E. I. DU PONT DE NEMOURS & COMPANY

OSHRC Docket No. 79-2261

Occupational Safety and Health Review Commission

February 13, 1981

[*1]

Before: CLEARY, Chairman; BARNAKO and COTTINE, Commissioners.

COUNSEL:

Baruch A. Fellner, Office of the Solicitor, USDOL

F. V. LaRuffa, Reg. Sol., USDOL

Hastings S. Trigg, Jr., E. I. Du Pont De Nemours & Co., Legal Department D-7150, for the employer

Robert F. O'Brien, for the employer

OPINION:

DECISION

BY THE COMMISSION:

This is a case under the Occupational Safety and Health Act of 1970, 29 U.S.C. 651-678 ("the Act"). A decision of Administrative Law Judge Edward V. Alfieri is before the Commission for review under section 12(j) of the Act, 29 U.S.C. 661(i). Judge Alfieri approved a settlement proposal entered into by the Secretary of Labor and Respondent, E.I. Du Pont De Nemours & Co. Commissioner Cottine granted the authorized employee representative's petition for discretionary review. In his direction for review, Commissioner Cottine stated the primary issue presented by the authorized employee representative's petition as:

Whether the language of clause 6(2) of the settlement agreement between the Secretary and the Respondent in this case is inconsistent with the provisions and objectives of the Occupational Safety and Health Act, 29 U.S.C. 651-678. The clause states: [*2]

"That the Citation and Notification of Penalty, Complaint, Answer, Stipulated Settlement, Respondent's Notice of Contest, Respondent's withdrawal of its Notice of Contest, Respondent's failure to continue to contest, Respondent's abatement of the alleged violations, Respondent's payment of any penalty and the Commission's Final Order entered herein shall not constitute any evidence or admission upon the part of Respondent, or be admitted into evidence, in whole or in part, in any proceeding or litigation in any court, agency or forum, except in proceedings brought directly under the Act by the Secretary, inasmuch as the contents of the Stipulated Settlement are for the exclusive benefit of the parties hereto; nor shall they constitute an admission upon the part of Respondent that any of the conditions alleged in the Citations or Complaint existed or were the cause, or a cause, proximate or otherwise, of any accident, or damages, if any, resulting therefrom."

After it was served with a copy of the settlement proposal, the authorized employee representative, the Chemical & Industrial Union ("Union") filed with the Judge an objection to the settlement proposal. The judge subsequently [*3] held a hearing on the Union's objections.

At the hearing, the parties stipulated that some of the Union members affected by some of the sited conditions were "involved in third party and workmen's compensation actions." The Union made two basic objections to the settlement proposal. First, it contended that approval of a proposal with the above exculpatory language would deny access in future legal proceedings to previously public documents. Second, such language would prevent the introduction into evidence of such documents and would thereby hinder recovery in workers' compensation and civil tort actions by employees who suffered injury as a result of the cited conditions. The Union attempted to distinguish the Commission's decision in Farmers Export Co., 80 OSAHRC    , 8 BNA OSHC 1655, 1980 CCH OSHD P24,569 (No. 78-1708, 1980) ("Farmers Export"), on the ground that there the Commission held permissible only clauses restricting the admissibility of the settlement in non-agency forums. The Union maintains that Farmers Export did not deal with the more sweeping clause presented here, which, according to the Union, purports to bar the admission of the citation and similar [*4] documents in non-agency forums when offered by persons not signatories to the settlement. n1

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n1 As noted above, the Union argues that the language of clause 6(2) of the settlement would deny access to previously public documents. The Commission's official records as well as transcripts of its hearings are open to the public. Section 12(g) of the Act, 29 U.S.C. 661(f). See also, Commission Rule 105, 29 C.F.R. 2200.105. The Secretary represented in his post-hearing brief to the judge, and Du Pont did not dispute, that "this agreement does not in any way preclude anyone from receiving any information from the files of the government available under the Freedom of Information Act", 5 U.S.C. 552.

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The judge, following our decision in Farmers Export held that "the inclusion of the exculpatory language objected to by the Union does not warrant the disapproval of the settlement agreement." He rejected the Union's argument that Farmers Export was distinguishable. He viewed our decision there as including [*5] the view that the inclusion of an exculpatory clause that affects only proceedings in other forums and not matters arising under the Act is not objectionable. He therefore approved the settlement proposal.

In its brief in support of its petition for review, the Union renews the arguments it made before the judge. We have considered the Union's arguments and conclude that the judge correctly decided the issues for the reasons he assigned. n2 Accordingly, we adopt the judge's decision. See Gulf Oil Co., 77 OSAHRC 216/BIO, 6 BNA OSHC 1240, 1978 CCH OSHD P22,737 (No. 14281, 1977).

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n2 The Union's motion for oral argument is denied.

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SO ORDERED.

