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Barnhart v. Sigmon Coal Co.

February 19, 2002

JO ANNE B. BARNHART, COMMISSIONER OF SOCIAL SECURITY, PETITIONER
v.
SIGMON COAL COMPANY, INC., ET AL.



Court Below: 226 F. 3d 291

SYLLABUS BY THE COURT

OCTOBER TERM, 2001

Certiorari To The United States Court Of Appeals For The Fourth Circuit

Argued November 7, 2001

The Coal Industry Retiree Health Benefit Act of 1992 (Coal Act or Act) restructured the system for providing private health care benefits to coal industry retirees. The Act merged the 1950 and 1974 Benefit Plans -- which were created pursuant to collective-bargaining agreements between the United Mine Workers of America (UMWA) and coal operators -- into a new multiemployer plan called the UMWA Combined Benefit Fund (Combined Fund). See 26 U. S. C. §9702(a). That fund is financed by annual premiums assessed against "signatory coal operators," i.e., those who signed any agreement requiring contributions to the 1950 or 1974 Benefits Plans. Where the signatory is no longer in business, the Act assigns liability for beneficiaries to a defined group of "related persons." See §§9706(a), 9701(c)(2), (7). The Act charges the Commissioner of Social Security with assigning each eligible beneficiary to a signatory operator or its related persons, §9706(a); identifies specific categories of signatory operators (and their related persons) and requires the Commissioner to assign beneficiaries among these categories in a particular order, ibid.; and ensures that if a beneficiary remains unassigned because no existing company falls within the categories, benefits will be financed by the Combined Fund, see §§9704(a), (d), 9705(b). Shortly after respondent Jericol Mining Co. (Jericol) was formed in 1973 as Irdell Mining, Inc., Irdell and another company purchased the coal mining operating assets of Shackleford Coal Co., which was a signatory to a coal wage agreement while it was in business. Among other things, they assumed responsibility for Shackleford's collective-bargaining agreement with the UMWA. There was no common ownership between Irdell and Shackleford. Irdell subsequently changed its name, operating as the Shackleford Coal Co. until 1977, when it again changed its name to Jericol. Between 1993 and 1997, the Commissioner assigned premium responsibility for 86 retired miners to Jericol under §9706(a)(3), determining that as a "successor" or "successor in interest" to the original Shackleford, Jericol qualified as a "related person" to Shackleford. All of these retirees had worked for Shackleford, but none of them had actually worked for Jericol. Jericol and respondent Sigmon Coal Company, Inc., a person related to Jericol under §9701(c)(2), filed suit against the Commissioner. The District Court granted them summary judgment, concluding that the Act's classification regime does not provide for the liability of successors of defunct signatory operators. In affirming, the Fourth Circuit concluded that the Act was clear and unambiguous and that the court was bound to read it exactly as it was written, and held, inter alia, that Jericol was not a "related person" to Shackleford and thus could not be held responsible for Shackleford's miners.

Held: The Coal Act does not permit the Commissioner to assign retired miners to the successors in interest of out-of-business signatory operators. Pp. 10-22.

1. Because the Act is explicit as to who may be assigned liability for beneficiaries and neither the "related persons" provision nor any other provision states that successors in interest to these signatory operators may be assigned liability, the Act's plain language necessarily precludes the Commissioner from assigning the disputed miners to Jericol. Where, as here, the statutory language is unambiguous, the inquiry ceases. See, e.g., United States v. Ron Pair Enterprises, Inc., 489 U. S. 235, 240. Since the retirees at issue were Shackelford employees, the "signatory operator" that sold its assets to Jericol (then-Irdell) in 1973, the Commissioner can only assign the beneficiaries to Jericol if it is a "related person" to Shackleford under §9706(a). Section 9701(c)(2) states that "[a] person shall be considered to be a related person to a signatory operator if that person is -- " "(i) a member of the controlled group of corporations ... which includes [the] signatory operator"; "(ii) a trade or business ... under common control ... with such signatory operator"; or "(iii) any other person who [has] a partnership interest or joint venture with a signatory operator" with some exceptions. A related person also includes "a successor in interest of any person described in clause (i), (ii), or (iii)." There is no contention that Jericol was ever a member of a controlled group of corporations including Shackleford, that it was ever a business under common control with Shackleford, or that it ever had a partnership interest or engaged in a joint venture with Shackleford. Therefore, liability for these beneficiaries may attach to Jericol only if it is a successor in interest to an entity described in §§9701(c)(2)(A)(i)-(iii). Because Jericol is a successor in interest only to Shackleford, Jericol will be liable only if a signatory operator itself, here Shackleford, falls within one of these categories. None of the three categories, however, includes the signatory operator itself. Nor should such inclusion be inferred, since it is a general principle of statutory construction that when one statutory section includes particular language that is omitted in another section of the same Act, it is presumed that Congress acted intentionally and purposely. E.g., Russello v. United States, 464 U. S. 16, 23. Where Congress wanted to provide for successor liability in the Coal Act, it did so explicitly, as demonstrated by §§9706(b)(2) and 9711(g)(1). If Congress had meant to make a preenactment successor in interest like Jericol liable, it could have done so clearly and explicitly. Pp. 10-14.

