COLORADO COURT OF APPEALS                                          2017COA21


Court of Appeals No. 16CA0249
Industrial Claim Appeals Office of the State of Colorado
W.C. No. XX-XXXXXXX


Dami Hospitality, LLC,

Petitioner,

v.

Industrial Claim Appeals Office of the State of Colorado and Division of
Workers’ Compensation,

Respondents.


                         ORDER SET ASIDE AND CASE
                         REMANDED WITH DIRECTIONS

                                  Division III
                           Opinion by JUDGE WEBB
                         Dunn and Davidson*, JJ., concur

                          Announced February 23, 2017


Law Offices of Daniel T. Goodwin, Daniel T. Goodwin, Caroline R. Kert, Paige
Orgel, Broomfield, Colorado, for Petitioner

No Appearance for Respondent Industrial Claim Appeals Office

Cynthia H. Coffman, Attorney General, Emmy A. Langley, Assistant Attorney
General, Denver, Colorado, for Respondent Division of Workers’ Compensation


*Sitting by assignment of the Chief Justice under provisions of Colo. Const. art.
VI, § 5(3), and § 24-51-1105, C.R.S. 2016.
¶1    Is a fine of $841,200 imposed by the Division of Workers’

 Compensation (the division) on a small employer for having failed

 over several years to maintain workers’ compensation insurance

 excessive under the Eighth Amendment?1 On the particular facts

 presented, which include a failure to perform the required

 fact-specific constitutional analysis, we answer this novel question

 “yes.”

¶2    The employer, Dami Hospitality, LLC, appeals the fine as

 unconstitutional, challenging the underlying statute both facially

 and as applied; as contrary to other provisions of the Workers’

 Compensation Act of Colorado, sections 8-40-101 to 8-47-209,

 C.R.S. 2016 (the Act); and as a procedural due process violation.

¶3    We uphold the facial constitutionality of section 8-43-409,

 C.R.S. 2016, the statute underlying the fine. But on an as-applied

 basis, we conclude that because the Director of the division

 (Director) failed to apply the excessive fine factors adopted under

 the Eighth Amendment to the particular facts that Dami presented,




 1 Because the wording of Colorado Constitution article II, section 20
 is identical, we do not address it separately.

                                   1
 the fine must be set aside as excessive. We reject Dami’s remaining

 contentions.

¶4    Therefore, we set aside the decision of the Industrial Claim

 Appeals Office (Panel) affirming the Director’s decision and remand

 the case to the Panel with directions to order the Director to

 reconsider imposing a fine calculated according to this opinion.

                I. Background and Procedural History

¶5    Dami operates a motel in Denver, Colorado. For a period in

 2006, Dami failed to carry workers’ compensation insurance as

 required by section 8-43-409. It was fined approximately $1200 for

 that violation, paid the fine, and obtained the necessary insurance.

¶6    In 2014, the division notified Dami that it was again without

 workers’ compensation insurance and had been for periods during

 2006 and 2007, as well as from September 2010 through the date

 of the division’s notice. The Director’s “Notice to Show Compliance”

 advised Dami that within twenty days it had to answer an attached

 questionnaire, had to submit documents establishing coverage, and

 could “request a prehearing conference on the issue of default.”

 Dami admits that it received this notice on June 28, 2014, but

 denies having received a notice the division said had been sent four


                                   2
 months earlier. Although Dami obtained the necessary insurance

 by July 9, 2014, it neither submitted a response to the Notice to

 Show Compliance nor requested a prehearing conference.2

¶7    Information provided by the division’s coverage enforcement

 unit — which Dami does not contest — showed that Dami had been

 without coverage from August 10, 2006, through June 8, 2007, and

 again from September 12, 2010, through July 9, 2014. On this

 basis, the Director fined Dami from $250 to $400 per day, through

 September 18, 2006. From September 19, 2006, through June 8,

 2007, and from September 12, 2010, through July 9, 2014, Dami

 was fined $500 per day. The Director calculated the fine based on

 the formula adopted by the division under section 8-43-409(1)(b)(II)

 in Department of Labor & Employment Rule 3-6, 7 Code Colo. Regs.

 1101-3 (Rule 3-6), discussed in Part III.B below.



 2 Section 8-43-409, C.R.S. 2016, requires the Director to notify an
 employer “of the opportunity to request a prehearing conference on
 the issue of default.” However, the statute does not define “default.”
 Such a request must be made within twenty days of the notice.
 And an employer is not entitled to a hearing as a matter of right.
 Rather, “if necessary, the [D]irector may set the issue of the
 employer’s default for hearing.” § 8-43-409(1) (emphasis added).
 The statute is also silent whether the division may request a
 hearing or the Director may hold one sua sponte.

                                   3
¶8     Dami’s owner, Soon Pak, sent a letter to the Director captioned

  “Petition to Review,” asking the Director to reconsider the fine. The

  Director treated the letter as a petition to review his findings of fact,

  conclusions of law, and order.

¶9     In the letter/petition, Ms. Pak explained that she “believed”

  the insurance policies she obtained for the motel had “included the

  required coverage.” She blamed her insurance agent for the lapse

  in coverage, asserting that her trust “in insurance professionals to

  quote and secure . . . competitive workmen’s compensation

  insurance” was “obviously” misplaced. The petition also asked the

  Director to reduce the penalty because “$842,000 is more that [sic]

  my business grosses in one year. . . . My payroll each year is less

  than $50,000 per year. . . . If the penalty stands as presented, I

  have no choice but to declare personal and business bankruptcy

  and go out of business.”

¶ 10   In a letter that Ms. Pak’s insurance agent submitted to the

  Director, the agent accepted responsibility for the lack of workers’

  compensation insurance: “I think I feel part of responsibility for this

  matter that I did not tell about Worker’s Compensation and I will be

  managing my client in the future. . . . Actually she confused


                                      4
  Property Insurance and Worker’s Compensation.” Later, Dami’s

  counsel filed a brief in support of the petition to review. Attached to

  the brief was Ms. Pak’s affidavit reiterating her reliance on the

  insurance agent.

¶ 11    In a supplemental order following Dami’s petition and brief,

  the Director again ordered Dami to pay the fine. He found that

  because of the earlier fine, Dami had been aware of the need to

  maintain insurance and failure to do so was within its control. As

  for Dami’s asserted inability to pay, the Director concluded that

  neither section 8-43-409 nor Rule 3-6(D) contains “an exclusion or

  exemption from incurring and paying a fine based upon a

  Respondent’s financial inability to pay.”

¶ 12    On Dami’s appeal of the supplemental order, the Panel

  remanded the case to the Director. It held that the Director had

  failed to consider the factors set out in Associated Business

  Products v. Industrial Claim Appeals Office, 126 P.3d 323 (Colo. App.

  2005), to protect against constitutionally excessive fines or

  penalties. The Panel summarized those factors as follows:

        the degree of reprehensibility of the defendant’s misconduct;




                                     5
        the disparity between the harm or potential harm suffered

         and the fine to be assessed; and

        the difference between the fine imposed and the penalties

         authorized or imposed in comparable cases.

¶ 13    Without taking additional evidence, the Director issued an

  order on remand. Still, the Director did not analyze the factors that

  Dami had presented under Associated Business Products. Instead,

  he concluded that because Rule 3-6 inherently incorporates these

  factors, no further consideration was necessary. Then for the third

  time, the Director ordered Dami to pay a fine of $841,200.

¶ 14    Again, Dami appealed. But this time the Panel agreed with the

  Director’s analysis and affirmed the order on remand. The Panel’s

  decision is now before us.

           II. Was Dami Deprived of Procedural Due Process?

¶ 15    Although procedural due process is not Dami’s primary

  argument, we begin there because if Dami is correct, the fine must

  be set aside and the broader constitutional issues would no longer

  be ripe for decision. Courts “have a duty to decide constitutional

  questions when necessary to dispose of the litigation before them.

