[Federal Register Volume 61, Number 245 (Thursday, December 19, 1996)]
[Proposed Rules]
[Pages 66961-66965]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-31631]


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FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

29 CFR Part 2704


Implementation of Equal Access to Justice Act in Commission 
Proceedings

AGENCY: Federal Mine Safety and Health Review Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Federal Mine Safety and Health Review Commission is 
proposing to revise its rules providing for the award of attorneys' 
fees and other expenses under the Equal Access to Justice Act (EAJA), 5 
U.S.C. 504, applicable to eligible individuals and entities who are 
parties to administrative proceedings before the Commission. The 
proposed revisions to the rules are in response to amendments to the 
EAJA, enacted pursuant to Public Law 104-121, 110 Stat. 862 (1996), and 
effective on March 29, 1996. The proposed rules authorize fee awards 
under a newly-defined standard--when the Secretary of Labor's demand is 
substantially in excess of the decision of the Commission and is 
unreasonable when compared to that decision. The proposed rules also 
expand the definition of a ``party'' eligible for an award under this 
new standard to include ``a small entity'' as defined by 5 U.S.C. 601. 
The maximum hourly rate for attorneys' fees in all EAJA cases before 
the Commission is increased to $125. Finally, the Commission is 
revising its rules to provide that parties submit EAJA applications to 
the Chief Administrative Law Judge instead of the Chairman. The 
Commission invites public comments on these proposed rules.

DATES: Comments should be received by January 21, 1997.

ADDRESSES: Comments should be sent to Richard L. Baker, Executive 
Director, Federal Mine Safety and Health Review Commission, 1730 K 
Street, NW, 6th Floor, Washington, DC 20006. For the convenience of 
persons who will be reviewing the comments, it is requested that 
commenters provide an original and three copies of their comments.

FOR FURTHER INFORMATION CONTACT: Norman M. Gleichman, General Counsel, 
Office of the General Counsel, 1730 K Street, NW, 6th Floor, 
Washington, DC 20006, telephone 202-653-5610 (202-566-2673 for TDD 
Relay). These are not toll-free numbers.

SUPPLEMENTARY INFORMATION:

I. Background

    Under the Commission's present rules, the EAJA applies to 
administrative adjudications, brought pursuant to the Federal Mine 
Safety and Health Act of 1977, 30 U.S.C. 801 et seq., in which an 
eligible party prevails over the Department of Labor's Mine Safety and 
Health Administration. 29 CFR 2704.100 and 2704.103. Prior to the 
enactment of Public Law 104-121, prevailing parties could receive 
awards if they met the EAJA's eligibility standards (which set ceilings 
on the net worth and number of employees) and if the government's 
position was not ``substantially justified.''
    Public Law 104-121 creates an additional standard under which 
eligible parties can obtain fees in administrative adjudications. The 
EAJA amendments authorize an award when a government ``demand'' is both 
``substantially in excess of the decision of the adjudicative officer'' 
and ``unreasonable.'' Id. at 231(a). Under this standard, if the demand 
by the Secretary of Labor is substantially in excess of the judgment 
finally obtained by the Secretary and is unreasonable when compared 
with that judgment under the facts and circumstances of the case, the 
Commission shall award to the opposing party the fees and other 
expenses related to defending against the excessive demand, unless the 
party has committed a willful violation of law or otherwise acted in 
bad faith, or special circumstances make an award unjust. Id.
    Public Law 104-121 also establishes a separate definition of a 
``party'' for fee awards under the new standard. Parties that are 
eligible to apply for awards include ``small entit[ies] as defined in 
section 601 [of title 5].'' Id. at 231(b)(2). Title 5 U.S.C. 601(6) 
provides that ``small entity'' has ``the same meaning as the term[ ] 
`small business'. . . .'' In turn, a ``small business'' is defined at 5 
U.S.C. 601(3) as a ``small business concern'' under section 3 of the 
Small Business Act (15 U.S.C. 632). Section 632(a) authorized the Small 
Business Administration (SBA) to establish standards to specify when a 
business concern is ``small.'' The SBA has recently issued updated size 
standards for various types of economic activity, categorized by the 
Standard Industrial Classification System (SIC). 13 CFR 121.105. In 
defining the standards for small businesses engaged in mining, the SBA 
regulations count either annual receipts or numbers of employees. The 
number of employees or annual receipts specified is the maximum allowed 
for a concern and its affiliates to be considered small. 13 CFR 
121.201. The standards for the mining industry are as follows:

