No. 99-262
In the Supreme Court of the United States
ANKER ENERGY CORPORATION, ET AL., PETITIONERS
v.
UNITED MINE WORKERS OF AMERICA
COMBINED BENEFIT FUND, ET AL.
ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
BRIEF FOR THE COMMISSIONER
OF SOCIAL SECURITY IN OPPOSITION
SETH P. WAXMAN
Solicitor General
Counsel of Record
DAVID W. OGDEN
Acting Assistant Attorney General
DOUGLAS N. LETTER
Attorney
Department of Justice
Washington, D.C. 20530-0001
(202) 514-2217
QUESTION PRESENTED
Whether the provisions of the Coal Industry Retiree Health Benefit Act of
1992, 26 U.S.C. 9701 et seq., that assign responsibility for funding the
health-care benefits of retired coal miners and their dependents to the
coal mine operators that previously employed the miners pursuant to collective
bargaining agreements that promised the miners health-care benefits for
life violate the Due Process or Just Compensation Clause of the Fifth Amendment.
In the Supreme Court of the United States
No. 99-262
ANKER ENERGY CORPORATION, ET AL., PETITIONERS
v.
UNITED MINE WORKERS OF AMERICA
COMBINED BENEFIT FUND, ET AL.
ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
BRIEF FOR THE COMMISSIONER
OF SOCIAL SECURITY IN OPPOSITION
OPINIONS BELOW
The opinion of the court of appeals (Pet. App. 1a-40a) is reported at 177
F.3d 161. The opinions of the district court (Pet. App. 41a-50a, 51a-73a)
are unreported.
JURISDICTION
The judgment of the court of appeals was entered on May 14, 1999. The petition
for a writ of certiorari was filed on August 12, 1999. The jurisdiction
of this Court is invoked under 28 U.S.C. 1254(1).
STATEMENT
1. Congress enacted the Coal Industry Retiree Health Benefit Act of 1992
(Coal Act or Act), 26 U.S.C. 9701 et seq., to address a crisis in the funding
of two multi-employer welfare benefit plans that paid for the health-care
benefits of coal miners, retired miners, and their dependents. Those multi-employer
plans, the United Mine Workers of America 1950 Benefit Plan and Trust (1950
Benefit Trust) and the United Mine Workers of America 1974 Benefit Plan
and Trust (1974 Benefit Trust), were created and funded through a series
of national collective bargaining agreements, known as National Bituminous
Coal Wage Agreements (NBCWAs), between the United Mine Workers of America
(UMWA) and the Bituminous Coal Operators Association (BCOA). See generally
Eastern Enters. v. Apfel, 524 U.S. 498, 505-509 (1998) (plurality opinion).
The NBCWAs covered members of the BCOA that employed miners, as well as
other coal mine operators who, although not members of the BCOA, nonetheless
agreed to be bound by the terms of the NBCWAs in "me too agreements."
See Pet. App. 10a.
Before 1974, a single multi-employer fund was the exclusive source of pension
and health-care benefits for UMWA miners, retirees, and their dependents.
See Eastern, 524 U.S. at 505-506 (plurality opinion). In the 1974 NBCWA,
the UMWA and the BCOA agreed to separate that fund into two multi-employer
pension funds and two multi-employer welfare benefit funds. Under the 1974
NBCWA, the 1950 Benefit Trust provided health-care benefits to miners who
retired before 1976, and the 1974 Benefit Trust provided health-care benefits
to both the active work force and miners who retired in 1976 or thereafter.
Id. at 509 (plurality opinion). Unlike previous agreements, the 1974 NBCWA
expressly stated that miners and their spouses would be entitled to health-care
benefits for life. Id. at 510 (plurality opinion); see also Pet. App. 6a;
In re Chateaugay Corp., 53 F.3d 478, 482 (2d Cir.), cert. denied, 516 U.S.
913 (1995).
The structure of the 1950 and 1974 Benefit Trusts was changed in the 1978
NBCWA. In that agreement, employers that were bound by the NBCWA agreed
to provide benefits to their active employees and future retirees through
individual employer health plans, rather than the 1974 Benefit Trust. The
1974 Benefit Trust was retained to provide health-care benefits to post-1975
"orphaned" retirees, whose last employer had gone out of business.