  But they have an equally strong duty to avoid constitutional issues

                                    6
  that need not be resolved in order to determine the rights of the

  parties to the case under consideration.” Cty. Court v. Allen, 442

  U.S. 140, 154 (1979); see also People v. Montour, 157 P.3d 489,

  503-04 (Colo. 2007) (Under “the doctrine of constitutional

  avoidance, . . . courts have a duty to interpret a statute in a

  constitutional manner where the statute is susceptible to a

  constitutional construction.”). However, we discern no due process

  violation.

¶ 16   On procedural due process grounds, Dami challenges the

  method by which it was notified that it lacked workers’

  compensation insurance, explaining “common sense indicates that

  simple notice by mail is not reasonable.” Alternatively, it argues

  that a hearing should have been held before the fine was imposed.

  Neither of these assertions provides a basis for setting aside the

  Panel’s order.

¶ 17   The “fundamental requisites of procedural due process are

  notice and the opportunity to be heard.” Kuhndog, Inc. v. Indus.

  Claim Appeals Office, 207 P.3d 949, 950 (Colo. App. 2009).

¶ 18   The Director’s Notice to Show Compliance, informing Dami of

  its “subsequent violation” of section 8-43-409 for failure to carry


                                     7
  workers’ compensation insurance, appears to have been mailed to

  the address the division had on file for Dami. Dami does not point

  to any evidence in the record that it had ever advised the division of

  a new mailing address.

¶ 19   More importantly, despite Dami’s argument that notice was

  inadequate, Ms. Pak admitted in her affidavit to the Director that

  she had received a second notice in June 2014, just four months

  after the first notice of subsequent violation had been mailed. Dami

  does not assert that the passage of these four months created

  constitutional prejudice. And when a party has received actual

  notice of an agency’s action, the party cannot claim a procedural

  due process violation based on an alleged defect in the method of

  giving notice. See Amos v. Aspen Alps 123, LLC, 2012 CO 46, ¶¶ 1,

  20 (“We conclude that when the parties received actual notice which

  afforded them an opportunity to present their objections and no

  prejudice resulted, we will not disturb a completed foreclosure

  sale.”); see also Baker v. Latham Sparrowbush Assocs., 72 F.3d 246,

  254 (2d Cir. 1995) (“If a party receives actual notice that apprises it

  of the pendency of the action and affords an opportunity to

  respond, the due process clause is not offended.”).


                                     8
¶ 20   Dami’s assertion that a hearing should have been held fares

  no better. In responding to the Notice to Show Compliance, Dami

  never asked for a prehearing conference.3 Nor did Dami request a

  remand hearing in its first appeal to the Panel. And Dami does not

  offer any supporting authority or legal argument for the assertion

  that despite its own inaction, a hearing should have been held.

¶ 21   Instead, Dami argues only that, “reading between the lines,”

  the division failed to follow the Panel’s “suggestion” that the

  Director hold a hearing. But “[g]iven the dearth of legal grounds

  offered,” we decline to address this issue on its merits. Meza v.

  Indus. Claim Appeals Office, 2013 COA 71, ¶ 38; see also Antolovich

  v. Brown Grp. Retail, Inc., 183 P.3d 582, 604 (Colo. App. 2007)

  (declining to address “underdeveloped arguments”).

¶ 22   For these reasons, we conclude that Dami has not articulated

  a cognizable claim for due process violations based on either

  inadequacy of the notice or failure to hold a hearing.


  3 Dami did not contest the wording of the notice below and does not
  do so on appeal. For that reason, we do not address what “you may
  request a prehearing conference on the issue of default” would
  mean to a reasonable person. Be that as it may, lack of a hearing
  at which the record could have been more fully developed plagues
  this appeal.

                                     9
       III. Was the Fine Imposed on Dami Constitutionally Excessive?

                   A. Dami’s Excessive Fine Arguments

¶ 23     Dami challenges the $841,200 fine on three grounds.

¶ 24     First, Dami argues that section 8-43-409 is unconstitutional

  on its face. According to Dami, the General Assembly’s removal of a

  penalty cap from the statute in 2005, plus the absence of any

  statutory deadline within which the Director must notify an

  employer that it is in violation of the mandate to carry workers’

  compensation insurance, effectively grants the Director “complete

  discretion regarding the timing of notice and thus the size of the

  fine.” Dami points out that this lack of any deadline — combined

  with the Director’s formulaic approach in imposing the fine —

  resulted in a penalty grossly disproportionate both to the fines

  anticipated by the legislature and to the risk of harm to Dami’s

  employees.

¶ 25     Second, arguing unconstitutionality as applied, Dami asserts

  that because the Director wrongly deemed the Associated Business

  Products factors for weighing excessive fines incorporated into Rule

  3-6, the Director abused his discretion in failing to apply the factors

  to Dami’s particular situation.


                                    10
¶ 26   Third, Dami argues that the fine is grossly disproportionate

  both to its ability to pay and to the harm caused by the lack of

  workers’ compensation insurance. It asserts the Director should

  also have considered its ability to pay when weighing the

  constitutionality of the fine.

¶ 27   Although we do not discern a facial flaw in the statute, we

  conclude that its application violated Dami’s constitutional

  protections against excessive fines. In so concluding, we agree with

  Dami that because the constitutional factors are not sufficiently

  incorporated into Rule 3-6, the Director abused his discretion in

  failing to consider facts specific to Dami — including Dami’s ability

  to pay — when he reimposed the fine after the Panel had directed

  him to address the Associated Business Products factors.

            B. Statutory and Regulatory Provisions at Issue

¶ 28   Dami was fined under section 8-43-409, which requires the

  Director to order the violating employer “to cease and desist

  immediately from continuing its business operations during the

  period such default continues,” or

             (b) For every day that the employer fails or has
             failed to insure or to keep the insurance
             required by articles 40 to 47 of this title in


                                    11
            force, allows or has allowed the insurance to
            lapse, or fails or has failed to effect a renewal
            of such coverage, impose a fine of:

            ....

            (II) Not less than two hundred fifty dollars or
            more than five hundred dollars for a second
            and any subsequent violation.

  § 8-43-409(1).

¶ 29   To implement this provision, the division adopted Rule 3-6. As

  pertinent here, the rule provides:

            3-6 FINES FOR DEFAULTING EMPLOYER

            (A) Following the Director’s determination that
            an employer has failed to obtain the required
            insurance or has failed to keep such insurance
            in force or has allowed the insurance to lapse
            or has failed to renew such insurance, the
            Director will impose fines on the defaulting
            employer and/or will compel the employer to
            cease and desist its business operations.

            ....

            (D) For the Director’s finding of an employer’s
            second and all subsequent defaults in its
            insurance obligations, daily fines from
            $250/day up to $500/day for each day of
            default will be assessed in accordance with the
            following schedule of fines until the employer
            complies with the requirements of the Workers’
            Compensation Act regarding insurance or until
            further order of the Director:



                                       12
                   Class   VII    1-20 Days    $250/Day
                   Class   VIII   21-25 Days   $260/Day
                   Class   IX     26-30 Days   $280/Day
                   Class   X      31-35 Days   $300/Day
                   Class   XI     36-40 Days   $400/Day
                   Class   XII    41 Days      $500/Day

                 C. Facial Challenge to Section 8-43-409

¶ 30   “A law is void for vagueness where its prohibitions are not

  clearly defined.” People v. Baer, 973 P.2d 1225, 1233 (Colo. 1999).

