United States of America OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION 1120 20th Street, N.W., Ninth Floor Washington, DC 20036-3457 SECRETARY OF LABOR, Complainant, v. OSHRC Docket Nos. 09-2011, 09-2055, 10-0447 CRANESVILLE AGGREGATE COMPANIES, INC., d/b/a SCOTIA BAG PLANT; and CRANESVILLE BLOCK COMPANY, INC. Respondents. APPEARANCES: Kathryn L. Stewart and Matthew Sullivan, Attorneys; Suzanne Demitrio, Senior Trial Attorney; Patricia M. Rodenhausen, Regional Solicitor; M. Patricia Smith, Solicitor of Labor, U.S. Department of Labor, New York City, NY For the Complainant Henry Chajet, Esq. and R. Brian Hendrix, Esq.; Patton Boggs LLP, Washington, DC; and Walter G. Breakell, Esq.; Breakell Law Firm P.C., Albany, NY For the Respondent DECISION AND ORDER Before: ROGERS, Chairman; and ATTWOOD, Commissioner. BY THE COMMISSION: Cranesville Aggregate Companies, Inc., d/b/a Scotia Bag Plant (“Cranesville”) operates a facility, known as the “Bag Plant,” near Albany, New York. The Occupational Safety and Health Administration (“OSHA”) commenced an inspection of the Bag Plant in May 2009 and, that November, issued Cranesville multiple serious, willful, and repeat citations under two inspection numbers. Footnote During discovery, Cranesville filed motions with the judge seeking to compel the Secretary’s production of three internal OSHA memoranda relating to the issuance of these citations, and requesting leave to depose three employees of the Mine Safety and Health Administration (“MSHA”). The Secretary opposed these motions, claiming that the internal memoranda were protected under the deliberative process, work product, and attorney-client privileges, and the MSHA employees’ depositions could not be compelled because they are high-ranking government officials who have no personal knowledge of the facts of this case, and their testimony would be either irrelevant or protected by the deliberative process privilege. Administrative Law Judge G. Marvin Bober Footnote granted Cranesville’s deposition motion on December 27, 2010, and, on January 10, 2011, denied the Secretary’s motion for reconsideration. Also, after ordering the Secretary to submit the unredacted internal OSHA memoranda for an /in camera/ review, the judge made /sua sponte /redactions, and disclosed them directly to Cranesville. The Secretary petitioned the Commission for interlocutory review of the judge’s three discovery orders under Commission Rule 73(a), 29 C.F.R. § 2200.73(a), renewing the arguments she made before the judge, and contending that the judge’s disclosure of the redacted memoranda to Cranesville was in violation of the Commission’s procedural rules. The Commission granted the Secretary’s petitions on February 1, 2011, and stayed the consolidated cases during the pendency of the interlocutory review. The parties have filed briefs with the Commission in support of their positions on the issues raised by the Secretary’s petitions. For the reasons that follow, we conclude that the internal OSHA memoranda should have been protected from disclosure in their entirety, and that leave to take a deposition should have been granted only as to one of the three MSHA employees. Accordingly, we set aside all three of the judge’s orders, lift the stay, and direct the Chief Administrative Law Judge to assign these cases for further proceedings consistent with this opinion. /Internal OSHA memoranda/ In his order disclosing the internal OSHA memoranda to Cranesville, the judge explained his rationale for redacting certain portions of these memoranda—designated in the record as Exhibits A, B, and C—but did not fully address all of the Secretary’s privilege claims. Footnote On review, the Secretary limits her claims of privilege to Exhibits B and C. In support of her argument that these memoranda are protected from disclosure under the deliberative process, attorney-client, and work product privileges, an attorney from the Solicitor’s Office in the Department of Labor has averred that the memoranda: (1) “concern OSHA’s health and safety investigations of Respondent’s facility”; (2) “detail OSHA’s legal and factual analysis of potential citations and make recommendations as to the number, types and gravity of violations proposed”; and (3) “were prepared as part of a process known as ‘Joint Review,’ whereby OSHA officials and attorneys from the Solicitor’s Office collaboratively review, discuss, and, if necessary, modify proposed citations.” Although the memoranda “were primarily drafted by OSHA personnel,” attorneys “provided extensive input and legal advice to OSHA employees” about them. Also, attorneys “met with OSHA personnel to discuss the proposed citations, penalties, and theories of liability described in these materials,” and, on at least two occasions, met with such personnel “to specifically discuss and review the information” in the memoranda. We conclude, based on the following analysis, that Exhibits B and C, in their entirety, are protected from disclosure by the work product privilege. Footnote The work