DIVISION B--MINING:                                                     
  MAJOR GROUP 10--METAL MINING........  500 employees.                  
  MAJOR GROUP 12--COAL MINING.........  500 employees.                  
  MAJOR GROUP 14--MINING AND QUARRYING  500 employees.                  
   OF NON-METALLIC MINERALS, EXCEPT                                     
   FUELS.                                                               
EXCEPT:                                                                 
  1081 Metal Mining Services..........  $5 million.                     
  1241 Coal Mining Services...........  $5 million.                     
  1481 Nonmetallic Minerals Services,   $5 million.                     
   Except Fuels.                                                        
                                                                        

13 CFR 121.201.
    Finally, Public Law 104-121 increases the maximum fee award of an 
attorney or agent from $75.00 to $125.00 per hour. Id. at 231(b)(1).

II. Analysis of the Regulations

    The present language of Sec. 2704.100 providing for fee awards to 
prevailing parties when the Secretary's position is not substantially 
justified is unchanged. The Commission proposes to add new language to 
the rule to provide that an eligible party may receive an award if the 
demand of the Secretary is substantially in excess of the decision of 
the Commission and is unreasonable when compared with that decision, 
unless the applicant party has committed a willful violation of law or 
otherwise acted in bad faith or special circumstances make an award 
unjust. For purposes of this part, a decision of the Commission 
includes not only a decision by the Commission but also a decision by 
an administrative law judge that becomes final by operation by law.
    The present language of Sec. 2704.102 is revised to specify that 
recovery under the prevailing party standard is available for any 
adversary adjudication commenced before the Commission after August 5, 
1984. Proposed language provides that, where an applicant seeks an 
award based on a substantially excessive and unreasonable demand of

[[Page 66962]]