2. The Court rejects the Commissioner's arguments that, in light of the Coal Act's text, structure, and purposes, a direct successor in interest of the entity that was the signatory operator is included within the liability scheme and should be responsible for that operator's Combined Fund premiums if the operator is defunct and there is no other "related person" still in business. Pp. 14-22.

(a) The Act's text supports neither of two readings proposed by the Commissioner. First, the Commissioner argues that, because §9701(c)(2)(A)'s last sentence states that "related person" "include[s]" a successor in interest of "any person described in clause (i), (ii), or (iii)," and because these clauses mention the "signatory operator" itself, that operator is "described" in clause (i) by virtue of the express reference. It is unlikely that Congress, which neither created a separate category for signatory operators nor included signatory operators within the categories, intended to attach liability to a group such as successors in interest to signatory operators through a general clause that was meant to reach persons "described" in one of three explicit categories. Second, the Commissioner argues that, because a signatory operator is necessarily a member of a controlled group of corporations that includes itself under §9701(c)(2)(A)(i), a "successor in interest" of a member of that group includes a successor in interest of the signatory operator. Section 9701(c)(2)(A)(i), however, cannot be divorced from the clause that begins the related persons provision: "A person shall be considered to be a related person to a signatory operator if that person is -- ." §9701(c)(2)(A) (emphasis added). Because it makes little sense for a signatory operator to be related to itself, the statute necessarily implies that a "related person" is a separate entity from a signatory operator. Moreover, the Commissioner's argument only works where the signatory operator is actually part of a "controlled group of corporations." The argument has no force here, in any event, because the Commissioner does not contend that Shackleford was part of such a group. Pp. 14-16.

(b) The floor statements of two Senators who sponsored the Coal Act, which the Commissioner alleges support her position, cannot amend the unambiguous language of the statute. There is no reason to give greater weight to a Senator's floor statement than to the collective votes of both Houses, which are memorialized in the unambiguous statutory text. Pp. 16-17.

(c) Also unavailing is the Commissioner's argument that construing the "related person" provision to exclude a signatory's direct successor in interest would be contrary to Congress' stated purposes of ensuring that each Combined Fund beneficiary's health care costs are borne (if possible) by the person with the most direct responsibility for the beneficiary, not by persons that had no connection with the beneficiary or by the public fisc. The Commissioner appears to request application of some form of an absurd results test. Respondents answer correctly that this Court rarely invokes such a test to override unambiguous legislation, and offer several explanations for why Congress would have purposefully exempted successors in interest of a signatory operator from the "related person" definition. Where the statutory language is clear and unambiguous, this Court need neither accept nor reject a particular "plausible" explanation for why Congress would have written a statute as it did. Negotiations surrounding the bill's enactment tell a typical story of legislative battle among interest groups, Congress, and the President. It is quite possible that a bill that assigned liability to successors of signatory operators would not have survived the legislative process. The deals brokered during a Committee mark-up, on the floor of the two Houses, during a joint House and Senate Conference, or in negotiations with the President are not to be second-guessed by this Court, whose role is to interpret the language of the statute enacted by Congress. The Court will not alter unambiguous text in order to satisfy the Commissioner's policy preferences. Pp. 18-22.

