United States Court of Appeals
For the First Circuit
No. 02-1908
EASTERN BRIDGE, LLC; ISAACSON STRUCTURAL STEEL, INC.;
VANGUARD MANUFACTURING, INC.; MONADNOCK FOREST PRODUCTS, INC.,
Plaintiffs, Appellants,
v.
ELAINE L. CHAO, Secretary of Labor, United States
Department of Labor; and JOHN L. HENSHAW,
Assistant Secretary of Labor for Occupational
Safety and Health Administration,
Defendants, Appellees.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW HAMPSHIRE
[Hon. Paul J. Barbadoro, U.S. District Judge]
Before
Boudin, Chief Judge,
Farris,* Senior Circuit Judge,
and Torruella, Circuit Judge.
Richard D. Wayne, with whom Debra Dyleski-Najjar, Brian E.
Lewis and Hinckley, Allen & Snyder LLP, were on brief, for
appellants.
Gretchen Leah Witt, Assistant United States Attorney, Chief,
Civil Division, with whom Thomas P. Colantuono, United States
Attorney, were on brief, for appellees.
February 14, 2003
*
Of the Ninth Circuit, sitting by designation.
TORRUELLA, Circuit Judge. Four New Hampshire companies
("plaintiffs") -- Eastern Bridge, LLC, Isaacson Structural Steel,
Inc., Vanguard Manufacturing, Inc., and Monadnock Forest Products,
Inc. ("Monadnock") -- claim that the Occupational Safety and Health
Administration ("OSHA") acted ultra vires when it mandated that
plaintiffs complete a Data Collection Initiative Survey ("DCI
Survey" or "Survey"). They argue that OSHA did not have a final
regulation requiring employers to maintain the information sought
in the DCI Surveys. The United States District Court for the
District of New Hampshire granted defendants'1 motion to dismiss,
holding that it lacked subject matter jurisdiction over plaintiffs'
claims. We affirm.
I. Background
A. The History of the DCI Survey
In 1970, Congress enacted the Occupational Safety and
Health Act ("OSH Act"), 29 U.S.C. § 651 et seq. (2000), giving the
Secretary of Labor ("Secretary") the responsibility to protect the
health and safety of American workers. The OSH Act gives the
Secretary authority to promulgate implementing regulations and
requires that employers comply with OSHA's standards and
regulations. See, e.g., id. § 673(e) ("On the basis of the records
1
Defendants include Elaine L. Chao, Secretary of Labor, United
States Department of Labor; and John L. Henshaw, Assistant
Secretary of Labor for Occupational Safety and Health
Administration.
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made and kept pursuant to section 657(c) of this title, employers
shall file such reports with the Secretary as [s]he shall prescribe
by regulation, as necessary to carry out h[er] functions under this
chapter.").
To enforce the OSH Act, Congress provides the following
administrative mechanism. If the Secretary believes, after a
workplace inspection, that an employer has violated a standard or
regulation, the Secretary can issue the employer a citation,
classify the citation, and set a penalty. 29 U.S.C. §§ 658(a),
666. If the employer contests the citation or the proposed
assignment of penalty, the Occupational Safety and Health Review
Commission ("Commission") will provide the employer with a hearing
before an administrative law judge ("ALJ"). Id. § 659. Following
the hearing, the ALJ makes a report of the hearing, which becomes
a final order of the Commission unless the Commission decides to
conduct further review. Id. § 661(j). The employer can appeal the
Commission's final order to a United States court of appeals. Id.
§ 660(a).
The Secretary first sent the challenged DCI Surveys to
various employers in February 1996. American Trucking Ass'ns v.
Reich, 955 F. Supp. 4, 5 (D. D.C. 1997). In March of that year, a
consortium of employers filed suit against the Secretary of Labor
under the Administrative Procedures Act ("APA"), claiming that the
Secretary did not have the regulatory authority to distribute the
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DCI Surveys. Id. A district court in the District of Columbia
Circuit held that OSHA's DCI Survey, as it then existed, violated
the APA because OSHA attempted to accomplish its data collection
without a final regulation in place requiring employers to complete
and return the Survey. Id. at 6-7.