the Secretary, the adversary adjudication before the Commission must 
have commenced on or after March 29, 1996, the effective date of the 
EAJA amendments.
    In Sec. 2704.104(a) the Commission proposes to restate the 
reference to 5 U.S.C. 551(3), which defines ``party'' in the 
Administrative Procedure Act. The Commission proposes to add new 
language referring to the eligibility conditions specified in 
paragraphs (b) and (c).
    Section 2704.104(b) states the eligibility requirements for an 
applicant seeking an award based on prevailing party status. The 
requirements in the present paragraph (b) are proposed in renumbered 
form with one exception; references to charitable or tax exempt 
organizations and units of local government have been deleted, because 
it is not apparent that such organizations have ever been involved in a 
Mine Act proceeding. Paragraph (c) states the standards for an 
applicant seeking an award based on a substantially excessive and 
unreasonable demand by the Secretary. Such an applicant must be a small 
entity as defined in 5 U.S.C. 601. To qualify as a small business under 
5 U.S.C. 601(3), the applicant must meet the requirements for a small 
mining business concern as set forth by the SBA at 13 CFR 121.104, 
121.106 and 121.201. Title 13 CFR 121.106 details the SBA's methodology 
of counting employees, which differs from the Commission's present rule 
for counting employees for purposes of determining eligibility of a 
prevailing party.
    The Commission proposes that it not reiterate the specific SBA 
standards for ascertaining whether a mining operation is ``small'' 
because those standards are subject to revision periodically by the 
SBA. Instead, the Commission proposes to notify the mining community, 
by Federal Register publication, of changes in the SBA standards as 
they occur. The Commission has omitted any reference to other types of 
small entities contained in 5 U.S.C. 601, including ``small 
organization,'' which pertains to not-for-profit enterprises, and 
``small governmental jurisdiction,'' 5 U.S.C. 601(4) and (5), because 
it is unlikely that any of these organizations will be involved in 
proceedings under the Mine Act.
    The Commission proposes to redesignate Sec. 2704.104(c) through (g) 
and amend paragraphs (c) and (f), in conformance with the EAJA 
amendments relating to eligibility, by adding language to the present 
rules. Under proposed paragraph (d), the annual receipts, number of 
employees or net worth of the applicant, as applicable, shall be 
determined as of the date the underlying proceeding was initiated under 
the Mine Act. Under proposed paragraph (g), the annual receipts, 
numbers of employees or net worth, as applicable, of the applicant and 
its affiliates shall be aggregated to determine eligibility. The 
Commission proposes to leave unchanged, except for redesignating, 
current paragraphs (d), (e), and (g).
    Section 2704.105(a) sets forth the standards for an applicant 
seeking an award based on prevailing party status and is unchanged 
except that it is amended to include the sentence regarding denial or 
reduction of an award because of unreasonable protraction in the 
proceedings or special circumstances that is presently in paragraph 
(b).
    The proposed language in Sec. 2704.105(b) tracks the language of 
Public Law 104-121 at section 231(a) and provides that, if the demand 
of the Secretary is substantially in excess of the decision of the 
Commission and is unreasonable when compared with such decision, under 
the facts and circumstances of the case, the Commission shall award to 
an eligible party applicant fees and expenses related to defending 
against the excessive demand. Nevertheless, an award may not be made if 
the applicant has committed a willful violation of law or otherwise 
acted in bad faith or special circumstances make an award unjust. 
Whether the applicant has unduly or unreasonably protracted the 
underlying proceeding may also be considered. The proposed language 
provides that the burden of proof is on the applicant to show that the 
demand of the Secretary is substantially excessive and unreasonable. 
The rule also defines ``demand'' by tracking language in the EAJA 
amendments, Public Law 104-121 at section 231(b)(5)(F). While the 
statutory language might suggest that the new standard of awards is 
limited to penalty cases, that issue is best left to resolution in 
individual case adjudication.
    In conformity with the EAJA amendments, Sec. 2704.106(b) is amended 
to provide that the maximum award for fees of an attorney or agent is 
$125.00 per hour.
    Section 2704.107(a) is amended to reflect that the highest award 
for fees of an attorney or agent is $125.00 per hour. The term 
``agent'' is added to the present rule to bring the rule into 
conformity with the statutory language.
    The present language of Sec. 2704.108 provides for awards only to 
prevailing parties in cases where the Secretary's position is not 
substantially justified. The Commission proposes to amend the rule to 
add a reference to the new standard for recovery in the EAJA amendments 
set forth in Sec. 2704.105(b). The rule provides that, if an applicant 
is entitled to an award under either standard in Sec. 2704.105, the 
award shall be made by the Commission against the Department of Labor.
    Proposed Sec. 2704.201 designates the Chief Administrative Law 
Judge as the Commission official to whom EAJA applications are 
submitted, revising the present procedure requiring submission of 
applications to the Chairman. The Commission further proposes to amend 
present Sec. 2704.201(a) and (b) by moving their major portions 
relating to the contents of an application by a prevailing party to 
Sec. 2704.202. The remaining portions of the proposed rule set forth 
the information common to applications based on either prevailing party 
status or a substantially excessive and unreasonable demand by the 
Secretary and are a redesignation of major portions of present 
Sec. 2704.201(a) to (f).
    In Sec. 2704.202(a) the Commission proposes to amend the present 
rule by adding the requirements presently in Sec. 2704.201(a) for an 
EAJA application by a prevailing party. Present Sec. 2704.202(b) is 
redesignated as Sec. 2704.204.
    Proposed Sec. 2704.202(b) is primarily a redesignation of present 
Sec. 2704.201(b) concerning the applicant's net-worth exhibit. Language 
from present Sec. 2704.201(b) permitting a tax-exempt organization to 
omit a net-worth statement has not been retained because of the low 
likelihood that such an organization would ever be a party to a 
Commission proceeding.
    Present Sec. 2704.203 is redesignated as Sec. 2704.205. Proposed 
Sec. 2704.203(a) amends the present rule by adding the new standard for 
recovery. Proposed Sec. 2704.203(b) provides that the application must 
show that the applicant is a small entity as defined in 5 U.S.C. 
601(6). Paragraph (b) also refers to the SBA regulations at 13 CFR Part 
121 and provides that the application shall include a statement of the 
applicant's annual receipts or number of employees, where the applicant 
seeks eligibility based on being a small business. Paragraph (b) 
requires a brief description of the type and purpose of the applicant's 
organization or business. Because the EAJA amendments rely on the SBA's 
definition of ``small business concern,'' and because the SBA has 
defined small business concerns engaged in mining in terms of annual 
receipts or number of employees and has set forth its methodology for