See Eastern, 524 U.S. at 510 (plurality opinion). The 1950 Benefit Trust
for miners who retired before 1976 (and their dependents) was also retained.
See id. at 511 (plurality opinion). The 1978 NBCWA, like the previous one,
expressly promised that miners covered by the agreement would receive health-care
benefits for life. See Chateaugay, 53 F.3d at 482.
In the 1980s, the financial stability of the 1950 and 1974 Benefit Trusts
was plagued by spiraling health-care costs, the phenomenon of coal operators
"dumping" their retirees into the 1974 Benefit Trust by terminating
their individual welfare benefit plans or leaving the coal business, and
judicial decisions maintaining the trusts' beneficiary population without
corresponding increases in coal operator contributions. The withdrawal of
coal operators from the 1950 and 1974 Benefit Trusts forced the remaining
participating employers to shoulder increasingly large contribution obligations
to pay for not only their own retirees, but also newly "orphaned"
retirees whose employers had ceased contributing to the Trusts. Those rising
costs, in turn, influenced some still-contributing signatory operators to
withdraw from the Trusts, thus further shrinking the trust fund contribution
base. See Eastern, 524 U.S. at 511 (plurality opinion). The Trusts' ability
to provide health-care benefits was jeopardized, and the issue of retiree
health-care benefits contributed to a protracted strike at the Pittston
Coal Company. Ibid. (plurality opinion).
2. In 1990, the Secretary of Labor established the Advisory Commission on
United Mine Workers of America Retiree Health Benefits (Coal Commission)
to examine the financial crisis confronting the Trusts and to recommend
solutions. See Eastern, 524 U.S. at 511-512 (plurality opinion). As relevant
here, the Coal Commission recommended, as one alternative solution, that
current and past signatories to the NBCWAs should bear the cost of providing
health-care benefits to "orphaned" retirees whose former employers
were no longer in the coal business, as well as to their own retirees. See
id. at 512-513 (plurality opinion). The Coal Act was based in large part
on that alternative recommendation by the Coal Commission. See id. at 513-514
(plurality opinion); 138 Cong. Rec. 5331 (1992) (statement of Sen. Wofford).
The Coal Act was designed to provide stable financing for the health-care
benefits of all retired coal miners and their dependents who were covered
by either the 1950 or 1974 Benefit Trust, or by an individual employer plan
under the NBCWAs. To that end, the Coal Act created two new, private multi-employer
health-care benefit trusts. The first new fund, the United Mine Workers
of America Combined Fund (Combined Fund), the trust at issue in Eastern,
was created by the statutory merger of the 1950 and 1974 Benefit Trusts.
It provides benefits to beneficiaries who were receiving (and were eligible
to receive) benefits from those Trusts as of July 1992. See 26 U.S.C. 9702.1
The Coal Act provides that health-care benefits from the Combined Fund shall
be financed through annual premiums paid by "signatory operators."
The Act defines a "signatory operator" to be a person "which
is or was a signatory to a coal wage agreement." 26 U.S.C. 9701(c)(1).
The term "coal wage agreement" includes both the NBCWAs and the
"me too agreements." See 26 U.S.C. 9701(b)(1). Any "related
person" to a signatory operator is jointly and severally liable for
the signatory operator's premiums. See 26 U.S.C. 9701(c)(2)(A), 9704(a).
The amount of the premiums is determined by the Commissioner of Social Security
under a three-tier formula established by the Coal Act. 26 U.S.C. 9706(a).
Under that formula, the Commissioner is to assign responsibility for the
benefits of a retired miner, if possible, to a signatory operator that "employ[ed]"
the retiree in the coal industry under a 1978 or subsequent wage agreement
(or any related person to such a signatory operator). See 26 U.S.C. 9706(a)(1)(B)
and (2)(B).
The Coal Act directs the creation of the Combined Fund as a private multi-employer
benefit plan, and the appointment of its trustees. 26 U.S.C. 9702(a). The
Act further provides that the Combined Fund shall have the same legal status
as any other private multi-employer welfare benefit plan under the Labor
Management Relations Act of 1947 and the Employee Retirement Income Security
Act of 1974. 26 U.S.C. 9702(a)(3); see 29 U.S.C. 186(c)(5); 29 U.S.C. 1002(1)
and (37).