Following American Trucking, the Secretary promulgated a
final regulation explicitly requiring employers to complete the DCI
Survey:
Each employer shall, upon receipt of OSHA's
Annual Survey Form, report to OSHA or OSHA's
designee the number of workers it employed and
number of hours worked by its employees for
periods designated in the Survey form, and
such information as OSHA may request from
records required to be created and maintained
pursuant to 29 C.F.R. part 1904.
29 C.F.R. 1904.17(a) (1997).
OSHA uses the DCI Survey to gather injury and illness
data about specific establishments. The Survey asks for
information about the number of employees at the company, the
number of hours the employees worked over a specified period, and
the number of injuries and illnesses the employees suffered during
that period. Based on this information, OSHA calculates the
workplace's injury/illness incidence rate and decides whether to
target the establishment for inspection.
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B. Plaintiffs were Sent DCI Surveys
In 2000, OSHA sent a DCI Survey to three of the four
plaintiffs seeking information based upon 1999 data.2 Plaintiffs
completed the 2000 DCI Survey, leading to the placement of
Monadnock and Eastern Bridge on OSHA's primary inspection list.3
Although OSHA never initiated an inspection of Monadnock, it
attempted to inspect Eastern Bridge. When Eastern Bridge withdrew
its consent to inspection, OSHA obtained an administrative search
warrant from the district court. Eastern Bridge moved to quash the
warrant, but the motion was denied. Subsequently, OSHA carried out
the inspection and issued Eastern Bridge a citation. Eastern
Bridge has not appealed the issuance of the warrant.
In 2001, OSHA sent all four plaintiffs a DCI Survey
requesting data from 2000. All of the plaintiffs completed the
Survey. OSHA placed Eastern Bridge on the primary inspection list
and placed the other three plaintiffs on the supplemental
inspection list. Because OSHA had already inspected Eastern Bridge
that year, it deleted Eastern Bridge from its inspection list. On
the record before us, OSHA has not subjected any of the plaintiffs
2
OSHA did not send Vanguard Manufacturing, Inc. a survey in 2000.
3
OSHA has a primary and a supplemental inspection list.
Worksites on the supplemental list are only inspected after all of
the worksites on the primary list are inspected. Based on the 2000
DCI Survey, Isaacson Structural Steel, Inc. was placed on the
supplemental list but was not inspected.
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on the supplemental list to an inspection, and there is no
indication that any inspection is pending.
C. District Court Proceeding
In April of 2002, before they received their 2002 DCI
Surveys requesting data from 2001,4 plaintiffs brought suit seeking
to have the district court declare the DCI Survey ultra vires and
the use of information gathered in the DCI Survey illegal.
Plaintiffs sought declaratory and injunctive relief, arguing that
the DCI Survey violated the OSH Act and the APA because it required
plaintiffs to report information that they were not required by
regulation to maintain, and that the Survey violated their Fourth
Amendment privacy right. Plaintiffs argue that 29 C.F.R. § 1904.17
(b) simply required employers to "report" the information, but did
not require them to record and maintain the requested information.
In response, OSHA argues that the plaintiffs are required to
channel and exhaust their claims administratively pursuant to the
OSH Act's statutorily provided review scheme.5 The district court
dismissed plaintiffs' action due to lack of subject matter
jurisdiction.
4
After the litigation began, plaintiffs received their 2002 DCI
Surveys, requesting 2001 information, and they refused to complete
the Surveys.
5
On the merits, defendants also contend that 29 C.F.R. section
1904.17 (1997) required employers to maintain the employment
information necessary to respond to the DCI Survey.
