Barnhart v. Sigmon Coal Company, Inc.

PETITIONER: Barnhart
RESPONDENT: Sigmon Coal Company, Inc.
LOCATION: United States District Court Eastern District of Michigan

DOCKET NO.: 00-1307
DECIDED BY: Rehnquist Court (1986-2005)
LOWER COURT: United States Court of Appeals for the Fourth Circuit

CITATION: 534 US 438 (2002)
ARGUED: Nov 07, 2001
DECIDED: Feb 19, 2002

ADVOCATES:
John R. Woodrum - Argued the cause for the respondents
Peter Buscemi - on behalf of the United Mine Workers Combined Benefit Fund, as amicus curiae
Paul R. Q. Wolfson - Argued the cause for the petitioner

Facts of the case

The Coal Industry Retiree Health Benefit Act of 1992 restructured the system for providing private health care benefits to coal industry retirees by merging two previous benefits plans into the United Mine Workers of America Combined Benefit Fund. The fund is financed by annual premiums assessed against signatory coal operators, or those who signed any agreement requiring contributions to the plans that were merged into the Fund. If the signatory is no longer in business, the Act assigns liability for beneficiaries to a defined group of "related persons" based on the Commissioner of Social Security assignments. Shortly after Jericol Mining Co. was formed in 1973 as Irdell Mining, Inc., Irdell purchased the coal mining operating assets of Shackleford Coal Co., which was a signatory to a coal wage agreement while it was in business. Between 1993 and 1997, the Commissioner assigned responsibility for 86 retired miners to Jericol, determining that as a successor in interest to Shackleford, Jericol qualified as a related person. All of these retirees had worked for Shackleford, but none of them had actually worked for Jericol. Jericol filed suit against the Commissioner. The District Court granted Jericol summary judgment, concluding that the Act's classification regime does not provide for the liability of successors of defunct signatory operators. In affirming, the Court of Appeals concluded that Jericol was not a related person to Shackleford and thus could not be held responsible for Shackleford's miners.

Question

Does the Coal Industry Retiree Health Benefit Act of 1992 permit the Commissioner of Social Security to assign retired miners to the successors in interest of out-of-business signatory operators?

Media for Barnhart v. Sigmon Coal Company, Inc.

Audio Transcription for Oral Argument - November 07, 2001 in Barnhart v. Sigmon Coal Company, Inc.

Audio Transcription for Opinion Announcement - February 19, 2002 in Barnhart v. Sigmon Coal Company, Inc.

William H. Rehnquist:

The opinion of the Court No. 00-1307, Barnhart versus Sigmon Coal Co. will be announced by Justice Thomas.

Clarence Thomas:

This case comes to us on a writ of certiorari to the United States Court of Appeals for the Fourth Circuit.

The Coal Industry Retirement Health Benefit Act of 1992 charges petitioner, the Commissioner of Social Security with the task of assigning fiscal responsibility for the health benefits of Coal Industry Retirees who worked for signatory operators.

Signatory operators are those coal operators that are signatories to coal wage agreements that require contributions to the 1950 or the 1974 benefits plans.

The commissioner assigned responsibility for the health benefits of 86 retired coal miners to respondent Jericol Coal Mining Company on the basis that Jericol was a successor in interest to an out-of-business signatory operator that had employed the retired miners.

Jericol and respondents Sigmon are related person under the Act challenge these assignments arguing that the Coal Act does not permit the Commissioner to assign retired miners to successors in interest to out-of-business signatory operators.

The United States Court of Appeals for the Fourth Circuit agreed with Jericol.

In an opinion filed with the Clerk today, we affirm.

The statute carefully delineates which entities are responsible for the health benefits of retired miners.

It requires the Commissioner to assign responsibility for the benefits of retired miners to one of three categories of signatory operators or where a signatory operator is no longer in business to a defined group of related persons to that signatory operator.

The commissioner contends that Jericol qualifies as a related person because it is a successor in interest to the signatory operator that employed the retired miners.

We disagree.

Under the Act an entity qualifies as a related person if that entity is: one, a member of the controlled group of corporations that includes the signatory operator; two, a trade or business that is under common control with the signatory operator; or three, a trade or business that has a partnership interest or joint venture with the signatory operator.

A successor in interest to an entity described in the three categories also qualifies as a related person.

Jericol is neither an entity described in those three categories nor a successor in interest to any such entity because the statute is explicit as to who may be assigned liability for beneficiaries and neither the related persons provisions nor any other provision states that such successors in interests to signatory operators may be assigned the liability.

The unambiguous statutory text precludes the assignment of these retired miners to Jericol.

Justice Stevens has filed a dissenting opinion in which Justices O’Connor and Breyer have joined.