3. From 1967 until 1982, petitioner King Knob Coal Co. and Consolidation
Coal Company2 were parties to a series of contracts under which King Knob
agreed to extract coal on properties owned or controlled by Consolidation.
Pet. App. 9a. In those contracts, King Knob agreed that "all parties
working for it in connection with the undertaking covered by this Agreement
shall be its [King Knob's] employees." Id. at 28a. King Knob also agreed
that "its employees shall be members of the United Mine Workers of
America and it shall be a signatory to the then current [NBCWA]." Id.
at 9a-10a. King Knob signed "me too" agreements during the 1970s
and early 1980s; the last collective bargaining agreement executed by King
Knob was a "me too" agreement in 1984. Id. at 10a.
During the course of the contractual relationship between King Knob and
Consolidation, King Knob was acquired by an affiliate of petitioner Anker
Energy Corporation in 1975. Pet. App. 10a. Thereafter, in 1982, the contract
mining agreements between Consolidation and King Knob were terminated, and
a settlement agreement between Consolidation and King Knob provided that
Consolidation would reimburse King Knob for certain subsequent payments
"due to the UMWA Fund or any successor fund" to finance miners'
health-care benefits. Ibid.
In 1994 and 1995, the Commissioner of Social Security notified petitioner
Anker Energy Corporation that it had been assigned liability for a number
of beneficiaries under the Coal Act as a "related person" to King
Knob. Pet. App. 10a. Anker objected to those assignments on the ground that
they should have been made to Consolidation because Consolidation owned
the mine where King Knob's employees worked, had made payments to the Benefit
Trusts to cover the health-care expenses of King Knob's employees, and had
agreed in the 1982 settlement agreement to assume continued financial liability
for the health-care expenses of those employees. The Commissioner rejected
those objections, emphasizing that the retired miners in question were employed
by King Knob:
Under the Coal Act, ownership of a mine is immaterial to assignment decisions.
Assignments are made solely on the basis of the signatory employer who employed
the eligible retiree. In the case involving King Knob, an affiliate of Anker
Energy, the signatory that employed the retirees was King Knob, not Consol[idation].
Also, for Coal Act purposes, SSA is not bound by any private agreements
made between companies, nor does the Coal Act allow for pro-ration of premium
payments between companies. In light of the foregoing, no assignments that
were made to Anker on the basis of its relationship to King Knob Coal can
be reassigned to Consol[idation].
Id. at 26a (citation omitted).
4. Petitioners initiated this action in district court against the Commissioner,
the Combined Fund, and Consolidation to contest Anker's liability for the
beneficiaries assigned to it as a related person to King Knob. Petitioners
contended that the assignments should have been made to Consolidation, that
Consolidation was contractually obligated to reimburse them for any liability
to the Combined Fund, and that the assignment of beneficiaries to Anker
violated the Due Process and Just Compensation Clauses of the Fifth Amendment.
Pet. App. 11a.
In July 1997, the district court granted Consolidation judgment on the pleadings,
dismissing petitioners' claim that the assignments should have been made
to Consolidation, Pet. App. 67a, as well as their claim that Consolidation
was required to reimburse Anker for payments to the Combined Fund, id. at
68a. In March 1998, before this Court decided Eastern, the district court
rejected petitioners' constitutional challenges, and granted summary judgment
for respondents. Id. at 45a. In July 1998, the court entered judgment for
respondents Combined Fund and its Trustees on their counterclaims seeking
premiums, interest, liquidated damages, attorney's fees, and costs. Id.
at 13a.