  “Vague laws are unconstitutional and ‘offend due process because

  they (1) fail to give fair notice of the conduct prohibited, and (2) do

  not supply adequate standards for those who apply them in order to

  prevent arbitrary and discriminatory enforcement.’” Denver Health

  & Hosp. Auth. v. City of Arvada, 2016 COA 12, ¶ 14 (quoting Baer,

  973 P.2d at 1233) (cert. granted in part Sept. 12, 2016). Even so, a

  “facial challenge to a legislative Act is, of course, the most difficult

  challenge to mount successfully, since the challenger must

  establish that no set of circumstances exists under which the Act

  would be valid.” United States v. Salerno, 481 U.S. 739, 745 (1987).

  And at least in Colorado, “[t]he party challenging the facial

  constitutionality of a statute has the burden of showing the statute




                                       13
  is unconstitutional beyond a reasonable doubt.” Hinojos-Mendoza

  v. People, 169 P.3d 662, 668 (Colo. 2007).4

¶ 31   First, we reject Dami’s assertion that the absence of a penalty

  cap renders the statute unconstitutional.5

¶ 32   For purposes of the Eighth Amendment, “[t]he notion of

  punishment, as we commonly understand it, cuts across the

  division between the civil and the criminal law.” Austin v. United

  States, 509 U.S. 602, 610 (1993) (quoting United States v. Halper,

  490 U.S. 435, 447-48 (1989)).

¶ 33   Numerous sentencing cases have held that the absence of a

  maximum cap does not invalidate a statute. For example,

            [s]uch a statute is not subject to the attack
            that it is void because it is vague and
            indefinite. There are many laws such as this
            upon the statute books of the Federal
            Government, as well as of the various states,
            fixing a minimum sentence and leaving it
            within the power of the court to fix the
            maximum sentences. In every instance the
            validity of such statutes has been upheld.

  4 In Tabor Foundation v. Regional Trans. Dist., 2016 COA 102, our
  supreme court has granted certiorari to consider this standard.
  16SC639, 2017 WL 280826 (Colo. Jan. 23, 2017).
  5 Section 8-43-409 was amended in 2005 to remove the cap that

  had prohibited any penalty from “exceed[ing] the annual cost of the
  insurance premium that would have been charged for such
  employer.” Ch. 49, sec. 1, § 8-43-409, 2005 Colo. Sess. Laws 199.

                                   14
  Binkley v. Hunter, 170 F.2d 848, 849 (10th Cir. 1948); see also

  United States v. Kuck, 573 F.2d 25, 26 (10th Cir. 1978) (“A

  sentencing statute is not unconstitutional because of failure to

  provide a maximum term.”).

¶ 34   In contrast, Dami has not cited authority holding a statute

  that imposes a fine or penalty facially unconstitutional for lack of a

  cap. Nor have we found any such authority in Colorado.

¶ 35   Looking outside of Colorado, the notion that the absence of a

  maximum fine renders a statute facially unconstitutional

  “represents the clear minority rule on the issue. In fact, the

  majority of courts considering this issue have upheld the

  constitutionality of statutes which set a minimum fine or

  punishment but which do not prescribe a maximum fine or

  punishment.” State v. Taylor, 70 S.W.3d 717, 721 (Tenn. 2002);

  see, e.g., United States v. Hayes, 589 F.2d 811, 825 (5th Cir. 1979)

  (“While the statute does not provide for a specific maximum

  sentence in situations of life imprisonment for the principal, failure

  to provide a clearer maximum possible sentence does not render the

  statute constitutionally infirm. Leaving the determination of



                                    15
  maximum sentences to the court is not uncommon.”) (citation

  omitted); Ex parte Robinson, 474 So. 2d 685, 686 (Ala. 1985); State

  v. Nelson, 11 A.2d 856, 862 (Conn. 1940); Mannon v. State, 788

  S.W.2d 315, 322 (Mo. Ct. App. 1990) (“A statute which fixes a

  minimum punishment but provides no maximum term is neither

  constitutionally invalid nor void because of indefiniteness.”).

¶ 36   Second, we reject Dami’s assertion that the absence of a

  deadline for division action against an employer lacking insurance

  — which allows the fine to ratchet up — renders the statute facially

  unconstitutional. Again, Dami has not offered any cases

  supporting its position. To the contrary, substantial authority

  suggests the opposite.

¶ 37   To begin, the Supreme Court has upheld a court’s authority to

  impose daily fines under a statute that lacked both a cap and a

  deadline for notifying the offending parties of accumulating fines.

  United States v. ITT Cont’l Baking Co., 420 U.S. 223, 243 (1975)

  (remanding for recalculation of daily fines under the Clayton and

  Federal Trade Commission Acts).

¶ 38   Likewise under Colorado law, daily penalties that accumulated

  for continuing violations have been upheld. See Crowell v. Indus.


                                    16
  Claim Appeals Office, 2012 COA 30, ¶ 15 (“[W]hen there is ongoing

  conduct, the continuation of the penalty is mandatory, rather than

  discretionary.”); Pueblo Sch. Dist. No. 70 v. Toth, 924 P.2d 1094,

  1100 (Colo. App. 1996) (mandating imposition of the penalty at a

  “daily rate” where violation was continuing).

¶ 39   Some lower federal courts have taken the same approach. In

  Center for Biological Diversity v. Marina Point Development

  Associates, 434 F. Supp. 2d 789 (C.D. Cal. 2006), for example, the

  defendants were found to have been in violation of the Clean Water

  Act from at least October 2002 to 2006. Because they were subject

  to daily penalties of $27,500 to $32,500 over the course of their

  violations, “the maximum penalty” could have been as high as

  “$15,445,000.” Id. at 799. The court imposed a penalty of $2500

  for each day of violation “from October 7, 2002 to April 16, 2004,”

  totaling $1,312,500. Id. at 800. Similarly, in Honey v. Dignity

  Health, 27 F. Supp. 3d 1113 (D. Nev. 2014), daily penalties were

  imposed against an employer for violating the notice provision in

  the Consolidated Omnibus Budget Reconciliation Act (COBRA), 29

  U.S.C. §§ 1161-1169 (2012). The court noted that it “ha[d]

  discretion to impose a penalty and to set its amount, subject only to


                                    17
  a $110 per day statutorily set maximum.” Honey, 27 F. Supp. 3d at

  1124.

¶ 40   None of the courts in these cases pondered whether the fines

  should be tempered because the underlying statutes did not require

  the regulating authorities to provide timely notice of a violation.

  Instead, at least as best we can determine, like Rome burning as

  Nero fiddled, fines mounted while the regulators said nothing.6

¶ 41   Given all this, we conclude that Dami has not met its burden

  of showing that section 8-43-409 is facially unconstitutional beyond

  a reasonable doubt. Even so, our inquiry does not end, as the

  statute’s application in this case could still be unconstitutional.

            D. As-Applied Constitutional Challenges to Fines

¶ 42   Dami’s as-applied challenge to section 8-43-409 differs from

  its facial challenge to the statute.



  6 To be sure, Dami might distinguish some of these cases on the
  basis that the party fined could not dispute its knowledge of the
  conduct triggering the fine. For example, Crowell v. Industrial Claim
  Appeals Office, 2012 COA 30, involved the employer’s affirmative
  action. In contrast, Dami maintains that it did not know the
  insurance coverage had lapsed. But Dami’s alleged ignorance can
  be addressed under reprehensibility, one of the factors from
  Associated Business Products v. Industrial Claim Appeals Office, 126
  P.3d 323 (Colo. App. 2005), as discussed in Part III.D.4.a below.

                                     18
            A plaintiff bringing an “as-applied” challenge
            contends that the statute would be
            unconstitutional under the circumstances in
            which the plaintiff has acted or proposes to
            act. If a statute is held unconstitutional “as
            applied,” the statute may not be applied in the
            future in a similar context, but the statute is
            not rendered completely inoperative.