product privilege “protects from disclosure certain materials prepared by attorneys or their agents acting for clients in anticipation of litigation.” Footnote /St. Lawrence Food Corp./, 21 BNA OSHC 1467, 1470-71, 2004-09 CCH OSHD ¶ 32,801, p. 52,479 (No. 04-1734, 2006) (consolidated). This privilege “applies when the materials in question are shown to be (1) documents or other tangible things, including an attorney’s ‘mental impressions, conclusions, opinions or legal theories,’ (2) prepared in anticipation of litigation or trial,and (3) gathered by or for a party or by or for that party’s representative.” /Id./ at 1471, 2004-09 CCH OSHD at p. 52,479 (citation omitted). The judge recognized in his order that the Secretary had asserted this privilege, but he did not determine its applicability to the memoranda at issue. Here, the record shows that attorneys from the Solicitor’s Office were involved in the review and preparation of these documents and had addressed matters, such as the standards to be cited, the justifications for willful and repeat characterization, and the proposed penalty amounts. Their “mental impressions, conclusions, opinions or legal theories” are reflected in the documents and are thus implicated here./Id./, 2004-09 CCH OSHD at p. 52,479. Moreover, at the time the documents were prepared litigation was plainly anticipated, as the documents comprise a draft and revisions setting forth the factual and legal bases for the violation allegations and penalty assessments to be contained in an OSHA citation. And OSHA personnel, along with the attorneys from the Solicitor’s Office, would have understood that matters such as the standards cited, justifications for characterization, and the proposed penalty amounts would be central to that litigation. /See id. /at 1471 n.7, 2004-09 CCH OSHD at p. 52,479 n.7 (noting rule of law set forth in /United States v. Adlman/, 134 F.3d 1194, 1202 (2d Cir. 1998), which states that documents are deemed “prepared ‘in anticipation of litigation’ . . . if ‘in light of the nature of the document and the factual situation in the particular case, the document can fairly be said to have been prepared or obtained /because of/ the prospect of litigation’ ”); /EEOC v. Lutheran Social Serv./, 186 F.3d 959, 968 (D.C. Cir. 1999) (noting that “prospect of litigation” means that “the lawyer must at least have had a subjective belief that litigation was a real possibility, and that belief must have been objectively reasonable” (internal quotation marks omitted)). Finally, as to satisfaction of the last element, there is no question that OSHA created these memoranda, i.e., that it “gathered” the documents. /St. Lawrence Food Corp./, 21 BNA OSHC at 1471, 2004-09 CCH OSHD at p. 52,479. We also note that opinion work product, such as the recommendations included in the exhibits, “is virtually undiscoverable.” /United States v. Deloitte, LLP/, 610 F.3d 129, 135 (D.C. Cir. 2010) (citation omitted); /St. Lawrence Food Corp./, 21 BNA OSHC at 1471, 2004-09 CCH OSHD at p. 52,479 (“Opinion work product enjoys either absolute or near-absolute immunity and is only discoverable in very rare and extraordinary circumstances, such as where [it] contains evidence of fraud or illegal activities.”). And other work product, such as statements of fact, is discoverable, but only if the party seeking the material “shows that it has substantial need for the materials to prepare its case and cannot, without undue hardship, obtain their substantial equivalent by other means.” Fed. R. Civ. P. 26(b)(3) (noting that this exception applies only to material that is otherwise discoverable under Federal Rule of Procedure 26(b)(1)); /Office of Thrift Supervision v. Vinson & Elkins, LLP/, 124 F.3d 1304, 1307 (D.C. Cir. 1997) (“A party can discover fact work product upon showing a substantial need for the materials and an undue hardship in acquiring the information any other way.”). Cranesville has made no attempt here to demonstrate such a need. We thus conclude that the Secretary has established that Exhibits B and C are protected, in their entirety, by the work product privilege. Under these circumstances, we find that the judge erred in partially disclosing these two memoranda to Cranesville after redacting certain information, /sua sponte/. Commission Rule 52(d)(2) permits a party to “obtain as of right an order sealing from the public those portions of the record containing the allegedly privileged information pending interlocutory or final review of the ruling, or final disposition of the case, by the Commission.” 29 C.F.R. § 2200.52(d)(2). Thus, not only are Exhibits B and C fully protected from disclosure, the judge’s decision to partially disclose their contents, without providing the Secretary an opportunity to review his redactions and respond accordingly, deprived the Secretary of this right. Indeed, the Secretary was entitled to seek interlocutory review of the judge’s order /before/ information “alleged to be privileged” was disclosed. 