(d) Finally, the Court rejects the Commissioner's suggestion that, because it was reasonable for her to conclude that direct successors of a signatory operator should be responsible for the operator's employees, her interpretation is entitled to deference. In the context of an unambiguous statute, this Court need not contemplate deferring to an agency's interpretation. See Chevron U. S. A. Inc. v. Natural Resources Defense Council, Inc., 467 U. S. 837, 842-843. P. 22.

226 F. 3d 291, affirmed.

Thomas, J., delivered the opinion of the Court, in which Rehnquist, C. J., and Scalia, Kennedy, Souter, and Ginsburg, JJ., joined. Stevens, J., filed a dissenting opinion, in which O'Connor and Breyer, JJ., joined.

The opinion of the court was delivered by: Justice Thomas

534 U. S. ____ (2002)

On Writ Of Certiorari To The United States Court Of Appeals For The Fourth Circuit

This case arises out of the Commissioner of Social Security's assignment, pursuant to the Coal Industry Retiree Health Benefit Act of 1992 (Coal Act or Act), 26 U. S. C. §9701 et seq. (1994 ed. and Supp. V), of 86 retired coal miners to the Jericol Mining Company (Jericol). The question presented is whether the Coal Act permits the Commissioner to assign retired miners to the successors in interest of out-of-business signatory operators.*fn1 The United States Court of Appeals for the Fourth Circuit held that it does not. Sigmon Coal Co. v. Apfel, 226 F. 3d 291 (2000). We affirm.

I.

The Coal Act reconfigured the system for providing private health care benefits to retirees in the coal industry. In restructuring this system, Congress had to contend with over half a century of collective-bargaining agreements between the coal industry and the United Mine Workers of America (UMWA), the coal miners' union. Tensions between coal operators and the UMWA had often led to lengthy strikes with serious economic consequences for both the industry and its employees. Confronted with an industry fraught with contention, Congress was faced with a difficult task.*fn2

This was not the first time that the Federal Government had been called on to intervene in negotiations within the industry. Such tensions motivated President Truman, in 1946, to issue an Executive Order directing the Secretary of the Interior to take possession of all bituminous coal mines and to negotiate with the UMWA over changes in the terms and conditions of miners' employment. See Eastern Enterprises v. Apfel, 524 U. S. 498, 504-505 (1998) (plurality opinion) (quoting 11 Fed. Reg. 5593 (1946)). These negotiations culminated in the first of many agreements that resulted in the creation of benefit funds compensating miners, their dependents, and their survivors. 524 U. S., at 505.

Subsequently, the UMWA and several coal operators entered into a collectively bargained agreement, the National Bituminous Coal Wage Agreement of 1947 (NBCWA), which established a fund under which three trustees "were given authority to determine," among other things, the allocation of benefits to miners and their families. Id., at 505-506. Further disagreement prompted the parties to negotiate another NBCWA in 1950. The following year, the Bituminous Coal Operators' Association (BCOA) was created as a multiemployer bargaining association and primary representative for the coal operators in their negotiations with the UMWA. Id., at 506.

While the NBCWA was amended occasionally and new NBCWAs were adopted in 1968 and 1971, the terms and structure of the 1950 agreement remained largely unchanged between 1950 and 1974. Ibid. In 1974, in order to comply with the Employee Retirement Income Security Act of 1974 (ERISA), 29 U. S. C. §1001 et seq. (1994 ed. and Supp. V), the UMWA and the BCOA negotiated a new agreement to finance benefits. 524 U. S., at 509. The 1974 NBCWA created four trusts that replaced the 1950 fund.*fn3

These benefit plans quickly developed financial problems. Thus, in 1978 the parties executed another NBCWA. This agreement assigned responsibility for the health care of active and retired employees to the respective coal mine operators who were signatories to the earlier NBCWAs, and left the 1974 Benefit Plan in effect only for those retirees whose former employers were no longer in business. Id., at 510.