[[Page 66963]]

calculating the annual receipts or number of employees (13 CFR 121.104 
and 121.106), the Commission intends that parties be guided by those 
regulations in meeting the SBA's standards of annual receipts or number 
of employees to qualify as a ``small business.''
    Present Sec. 2704.204 is redesignated as Sec. 2704.206. Proposed 
Sec. 2704.204 is a redesignation of Sec. 2704.202(b). In addition, the 
Commission proposes to modify the language in present Sec. 2704.202(b) 
for regulating the public disclosure of financial information in the 
networth and annual receipts exhibits. Present Sec. 2704.202(b) only 
relates to the net-worth exhibit.
    Proposed Sec. 2704.205 is a redesignation of present Sec. 2704.203.
    Proposed Sec. 2704.206 is a redesignation of Sec. 2704.204. 
Paragraph (a) adds new language that an application may also be filed 
when a demand by the Secretary is substantially in excess of the 
decision finally obtained in the case and unreasonable. In addition, 
language has been added to provide for the filing of EAJA applications 
with the Commission 30 days after final disposition by a court in the 
event that an applicant wishes to file in light of the court's 
disposition. See Dole v. Phoenix Roofing, Inc., 922 F.2d 1202 (5th Cir. 
1991). Section 2704.206(b) proposes language to include the new 
standard for recovery. Section 2704.206(c) is changed to delete an 
inadvertent reference to section 105(a) of the Mine Act, 30 U.S.C. 
815(a), in the definition of final Commission dispositions in the 
present rule; in addition, references to Commission EAJA decisions in 
Sec. 2704.307 and 2704.308 are deleted.
    Proposed Sec. 2704.305 eliminates ``prevailing'' from present 
Sec. 2704.305 to reflect that an EAJA award is no longer limited to 
proceedings involving a prevailing party but includes those proceedings 
in which the Secretary has made a substantially excessive and 
unreasonable demand.
    Because an EAJA award is no longer limited to a prevailing party, 
language has been added to Sec. 2704.307 to provide for the issuance of 
written findings and conclusions covering whether the applicant has 
been subjected to a substantially excessive and unreasonable demand. 
Commission judges are instructed to make specific findings depending on 
whether the application was filed pursuant to Sec. 2704.105 (a) or (b).

III. Matters of Regulatory Procedure

    The Commission has determined that these rules are not subject to 
Office of Management and Budget review under Executive Order 12866.
    The Commission has determined under the Regulatory Flexibility Act 
(5 U.S.C. 601-612) that these rules, if adopted, would not have a 
significant economic impact on a substantial number of small entities. 
Therefore, a Regulatory Flexibility Statement and Analysis has not been 
prepared.
    The Commission has determined that the Paperwork Reduction Act (44 
U.S.C. 3501 et seq.) does not apply because these rules do not contain 
any information collection requirements that require the approval of 
the Office of Management and Budget.