  Sanger v. Dennis, 148 P.3d 404, 410 (Colo. App. 2006). “For

  as-applied constitutional challenges, the question is whether the

  challenging party can establish that the statute is unconstitutional

  ‘under the circumstances in which the plaintiff has acted or

  proposes to act.’” Qwest Servs. Corp. v. Blood, 252 P.3d 1071, 1085

  (Colo. 2011) (quoting Developmental Pathways v. Ritter, 178 P.3d

  524, 534 (Colo. 2008)). Yet again, “the burden of establishing the

  unconstitutionality of a statute, as applied, [is] beyond a reasonable

  doubt.” People v. Gutierrez, 622 P.2d 547, 555 (Colo. 1981).

¶ 43   Statutory penalties, like those assessed under section

  8-43-409, are subject to the constitutional prohibition against

  excessive fines. See Associated Bus. Prods., 126 P.3d at 326;

  Wolford v. Pinnacol Assurance, 81 P.3d 1079, 1084 (Colo. App.

  2003), rev’d on other grounds, 107 P.3d 947 (Colo. 2005). The

  Eighth Amendment provides that “[e]xcessive bail shall not be



                                    19
  required, nor excessive fines imposed, nor cruel and unusual

  punishment inflicted.”

¶ 44   As a division of this court noted, the Supreme Court first

  applied this provision to “civil cases where the government seeks, at

  least in part, to punish a party” in 1993, when it announced Austin

  v. United States, 509 U.S. 602 (1993). Toth, 924 P.2d at 1099-1100.

  In Austin, the Supreme Court applied the Eighth Amendment to an

  in rem civil forfeiture, noting that “the question is not . . . whether

  forfeiture . . . is civil or criminal, but rather whether it is

  punishment.” Austin, 509 U.S. at 610. After Austin, fines assessed

  for non-criminal statutory violations have been subject to the

  Eighth Amendment’s protections against excessive fines.

¶ 45   More recently, Colorado courts have applied the

  constitutionally excessive limitation to civil fines. See Associated

  Bus. Prods., 126 P.3d at 326; Boulder Cty. Apartment Ass’n v. City

  of Boulder, 97 P.3d 332, 338 (Colo. App. 2004). But exactly when is

  a fine excessive?

¶ 46   The Supreme Court has held that a civil fine is excessive “if it

  is grossly disproportional to the gravity of a defendant’s offense.”

  United States v. Bajakajian, 524 U.S. 321, 334 (1998). Likewise, a


                                      20
  division of this court has said that a penalty “is excessive if the

  amount is so disproportionate to a defendants [sic] circumstances

  that there can be no realistic expectation that the defendant will be

  able to pay it.” Boulder Cty. Apartment Ass’n, 97 P.3d at 338.

¶ 47   This much is clear: the principle of proportionality

  encompassed in the constitutional protection against excessive

  fines “is that the punishment should fit the crime.” Id. at 337. Yet,

  “[i]f this principle were as easy of application as it is of statement,

  we should have little difficulty; but, like many another simple and

  plain principle, its application to concrete facts is sometimes very

  difficult.” Lovejoy v. Denver & Rio Grande R.R. Co., 59 Colo. 222,

  229, 146 P. 263, 265 (1915). Taking up that task, we start with the

  standard of review.

                          1. Standard of Review

¶ 48   The party challenging a fine bears the “the burden of proving

  the fine is ‘grossly disproportionate.’” Associated Bus. Prods., 126

  P.3d at 326 (quoting Toth, 924 P.2d at 1100). But deciding whether

  that burden has been met implicates conflicting standards of

  appellate review.




                                     21
¶ 49   On the one hand, “when a punitive damages award is reviewed

  for excessiveness under the Due Process Clause and the Eighth

  Amendment, a de novo standard of review should be applied.” Id.

  at 325. And as discussed in Part III.D.4 below, courts have applied

  de novo the punitive damages criteria in deciding whether a civil

  fine or penalty is excessive.

¶ 50   On the other hand, “[a] trial court enjoys considerable

  discretion in assessing a penalty.” Colo. Dep’t of Pub. Health &

  Env’t v. Bethell, 60 P.3d 779, 787 (Colo. App. 2002). Similarly, “[a]n

  [administrative law judge] has discretion to determine the amount

  of the penalty, provided that the amount does not exceed the

  legislatively enacted penalty range.” Crowell, ¶ 17. And as

  explained in the prior subsection, the statute before us no longer

  caps the fine.

¶ 51   Likewise, as to statutes underlying civil penalties, “legislatures

  have extremely broad discretion in setting the range of permissible

  punishments for statutorily enumerated offenses and . . . judicial

  decisions operating within the legislatively enacted guidelines are

  typically reviewed for abuse of discretion.” Associated Bus. Prods.,

  126 P.3d at 325 (citing Cooper Indus., Inc. v. Leatherman Tool Grp.,


                                    22
  Inc., 532 U.S. 424, 432 (2001)). And here, because the rule that the

  Director applied tracks the statute, his decision enjoys the same

  protection.

¶ 52   True, this case does not involve a punitive damages award, as

  in Cooper Industries. But like the challenge in Associated Business

  Products, Dami asks us to examine the excessiveness of a

  “legislatively enacted penalt[y],” which is also reviewed de novo.

  Associated Bus. Prods., 126 P.3d at 325.

¶ 53   An abuse of discretion occurs when the fact finder enters an

  order that is unsupported by the evidence or misapplies or is

  contrary to the law. Heinicke v. Indus. Claim Appeals Office, 197

  P.3d 220, 222 (Colo. App. 2008). As has been so often stated,

  discretion is abused when the decision “is manifestly arbitrary,

  unreasonable, unfair, or misapplies the law.” Patterson v. BP Am.

  Prod. Co., 2015 COA 28, ¶ 67.

¶ 54   Associated Business Products recognized — but did not resolve

  — the tension between de novo review and review for an abuse of

  discretion. And where a constitutional interest is in play,

  sometimes the latter bleeds into the former. Cf. People v. Dunham,

  2016 COA 73, ¶ 13 (“Ordinarily, we review a defendant’s preserved


                                    23
  contention that the trial court erred in limiting cross-examination of

  a witness for an abuse of discretion. But where, as in this case, a

  defendant contends that the trial court so excessively limited his

  cross-examination of a witness as to violate the Confrontation

  Clause, see U.S. Const. amend. VI, we review that contention de

  novo.”) (citations omitted). In any event, we avoid reconciling this

  tension because ultimately we conclude that the Director abused

  his discretion by misapplying the law.

          2. Constitutional Protections Afforded Corporations

¶ 55   In its answer brief, the division preliminarily questions

  whether the Eighth Amendment’s excessive fines protections even

  apply to corporations. The answer to this question is unresolved in

  Colorado and unclear elsewhere. We conclude that corporations

  enjoy these protections.

¶ 56   To begin, the cases relied on by the division, as well as the

  opinions of several other courts, have assumed that corporations

  are entitled to the Eighth Amendment’s protections. See, e.g.,

  United States v. Pilgrim Mkt. Corp., 944 F.2d 14, 22 (1st Cir. 1991)

  (“We will assume for purposes of our discussion that the eighth

  amendment proscription against excessive fines applies to


                                    24
  corporations, although this is a very tenuous assumption.”); United

  States v. Seher, 686 F. Supp. 2d 1323, 1327 n.2 (N.D. Ga. 2010)

  (“The Court assumes that the corporate Defendants are entitled to

  raise an Eighth Amendment challenge. Whether the protections of

  the Eighth Amendment extend to a corporation is an open question

  that remains unaddressed by this Circuit or the Supreme Court.”),

  aff’d sub nom. United States v. Chaplin’s, Inc., 646 F.3d 846, 851

  n.15 (11th Cir. 2011) (“Our analysis assumes, but does not hold,

  that the Eighth Amendment applies to corporations. The Supreme

  Court has never held that this amendment applies to

  corporations.”).7

¶ 57   But despite these cases, we decline to reach the as-applied

  Eighth Amendment question by the expedient of assuming without

  deciding the preliminary constitutional question of whether Dami is

  entitled to constitutional protection against excessive fines. Doing

  so would be contrary to the doctrine of constitutional avoidance.