29 C.F.R. § 2200.73(a)(2). To remedy this situation, we direct the Chief Judge to immediately enter a protective order that (1) requires Cranesville to return all outstanding copies of Exhibits B and C to the Secretary, and (2) prohibits it from using Exhibits B and C in any way, including during the proceedings before the Commission. This order should also seal from the public any copies of Exhibits B and C presently in the record. 29 C.F.R. § 2200.52(d)(2). /Leave to depose MSHA employees/ Cranesville sought leave under Commission Rule 56(a) to depose three MSHA employees—James Petrie, Donald Foster, and James Hull—on issues pertaining to Cranesville’s defense that MSHA, rather than OSHA, had jurisdiction over the cited facility. 29 C.F.R. § 2200.56(a) (“Depositions of . . . witnesses shall be allowed only by agreement of all the parties, or on order of the Commission or Judge following the filing of a motion of a party stating good and just reasons.”). Petrie was an MSHA district manager at the time OSHA inspected Cranesville’s facility in 2009 and is presently a senior health specialist in MSHA’s Office of Standards. Foster was an MSHA assistant district manager at the time of the 2009 inspections and is presently a district manager. And Hull has been an MSHA supervisory inspector at all relevant times. According to Cranesville, the topics to be addressed with these prospective deponents are (1) “the historic application” of the memorandum of understanding (“MOU”) Footnote between OSHA and MSHA on jurisdictional issues; (2) the MOU’s application to, and the “historical jurisdictional treatment” of, Cranesville’s property, which includes the cited facility; and (3) “the facts and circumstances surrounding the sudden assertion of jurisdiction by OSHA over [Cranesville’s] property.” In her opposition to Cranesville’s motion, the Secretary relied on /Simplex Time Recorder Co. /(“/Simplex/”)/v. Secretary of Labor/, 766 F.2d 575 (D.C. Cir. 1985), to claim that all three MSHA employees qualify as high-ranking government officials. Without addressing the Secretary’s claim, the judge granted Cranesville’s motion and denied the Secretary’s motion for reconsideration. We conclude that, under /Simplex/, the judge erred in granting Cranesville leave to depose two of the three MSHA employees, Petrie and Foster. Thus, we find that the MSHA district manager position—held by Petrie at the time of OSHA’s inspections and currently held by Foster—is that of a high-ranking government official who, under the circumstances of this case, cannot be compelled to provide deposition testimony. In /Simplex/, the D.C. Circuit determined that the Solicitor of Labor, the Secretary’s chief of staff, an OSHA regional administrator, and an OSHA area director were all “top executive department officials” who “should not, absent extraordinary circumstances, be called to testify regarding their reasons for taking official actions.” 766 F.2d at 586.//As evidenced by the MOU between OSHA and MSHA, which permits certain jurisdictional issues to be resolved by the OSHA regional administrator and the MSHA district manager, Footnote these two positions are of approximately equivalent ranking within OSHA and MSHA, sister agencies within the Department of Labor. We thus find that an MSHA district manager, like the OSHA regional administrator in /Simplex/, is the type of official who, “absent extraordinary circumstances,” may not be required to testify about his or her “reasons for taking official actions.”/Id./ The protection afforded to high-ranking government officials has been applied to current holders of high-ranking positions and, in some instances, to individuals who formerly held these positions. /See United States v. Sensient Colors, Inc./, 649 F. Supp. 2d 309, 316-18 (D.N.J. 2009); /United States v. Wal-Mart Stores, Inc./, No. CIV.A. PJM-01-1521, 2002 WL 562301, at **2-4 (D. Md. Mar. 29, 2002). The rationale for providing such protection is based, in part, “on the notion that ‘[h]igh ranking government officials have greater duties and time constraints than other witnesses’ and that, without appropriate limitations, such officials will spend an inordinate amount of time tending to pending litigation.” /Bogan v. City of Boston/, 489 F.3d 417, 423 (1st Cir. 2007) (citation omitted). This purpose supports extending high-ranking status to Foster in his current capacity as MSHA district manager but not necessarily to Petrie, who is currently employed as an MSHA senior health specialist, a position that is not akin to those the court found to be high ranking in /Simplex/. Nonetheless, we find that Petrie’s role while serving as MSHA’s district manager at the time of the 2009 inspections is entitled to protection, and this protection survives Petrie’s change in position. As the Supreme Court noted in /United States v. Morgan/, 313 U.S. 409, 422 (1941), it is “not the function of the court to probe the mental processes of the Secretary”; “[j]ust as a judge cannot be subjected to such scrutiny, so the integrity of the administrative process must be equally