List of Subjects in CFR Part 2704

    Administrative practice and procedure, Equal access to justice.

    For the reasons set out in the preamble, it is proposed that 29 CFR 
part 2704 be amended as follows:

PART 2704--IMPLEMENTATION OF THE EQUAL ACCESS TO JUSTICE ACT IN 
COMMISSION PROCEEDINGS

    1. The authority citation for part 2704 is revised to read as 
follows:

    Authority: Pub. L. 96-481, 94 Stat. 2325 (5 U.S.C. 504(c)(1)); 
Pub. L. 99-80, 99 Stat. 183; Pub. L. 104-121, 110 Stat. 862.

Subpart A--General Provisions

    2. Section 2704.100 is revised to read as follows:


Sec. 2704.100  Purpose of these rules.

    The Equal Access to Justice Act, 5 U.S.C. 504, provides for the 
award of attorney fees and other expenses to eligible individuals and 
entities who are parties to certain administrative proceedings (called 
``adversary adjudications'') before this Commission. An eligible party 
may receive an award when it prevails over the Department of Labor, 
Mine Safety and Health Administration (MSHA), unless the Secretary of 
Labor's position in the proceeding was substantially justified or 
special circumstances make an award unjust. In addition to the 
foregoing ground of recovery, an eligible party may receive an award if 
the demand of the Secretary is substantially in excess of the decision, 
unless the applicant party has committed a willful violation of law or 
otherwise acted in bad faith, or special circumstances make an award 
unjust. The rules in this part describe the parties eligible for each 
type of awards. They also explain how to apply for awards, and the 
procedures and standards that this Commission will use to make the 
awards.
    3. Section 2704.102 is revised to read as follows:


Sec. 2704.102  Applicability.

    Section 2704.105(a) applies to adversary adjudications before the 
Commission pending or commenced on or after August 5, 1984. Section 
2704.105(b) applies to adversary adjudications commenced on or after 
March 29, 1996.
    4. Section 2704.104 is amended by revising paragraphs (b) through 
(e) and removing paragraphs (f) and (g) to read as follows:


Sec. 2704.104  Eligibility of applicants.

* * * * *
    (b) For purposes of awards under Sec. 2704.150(a) for prevailing 
parties:
    (1) The employees of an applicant include all persons who regularly 
perform services for remuneration for the applicant, under the 
applicant's direction and control. Part-time employees shall be 
included on a proportional basis;
    (2) The net worth and number of employees of the applicant and all 
of its affiliates shall be aggregated to determine eligibility. Any 
individual, corporation or other entity that directly or indirectly 
controls or owns a majority of the voting shares or other interest of 
the applicant, or any corporation or other entity of which the 
applicant directly or indirectly owns or controls a majority of the 
voting shares or other interest, will be considered an affiliate for 
purposes of this part, unless the administrative law judge determines 
that such treatment would be unjust and contrary to the purposes of the 
Act in light of the actual relationship between the affiliated 
entities. In addition, the administrative law judge may determine that 
financial relationships of the applicant other than those described in 
this paragraph constitute special circumstances that would make an 
award unjust.
    (3) An applicant who owns an unincorporated business will be 
considered as an ``individual'' rather than a ``sole owner of an 
unincorporated business'' if the issues on which the applicant prevails 
are related primarily to personal interests rather than to business.
    (4) The types of eligible applicants are as follows--
    (i) An individual with a net worth of not more than $2 million;
    (ii) The sole owner of an unincorporated business who has a net 
worth of not more than $7 million, including both personal and business 
interests, and employs not more than 500 employees;

[[Page 66964]]