  Cf. Allen, 442 U.S. at 154; Montour, 157 P.3d at 503-04. For the

  7 Other courts have ignored the question altogether. See United
  States v. Bucuvalas, 970 F.2d 937, 946 (1st Cir. 1992) (“We bypass
  the unresolved question whether a corporation may assert an
  Eighth Amendment claim.”), abrogated on other grounds by
  Cleveland v. United States, 531 U.S. 12 (2000).

                                   25
  following reasons, we conclude that despite Dami’s corporate

  status, it enjoys the Eighth Amendment’s protection.

¶ 58   Other divisions of this court that have examined the

  constitutionality of fines imposed against corporate entities are

  silent on this issue. See Associated Bus. Prods., 126 P.3d at 325-

  27; Boulder Cty. Apartment Ass’n, 97 P.3d at 337-38. The opinions

  do not indicate whether the issue was raised. But since these cases

  were decided, the Supreme Court has extended other constitutional

  protections to corporations. This tidal shift in constitutional law

  leads us to resolve the issue for Dami.

¶ 59   In Citizens United v. Federal Election Commission, 558 U.S.

  310 (2010), the Supreme Court extended First Amendment

  protection for political speech to corporations. Id. at 342-43. The

  Court “rejected the argument that political speech of corporations

  or other associations should be treated differently under the First

  Amendment simply because such associations are not ‘natural

  persons.’” Id. at 343 (quoting First Nat’l Bank of Boston v. Bellotti,

  435 U.S. 765, 776 (1978)). Declining to follow prior precedent that

  had permitted limitations on corporate speech, Citizens United held

  that “the Government may not suppress political speech on the


                                     26
  basis of the speaker’s corporate identity. No sufficient

  governmental interest justifies limits on the political speech of

  nonprofit or for-profit corporations.” Id. at 365.

¶ 60   Like the First Amendment, the Second Amendment, and the

  Fourth Amendment, the wording of the Eighth Amendment is not

  restricted to “natural persons.” See Second Amendment Arms v.

  City of Chicago, 135 F. Supp. 3d 743, 761 (N.D. Ill. 2015)

  (corporations may assert both First and Fourth Amendment

  challenges); Geneva Coll. v. Sebelius, 929 F. Supp. 2d 402, 428

  (W.D. Pa. 2013) (“[A] for-profit, secular corporation has standing to

  assert the religious exercise claims of its owners in certain

  circumstances . . . .”).

¶ 61   In sum, we are unable to discern a reason for limiting the

  Eighth Amendment protection against excessive fines to natural

  persons. After all, such fines adversely impact both corporations

  and natural persons, and the financial condition of some persons

  may be stronger than that of some corporations. Nor does the

  division present one. Thus, we conclude that Dami’s status as a

  corporation does not deprive it of Eighth Amendment protection.




                                    27
                         3. Director’s Discretion

¶ 62   In his supplemental order, the Director assumed that section

  8-43-409 and Rule 3-6 require a formulaic calculation of any fine.

  Notwithstanding Dami’s claimed inability to pay such a large fine,

  the Director concluded that neither the statute nor the rule

  permitted consideration of an employer’s economic situation and

  that fines imposed under the statute and rule were “not

  discretionary.”

¶ 63   The Panel rejected the Director’s view in part. In its final

  order, the Panel observed that Rule 3-6 mandates that fines “will be

  assessed in accordance with the following schedule of fines until the

  employer complies with the requirements of the Workers’

  Compensation Act regarding insurance or until further order of the

  Director.” (Emphasis added.) Embracing this language, the Panel

  held that Rule 3-6 grants the Director authority to modify a fine

  which would otherwise be “calculated solely on the basis of the

  number of days involved.”

¶ 64   In its brief, the division acknowledges but does not contest the

  Panel’s interpretation. Instead, the division argues that the

  Director used his discretion “to determine which factor to prioritize”


                                    28
  and to consider “mitigating and aggravating factors” before

  reimposing Dami’s fine in the supplemental order.

¶ 65   We give “due deference to the interpretation of the statute

  adopted by the Panel as the agency charged with its enforcement.”

  Berg v. Indus. Claim Appeals Office, 128 P.3d 270, 273 (Colo. App.

  2005). In general, “an administrative agency’s interpretation of its

  own regulations is generally entitled to great weight and should not

  be disturbed on review unless plainly erroneous or inconsistent

  with such regulations.” Jiminez v. Indus. Claim Appeals Office, 51

  P.3d 1090, 1093 (Colo. App. 2002). “The Panel’s interpretation will

  therefore be set aside only ‘if it is inconsistent with the clear

  language of the statute or with the legislative intent.’” Zerba v.

  Dillon Cos., 2012 COA 78, ¶ 37 (quoting Support, Inc. v. Indus. Claim

  Appeals Office, 968 P.2d 174, 175 (Colo. App. 1998)).

¶ 66   We conclude that the Panel’s interpretation of the regulatory

  language is reasonable. See id.; Support, Inc., 968 P.2d at 175.

  Thus, the Director can modify a penalty under section 8-43-409

  and Rule 3-6, although no reason for doing so is identified in the

  rule or was addressed by the Panel.




                                     29
¶ 67     At the same time, we disagree that Rule 3-6 adequately

  incorporates the three factors articulated in Associated Business

  Products. On remand, the Director concluded — and the Panel

  agreed — that Rule 3-6 sufficiently incorporated these factors. He

  explained as follows:

        as to the first factor, Rule 3-6 reflects reprehensibility because

         the fine increases for a second violation;

        as to the second factor, because the risk to employees

         increases the longer an employer is without insurance, the

         rule recognizes the potential magnitude of the harm by

         increasing the amount of the fine based on how long an

         employer remains uninsured; and

        as to the third factor, by providing a uniform formula for fining

         all noncomplaint employers, the rule assures uniformity in its

         application while penalizing employers with longer periods of

         noncoverage more heavily.

  (Those factors are discussed fully in the following subsection of this

  opinion.)

¶ 68     But these observations go only so far. For example, an

  employer’s reasons for a second lapse of coverage may affect its

                                      30
  reprehensibility. The duration of that lapse will often be determined

  by how much time passes between the lapse beginning and notice

  of noncompliance from the division. And this timing dimension —

  not addressed in either the statute or any regulation that has been

  called to our attention — could erode uniformity.8

¶ 69   As addressed in the following subsection, to pass

  constitutional muster the factors that the Panel ordered the

  Director to consider must be applied on a case-by-case basis, with

  due consideration given to each employer’s unique situation. For

  this reason, we reject the Director’s and the Panel’s contrary

  interpretations. See Solid Waste Agency of N. Cook Cty. v. U.S.

  Army Corps of Eng’rs, 531 U.S. 159, 160 (2001) (rejecting doctrine

  of agency deference “[w]here an administrative interpretation of a

  statute would raise serious constitutional problems”).9


  8 Disuniformity is not the only potential problem resulting from the
  absence of a statutory or regulatory limitation of fines based on the
  failure to afford an employer prompt notice of noncompliance. Lack
  of such a limitation also invites future disputes over excessive fines.
  9 The Panel’s interpretation also suffers from lack of consistency. If

  Rule 3-6 already and adequately encompasses the Associated
  Business Products factors, as the Panel ultimately held after
  remand, then the Panel had no reason to remand to the Director for
  him to consider those factors. See, e.g., Turney v. Civil Serv.
  Comm’n, 222 P.3d 343, 352 (Colo. App. 2009) (“Although courts

                                    31
¶ 70   With these conclusions in mind, we turn to the propriety and

  proportionality of the fine imposed on Dami.

