Assistant Secretary for Mine Safety and Health David Zatezalo. Image via msha.gov

By Steve Horn

David Zatezalo, President Trump’s top official for mining safety, is set to decide over the next two weeks whether to settle a mining-safety lawsuit filed by an industry group that included Zatezalo at the time. The Mine Safety and Health Administration told TYT that MSHA lawyers have cleared Zatezalo to decide the matter.

The lawsuit was filed in March 2013 by the Kentucky Coal Association, opposing the Obama Administration’s use of a mine-safety rule known as POV, or Pattern of Violations. POV accelerates the penalty process for mining companies that repeatedly violate safety rules. Zatezalo, now the assistant secretary of mine health and safety, served on the Kentucky Coal Association board of directors through 2014.

As has been previously reported, through late 2014 Zatezalo was also chairman of Rhino Resource Partners, a mining company which twice ran afoul of POV during his tenure there. Rhino’s current CEO, Rick Boone, served as an executive under Zatezalo, and now sits on the Kentucky Coal Association executive committee.

The lawsuit filed by the Kentucky Coal Association was combined by a judge with other suits challenging the government’s use of the POV rule against repeat offenders. (Zatezalo also sat on the board of the Ohio Coal Association prior to its participation in the lawsuit.) The court has now given MSHA until March 9 to decide whether to settle the suit by rolling back its use of the POV rule.

Zatezalo is not the first Trump official now overseeing agencies they once sued to curtail their power. As an attorney general, Scott Pruitt filed multiple suits against the agency he now runs, the EPA.

Zatezalo’s role at the MSHA came under scrutiny from Congress earlier this month. At a February 6 hearing, Rep. Mark Takano (D-Calif.), the ranking member of the Committee on Education and the Workforce, said, “I have serious questions about whether the assistant secretary can have any role in these settlement negotiations.”

Takano said, “At a minimum, there is an appearance of a conflict of interest, which highlights the need for transparency in the closed-door negotiations with the plaintiffs.”

Testifying at the hearing, Zatezalo said, “If there is a conflict, I am happy to work with the ethics counsel . . . I don’t believe that there is; I had no involvement” in the lawsuit.

MSHA spokeswoman Amy Louviere told TYT in an email that attorneys for the Labor Department—which includes the MSHA—cleared Zatezalo to take part in the settlement negotiations.

“Under ethics law and the Trump administration ethics pledge, a former employer is any person for whom the appointee has, within the two years prior to the date of his or her appointment, served as an employee, officer, director, trustee, or general partner,” said Louviere. “Accordingly, on the advice of Department ethics counsel, he is not required to recuse himself from matters involving specific parties, e.g., investigations, litigation, inspections concerning the Ohio Coal Association and the Kentucky Coal Association.”

A spokesman for Takano told TYT said that his office had “not received any additional details regarding the settlement discussions.”

Though Zatezalo pledged to divest from some of his coal mining investment assets within 90 days in a September 6 letter to a Labor Department’s ethics lawyer, a TYT review of his Public Financial Disclosure Report shows that he still owns tens of thousands of dollars worth of stock holdings in companies whose business portfolios touch the coal supply chain. Those holdings include $15,001–$50,000 invested in the company Energy Transfer Partners and $200,000–$450,000 invested in Dominion Resources.

Louviere told TYT that Zatezalo, according to the Labor Department’s legal counsel, was in compliance with the law, despite his stock holdings.

“MSHA has a supplemental ethics rule that prohibits MSHA employees, their spouses and minor children from having any financial interests in any company engaged in mining activities subject to the agency’s jurisdiction,” said Louviere. “A company is deemed to be engaged in mining activities if it owns 50% or more of the voting securities of a company engaged in such activities. Assistant Secretary Zatezalo divested those that met this definition.”

Asked what MSHA plans to do about the lawsuit, Louviere said, “MSHA does not discuss cases that are currently in litigation, nor does it speculate on the status of a final rule that may or may not be under reconsideration.” An attorney for coal industry plaintiffs also told TYT that he could not provide settlement negotiation details due to the case’s ongoing nature.

At the February 6 hearing, Zatezalo said. “I have been briefed only one time for a few short minutes about the situation. There have not been any settlement discussions to my knowledge since the time that I came with MSHA.”

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