    (iii) Any other partnership, corporation, association, or public or 
private organization with a net worth of not more than $7 million and 
not more than 500 employees;
    (c) For the purposes of awards under Sec. 2704.105(b), eligible 
applicants are small entities as defined in 5 U.S.C. 601, subject to 
the annual-receipts and number-of-employees standards as set forth by 
the Small Business Administration at 30 CFR part 121;
    (d) For the purpose of eligibility, the net worth, number of 
employees, or annual receipts of an applicant, as applicable, shall be 
determined as of the date the underlying proceeding was initiated under 
the Mine Act.
    (e) An applicant that participates in a proceeding primarily on 
behalf of one or more other persons or entities that would be 
ineligible is not itself eligible for an award.
    5. Section 2704.105 is revised as follows:


Sec. 2704.105  Standards for awards.

    (a) A prevailing applicant may receive an award of fees and 
expenses incurred in connection with a proceeding, or in a significant 
and discrete substantive portion of the proceeding, unless the position 
of the Secretary was substantially justified. The position of the 
Secretary includes, in addition to the position taken by the Secretary 
in the adversary adjudication, the action or failure to act by the 
Secretary upon which the adversary adjudication is based. The burden of 
proof that an award should not be made to a prevailing applicant 
because the Secretary's position was substantially justified is on the 
Secretary, who may avoid an award by showing that his position was 
reasonable in law and fact. An award will be reduced or denied if the 
applicant has unduly or unreasonably protracted the underlying 
proceeding or if special circumstances make the award unjust.
    (b) If the demand of the Secretary is substantially in excess of 
the decision of the Commission and is unreasonable when compared with 
such decision, under the facts and circumstances of the case, the 
Commission shall award to an eligible applicant the fees and expenses 
related to defending against the excessive demand, unless the applicant 
has committed a willful violation of law or otherwise acted in bad 
faith or special circumstances make an award unjust. The burden of 
proof that the demand of the Secretary is substantially in excess of 
the decision of the Commission and is unreasonable when compared with 
such decision is on the applicant. As used in this section, ``demand'' 
means the express demand of the Secretary which led to the adversary 
adjudication, but does not include a recitation by the Secretary of the 
maximum statutory penalty--
    (1) In the administrative complaint, or
    (2) Elsewhere when accompanied by an express demand for a lesser 
amount.
    6. Section 2704.106(b) is revised to read as follows:


Sec. 2704.106  Allowable fees and expenses.

* * * * *
    (b) No award for the fee of an attorney or agent under this part 
may exceed $125.00 per hour. No award to compensate an expert witness 
may exceed the highest rate at which the Secretary of Labor pays expert 
witnesses. However, an award may also include the reasonable expenses 
of the attorney, agent, or witness as a separate item if the attorney, 
agent or witness ordinarily charges clients separately for such 
expenses.
* * * * *
    7. Section 2704.107(a) is revised to read as follows:


Sec. 2704.107  Rulemaking on maximum rates for attorney fees.

    (a) If warranted by an increase in the cost of living or by special 
circumstances (such as limited availability of attorneys qualified to 
handle certain types of proceedings), the Commission may adopt 
regulations providing that the fees of an attorney or agent may be 
awarded at a rate higher than $125.00 per hour in some or all of the 
types of proceedings covered by this part.
* * * * *
    8. Section 2704.108 is revised to read as follows:


Sec. 2704.108  Awards.

    If an applicant is entitled to an award because it has met its 
burden of proof under Sec. 2704.105 (a) or (b), the award shall be made 
by the Commission against the Department of Labor.
    9. Subpart B is revised to read as follows:

Subpart B--Information Required From Applicants

Sec.
2704.201  Contents of application--in general.
2704.202  Contents of application--where the applicant has 
prevailed.
2704.203  Contents of application--where the Secretary's demand is 
substantially in excess of the judgment finally obtained and 
unreasonable.
2704.204  Confidential financial information.
2704.205  Documentation of fees and expenses.
2704.206  When an application may be filed.

