## Facts

- Erik K. Ho bought a defunct hospital/medical office building in Houston to convert it into residential housing.
- Ho knew asbestos was present and that disturbance of asbestos-containing materials required licensed and registered contractors, but hired unlicensed individuals to perform renovations.
- One contractor hired 11 undocumented workers who received no asbestos training and were not provided respirators or dust masks.
- After a city stop-work order for suspected asbestos, Ho negotiated with a licensed asbestos contractor but did not retain it and resumed unlicensed asbestos-removal work.
- An explosion occurred after an unmarked pipeline was illegally tapped at Ho’s direction, prompting an OSHA investigation.
- OSHA issued multiple citations, including asbestos-related violations, respirator and training violations, and a willful violation related to the pipeline tapping.
- In administrative proceedings, Ho conceded certain violations but argued the Secretary failed to prove OSH Act coverage because his activities did not affect interstate commerce; disputes also arose over willfulness, per-employee citations, and whether related corporate entities were alter egos.

## Issues

1. Whether substantial evidence supported OSHRC’s finding that Ho’s business activities affected interstate commerce, making him an “employer” covered by the OSH Act.
2. Whether OSHRC erred in determining Ho’s corporate entities were not alter egos for liability purposes in connection with the renovation work.
3. Whether substantial evidence supported OSHRC’s willfulness findings for certain violations.
4. Whether OSHA standards permitted per-employee citations and penalties for respirator and training violations, or whether OSHRC reasonably limited such citation practices.

## Decision

- The Fifth Circuit denied the Secretary’s petition for review and denied the Ho respondents’ cross-petition.
- The court affirmed OSHRC’s final order in full.
- The court held OSHRC’s key factual findings (including coverage and willfulness determinations) were supported by substantial evidence.
- The court sustained OSHRC’s treatment of corporate separateness and its approach to per-employee citations as legally permissible.

## Legal Principles

- OSH Act coverage extends broadly to employers whose activities affect interstate commerce; OSHRC’s coverage finding will be upheld if supported by substantial evidence.
- A violation may be “willful” when committed with intentional or knowing disregard of legal requirements, or with plain indifference to employee safety; willfulness determinations are reviewed under the substantial evidence standard.
- In review of OSHA enforcement actions, courts defer to OSHRC’s reasonable interpretations of ambiguous provisions of the OSH Act and OSHA standards in the course of adjudication.
- Whether a standard supports per-employee citation can turn on the text and structure of the particular standard; OSHRC may reasonably distinguish between duties framed as applying to “each employee” and programmatic employer obligations.
- Alter-ego and related corporate-liability determinations are fact-intensive and will be sustained if supported by substantial evidence in the record.

## Conclusion

The Fifth Circuit affirmed OSHRC’s resolution of an OSHA enforcement action arising from hazardous asbestos-related renovation work and a pipeline incident, sustaining OSHRC’s findings on OSH Act coverage, willfulness, corporate separateness, and its restrained approach to per-employee citations where the governing standards did not clearly require them.


Chao v. Occupational Safety & Health Review Comm'n, 401 F.3d 355 (5th Cir. 2005)