   4. Applying the Associated Business Products Factors in Weighing
        Whether a Fine Is Grossly Disproportionate and Thus
                      Constitutionally Excessive

¶ 71   Because the constitutional line demarcating an excessive fine

  is “inherently imprecise” and “not marked by a mathematical

  formula,” determining whether a fine is “grossly disproportionate”

  can be difficult. Associated Bus. Prods., 126 P.3d at 326 (first

  quoting Cooper Indus., 532 U.S. at 425; then quoting Toth, 924 P.2d

  at 1100). But cases addressing the constitutional limitations on

  punitive damages awards — from which the three Associated

  Business Products factors evolved — provide context for doing so.

¶ 72   In BMW of North America, Inc. v. Gore, 517 U.S. 559, 575, 580,

  583 (1996), the Supreme Court first articulated factors that should

  be considered when weighing the “reasonableness of a punitive

  damages award.” In deciding whether the constitutional line for an

  excessive fine “has been crossed,” the Court later condensed these

  factors by instructing lower courts to “focus[] on the same three

  extend deference to an agency’s interpretation of its own rules, they
  are not bound by it, particularly where the agency’s interpretation
  is not uniform or consistent.”).

                                    32
  criteria: (1) the degree of the defendant’s reprehensibility or

  culpability; (2) the relationship between the penalty and the harm to

  the victim caused by the defendant’s actions; and (3) the sanctions

  imposed in other cases for comparable misconduct.” Cooper Indus.,

  532 U.S. at 425.

¶ 73   Although Gore and Cooper addressed only punitive damages,

  the factors have been more broadly applied. As pertinent here, a

  statutory damage award could be “devastatingly large . . . out of all

  reasonable proportion to the actual harm suffered,” which could be

  a “sufficiently serious case [that] the due process clause might be

  invoked.” Parker v. Time Warner Entm’t Co., 331 F.3d 13, 22 (2d

  Cir. 2003); see also St. Louis, Iron Mountain & S. Ry. Co. v. Williams,

  251 U.S. 63, 66-67 (1919) (Although states have wide latitude in

  setting penalties for statutory violations, states cannot impose

  penalties “so severe and oppressive as to be wholly disproportioned

  to the offense and obviously unreasonable.”). Not surprisingly,

  Associated Business Products, 126 P.3d at 326, adopted the Gore

  factors and applied them to statutory penalties and civil fines.10


  10Associated Business Products, 126 P.3d at 326, quoted the
  recitation of the factors in Cooper Industries, 532 U.S. at 425;

                                     33
¶ 74   Dami asserts that the Director did not adequately apply these

  factors in his supplemental decision. True, the Director discussed

  the factors in his order on remand, although only after having been

  directed to do so by the Panel. But recall the Director determined

  that because the factors were incorporated into section 8-43-409

  and Rule 3-6, no further fact-specific analysis was required. In our

  view, this approach sells the necessary constitutional inquiry short.

¶ 75   When the Gore/Cooper Industries analysis has been applied by

  divisions of this court and by courts in other jurisdictions, the

  factors were examined in the context of the fined party’s actual

  behavior. No less is required here.

¶ 76   Consider Associated Business Products, 126 P.3d at 324,

  where an employer and its insurer were fined $24,900 for delaying

  or failing to pay $107.79 in medical bills incurred by an injured

  worker. A division of this court upheld the fine. In applying the

  Gore factors, it noted that the employer’s and its insurer’s actions

  met the reprehensibility factor because they had (1) previously been

  fined for failing to pay bills; (2) showed a pattern of delaying



  Cooper Industries summarized and compiled the factors articulated
  in Gore, 517 U.S. at 575, 580, 583.

                                     34
  payment of the worker’s bills; (3) failed to adhere to orders requiring

  them to pay for attendant care services, medical supplies, and

  prescriptions; and (4) disobeyed an order requiring them to identify

  the claims adjuster handling the file and provide a complete copy of

  the claims file and payment records. Id. at 326. The division went

  on to compare the fine to the range of penalties allowed under the

  statute and found it to be “well below the maximum” daily fine. Id.

  at 327.

¶ 77   Next consider Blood, 252 P.3d at 1094, where the Colorado

  Supreme Court applied the Gore factors to decide whether an $18

  million punitive damages award assessed against Qwest was

  “excessive and disproportionate.” A jury had awarded the punitive

  damages to a lineman who suffered grave injuries when the pole he

  was climbing — owned by Qwest — collapsed and fell to the ground.

  The court examined Qwest’s behavior de novo. It noted that Qwest

  (1) lacked “a periodic pole inspection program,” which demonstrated

  a “conscious indifference to the safety of linemen”; (2) had failed to

  implement such an inspection program for five decades; and (3)

  should have foreseen the plaintiff’s injuries caused by the collapse

  of a pole due to rot as the natural result of never inspecting its


                                    35
  poles. Id. at 1095-97. Based on these particular facts, the court

  affirmed the award.

¶ 78   Similarly, courts in other jurisdictions have applied the

  Gore/Cooper Industries factors using a fact-specific analysis. See,

  e.g., Lompe v. Sunridge Partners, LLC, 818 F.3d 1041, 1065-73

  (10th Cir. 2016) (reducing a punitive damages award against an

  apartment management company for tenant’s carbon monoxide

  poisoning injuries on grounds that, under Gore factors, the amount

  was excessive when compared to other carbon monoxide poisoning

  cases); In re Exxon Valdez, 270 F.3d 1215, 1242 (9th Cir. 2001)

  (rejecting a $5 billion punitive damages award against Exxon in part

  because “there was no violence, no intentional spilling of oil (as in a

  ‘midnight dumping’ case), and no executive trickery to hide or

  facilitate the spill”); People ex rel. Bill Lockyer v. Fremont Life Ins.

  Co., 128 Cal. Rptr. 2d 463, 475-81 (Cal. Ct. App. 2002) (upholding

  a civil penalty because it did not violate the Gore factors); In re

  Marriage of Miller, 860 N.E.2d 519, 523-24 (Ill. App. Ct. 2006)

  (comparing the $1,172,100 penalty imposed against an employer for

  failure to garnish the wages of an employee who owed child support

  against the maximum fine for the criminal offense of failing to pay


                                       36
  child support and concluding that the penalty was excessive), rev’d,

  879 N.E.2d 292 (Ill. 2007) (reconsidering the factors in light of the

  evidence and reinstating the $1,172,100 penalty).

¶ 79     We consider these decisions well reasoned and apply them

  here. Thus, when Dami challenged the fine as constitutionally

  excessive, the Director should have weighed the facts specific to

  Dami. By failing to do so, the Director misapplied the law and

  abused his discretion. See Patterson, ¶ 6; Heinicke, 197 P.3d at

  222.

¶ 80     Even so, could we set aside the Panel’s final order upholding

  the fine unless the Director’s failure to make a fact-specific inquiry

  harmed Dami? After all, as the Director recognized, the formula in

  Rule 3-6 gives limited voice to the Gore factors.

