Opinion ID: 792274
Heading Depth: 2
Heading Rank: 2

Heading: The Supreme Court Decision in Eastern Enterprises

Text: 17 The Supreme Court, in Eastern Enterprises v. Apfel, 524 U.S. 498, 537, 118 S.Ct. 2131, 141 L.Ed.2d 451 (1998), altered the Coal Act's application by voiding all assignments the SSA had made pursuant to the statute's third prong. 26 U.S.C. § 9706(a)(3) (Third, if the retiree is not assigned under paragraph (1) or (2), [the Commissioner shall assign the retiree] to the signatory operator which employed the coal industry retiree in the coal industry for a longer period of time than any other signatory operator prior to the effective date of the 1978 coal wage agreement.). Eastern Enterprises had been a part of the 1947 and 1959 NBCWA's, but had not, since then, been a signatory to any other NBCWA. Yet, under the Coal Act's third prong, it became responsible for over 1,000 retired miners who had worked for the company before 1966, based on Eastern's status as the signatory operator which employed the coal industry retiree in the coal industry for a longer period of time than any other signatory operator prior to the effective date of the 1978 coal wage agreement. Id. at 517, 118 S.Ct. 2131; § 9706(a)(3). 18 In a plurality opinion, the Supreme Court held unconstitutional the assignments to Eastern Enterprises and any other company in a similar situation, i.e., those that had not signed the 1974 NBCWA or any subsequent NBCWA ( Eastern-type  companies). The Supreme Court reasoned that because these companies had not participated in any agreement promising lifetime medical benefits to retirees, they should neither be held to such a promise nor forced to contribute to the Combined Fund. 3 Id. at 535, 118 S.Ct. 2131 (Not until 1974 ... could lifetime medical benefits under the multiemployer agreement have been viewed as promised.). Although there was no majority rationale in Eastern Enterprises, the plurality and Justice Kennedy, who concurred in part and dissented in part, found that the Coal Act's severe retroactive liability could not be constitutionally applied to those operators who had not signed a coal wage agreement explicitly promising miners lifetime health benefits. Id. at 537, 547, 118 S.Ct. 2131. As a result, the Supreme Court voided all assignments that the SSA had made to Eastern Enterprises and all similarly-situated companies. 19 In fall 1998, pursuant to Eastern Enterprises, the SSA invalidated all assignments it had made to any Eastern -type company since the Combined Fund's inception on February 1, 1993, and temporarily designated these so-called  Eastern beneficiaries as unassigned. In fall 1999, the SSA assigned approximately 1,500 Eastern beneficiaries to coal operators, like Plaintiffs-Appellees, that had employed the retired miners for the longest period and to whom it was constitutional to make assignments under § 9706, i.e., only those coal operators that had signed a 1974 NBCWA or later agreement and that remained in business. 4 Of these 1,500 Eastern beneficiaries, the SSA assigned eighteen beneficiaries and their dependents to Plaintiffs-Appellees.