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Effective January 1, 2002, OSHA issued a final rule
revising its employer injury and illness record keeping and
reporting requirements. See 66 Fed. Reg. at 5916 (Jan. 19, 2001)
(codified at 29 C.F.R. pt. 1904 (2002)). This rule explicitly
requires employers to record, maintain, and report the information
requested in the DCI Survey. See 29 C.F.R. §§ 1904.29, 1904.30,
1904.32 (2002). The January 1, 2002 effective date means that
employers must maintain the requested information starting with
that date. Plaintiffs concede that the 2003 DCI Survey (requesting
2002 information) will be valid even under the theory on which they
challenge the prior Surveys, and they do not seek to enjoin it.
D. Standard of Review
We review de novo the district court's dismissal for lack
of subject matter jurisdiction because the question of subject
matter jurisdiction in this case focuses on "pure (or nearly pure)
questions of law." Gonzáles v. United States, 284 F.3d 281, 287
(1st Cir. 2002).
II. Analysis
A. Presumption of Administrative Review
To determine whether Congress intended to preclude
district court review of plaintiffs' claims, we first examine the
OSH Act for explicit language of preclusion. Because no such
language exists, we look next for other indicia of congressional
intent. Thunder Basin Coal Co. v. Reich, 510 U.S. 200, 207 (1994).
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Due to the similarity between the review provisions in the Mine Act
and the OSH Act, we have already found Thunder Basin's holding --
that, in general, Congress intended Mine Act challenges to be
initially reviewed administratively -- to apply to the OSH Act.6
Northeast Erectors Ass'n of the BTEA v. Sec'y of Labor, 62 F.3d 37,
40 (1st Cir. 1995) (finding that the comprehensive administrative
review procedure under the Mine Act is "nearly identical" to the
administrative review process for review of OSHA enforcement
actions); see also Sturm, Ruger & Co., Inc. v. Chao, 300 F.3d 867,
873 (D.C. Cir. 2002) (stating that "in every relevant respect the
statutory review provisions of the OSH Act parallel those of the
Mine Act, and we therefore join the First and Sixth circuits in
concluding that Thunder Basin's analysis of review under the Mine
Act is fully applicable to the OSH Act").
Committing initial review to the agency is often sensible
policy. Because the administrative agency may possess greater
expertise with respect to the organic statute, agency review can be
more informed and thus more expeditious, and scarce judicial
resources can be conserved for other areas of pressing concern.
Moreover, streamlined agency adjudication and deferential appellate
review can induce greater compliance by ensuring that penalties are
6
Plaintiffs argue that Thunder Basin does not apply to the
present dispute because it is not a pre-enforcement challenge.
This argument is faulty because whether this case is an
impermissible pre-enforcement challenge is exactly what a Thunder
Basin analysis determines.
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paid reasonably close in time to violations and by deterring
frivolous and dilatory challenges. Cf. Thunder Basin, 510 U.S. at
210-11 (discussing the motivation for the similarly worded review
scheme in the Mine Act).
B. Exceptions to Preclusion
To unsettle this presumption of initial administrative
review -- made apparent by the structure of the organic statute --
requires a strong countervailing rationale. See Thunder Basin, 510
U.S. at 212-17. The Supreme Court has made exceptions in the past,
inter alia, for situations where plaintiffs will effectively
receive no review at all,7 where the administrative process is
fundamentally flawed because of a pattern and practice of
administrative agency abuse,8 where the agency's behavior is
7
See, e.g., Bowen v. Mich. Acad. of Family Physicians, 476 U.S.
667, 678-80 (1986) (holding that Congress did not intend to
foreclose judicial review where such a finding would result in
respondents being left without any forum to adjudicate statutory
and constitutional challenges to agency regulations).
8
See, e.g., McNary v. Haitian Refugee Center, 498 U.S. 479, 496-
98 (1991) (holding that the federal district court had jurisdiction
over an action in which respondents alleged that the INS had
engaged in a pattern and practice of due process violations, and
where, if respondents were denied district court review, they
"would not as a practical matter be able to obtain meaningful
judicial review" of their claims).