CONCURBY: COTTINE

CONCUR:

COTTINE, Commissioner, concurring:

Section 4(b)(4) of the Act provides that nothing in the statute shall be construed to enlarge, diminish, or otherwise affect common law or statutory rights of employers and employees with respect to job-related injuries, diseases or deaths of employees. n1 As a matter of federal law, settlement agreements attempting to restrict [*6] or enlarge those rights in violation of section 4(b)(4) cannot be approved by the Commission. However, the settlement agreement in this case is properly approved because the record lacks support for the Union's claims that the agreement violates its members' rights protected by section 4(b)(4). In addition, considerations of judicial administration in our federal system favor resolution of the Union's claims in the forums where the agreement may be introduced to enlarge or diminish obligations in violation of section 4(b)(4).

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n1 The language of section 4(b)(4), 29 U.S.C. 653(b)(4), is as follows:

Nothing in this chapter shall be construed to supersede or in any manner affect any workmen's compensation law or to enlarge or diminish or affect in any other manner the common law or statutory rights, duties, or liabilities of employers and employees under any law with respect to injuries, diseases, or death of employees arising out of, or in the course of, employment.

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I

Clause 6(2) of the settlement agreement, the [*7] provision challenged by the Union, is not a simple exculpatory clause involving a unilateral representation by the employer that its agreement to settle the citation is not to be construed as an admission in any non-OSHA proceeding. n2 See Farmers' Export Co., 8 BNA OSHC 1655, 1663, 1980 CCH OSHD P24,569 at pp. 30,086-7 (No. 78-1708, 1980) (Cottine, Commissioner, dissenting). In contrast to the exculpatory provision in Farmers' Export Co., the challenged provision in this case attempts to specifically restrict the discovery and introduction of documents such as the citation and complaint.

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n2 The text of clause 6(2) is set out in the lead opinion at p. 2.

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The Union challenges this clause on the grounds that it violates the rights of its member employees under both federal and state law. n3 Specifically, the Union argues that this provision violates state law in that it restricts the use of evidence in proceedings by its members against the respondent. n4 Thus, it contends that the documents purportedly [*8] made inadmissible under the terms of this agreement may be relevant to a determination by a state worker's compensation agency as to the level of compensation awarded. Union's Brief Supporting Review at 11-12. In addition, the Union claims that these documents may be relevant to a finding with respect to the applicable standard of care and its alleged breach in a personal injury action or other claim brought under statutory or common law. Id. at 12-14. n4

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n3 For the reasons stated in the lead opinion at note 1, I join in rejecting the Union's objections based on the federal Freedom of Information Act (FOIA), 5 U.S.C. 552, the Secretary's FOIA regulations, 29 C.F.R. Parts 70 and 1906, and the historic national policy of access to public documents and judicial records.

n4 There is no specific claim in this case that the challenged provision interferes with Union members' rights under any federal law with respect to job-related injuries, illnesses, or deaths of employees. E.g. Longshoremen's and Harbor Workers' Compensation Act, 33 U.S.C. 901 et seq. (1978, as amended); Jones Act, 46 U.S.C. 688 (1975); Federal Employers' Liability Act, 45 U.S.C. 51 et seq. (1972). Thus, this opinion deals exclusively with the effect of the settlement agreement on state law.

[*9]

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To the extent that restrictions on the use of the citation, complaint, and related documents conflict with substantive rights and obligations under state law, the challenged provisions of the settlement violate section 4(b)(4) and the agreement would have to be disapproved as not consistent with the provisions and objectives of the Act. See Commission Rule 100(a), 29 C.F.R. 2200.100(a) (1979).

However, in applying section 4(b)(4) of the Act to this case, it is important to note that this section saves to the states their authority to continue to develop their statutory and common law with respect to recovery for occupational injuries and illnesses. n5 Specifically, it reserves to the states the authority to assign whatever substantive significance it deems proper to OSHA regulations and Commission decisions in personal injury actions and workers' compensation claims arising out of the employment relation. See National Marine Services, Inc v. Gulf Oil, Inc., 433 F.Supp. 913 (E.D. La. 1977), aff'd mem., 608 F.2d 522 (5th Cir. 1979); but see Otto v. Specialties, Inc., 386 F.Supp. [*10] 1240 (N.D. Miss. 1974). For example, a state that previously used state health and safety regulations to determine the applicable standard of care in personal injury actions arising out of the employment relation is not precluded as a matter of federal law from modifying its statutory or case law to permit OSHA standards to be determinative of the standard of care. n6 Thus, section 4(b)(4) is substantively neutral in its effect on state law n7 -- it imposes neither a federally mandated reform nor a federally reinforced status quo.

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n5 Unless Congress clearly declares in the legislation that it intends to preempt state laws, the courts normally sustain state or local regulation on the same subject unless it conflicts with the federal law. Malone v. White Motor Corp., 435 U.S. 497, 504 (1978). Section 4(b)(4) expressly avoids any interpretation of the Act that would preempt state laws concerning workers' compensation or job-related personal injury actions.

n6 In fact, this development could be anticipated in those states that declined to resume state jurisdiction under section 18 of the Act, 29 U.S.C. 667.

n7 Compare S. 420, 96th Cong., 1st Sess. (1979) with 29 U.S.C. 676 (1970). See generally Nat'l Comm. on State Workmen's Compensation Laws, Report of the National Commission (1973); Note, Compensating Victims of State Occupational Disease, 93 Harv. L. Rev. 916 (1980).