Subpart B--Information Required From Applicants


Sec. 2704.201  Contents of application--in general.

    (a) An application for an award of fees and expenses under the Act 
shall be made to the Chief Administrative Law Judge of the Commission 
at 1730 K Street NW, 6th Floor, Washington, DC 20006. The application 
shall identify the applicant and the underlying proceeding for which an 
award is sought.
    (b) The application shall state the amount of fees and expenses for 
which an award is sought.
    (c) The application may also include any other matters that the 
applicant wishes the Commission to consider in determining whether and 
in what amount an award should be made.
    (d) The application should be signed by the applicant or an 
authorized officer or attorney of the applicant. It shall also contain 
or be accompanied by a written verification under oath or under penalty 
of perjury that the information provided in the application is true and 
correct.
    (e) Upon receipt of an application, the Chief Administrative Law 
Judge shall immediately assign it for disposition to the administrative 
law judge who presided over the underlying Mine Act proceeding.


Sec. 2704.202  Contents of application--where the applicant has 
prevailed.

    (a) An application for an award under Sec. 2704.105(a) shall show 
that the applicant has prevailed in a significant and discrete 
substantive portion of the underlying proceeding and identify the 
position of the Department of Labor in the proceeding that the 
applicant alleges was not substantially justified. Unless the applicant 
is an individual, the application shall also state the number of 
employees of the applicant and describe briefly the type and purpose of 
its organization or business.
    (b) The application also shall include a statement that the 
applicant's net worth does not exceed $2 million (if an individual) or 
$7 million (for all other applicants including their affiliates, as 
described in Sec. 2704.104(b)(2) of this part).
    (c) Each applicant must provide with its application a detailed 
exhibit showing the net worth of the applicant and any affiliates (as 
described in Sec. 2704.104(b)(2) of this part) when the underlying 
proceeding was initiated. The exhibit may be in any form convienient to 
the applicant that

[[Page 66965]]

provides full disclosure of the applicant's and its affiliates' assets 
and liabilities and is sufficient to determine whether the applicant 
qualifies under the standards in this part. The administrative law 
judge may require an applicant to file additional information to 
determine its eligibility for an award.


Sec. 2704.203  Contents of application--where the Secretary's demand is 
substantially in excess of the judgment finally obtained and 
unreasonable.

    (a) An application for an award under Sec. 2704.105(b) shall show 
that the Secretary's demand is both substantially in excess of the 
decision of the Commission and is unreasonable when compared with such 
decision.
    (b) The application shall show that the applicant is a small entity 
as defined in 5 U.S.C. 601(6) and must conform with the standards of 
the Small Business Administration at 13 CFR 121.201 for mining 
entities. The application shall include a statement of the applicant's 
annual receipts or number of employees, as applicable, in conformance 
with the requirements of 13 CFR 121.104 and 121.106. The application 
shall describe briefly the type and purpose of its organization or 
business.


Sec. 2704.204  Confidential financial information.

    Ordinarily, the net-worth and annual receipts exhibits will be 
included in the public record of the proceeding. However, an applicant 
that objects to public disclosure of information in any portion of such 
exhibits and believes there are legal grounds for withholding the 
information from disclosure may submit that portion of the exhibit 
directly to the administrative law judge in a sealed envelope labeled 
``Confidential Financial Information,'' accompanied by a motion to 
withhold the information from public disclosure. The motion shall 
describe the information sought to be withheld and explain, in detail, 
why it falls within one or more of the specific exemptions from 
mandatory disclosure under the Freedom of Information Act, 5 U.S.C. 
552(b)(1)-(9), why public disclosure of the information would adversely 
affect the applicant, and why disclosure is not required in the public 
interest. The material in question shall be served on counsel 
representing the Secretary of Labor against whom the applicant seeks an 
award, but need not be served on any other party to the proceeding. If 
the administrative law judge finds that the information should not be 
withheld from disclosure, it shall be placed in the public record of 
the proceeding. Otherwise, any request to inspect or copy the exhibit 
shall be disposed of in accordance with the established procedures 
under the Freedom of Information Act (29 CFR part 2702).


