Court Opinion

ID: 184936
Source: CourtListenerOpinion
Date Created: 2011-02-05 02:25:55+00
Date Added: 2024-06-11T17:26:12.102225
License: Public Domain

183 F.3d 860 (D.C. Cir. 1999)
Penn Allegh Coal Company, Inc., Appelleev.Michael H. Holland, Marty D. Hudson, Elliot A. Segaland A. Frank Dunham, as Trustees of theUMWA 1992 Benefit Plan, Appellants
No. 98-7161
United States Court of AppealsFOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued April 26, 1999Decided August 20, 1999

Appeal from the United States District Court for the District of Columbia(No. 97cv00121)
Peter Buscemi, with whom Paul A. Green and David W.  Allen were on the briefs, argued the cause for appellants.
E. Preston Rutledge, with whom John R. Woodrum was on  the brief, argued the cause for appellee.
Before Edwards, Chief Judge, Rogers, Circuit Judge, and  Buckley, Senior Circuit Judge.
Opinion for the court filed by Senior Judge Buckley.
Buckley, Senior Judge:

1
The trustees of a health benefit  plan created by the Coal Industry Retiree Health Benefit Act  of 1992 claim that Penn Allegh Coal Company is obliged to  pay premiums to the plan because it is responsible, under  section 9711(b) of the Act as codified, 26 U.S.C. § 9711(b)  (1994), for the continuing payment of the health benefits due  a former employee under an earlier industry-wide labor  agreement.  Penn Allegh denies liability on the grounds that  the former employee, who was a disability pensioner, had not  met the "age and service requirements" necessary to qualify  for benefits under section 9711(b) and that he had not "retired from the coal industry" by September 30, 1994, as  required by the section.  The district court granted summary  judgment in favor of Penn Allegh based on the first ground  and therefore did not reach the second.

2
Because we conclude that Congress intended to ensure the  continued payment of the health benefits due all coal industry  retirees covered by the Act, including those of disability  pensioners, we hold that section 9711(b) must be construed to  cover any pensioner who qualified for disability retirement on  or before the statutory cut-off date of February 1, 1993, and  retired from the coal industry on or before September 30,  1994.  Accordingly, we reverse and remand the case so that  the district court may consider Penn Allegh's remaining claim  that the employee failed to retire by the September deadline.

I. Background
A. The Coal Act

3
For a number of years, the employees of the members of  the Bituminous Coal Operators' Association ("Association")  were covered by health benefit plans established pursuant to  collective bargaining agreements between the Association and  the United Mine Workers of America ("UMWA").  In the  1980's, these plans began to suffer financial difficulties because a growing number of those members ("signatory operators") went out of business, withdrew from the agreements,  or otherwise defaulted on their obligations to the plans established for the benefit of employees.  Because of these and  other developments, the various plans began to experience  deficits that reached a level of approximately $110 million by  1990.  See Eastern Enterprises v. Apfel, 524 U.S. --, 118  S. Ct. 2131, 2140 (1998).

4
In March 1990, then-Secretary of Labor Elizabeth Dole  appointed an Advisory Commission on United Mine Workers  of America Retiree Health Benefits ("Coal Commission"),  which she tasked with developing a "solution for assuring that  orphan retirees in the [various benefit trusts] will continue to  receive promised medical care."  The Secretary of Labor's  Advisory Comm'n on United Mine Workers of America Retiree Health Benefits, Coal Comm'n Report 2 (1990), reprinted  in Joint Appendix ("J.A.") at 95.  Later that year the Commission issued a report in which it noted that "coal miners  have been promised and guaranteed health care benefits for  life."  Coal Comm'n Report, Executive Summary at vii, reprinted in J.A. at 86.  It then submitted two alternative  statutory proposals for ensuring that these promises would be  kept.  Id. at viii, reprinted in J.A. at 87.

5
After conducting hearings on the report, in which it was  advised that more than 120,000 retirees might not receive the  benefits promised to them through the collective bargaining  process, Congress acted on the Commission's recommendations and passed the Coal Industry Retiree Health Benefit  Act of 1992, Pub. L. No. 102-486, 106 Stat. 3036 (codified at  26 U.S.C. §§ 9701-22 (1994)) ("Coal Act" or "Act").  Eastern  Enters., 118 S. Ct. at 2141-42.  An explicit purpose of the Act  was "to provide for the continuation of a privately financed  self-sufficient program for the delivery of health care benefits  to the beneficiaries of [multi-employer benefit] plans."  Coal  Act, Pub. L. No. 102-486, § 19142(b)(3), 106 Stat. 3037 (1992)  (codified as note following 26 U.S.C. § 9701 (1994)).