respected.” Moreover, courts have held in some cases that subjecting the decision-making processes of former high-ranking government officials “to judicial scrutiny and the possibility of continued participation in lawsuits years after leaving public office would serve as a significant deterrent to qualified candidates for public service.” /Wal-Mart Stores, Inc./, No. CIV.A. PJM-01-1521, 2002 WL 562301, at *3; /accord Sensient Colors, Inc./, 649 F. Supp. 2d at 316. Based on these considerations, we find that both Foster and Petrie are entitled to be treated as high-ranking government officials for purposes of assessing whether Cranesville should be permitted to take their depositions. The protection, however, is not absolute since “[d]epositions of high ranking officials may be permitted where the official has first-hand knowledge related to the claim being litigated.”/Bogan/, 489 F.3d at 423. But “even in such cases, discovery is permitted only where it is shown that other persons cannot provide the necessary information.” /Id./ Here, both Foster and Petrie averred in their declarations that they (1) had “no first-hand knowledge of any facts of this case or the underlying investigation that led to the citation[s] in this case”; (2) “neither compiled nor gathered any factual information relating to the citation[s],” and did not recall ever visiting the cited facility or the nearby quarry that, on previous occasions, had been inspected by MSHA; and (3) had no involvement, either directly or as a consultant, in “OSHA’s decision to inspect” the cited facility. In certain circumstances, a party may be permitted to test through deposition the veracity of averments made in a sworn statement. /See Rolscreen Co. v. Pella Prods. of St. Louis, Inc./, 145 F.R.D. 92, 97 (S.D. Iowa 1992) (concluding that party, through deposition, is “entitled to ‘test’ ” company president’s “professed lack of knowledge,” as averred in affidavit, regarding matter relevant to cause of action). But here, there is no indication that, before subpoenaing Foster and Petrie, Cranesville attempted to “pursue other sources to obtain” the first-hand knowledge that it believes Foster and Petrie may be able to provide. /Bogan/, 489 F.3d at 424 (concluding that need to depose high-ranking official—mayor of Boston—was not established “because [those seeking the deposition] did not pursue other sources to obtain relevant information before turning to the Mayor”). Accordingly, given the status of Foster and Petrie as high-ranking government officials, their sworn statements denying any knowledge of the relevant facts, and Cranesville’s failure to demonstrate that the “first-hand knowledge” it seeks from them could not be obtained through other means, we conclude that the judge erred in granting Cranesville leave to depose Foster and Petrie. However, MSHA Supervisory Inspector Hull, who manages a staff of eleven employees, is not a high-ranking government official under the court’s rationale in /Simplex/. The lowest ranking official in /Simplex /to be granted this status was the OSHA area director—a position that is not comparable to an MSHA supervisory inspector—and we find that other applicable precedent does not support extending the protection to a supervisory employee in Hull’s position. /Simplex/, 766 F.2d at 586; /see, e.g./, /In re United States/, 624 F.3d 1368, 1369 (11th Cir. 2010) (Administrator of EPA); /Bogan/, 489 F.3d at 423-24 (mayor of Boston); /In re FDIC/, 58 F.3d 1055, 1060 (5th Cir. 1995) (FDIC Directors); /In re United States/, 985 F.2d 510, 512 (11th Cir.) (FDA Commissioner), /cert. denied/, 510 U.S. 989 (1993); /U.S. Bd. of Parole v. Merhige/, 487 F.2d 25, 29 (4th Cir. 1973) (United States Parole Board members), /cert. denied/, 417 U.S. 918 (1974). We thus conclude that the judge properly granted Cranesville leave to depose Hull on matters relevant to its jurisdictional defense. Footnote ORDER We set aside all three discovery orders, lift the stay of these consolidated cases, and direct the Chief Judge to assign these cases for further proceedings consistent with this opinion. With respect to the internal OSHA memoranda, we direct the Chief Judge to immediately issue an order that (1) requires Cranesville to return to the Secretary the copies of Exhibits B and C that Judge Bober disclosed with his previous order, and all other outstanding copies of these memoranda; (2) prohibits Cranesville from using Exhibits B and C in any way, including during the proceedings before the Commission; and (3) seals from the public copies of Exhibits B and C presently in the record. With respect to the depositions of the MSHA employees, we direct that an order be issued quashing Cranesville’s subpoenas of MSHA District Manager Foster and former MSHA District Manager Petrie, but granting Cranesville leave to take the deposition of MSHA Supervisory Inspector Hull. SO ORDERED. ____/s/___________________________ Thomasina V. Rogers Chairman ____/s/___________________________ Cynthia L. Attwood Dated: July 13, 2011 Commissioner