Nonetheless, financial problems continued to plague the plans "as costs increased and employers who had signed the 1978 NBCWA withdrew from the agreement, either to continue in business with nonunion employees or to exit the coal business altogether." Id., at 511. "As more and more coal operators abandoned the Benefit Plans, the remaining signatories were forced to absorb the increasing cost of covering retirees left behind by exiting employers." Ibid. Pursuant to yet another NBCWA, the UMWA and the BCOA in 1988 attempted to remedy the problem, this time by imposing withdrawal liability on NBCWA signatories that seceded from the benefit plans.

Despite these efforts, the plans remained in serious financial crisis and, by June 1991, the 120,000 individuals who received health benefits from the funds were in danger of losing their benefits. Frieden, Congress Ponders Fate of Coal Miners' Fund, 10 Business & Health 65 (Sept. 1992) (hereinafter Frieden). About 60% of these individuals were retired miners and their dependents whose former employers were no longer contributing to the benefit plans. Another 15% worked for employers that were no longer UMWA-represented or were never unionized.*fn4 Karr, Union, Nonunion Coal Companies Head for Showdown on Retirement Benefits, Wall Street Journal, Mar. 3, 1992, p. A6 (hereinafter Karr). These troubles were further aggravated by rising health care costs. Frieden 65.

The UMWA threatened to strike if a legislative solution was not reached. Karr A6. And BCOA members, which included those coal firms that were currently signatories to NBCWAs, threatened that they would not renew their commitments to cover retiree costs when their contracts expired. Ibid. Following another strike and much unrest, Secretary of Labor Elizabeth Dole created the Advisory Commission on United Mine Workers of America Retiree Health Benefits (Coal Commission), which studied the problem and proposed several solutions. Eastern Enterprises, 524 U. S., at 511-512. In particular, the Coal Commission focused on how to finance the health care benefits of orphaned retirees.

Congress considered these and other proposals and eventually reconfigured the allocation of health benefits for coal miner retirees by enacting the Coal Act in 1992. Crafting the legislative solution to the crisis, however, was no easy task. The Coal Act was passed amidst a maelstrom of contract negotiations, litigation,*fn5 strike threats, a presidential veto of the first version of the bill*fn6 and threats of a second veto, and high pressure lobbying,*fn7 not to mention wide disagreements among Members of Congress.

The Act "merged the 1950 and 1974 Benefit Plans into a new multiemployer plan called the United Mine Workers of America Combined Benefit Fund (Combined Fund)." Id., at 514; see 26 U. S. C. §9702(a) (1994 ed.). The Combined Fund "is financed by annual premiums assessed against `signatory coal operators,' i.e., coal operators that signed any NBCWA or any other agreement requiring contributions to the 1950 or 1974 Benefits Plans." Eastern Enterprises, 524 U. S., at 514. Where the signatory is no longer in business, the statute assigns liability for beneficiaries*fn8 to a defined group of "related persons." Ibid.; see §§9706(a), 9701(c)(2), (7). The Coal Act charged the Commissioner of Social Security with assigning each eligible beneficiary to a signatory operator or its related persons. §9706(a). The statute identifies specific categories of signatory operators (and their related persons) and requires the Commissioner to assign beneficiaries among these categories in a particular order. Ibid. The Coal Act also ensures that if a beneficiary remains unassigned because no existing company falls within the aforementioned categories, then benefits will be financed by the Combined Fund, either with funds transferred from interest earned on the Department of the Interior's Abandoned Mine Reclamation Fund or from an additional premium imposed on all assigned signatory operators on a pro rata basis. See §§9704(a), (d), 9705(b).

II.

Respondent Jericol was formed in 1973 as Irdell Mining, Inc. (Irdell). Shortly thereafter, Irdell and another company purchased the coal mining operating assets of Shackleford Coal Company, Inc., a company that was a signatory to a coal wage agreement while it was in business. Sigmon Coal Co. v. Apfel, 33 F. Supp. 2d 505, 507 (WD Va. 1998). They acquired the right to use the Shackleford name and assumed responsibility for Shackleford's outstanding contracts, including its collective-bargaining agreement with the UMWA. App. 23-24, 26. "There was no common ownership between Irdell and Shackleford." 226 F. 3d, at 297. Irdell subsequently ...


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