6
This case is concerned with Subchapter C of the Coal Act,  which ensures the continued payment of health benefits to certain retired coal mining employees through either an  individual employer plan ("IEP") or a statutory trust fund. Part I of the subchapter is addressed to retired miners who  were covered by an IEP maintained pursuant to a 1978 or  subsequent coal wage agreement.  It requires that the last  signatory operator to employ a retiree continue to provide  him with health benefits under its IEP if he was either  (a) receiving retiree health benefits as of February 1, 1993, 26  U.S.C.  § 9711(a), or (b) "met the age and service requirements for eligibility to receive benefits under [the IEP]" by  that date and had not "retired from the coal industry after  September 30, 1994."  Id. § 9711(b)(1).

7
Part II of the subchapter establishes a new statutory trust,  the United Mine Workers of America 1992 Benefit Plan  ("1992 Plan"), id. § 9712(a), which provides health benefits to  two categories of beneficiaries:  those who "but for the enactment of [the Coal Act] would be eligible to receive benefits  from the [1950 or 1974 UMWA Benefit Plans], based upon  age and service earned as of February 1, 1993," id.  § 9712(b)(2)(A);  and those "with respect to whom coverage is  required to be provided under section 9711, but who do[ ] not  receive such coverage from the applicable last signatory  operator," id. § 9712(b)(2)(B).  The 1992 Plan is financed by  the operators who were signatories to the 1988 coal wage  agreement between the Association and the UMWA.  These  signatory operators are required to pay both an annual  "prefunding premium" for all eligible and potentially eligible  beneficiaries of the Plan attributable to them and a monthly  "per beneficiary" premium for each beneficiary attributable to  them who is actually receiving benefits under the Plan.  Id.  § 9712(d)(1)(A), (B).

B. Factual Background

8
Penn Allegh Coal Company, Inc. ("Penn Allegh" or "company") was a signatory to the 1988 coal wage agreement. That agreement provided that in order to qualify for health  benefits as a disabled pensioner, an employee must be eligible  for Social Security Disability Insurance benefits.  In August  1992, Richard J. Ferrari, a Penn Allegh employee who had been injured in a mine accident, applied for disability benefits  with the Social Security Administration.  More than two  years later, on December 8, 1994, that Administration determined that Mr. Ferrari was indeed disabled and that December 20, 1990, was the effective date of his disability.

9
On January 12, 1995, Mr. Ferrari applied for a disability  pension, which was granted and dated retroactively to July 1,  1992, the day after he left active employee status.  Mr.  Ferrari then applied to Penn Allegh for health benefits under  its IEP.  The company determined that he was not eligible to  receive them on the ground that he had not applied for his  pension, and thereby "retired," by September 30, 1994, as  required by section 9711(b).  Mr. Ferrari thereafter sought  and received benefits from the 1992 Plan pursuant to sections  9711(b) and 9712(b)(2)(B) of the Act.

10
In April 1996, the Trustees of the 1992 Plan ("Trustees")  informed Penn Allegh that Mr. Ferrari had been enrolled in  and received benefits from the Plan retroactive to Febru ary 1, 1993, and demanded that the company pay per beneficiary premiums on his behalf.  Penn Allegh disagreed with  the Trustees' conclusion that Mr. Ferrari was eligible for  coverage under Penn Allegh's IEP and the 1992 Plan and  filed this action in district court.  In its complaint, the  company alleged that the Trustees had no authority, under  section 9712(b)(2), to enroll Mr. Ferrari because he had not  retired by September 30, 1994, as required by section 9711(b),  and sought a declaration that it had no obligation to pay  premiums on his behalf.  The Trustees responded with a  counterclaim in which they asked the court to declare that  Penn Allegh had a duty, under section 9711, to provide  benefits directly to Mr. Ferrari and, under section 9712, to  pay prefunding and per beneficiary premiums to the 1992  Plan.

11
The parties filed cross motions for summary judgment that  addressed two issues:  (1) whether, in order to qualify for  benefits under section 9711(b), a disabled coal industry retiree had to be eligible for an "age and service" pension as of  February 1, 1993;  and (2) whether Mr. Ferrari was ineligible  for such benefits because he did not "retire" from the coal industry, within the meaning of the Act, on or before September 30, 1994.  The district court granted summary judgment  in favor of Penn Allegh on the first issue and therefore did  not reach the second.  It concluded that because section  9711(b) specified that a retiree must meet "age and service  requirements" in order to qualify for IEP coverage, it applied  only to individuals who qualified for a pension by virtue of age  and length of service, and not as a consequence of an injury. Accordingly, the court also held that Mr. Ferrari was not  eligible for benefits from the 1992 Plan because section  9712(b) "bases eligibility on age and service or on entitlement  to coverage under § 9711."  Penn Allegh Coal Co. v. Holland,  No. 97-0121, at 9-10 (D.D.C. July 22, 1998).

II. Discussion

12
Section 9711(b) of the Coal Act assures continued health  benefits coverage under an IEP for any individual who has  retired from the coal industry on or before September 30,  1994, and who, as of February 1, 1993, is not receiving retiree health benefits under the individual employer plan maintained by the last signatory operator pursuant to a 1978or subsequent coal wage agreement, but has met the age and service requirements for eligibility to receive bene-fits under such plan as of such date....