5. While this case was still before the district court, a divided Court
held in Eastern Enterprises v. Apfel that the Coal Act was unconstitutional
as applied to a coal mine operator that signed NBCWAs in effect between
1947 and 1964, but ceased coal mining operations in 1965. See 524 U.S. at
516-517 (plurality opinion) (recounting history of Eastern's involvement
in the coal business). The Coal Act obligated Eastern to pay premiums to
the Combined Fund to cover the health benefits of more than 1000 retired
miners or their dependents who had worked for the company before 1966. Id.
at 517 (plurality opinion). Eastern contended that the Coal Act violated
substantive due process as applied to it and effected an unconstitutional
taking of its property without just compensation by retroactively creating
an obligation to finance the benefits of miners who, when employed by Eastern,
had no expectation that they would receive open-ended health-care benefits
at Eastern's expense.
The plurality concluded that the application of the Coal Act to Eastern
effected an unconstitutional taking without just compensation. See Eastern,
524 U.S. at 524-527. Applying the Court's three-factor test for analyzing
regulatory taking claims (id. at 523-524), the plurality found a constitutional
problem as to each factor. In particular, the plurality found it significant
that the Coal Act imposed liability on Eastern for lifetime health-care
benefits even though Eastern had withdrawn from the coal industry before
any of the NBCWAs had promised lifetime benefits to the miners. See id.
at 532 (with respect to the burden placed on Eastern, noting that Eastern
"had no control over the activities of its former employees subsequent
to its departure from the coal industry in 1965"); ibid. (with respect
to investment-backed expectations, stressing that Eastern never participated
in an industry-wide agreement creating expectations of lifetime benefits);
id. at 537 (with respect to the nature of the governmental action at stake,
stating that "Eastern cannot be forced to bear the expense of lifetime
health benefits for miners based on its activities decades before those
benefits were promised").
Justice Kennedy, concurring in the judgment and dissenting in part, disagreed
with the plurality's conclusion that the Coal Act should be analyzed as
a taking, see Eastern, 524 U.S. at 539-547, but concluded that the application
of the Coal Act to Eastern violated "[a]ccepted principles" of
substantive due process inhibiting the operation of severely retroactive
laws, id. at 547- 550. Justice Kennedy noted that "the imposition of
liability on former employers based on past employment relationships"
may be upheld under due process principles as remedial legislation designed
to allocate properly the costs of the employer's business. Id. at 549. He
concluded, however, that the Coal Act did not serve that purpose as applied
to Eastern because, although "Eastern was once in the coal business
and employed many of the beneficiaries, * * * it was not responsible for
their expectation of lifetime health benefits or for the perilous financial
condition of the 1950 and 1974 plans which put the benefits in jeopardy.
* * * [T]he expectation was created by promises and agreements made long
after Eastern left the coal business." Id. at 550.
Four Justices dissented, concluding that the Coal Act, as applied to Eastern,
was not unconstitutional under either due process or taking principles.
Eastern, 524 U.S. at 553-568. The four dissenting Justices agreed with Justice
Kennedy that the Coal Act should not be analyzed as a taking at all. Id.
at 554-557.
6. After this Court's decision in Eastern, the court of appeals affirmed
the judgment of the district court in part and reversed in part. Pet. App.
1a-40a. The court held that the Coal Act is constitutional as applied to
petitioners. Id. at 25a. In reaching that decision, the court followed in
large part its analysis in Unity Real Estate Co. v. Hudson, 178 F.3d 649
(3d Cir. 1999), petition for cert. pending, No. 99-12, in which the same
constitutional claims were rejected. See Pet. App. 9a, 17a, 22a-25a.
First, the court observed that the concurrence in Eastern did not rest on
a "narrower" ground of decision than that of the plurality opinion,
and so neither decision could be taken as constituting the "controlling
holding" of Eastern. Pet. App. 17a. Therefore, the court concluded,
Eastern requires "a finding that the Coal Act is unconstitutional as
applied to [petitioners] * * * only if [petitioners] stand[] in a substantially
identical position to Eastern Enterprises with respect to both the plurality
and Justice Kennedy's concurrence." Ibid. (internal quotation marks
omitted).
The court then noted that Eastern involved a mine operator that had not
signed either the 1974 or a subsequent NBCWA, whereas King Knob, the signatory
operator in this case, had agreed to be bound by NBCWAs in 1974 and afterwards.
Pet. App. 17a. "[The] plurality and concurrence [in Eastern] both found
significant the fact that Eastern Enterprises was not a signatory to either
the 1974 or 1978 NBCWAs, and thus it did not contemplate either being responsible
for or contributing to the miners' expectation of lifetime benefits."