¶ 81     The record contains Dami’s written assertions and Ms. Pak’s

  affidavit.11 In his supplemental order and order on remand, the


  11As indicated, Ms. Pak’s affidavit explained that she relied on her
  insurance agent to obtain and maintain all necessary insurance
  coverages, but she asserted inability to pay the fine only in her
  separate letter to the division, which served as Dami’s initial
  petition to review. Of course, appellate courts may only consider
  assertions that are supported by record evidence, McCall v. Meyers,
  94 P.3d 1271, 1272 (Colo. App. 2004), and mere arguments of
  counsel must be disregarded. Lucero v. People, 166 Colo. 233, 237,

                                     37
  Director accepted these assertions as true. The division did not

  controvert any of this information before the Panel, nor does it do so

  on appeal. And “a legal conclusion drawn by the Panel from

  undisputed facts is a matter for the appellate court.” Coates, Reid

  & Waldron v. Vigil, 856 P.2d 850, 856 (Colo. 1993). So, we apply

  the Gore/Cooper Industries factors to those undisputed facts as

  follows.

                           a. Reprehensibility

¶ 82   In a punitive damages case, our supreme court has adopted

  the Supreme Court’s criteria for assessing reprehensibility:

             The [United States Supreme] Court has
             analyzed the Gore reprehensibility guidepost
             according to the following five criteria:

                  the harm caused was physical as
                  opposed to economic; the tortious
                  conduct evinced an indifference to
                  or a reckless disregard of the health
                  or safety of others; the target of the
                  conduct had financial vulnerability;
                  the conduct involved repeated
                  actions or was an isolated incident;
                  and the harm was the result of
                  intentional malice, trickery, or
                  deceit, or mere accident.

  442 P.2d 820, 822 (1968). But exactly what must be included in
  such a petition to make a sufficient record is not resolved by
  statute, regulation, or case law.

                                    38
             “The existence of any one of these [criterion]
             weighing in favor of a plaintiff may not be
             sufficient to sustain a punitive damages
             award; and the absence of all of them renders
             any award suspect.”

  Blood, 252 P.3d at 1094-95 (quoting State Farm Mut. Auto. Ins. Co.

  v. Campbell, 538 U.S. 408, 419 (2003)).

¶ 83   Dami said that it was unaware of the lapses of workers’

  compensation insurance. The Director found that Dami should

  have known about the lapses, but relied only on the prior violation

  in doing so. Instead, the uncontroverted evidence provided in Ms.

  Pak’s affidavit indicates she trusted her insurance agent to

  maintain the necessary coverages. In turn, the agent agreed that

  Ms. Pak was likely confused, that she did not realize she lacked the

  insurance, and that he “did not tell” her Dami lacked workers’

  compensation insurance.

¶ 84   These facts put Dami at the low end of the reprehensibility

  scale. By any fair reading of Blood, Dami did not act with

  “indifference to or reckless disregard for the safety of others,” nor

  did it act with intentional malice, trickery or deceit.




                                     39
            b. Disparity Between Actual or Potential Harm
                     to Employees and the Fine

¶ 85   Dami submitted its unemployment records showing that it had

  fewer than ten employees and its annual payroll was less than

  $50,000. Dami also said that a workers’ compensation claim has

  never been filed against it. The division could easily have

  controverted the latter statement, but has not done so. This

  information is significant in two ways.

¶ 86   First, because no claims have been filed against Dami, the

  lack of workers’ compensation insurance did not actually harm any

  of Dami’s employees.

¶ 87   Second, as for potential harm, Dami has few employees. Cf.

  Blood, 252 P.3d at 1079, 1098 (noting that Qwest’s failure to

  inspect any of its 157,000 poles for five decades endangered

  “linemen and the public”). And Dami’s lengthy history with no

  reported claims also suggests that the risk of injury to those few

  employees is low.

¶ 88   Yes, as the Director observed, “an employer that continues to

  operate without insurance for a lengthy period of time creates an

  ever-growing risk that a worker will be injured and be forced to rely



                                    40
  solely on the employer to pay for the injury.” Because the record

  does not include any evidence of particular risks arising from the

  nature of Dami’s operations, however, this observation paints an

  incomplete picture. Of course, all employees working for an

  employer without workers’ compensation coverage are at financial

  risk should an injury occur and the employer be unable or

  unwilling to compensate the injured worker. But the magnitude of

  that risk depends on the likelihood of severe or fatal injury.

¶ 89   As to that likelihood, the Director observed only that

  housekeeping and maintenance work involved potentially heavy

  lifting, which could lead to injury. But he did not refer to

  industry-specific data from Colorado. Nor have we found any.

¶ 90   To fill this void, we have taken judicial notice of federal

  government reports. Campbell v. Manchester Bd. of Sch. Dirs., 641

  A.2d 352, 359 n.7 (Vt. 1994) (“The Court in Nyquist took judicial

  notice of enrollment data from publicly available government

  reports, exactly the type of information we have used here. See

  Committee for Public Education & Religious Liberty v. Nyquist, 413

  U.S. 756, 768 n. 23 (1973).”). According to the United States

  Department of Labor’s most recent reports, the “leisure and


                                    41
  hospitality” industry ranks below the midpoint of other industries

  for incidence of nonfatal workplace injuries and well below that

  point for fatal injuries.12

                          c. Comparable Penalties

¶ 91   The record is barren of any evidence comparing Dami’s fine

  against fines imposed on other uninsured employers. We cannot

  fault Dami for this void because it would lack access to such

  information. Nor has the division provided it.

¶ 92   Instead, Dami identifies a 2005 “State Fiscal Impact

  Statement” related to the amendment of section 8-43-409, which

  estimated that the total fines collected from all violators of the

  statute in 2006-2007 would be “$200,000.” Further, Dami points

  out that the General Assembly anticipated the average fine would

  be $28,500, and that its fine exceeds this estimate by 2900%.13


  12 The reports are released by the Bureau of Labor Statistics and
  can be found at Bureau of Labor Statistics, Nonfatal Occupational
  Injuries and Illnesses Requiring Days Away from Work, 2015 (Nov.
  10, 2016), https://perma.cc/G4QQ-FM7V (nonfatal injuries); and
  Bureau of Labor Statistics, Census of Fatal Occupational Injuries
  Summary, 2015 (Dec. 16, 2016), https://perma.cc/Q7DF-XK7U
  (fatal injuries).
  13 Dami’s brief refers to a January 18, 2005, “State Fiscal Impact

  Statement” and attaches a “Summary of Legislation under State
  Revenues.” The Summary does not state from where it derived the

                                     42
¶ 93   Even so, according to the Director, the fines imposed on

  different employers must be similar because all of them were

  imposed solely by applying the formula in Rule 3-6. This assertion,

  even if accurate, accounts for only one-half of the process.

  Although we have rejected Dami’s vagueness argument, we agree

  that the more time that lapses before the division gives notice to an

  uninsured employer, the more the fine will have mounted. Due to

  this variable, significantly disparate fines could be imposed, despite

  the Director’s formulaic approach.

                            5. Ability to Pay

¶ 94   Dami next argues that the Director should have considered its

  ability to pay before imposing the penalty. As indicated, the

  Director did not do so, asserting lack of statutory or regulatory

  authority.

¶ 95   No Colorado case that Dami has cited, or that we have found,

  requires that ability to pay be considered before imposing a civil

  fine. However, Colorado courts consider ability to pay before

  imposing criminal fines. See, e.g., People v. Stafford, 93 P.3d 572,



  figures. In any event, the division does not contest the accuracy of
  this information.

                                    43
  574 (Colo. App. 2004) (“[A] sentencing court must consider the

  defendant’s financial status in determining the appropriate amount

  of any fine to be levied.”); People v. Pourat, 100 P.3d 503, 507 (Colo.

  App. 2004) (“[I]n imposing a fine, a trial court must consider a

  defendant’s ability to pay.”).

¶ 96   As well, the United States Supreme Court has held that a

  defendant’s ability to pay must be considered before a monetary

  civil contempt sanction may be imposed. See United States v.