[*11]

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II

In accommodating the respective authorities of the federal and state forums under section 4(b)(4), the Commission should be guided by principles of "wise judicial administration, giving regard to conservation of judicial resources and comprehensive disposition of litigation," as stated by the Supreme Court in Colorado River Water Conservation District v. United States, 424 U.S. 800, 817 (1976) (quoting Kerotest Mfg. Co. v. C-O-Two Fire Equipment Co., 342 U.S. 180, 183 (1952)). As the Court noted in Colorado River, there are limited circumstances when a federal court may dismiss a suit due to the exercise of concurrent jurisdiction over the controversy by a state court despite "the virtually unflagging obligation of the federal courts to exercise the jurisdiction given them." 424 U.S. at 817. n8

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n8 See generally 17 Wright, Miller & Cooper, Federal Practice and Procedure: Jurisdiction 4247 (1978); 1A Pt. 2 Moore's Federal Practice P0.203[4] (2d ed. 1980).

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In this case, state resolution of the contentions concerning the operation of section 4(b)(4) is preferable. First, the Union's contentions are exclusively premised on the effect of the challenged provision on state law. n9 In this regard, the Union has not shown any specific conflict between the challenged settlement provision and state statutory or common law that would be violative of section 4(b)(4). n10 Second, state resolution of this issue is preferable because there are presently pending civil suits and state workers' compensation actions brought by members of the Union against the Respondent based on the cited conditions. The state courts and administrative agencies hearing those cases have the authority to rule on the enforceability of this settlement agreement in their proceedings, particularly the legal effect to be given any exculpatory clauses. See Farmers' Export Co., supra. (Cottine, Commissioner, dissenting). The possibility of piecemeal litigation can be avoided if the state forums resolve the related federal issue arising under section 4(b)(4) when enforcement of the settlement agreement is sought [*13] in the state procedings. In the context of this case, efficient administration of justice is best preserved by reliance on state forums to resolve any underlying federal question arising under section 4(b)(4). n11

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n9 See note 3, supra.

n10 Because there is no specific state law challenge in this case, other federalism issued involving the interpretation of state law by a federal forum are not presented. See generally Railroad Comm'n of Tex. v. Pullman Co., 312 U.S. 496 (1941); 17 Wright, Miller & Cooper, supra note 7, at 4241-4248; 1A Pt. 2 Moore's Federal Practice P0.203.

n11 This case must be contrasted with a case not presently actionable in a state forum because the occupational injury or disease is either latent or not discoverable.

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When no clear violation of section 4(b)(4) is presented, reliance on state forums to resolve this mixed question of federal and state law is also consistent with the separate and distinct functions of state forums which are inherent in our constitutional [*14] federalism. As the Supreme Court recently observed, "in many articles of the Constitution the necessary existence of the States, and, within their proper spheres, the independent authority of the States, is distinctly recognized." National League of Cities v. Usery, 426 U.S. 833, 844 (1976) (quoting Lane County v. Oregon, 74 U.S. (7 Wall.) 71, 76 (1869)). By leaving to state forums the resolution of issues concerning a settlement agreement that may be inconsistent with section 4(b)(4), we avoid any unnecessary interference with those proceedings. See Colorado River Water Conservation Dist. v. U.S., supra at 813-18.

III

The Commission's approval of this settlement agreement is limited to our proceedings. Farmers' Export Co., supra, 8 BNA OSHC at 1657, 1662, 1980 CCH OSHD at pp. 30,081 & 30,085-6. As a consequence, state forums have jurisdiction to decide what effect, if any, they will give this settlement agreement in their proceedings. n12 In exercising this jurisdiction, state forums are free to set aside the challenged provision of the settlement agreement as: (1) inconsistent with state law, cf. Radio Station WOW, Inc. v. Johnson, 326 [*15] U.S. 120 (1945) (claim of fraud in a contract involving FCC-approved transfer of interest in licensed radio station), or (2) "enlarging or limiting" rights and obligations under state law in violation of section 4(b)(4) of the Act, U.S. CONST. art. VI, cl. 2; cf. Martin v. Hunter's Lessee, 14 U.S. (1 Wheat.) 304 (1816) (state courts have duty to enforce obligations under federal law). Thus, the Union and its members are free to challenge the enforcement of this settlement wherever the agreement may be introduced to limit or enlarge the common law or statutory rights and obligations of employees or employers for work-related injury, illness, or death.

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n12 It also should be noted that the Union cannot be bound by any settlement provision it does not agree to, consistent with the general principles applicable to settlement agreements. See Sartor v. Southern Carbon Co., 61 F.Supp. 649 (W.D. La. 1945); 15A C.J.S. Compromise & Settlement 28 (1967).

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