Ibid. In light of both the taking analysis applied by the plurality in Eastern
and the due process analysis undertaken by Justice Kennedy in that case,
the court concluded, "a majority of the Court would find the Act unconstitutional
when applied to an employer that did not agree to the 1974 or subsequent
NBCWAs, while application of the Act to a signatory to the 1974 or a subsequent
wage agreement would be an entirely different matter." Id. at 21a.
Following its earlier decision in Unity as well as the D.C. Circuit's decision
in Association of Bituminous Contractors, Inc. v. Apfel, 156 F.3d 1246 (1998),
the court then held the Coal Act's application to Anker constitutional.
Pet. App. 21a-22a.
The court also explained that its opinion in Unity directed it "to
apply an additional level of due process analysis designed to measure the
extent of the gap between the coal companies' contractual promises to the
Funds and the requirements of the Coal Act." Pet. App. 22a (internal
quotation marks omitted). Under that analysis, the court concluded that
the duration of the Coal Act's retroactive operation does not render its
application to Anker violative of due process. Id. at 23a. The court observed
that the extent of the retroactive application of the Act in this case is
no greater than it was in Unity (there, 11 years). Ibid. Further, Anker's
liability under the Coal Act is proportional to the experience of King Knob
(its related party) with the earlier system of financing coal miners' benefits,
because King Knob was a signatory to the 1978 and subsequent NBCWAs and
therefore bears some of the responsibility for creating miners' reasonable
expectation of lifetime health-care benefits as well as the problems of
underfunding that the Coal Act redresses. Id. at 24a- 25a. Concluding finally
that "nothing germane to our holding in [Unity] distinguishes Anker
from the plaintiffs in [Unity]," the court held the Act constitutional
as applied to petitioners "because of the factual distinction that
makes Eastern Enterprises inapplicable, and because the case falls squarely
under [the] analysis and holding in [Unity]." Id. at 25a.3
The court reversed, however, the district court's decision to dismiss Consolidation
as a defendant to petitioners' suit, and remanded for further proceedings
on petitioners' claims against Consolidation. Pet. App. 29a-35a. The court
concluded that the district court had erred in ruling on the pleadings that
the settlement agreement between King Knob and Consolidation could not have
obligated Consolidation to reimburse petitioners for their financial liability
to the Combined Fund. Id. at 31a-32a. The court also rejected the district
court's conclusion that the Coal Act voided private contractual arrangements
for indemnification or reimbursement of liability for health-care benefits
entered into before the Act was passed. Id. at 32a-34a. The court ruled
that, while the Coal Act does assign initial responsibility for Coal Act
premiums to the "signatory operators," as defined by the Act,
it does not prohibit private contractual agreements whereby those signatory
operators may seek recompense for those premiums from other entities. Id.
at 34a-35a.
ARGUMENT
1. Petitioners contend (Pet. 17-21) that the obligations imposed on them
under the Coal Act to finance the health-care benefits of their former employees
(and those employees' dependents) violate the Due Process and Just Compensation
Clauses of the Fifth Amendment. They contend, in particular, that the court
of appeals' decision conflicts with Eastern Enterprises v. Apfel, 524 U.S.
498 (1998), which held the Coal Act unconstitutional as applied to the coal
mine operator that challenged the Act in that case. Those contentions are
without merit. Petitioners' situation is fundamentally different from the
position of the coal operator before the Court in Eastern. Unlike that operator,
petitioner King Knob (for whom petitioner Anker is also responsible as a
related party) signed collective bargaining agreements in 1974, 1978, and
1981, that promised its employees health-care benefits for life. The decision
below therefore creates no inconsistency with Eastern.