Sec. 2704.205 Documentation of fees and expenses.

    The application shall be accompanied by full documentation of the 
fees and expenses, including the cost of any study, analysis, 
engineering report, test, project or similar matter, for which an award 
is sought. A separate itemized statement shall be submitted for each 
professional firm or individual whose services are covered by the 
application, showing the hours spent in connection with the underlying 
proceeding by each individual, a description of the specific services 
performed, the rate at which each fee has been computed, any expenses 
for which reimbursement is sought, the total amount claimed, and the 
total amount paid or payable by the applicant or by any other person or 
entity for the services provided. The administrative law judge may 
require the applicant to provide vouchers, receipts, or other 
substantiation for any expenses claimed.


Sec. 2704.206  When an application may be filed.

    (a) An application may be filed whenever the applicant has 
prevailed in the underlying proceeding or in a significant and discrete 
substantive portion of that proceeding. An application may also be 
filed when a demand by the Secretary is substantially in excess of the 
decision of the Commission and is unreasonable when compared with such 
decision. In no case may an application be filed later than 30 days 
after the Commission's final disposition of the underlying proceeding, 
or 30 days after issuance of a court judgment this is final and 
nonappealable in any Commission adjudication that has been appealed 
pursuant to section 106 of the Mine Act, 30 U.S.C. 816.
    (b) If review or reconsideration is sought or taken of a decision 
on the merits as to which an applicant has prevailed or has been 
subjected to a demand from the Secretary substantially in excess of the 
decision of the Commission and unreasonable when compared to that 
decision, proceedings for the award of fees shall be stayed pending 
final disposition of the underlying controversy.
    (c) For purposes of this part, final disposition before the 
Commission means the date on which a decision in the underlying 
proceeding on the merits becomes final under sections 105(d) and 113(d) 
of the Mine Act (30 U.S.C. 815(d), 823(d)).

Subpart C--Procedures for Considering Applications

    10. Section 2704.305 is revised to read as follows:


Sec. 2704.305  Settlement.

    If an applicant and counsel for the Secretary agree on a proposed 
settlement of an award before an application has been filed, the 
application shall be filed with the proposed settlement.
    11. Section 2704.307 is revised to read as follows:


Sec. 2704.307  Decision of administrative law judge.

    The administrative law judge shall issue an initial decision on the 
application within 75 days after completion of proceedings on the 
application. In all decisions on applications, the administrative law 
judge shall include written findings and conclusions on the applicant's 
eligibility, an explanation of the reasons for any difference between 
the amount requested and the amount awarded. As to applications filed 
pursuant to Sec. 2704.105(a), the administrative law judge shall also 
include findings on the applicant's status as a prevailing party and 
whether the position of the Secretary was substantially justified; if 
at issue, the judge shall also make findings whether the applicant 
unduly protracted or delayed the underlying proceeding or whether 
special circumstances make the award unjust. As to applications filed 
pursuant to Sec. 2704.105(b), the administrative law judge shall 
include findings that the Secretary made a demand that is substantially 
in excess of the decision of the Commission and unreasonable when 
compared with that decision; if a issue, the judge shall also make 
findings whether the applicant has committed a willful violation of the 
law or otherwise acted in bad faith or whether special circumstances 
make the award unjust. The initial decision by the administrative law 
judge shall become final 40 days after its issuance unless review by 
the Commission is ordered under Sec. 2704.308 of this part.
    Issued this 6th day of December, 1996 at Washington, D.C.
Mary Lu Jordan,
Chairman, Federal Mine Safety and Health Review Commission.
[FR Doc. 96-31631 Filed 12-18-96; 8:45am]
BILLING CODE 6735-01-P