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utterly lawless,9 and where further administrative exhaustion is
deemed futile.10
1. Preclusion of All Effective Review
The plaintiffs cannot escape the administrative process
on the basis of preclusion of all review because they can seek
judicial review of the agency proceedings. Plaintiffs can assert
all of their challenges as defenses in an agency enforcement
proceeding. If plaintiffs are dissatisfied with the outcome of the
agency proceeding, they can seek review in the appropriate federal
court of appeals. 29 U.S.C. § 660(a). This is simply not a case
where plaintiffs' claims are wholly committed to an administrative
process. See Bowen v. Mich. Acad. of Family Physicians, 476 U.S.
667, 674-78 (1986) (finding jurisdiction where there is no further
review of benefit determinations of a private insurance carrier).
The limitation imposed here is channeling of initial review through
the administrative process, not exclusion of judicial supervision.
9
See, e.g., Oestereich v. Selective Servs. Sys. Local Bd. No. 11,
393 U.S. 233, 237-39 (1968) (finding that the district court had
jurisdiction where the Selective Service Board had acted in a
"blatantly lawless manner" and where petitioner's only alternative
was to raise his claim through habeas corpus or in a criminal
prosecution).
10
See, e.g., Heckler v. Ringer, 466 U.S. 602, 619 (1984)
(requiring respondents to pursue "the often lengthy administrative
review process" because exhaustion would not be futile). The Court
stated that further exhaustion may be futile where the harm caused
by denial of respondents' claim early in the administrative process
could not later be remedied and where respondents' claim is "wholly
collateral" to a claim for benefits under the organic statute. Id.
at 618-19.
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However, we recognize that even with ultimate judicial
review, deferred review may not in reality be effective. Thunder
Basin, 510 U.S. at 212-18. In particular, effective review could
be cut off in two situations: (1) where the penalty for a violation
is set so high that no rational person would dare test the legality
of administrative action by refusing to comply, and (2) where the
compliance costs are so onerous that complying with the regulation
will cause irreparable harm. See id. Whether one or both of the
scenarios might justify pre-enforcement review would depend on the
magnitude of the burden, the different review options available to
the challenger, and other circumstances. But in this case, the
plaintiffs have failed to demonstrate that either scenario applies.
Plaintiffs have not alleged any facts demonstrating that
the potential penalty for refusing to complete the DCI Survey is
such that no rational actor would test the law. Similarly,
plaintiffs have not made any factual showing that the cost of
completing the DCI Survey is so high that it would cause
irreparable harm. The DCI Survey asks for information about the
number of employees at the company, the number of hours worked by
the employees, and the number of injuries and illnesses the
employees suffered during that period. But employers were already
required by regulation to "maintain . . . a log and summary of all
recordable occupational injuries and illnesses." 29 C.F.R. § 1904
.2(a) (1997). The marginal cost of maintaining the incremental
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data (number of employees the company employs and the number of
hours worked) does not appear to create a burden that causes
irreparable harm. Cf. Mathews v. Eldridge, 424 U.S. 319, 324-25,
331 (1976) (finding federal court jurisdiction because the
statute's provision for a hearing only after plaintiff was deprived
of disability benefits could damage plaintiff in a way not
recompensable through retroactive payments); R.I. Dep't of Envtl.
Mgmt. v. United States, 304 F.3d 31, 43 (1st Cir. 2002) (finding
subject matter jurisdiction to hear state's sovereign immunity
claim because undergoing an unconsented-to administrative
adjudication would itself deprive the state of its "immunity from
being haled before a tribunal by private parties"). Instead,
plaintiffs have successfully completed the 2000 and 2001 DCI
Surveys. If the cost of compliance created an imperiling burden,
we would expect the plaintiffs to have alleged such facts in this
challenge. Plaintiffs have made no such argument.