The decision of the court of appeals in this case, following its similar
decision in Unity Real Estate v. Hudson, 178 F.3d 649 (3d Cir. 1999), petition
for cert. pending, No. 99-12, is also correct under well-settled taking
and substantive due process principles, and it does not conflict with any
decision of any other court of appeals. To the contrary, the only other
court of appeals that has considered a constitutional challenge to the Coal
Act since Eastern by companies that were bound by the 1974 and 1978 NBCWAs
has rejected that challenge, see Association of Bituminous Contractors,
Inc. v. Apfel, 156 F.3d 1246, 1253-1258 (D.C. Cir. 1998), based on a reading
of the plurality and concurring opinions in Eastern that largely parallels
that of the Third Circuit in this case and in Unity. Further, this Court
recently denied review in another case from the District of Columbia Circuit
presenting the same challenges to the Coal Act. See Holland v. Robert Coal
Co., 172 F.3d 919 (D.C. Cir. 1998) (Table), cert. denied, 119 S. Ct. 1803
(1999). There is no basis in this case for a different result. Further review
is therefore not warranted.
a. Although the Court in Eastern did not arrive at a single rationale for
finding the Coal Act unconstitutional as applied to Eastern, both opinions
supporting the judgment in that case emphasized the fact that Eastern left
the coal industry before any collective bargaining agreement gave miners
an expectation of lifetime health-care benefits. See 524 U.S. at 530-531,
532, 535-536 (plurality opinion); id. at 549-550 (opinion of Kennedy, J.).
This case, by contrast, presents a factual situation in which the signatory
operator agreed to be bound by NBCWAs promising its employees lifetime benefits.
Thus, as the court of appeals concluded, "the fact that [King Knob]
was a signatory to 'me too' agreements from the 1970s until 1984 distinguishes
[petitioners'] situation from that of Eastern Enterprises." Pet. App.
21a. The result reached by the Court in Eastern therefore does not govern
here. To the contrary, as the court of appeals observed in Unity, "[b]ecause
[petitioners] signed NBCWAs in 1974 and thereafter, they are factually distinguishable
from [Eastern]. Language in the plurality and the concurrence suggesting
that expectations fundamentally changed after 1974 supports [that] conclusion."
Unity, 178 F.3d at 659; see also Association of Bituminous Contractors,
156 F.3d at 1257 ("the clear implication of each opinion in Eastern
Enterprises is that employer participation in the 1974 and 1978 agreements
represents a sufficient amount of past conduct to justify the retroactive
imposition of Coal Act liability.").4
b. Petitioners' further contention (Pet. 17-20) that the court of appeals
failed to apply the "retroactivity analysis" supposedly endorsed
by five Justices in Eastern is without merit. Petitioners submit (Pet. 17)
that that analysis requires that "retroactive employee benefits legislation
is unconstitutional if it imposes a substantial economic burden on employers
which is based on conduct 'far in the past' that is 'unrelated to any commitment
that the employers made or to any injury they caused.'" Contrary to
petitioners' contention, the court of appeals, following its retroactivity
analysis in Unity, see Pet. App. 22a- 23a, correctly concluded that the
retroactive scope of the Act, as applied to petitioners, is not beyond Congress's
legislative power. Id. at 23a.
Thus, the court of appeals, following Unity and this Court's decisions in
Eastern and in Connolly v. Pension Benefit Guaranty Corp., 475 U.S. 211
(1986), properly examined the proportionality of the burden imposed by the
Coal Act on petitioners and sustained that burden as permissible. Pet. App.
24a. As the court of appeals noted here, in Unity the court "found
that the Coal Act imposes a burden justified by both the industry's conduct
that created reasonable expectations of lifetime benefits * * * and conduct
that created the problem of underfunding." Id. at 23a. The court then
ruled that the "proportionality analysis in [Unity] applies full force
here because King Knob was a signatory to the 1978 and subsequent NBCWAs,
and thus bears the same responsibility as the plaintiffs in [Unity] for
creating the reasonable expectations and the problem of under-funding that
the Coal Act redresses." Id. at 24a. The imposition of liability on
petitioners, therefore, can hardly be considered "not related to any
commitment they have ever made" (Pet. 19).5
The court of appeals also correctly concluded that the extent of retroactivity
present in this case is not so extreme as to contravene substantive due
process. Pet. App. 24a. The court observed that, in Unity, the court had
found 11 years' retroactive operation to be "acceptable." Ibid.