13
26 U.S.C. § 9711(b)(1) (emphasis added).

14
The controversy in this case centers on the meaning to be  given to the italicized language.  The Trustees maintain that  the age and service requirements cannot be read to disqualify  disability pensioners under section 9711(b) for three reasons. First, they point out that the section speaks of the "age and  service requirements for eligibility to receive benefits";  it  does not state that the section applies only to miners who  have met the age and service requirements for retirement. Second, because section 9711(a) applies to all pensioners,  including those retired because of disability, Penn Allegh's  construction would lead to the absurd result of treating  differently two miners injured in the same accident merely because the Social Security paperwork for one of them was  completed before February 1993 while that for the other took  a month or so longer.  Finally, they maintain that Penn  Allegh's construction would frustrate the purpose of the Act,  which is to ensure that all retirees continue to receive the  health benefits they had bargained for.  For these reasons,  the Trustees insist that the language of section 9711(b) must  be interpreted to require no more than that an individual  meet whatever age and service requirements are applicable to  the kind of pension he is qualified to receive.

15
For its part, Penn Allegh insists that section 9711(b) unambiguously applies to only one category of retiree, namely  those who qualify for pensions by virtue of age and length of  service;  and it advances two arguments in support of that  position.  It asserts, first, that the inclusion of the "age and  service" provision necessarily distinguishes the scope of section 9711(b) from the broader coverage afforded by section  9711(a), which covers disability as well as age and length of  service pensioners.  In its view, any other interpretation  would make the age and service requirement surplusage. Second, the company points to section 9712(b)(2)(A), which  includes, as beneficiaries of the 1992 Plan, individuals who  would have been eligible, under plans superseded by the Coal  Act, for benefits "based upon age and service earned as of  February 1, 1993[.]"  It insists that the use of virtually  identical language in the two sections confirms that Congress  intended to limit the application of section 9711(b) to miners  who satisfied the age and service requirement for retirement  by February 1, 1993.

16
The plausibility of these competing interpretations underscores the ambiguity of the statute we are asked to apply.  In  such instances, it becomes necessary for a court to look to  "the intent of Congress as revealed in the history and purposes of the statutory scheme."  Adams Fruit Co. v. Barrett,  494 U.S. 638, 642 (1990);  Tataranowicz v. Sullivan, 959 F.2d  268, 276 (D.C. Cir. 1992) ("[C]ongressional intent can be  understood only in light of the context in which Congress  enacted a statute and of the policies underlying its enactment.").

17
The history and purposes of the Coal Act, as summarized  on pages 2-5 above, persuade us that the Trustees have the  better part of the statutory argument.  As the Fourth Circuit  observed in a recent case presenting the identical question  concerning the scope of section 9711(b),

18
[t]he historical background leading to the enactment of the Coal Act makes clear that Congress intended to provide coal industry retirees with the lifetime benefits they had been promised.  Since coal workers had been promised health benefits in the event of their retirement, whether that retirement resulted from a disability or was based solely on their satisfaction of age and service requirements, we conclude that Congress intended that coal industry workers who retired as a result of a disability would be eligible for benefits under § 9711(b)(1) ands 9712(b)(2).

19
Holland v. Big River Minerals Corp., No. 98-2353, 181 F.3d 597, 603-04 (4th Cir. June 23, 1999).

20
Because the promises the Coal Act was intended to apply  equally to all classes of pensioners, we hold that to qualify for  benefits under section 9711(b), a disability retiree need only  satisfy whatever requirements entitle him to receive a pension by February 1, 1993, provided he has retired from the  coal industry on or before September 30, 1994.  In so ruling,  we express no opinion as to how the age and service requirements of section 9712(b)(2)(A) are to be applied because that  section is not involved in this case.  If Mr. Ferrari qualifies  for health benefits under section 9711(b), he is eligible for  enrollment in the 1992 Plan pursuant to section 9712(b)(2)(B);and, of course, Penn Allegh is responsible, in turn, for premium payments to the Plan as required by section 9712(d).

21
At this point, however, we cannot conclude that Penn  Allegh was obligated to cover Mr. Ferrari under its IEP or to  pay premiums to the 1992 Plan on his account because in its  motion for summary judgment, Penn Allegh raised an alternative argument that Mr. Ferrari had not "retired," within  the meaning of section 9711(b), by September 30, 1994, and  therefore was not eligible for benefits under section 9711(b). We do not address that issue because the district court did  not reach it.  See Singleton v. Wulff, 428 U.S. 106, 120 (1976)  ("It is the general rule ... that a federal appellate court does  not consider an issue not passed upon below.")  We therefore  leave it for the district court to address on remand.

III. Conclusion

22
In light of the foregoing, we set aside the district court's  grant of summary judgment in favor of Penn Allegh and  remand the case so that the court may consider the company's argument that Mr. Ferrari had not retired from the coal  industry, within the meaning of the Coal Act, by September 30, 1994, and was therefore not eligible for benefits under  Penn Allegh's IEP or the 1992 Plan.

23
So ordered.