2. Other Arguments for Exception to Preclusion
Plaintiffs also assert that their challenge is collateral
to the statutory review scheme. But calling an issue "collateral"
does not make it so. Plaintiffs claim that OSHA has engaged in a
pattern and practice of ultra vires conduct that has successfully
evaded review for six years. However, successful pattern and
practice challenges involve attacks on fundamentally flawed
administrative procedures that prevent challengers from obtaining
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meaningful review. See, e.g., McNary v. Haitian Refugee Center,
498 U.S. 479, 496-97 (1991) (finding INS's review procedure flawed
because it did not create an adequate administrative record for
federal appellate review). Here, plaintiffs are only challenging
the underlying substantive conduct of the agency and not its review
procedures. They argue that the agency's DCI Survey is in part
unlawful (because not accompanied by a data-maintenance
regulation), but they have not challenged the integrity or fairness
of the administrative review process provided by the OSH Act.
Therefore, there is no reason why plaintiffs should not avail
themselves of the administrative forum first. All challenges to
agency action allege that the underlying substantive conduct is
unlawful. If we were to allow plaintiffs' claim to fit into the
pattern and practice exception, then the exception would swallow
the rule.
Plaintiffs also rely heavily on Leedom v. Kyne, 358 U.S.
184 (1958), in support of their argument that they should be
excepted from the exhaustion requirement. However, Leedom involved
an undisputed agency violation where the agency "attempted exercise
of power that had been specifically withheld" by statute, depriving
plaintiffs "of a right assured to them by Congress." Id. at 189
(emphasis added). Likewise, in Oestereich v. Selective Service
Systems Local Bd. No. 11, 393 U.S. 233 (1968), a case which
clarified Leedom, the Court held that the district court had
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jurisdiction because the Selective Service Board had acted in a
"blatantly lawless manner." Id. at 237-39. In both Leedom and
Oestereich, the lawlessness of agency conduct was obvious on its
face and conceded. Id. at 187-89; Oestereich, 393 U.S. at 237-38.
The case before us is quite different. Here, it is not at all
clear to us that OSHA's conduct was lawless on the merits, and OSHA
vigorously contests the allegation that the DCI Survey was unlawful
under then-existing regulations.
Plaintiffs also assert that because they are alleging a
Fourth Amendment violation, they need not exhaust administrative
remedies. But this invocation of constitutional authority, without
more, cannot breathe life into a theory already pronounced dead by
the Supreme Court in binding precedent. At the termination of
administrative review, plaintiffs' constitutional claims "can be
meaningfully addressed in the Court of Appeals." Thunder Basin,
510 U.S. at 215 (stating that "the general rule disfavoring
constitutional adjudication by agencies is not mandatory").
Additionally, the present constitutional claim is really just a
recharacterization of their administrative claim, and we will not
allow plaintiffs to circumvent the statutory review process with an
agile game of word play. See Heckler v. Ringer, 466 U.S. 602, 622-
24 (1984) (rejecting respondents attempt to obtain jurisdiction by
characterizing his claim as arising under the Constitution rather
than under the Social Security Act).
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C. Injunction Against the Use of Information
As an additional remedy, plaintiffs seek an injunction
against OSHA's use of any information obtained in the DCI Surveys;
we do not believe this alternative prayer for relief affords us
jurisdiction where their primary theory has failed. In accordance
with the principles we discussed above, the plaintiffs can and
should test the legality of the 2002 Survey in the statutorily
provided process, if and when they are cited for noncompliance. As
to past Surveys already completed, they can seek to exclude the use
of data in citation proceedings based on such information.
We think it clear -- and OSHA concedes -- that the
district court would have jurisdiction if OSHA sought an
administrative warrant for an inspection, and plaintiffs moved to
quash the warrant on the theory that the warrant was based on
illegally collected Survey data. But in this case, the only
plaintiff (Eastern Bridge) to have challenged an administrative
warrant below has chosen not to appeal that issue to this court.
As matters now stand, Eastern Bridge has already been cited for
violations following a completed inspection, and ordinary
principles of exhaustion require us to defer to an administrative
process that is already in motion. See Sturm, Ruger & Co. v. OSHA,
186 F.3d 63, 64-65 (1st Cir. 1999).
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III. Conclusion
For the reasons stated above, we affirm the district
court's dismissal for lack of subject matter jurisdiction.
Affirmed.
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