Similarly, the court properly found the extent of retroactivity here to
be acceptable; the Coal Act took effect only 11 years after King Knob agreed
to be bound by an NBCWA in a contract with Consolidation and only eight
years after King Knob signed a "me too" agreement. Ibid. As the
court of appeals noted in Unity, this Court has held that "Congress
may retroactively bar employers from giving their employees vested pensions
in multiemployer plans and then leaving those plans to collapse." Unity,
178 F.3d at 671. Furthermore, in contrast to Eastern, petitioners here participated
in the creation of a reasonable expectation of lifetime benefits and left
the benefit plans in a condition vulnerable to collapse. Accordingly, the
periods of retroactivity applicable to the conduct of petitioners survive
constitutional scrutiny.
Finally, in Unity, the court of appeals properly found that the Coal Act
was an appropriate congressional response to commitments participated in
by petitioners, and was designed to remedy injuries caused by companies
that withdrew from the coal industry, leaving "orphaned" miners
and their dependents without provision for adequate funding to meet the
expectation of lifetime benefits. 178 F.3d at 674. That particular point
was not expressly addressed in the decision below in this case, but in any
event petitioners' attempt to rely on Eastern to counter that conclusion
(Pet. 19) is misplaced. The injuries that the Coal Act is intended to remedy
are not physical harms suffered in "employment in mines," ibid.;
rather, as the court of appeals observed in Unity, they are the harms caused
by "dumping" retirees on benefit Funds whose funding structures
were vulnerable to such behavior. 178 F.3d at 674.
2. Petitioners contend (Pet. 21-23) that the court of appeals incorrectly
applied Marks v. United States, 430 U.S. 188 (1977), by failing to give
"import to the points of agreement between the Eastern plurality and
the concurrence." Pet. 22. That contention is without merit.
Marks addresses the situation where a concurring opinion in this Court reaches
the same result as that reached by a plurality of the Justices, but on narrower
grounds. In that situation, a lower court should follow the reasoning of
the concurring opinion, because the lower court may conclude that a majority
of this Court agrees with the narrower position reached by the concurrence.
430 U.S. at 193. To the extent that Marks provides any guidance here, it
supports the court of appeals' rejection of petitioners' due process challenge.
Even though the plurality and concurrence in Eastern analyzed that case
under different legal frameworks, those opinions agreed on the constitutional
significance of a particular fact, namely, that Eastern left the coal industry
before 1974, when the NBCWAs began expressly stating that retired miners
would receive health benefits for life. As we have explained, both the plurality
and Justice Kennedy concluded that the crucial constitutional problem in
Eastern was the Coal Act's application to an operator that had never signed
a wage agreement promising lifetime benefits, and both found that situation
distinguishable from the one where an operator had signed such an agreement.
See pp. 8-10, supra. The court of appeals properly focused on that point
of agreement between the plurality and Justice Kennedy in Eastern to reject
petitioners' due process claim.
Petitioners also err in arguing (Pet. 23) that the court of appeals improperly
"created a majority out of the concurrence and dissent and, thus, established
as the law of the case the position taken by the Eastern dissent" to
reject their taking claim. That argument overlooks the reliance of both
the plurality in Eastern and the court of appeals in Unity (and consequently
in this case as well, where the court followed its earlier decision in Unity)
on Connolly, including the three-part taking analysis of Connolly, in evaluating
the constitutionality of the Coal Act as applied to petitioners. See Eastern,
524 U.S. at 529-532 (plurality opinion); Unity, 178 F.3d at 657-658, 661,
663-665, 671-673, 677. Moreover, although in Unity the court of appeals
analyzed this case principally under the rubric of substantive due process,
it observed that "[t]o the extent that Eastern embodies principles
capable of broader application, * * * due process analysis encompasses the
relevant concerns." Id. at 659.
Thus, rather than giving legal effect to the agreement between the concurrence
and the dissent, as petitioners contend (Pet. 22), the court of appeals
effectively applied the analytical scheme of the plurality in Eastern to
the facts of this case. For the reasons given above, petitioners' claims
fail even under the reasoning of the plurality opinion in Eastern, which
emphasized that Eastern--unlike petitioners herein and other coal companies
that signed the 1974 and later NBCWAs--never contributed towards any reasonable
expectation of lifetime health benefits on the part of coal miners. The
plurality opinion and Justice Kennedy's concurrence therefore form a majority
sufficient to reject petitioners' taking claim, and it is not necessary
to rely on the dissenting opinion in Eastern (although it is at least doubtful
that Marks even addresses a situation such as the explicit agreement of
the four dissenting Justices in Eastern with a concurring Justice's rejection
of a particular constitutional claim).