  United Mine Workers of Am., 330 U.S. 258, 304 (1947) (“It is a

  corollary of the above principles that a court which has returned a

  conviction for contempt must, in fixing the amount of a fine to be

  imposed as a punishment or as a means of securing future

  compliance, consider the amount of defendant’s financial resources

  and the consequent seriousness of the burden to that particular

  defendant.”).

¶ 97   Other states have required that ability to pay be considered

  before imposing a civil penalty. See Parisi v. Broward Cty., 769 So.

  2d 359, 366 (Fla. 2000) (“[I]n imposing both criminal fines or

  coercive civil contempt fines, the court must consider the financial

  resources of the contemnor in setting the amount of the fine.”).


                                    44
¶ 98   In a case remarkably similar to this one, the Minnesota Court

  of Appeals listed ability to pay as one of the factors to be considered

  before a fine could be imposed against an employer for failing to

  carry workers’ compensation insurance. See State Dep’t of Labor &

  Indus. v. Wintz Parcel Drivers, Inc., 555 N.W.2d 908, 913 (Minn. Ct.

  App. 1996) (citing State v. Alpine Air Prods., Inc., 490 N.W.2d 888,

  896-97 (Minn. Ct. App. 1992)), modified, 558 N.W.2d 480 (Minn.

  1997). Wintz Parcel Drivers upheld a penalty against a trucking

  firm in excess of $1.2 million for failure to carry workers’

  compensation insurance. Although the opinion does not say how

  many employees Wintz had or describe its financial status, the

  court mentions that Wintz’s workers’ compensation insurance

  premium for the uncovered period would likely have been over $1

  million. Id.14

¶ 99   Guided by these authorities, we conclude that ability to pay

  should be considered when determining whether a penalty imposed

  against an employer for failure to carry workers’ compensation

  insurance is constitutionally excessive.


  14The record does not contain any comparable information for
  Dami.

                                    45
¶ 100   Ms. Pak’s letter asserted that Dami cannot afford to pay a fine

  of $841,200, which would put it — and her — into bankruptcy. The

  record does not include any contrary information. Nor does the

  division argue otherwise.

¶ 101   Thus, although the Director did not exercise his statutory

  power to seek a cease and desist order putting Dami out of

  business, which Dami could have opposed, the fine indirectly

  achieved this result. Still, the record does not fully describe Dami’s

  financial condition, such as its net worth. For this reason, we are

  unable to say whether Dami could pay a reduced fine.

¶ 102   Based on all of these facts, we conclude that the present

  record shows the $841,200 fine to be excessive. In saying this

  much, however, we take care to emphasize what we are not saying

  — that a lower fine against Dami would necessarily also fail a

  constitutional challenge. To the contrary, the constitutionality of

  such a fine can be addressed only when that fine has been imposed

  and any additional record is before us.




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            IV. Incorporating Provisions of Section 8-43-304
                         into Section 8-43-409

¶ 103   Dami next contests the fine by contending that provisions of

  section 8-43-304, C.R.S. 2016, must be read into section 8-43-409.

  In particular, Dami focuses on provisions in section 8-43-304 that

  (1) grant a violator twenty days to cure a violation and thus avoid a

  penalty, § 8-43-304(4); (2) require a party charging an opponent

  with a violation to prove by clear and convincing evidence that the

  violation occurred, § 8-43-304(4); and (3) mandate that a party

  alleging a violation file a claim within one year of when it knew or

  reasonably should have known of the alleged violation,

  § 8-43-304(5).

¶ 104   Based on these provisions, Dami argues that the fine must be

  set aside because (1) it cured its failure to carry workers’

  compensation insurance within twenty days; (2) the division did not

  prove Dami’s violation by clear and convincing evidence; and (3) the

  division did not file its notice of violation within one year of when

  Dami’s violation should reasonably have been discovered. But

  Dami’s conclusion fails because its premise that the provisions of

  section 8-43-304 must be read into section 8-43-409 is flawed.



                                     47
¶ 105   As with any statute, the provisions of the Act must be read

  “harmoniously, reconciling conflicts where necessary.” Anderson v.

  Longmont Toyota, Inc., 102 P.3d 323, 327 (Colo. 2004). But that

  general principle does not give a reviewing court license to read

  provisions from one statute into a different statute. To the

  contrary, courts are expressly prohibited from reading provisions

  into the Act. See Kraus v. Artcraft Sign Co., 710 P.2d 480, 482

  (Colo. 1985) (“We have uniformly held that a court should not read

  nonexistent provisions into the Colorado Workmen’s Compensation

  Act.”).

¶ 106   Relying on Holliday v. Bestop, Inc., 23 P.3d 700, 705 (Colo.

  2001), Dami argues that nothing in section 8-43-304 prohibits its

  provisions from being read into section 8-43-409. Then Dami

  insists that because the limiting phrase in section 8-43-304 — “for

  which no penalty has been specifically provided” — only applies to

  one of the four different acts giving rise to penalties under that

  statute, the other three types of actions leading to penalties may be

  read broadly and into section 8-43-409.

¶ 107   Holliday held as follows:




                                    48
             The legislature’s use of the disjunctive
             conjunction “or” in section 8-43-304(1) plainly
             demarcates four different acts giving rise to
             penalties. The legislature’s use of “or” makes
             clear that the statute penalizes the person
             who: (1) “violates any provision of [the Workers’
             Compensation Act],” (2) “does any act
             prohibited thereby,” (3) “fails or refuses to
             perform any duty lawfully enjoined within the
             time prescribed by the director or panel, for
             which no penalty has been specifically
             provided,” or (4) “fails, neglects, or refuses to
             obey any lawful order made by the director or
             panel or any judgment or decree made by any
             court as provided by said articles.”

  23 P.3d at 705 (citation omitted) (quoting § 8-43-304(1)).

¶ 108   Thus, Holliday does not carry the weight that Dami places on

  its shoulders. Had the General Assembly intended to incorporate a

  cure provision, a limitation period, or a clear and convincing burden

  of proof into section 8-43-409, it would have done so expressly.

  Because it did not, we are not free to do so by judicial fiat. See City

  of Loveland Police Dep’t v. Indus. Claim Appeals Office, 141 P.3d

  943, 954-55 (Colo. App. 2006) (“If [the General Assembly] intended

  to limit death benefits where the death results from mental

  impairment, we conclude it would have done so expressly.”).

¶ 109   For these reasons, we decline to incorporate the provisions of

  section 8-43-304 into section 8-43-409. Therefore, the Director was


                                    49
  not obligated to credit Dami for curing the violation, was not

  required to prove by clear and convincing evidence that Dami

  violated section 8-43-409, and did not have to file notice of Dami’s

  violation within one year of Dami’s lapse.

                              V. Conclusion

¶ 110   The fine must be set aside because the Director abused his

  discretion when he failed to apply the Associated Business Products

  factors — derived from Gore and Cooper Industries — to Dami’s

  specific circumstances. Facts relevant to that application include

  Dami’s ignorance that the required insurance had lapsed. While

  not mandated by Gore, the failure to notify Dami of the lapse for

  almost half a decade and Dami’s ability to pay are also relevant. On

  remand, the fine may be recalculated, but only after these facts

  have been weighed.

¶ 111   We conclude that Dami’s other contentions — challenging the

  facial constitutionality of section 8-43-409, seeking to incorporate

  the provisions of section 8-43-304 into section 8-43-409, and

  alleging procedural due process violations — do not provide a basis

  for setting aside the Panel’s final order affirming the Director’s

  remand order.


                                     50
¶ 112   The Panel’s order is set aside and the case is remanded to the

  Panel with directions to return it to the Director for recalculation of

  Dami’s fine in accordance with this opinion.

        JUDGE DUNN and JUDGE DAVIDSON concur.




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