did not require the employee to cause a line break.” But
this observation was related to the conclusion that the Secretary failed to establish that
Jacobs had actual or constructive knowledge of the need to use energy control procedures.
The mechanical integrity standards do not apply only to situations in which a line break is
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beyond the scope of troubleshooting the actuator, the task to which he was
assigned, and attempted to remove the bottom four bolts securing the bracket
to the valve.” As a result, Jacobs argues, Gonzalez was not “involved in
maintaining the on-going integrity of process equipment.” § 1910.119(j)(3).
But Jacobs admits that Gonzalez “was tasked with troubleshooting an actuator
that may have required [him] to remove the actuator from the top of the
bracket.” His assignment therefore required him to work on the actuator’s
mounting system, which the ALJ fairly considered to be covered process
equipment. And his alleged deviation from his assigned task, although
disastrous, was understandable. When he could not remove the actuator from
the bracket, he tried to remove the bracket from the valve; this would have
been safe on an actuator mounted in the new style, the system with which
Gonzalez had more experience. The fact that the accident occurred while
Gonzalez was trying to fulfill his work order demonstrates that the Secretary’s
interpretation of the regulations and issuance of the citation “sensibly
conform[ed] to the purpose and wording of the” standard. CF&I Steel Corp.,
499 U.S. at 150-52.
The definition of covered piping systems is open-ended: “piping systems
(including piping components such as valves).” § 1910.119(j)(1)(ii) (emphasis
added). Because one set of bolts connects the actuator bracket, the valve, and
the valve bonnet, and because removing the bracket would “break the line,”
the ALJ’s conclusion that the bracket and bolts used to mount the actuator to
the valve bonnet are process equipment within the meaning of § 1910.119(j)(1)
was not arbitrary, capricious, an abuse of discretion, or otherwise not in

anticipated, but rather where a line break is possible. See Process Safety Management of
Highly Hazardous Chemicals; Explosives and Blasting Agents 57 FR at 6389.
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accordance with law. Neither, consequently, was the ALJ’s determination that
§§ 1910.119(j)(2) and (3) applied to Jacobs.
C
To support a citation, the Secretary must show by a preponderance of
the evidence that: (1) the OSHA standard invoked applies to the cited
conditions; (2) the requirements of the standard were not met; (3) employees
were exposed to or had access to the hazardous condition; and (4) the employer
knew or should have known of the hazardous condition with the exercise of
reasonable diligence. Secretary of Labor v. Icarus Industrial Painting and
Contracting Co., 19 O.S.H. Cas. (BNA) 2101, 2102 (2002). In its reply brief,
Jacobs argues that the Secretary failed to carry his burden under Icarus
because “Jacobs did not know, and could not have known through the exercise
of reasonable diligence, that Mr. Gonzales would disassemble the valve while
troubleshooting the actuator and thereby be exposed to hazard of a release.”
This argument was not raised before the Commission and was not addressed
in Jacobs’s opening brief. As a result, the argument is forfeited. 29 U.S.C.
§ 660(a); Fed. R. App. P. 28(a)(8)(A).
IV
In summary, we hold that the Commission’s final order affirming
violations of §§ 1910.119(j)(2) and (3) and assessing violations was not
arbitrary, capricious, an abuse of discretion, or otherwise not in accordance
with law. Jacob’s petition for review is therefore DENIED.

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