3. Finally, petitioners contend that review is warranted because there is
now no "framework" for analyzing retroactive legislation other
than the Coal Act. Pet. 23. That contention provides no basis for review
in this case. The plurality and concurring opinions in Eastern identified
the same critical characteristics that distinguished the operators that
signed NBCWAs in 1974 and afterwards from those that did not, and both opinions
found the connection of the latter group of operators to miners' expectation
of lifetime benefits and the financial instability of the funds too attenuated
to sustain the Act as applied to those operators. In view of that articulation
of general agreement on the principles governing the constitutionality of
the Coal Act in particular--principles that were followed by the court of
appeals in this case and in the D.C. Circuit's decision in Association of
Bituminous Contractors, supra--there is no basis for further review in a
Coal Act case in order to address issues that might arise in other contexts
in the future.
Petitioners incorrectly suggest that the Court's emphasis in Eastern on
the fact that retroactivity is "generally disfavored" (Pet. 24)
constitutes a significant departure from the Court's previous substantive
due process decisions according a heavy presumption of constitutionality
to legislation (including retroactive legislation) that adjusts the burdens
and benefits of economic life. To the contrary, the plurality opinion in
Eastern emphasized the Court's long-standing "concerns about using
the Due Process Clause to invalidate economic legislation," 524 U.S.
at 537, and avoided resting its decision on the Due Process Clause. Justice
Kennedy's concurrence did rely on due process principles, but that opinion
did not discard the well-settled presumption of constitutionality for regulatory
statutes; rather, Justice Kennedy found that presumption rebutted on the
particular facts of the case in Eastern, which he considered to be a "rare
instance[]" of "egregious * * * circumstances." Id. at 550.
For the reasons we have given, this case presents no comparable circumstances.
CONCLUSION
The petition for a writ of certiorari should be denied.
Respectfully submitted.
SETH P. WAXMAN
Solicitor General
DAVID W. OGDEN
Acting Assistant Attorney General
DOUGLAS N. LETTER
Attorney
OCTOBER 1999
1 The Coal Act also established another fund, the 1992 UMWA Benefit Plan,
which is not at issue here. See 26 U.S.C. 9712.
2 Consolidation Coal Company was a defendant in the district court and appellee
in the court of appeals. Although the decision of the court of appeals was
in part adverse to Consolidation (see Pet. App. 33a-34a), Consolidation
has not filed a petition for a writ of certiorari seeking review of any
part of the court of appeals' decision. Petitioners have informed the Court
that Consolidation does not intend to participate in the proceedings in
this Court. See Pet. ii.
3 The court also affirmed the district court's decisions upholding the assignment
of beneficiaries to Anker, Pet. App. 25a-29a, and the award of interest,
liquidated damages, attorney's fees, and costs to the Combined Fund, id.
at 35a-36a.
4 Moreover, while the Coal Act required Eastern to begin paying premiums
to the Combined Fund in 1993, even though the company had not contributed
to the United Mine Workers Benefit Plans since 1965, the Coal Act requires
petitioners to finance the health benefits of retirees who were covered
by King Knob until 1984. See p. 6, supra; cf. Eastern, 524 U.S. at 516 (plurality
opinion).
5 Nor is it relevant, as petitioners contend (Pet. 19), that Consolidation,
rather than King Knob, was responsible for making payments to the Benefit
Trusts to finance miners' health-care benefits. The crucial point is that
King Knob agreed to be bound by the 1974 and later NBCWAs, including their
express promises of lifetime benefits, and therefore participated in the
creation of the miners' reasonable expectation of such benefits. Even if
Consolidation was the party responsible for directly paying the Trusts for
the miners' benefits, that cost was presumably reflected in the contract
price negotiated between King Knob and Consolidation.