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CONNORS v. HI-HEAT COAL CO.

May 23, 1991

JOSEPH P. CONNORS, SR., et al., Plaintiffs,
v.
HI-HEAT COAL COMPANY, INC., et al., Defendants


Joyce Hens Green, United States District Judge.


The opinion of the court was delivered by: GREEN

JOYCE HENS GREEN, UNITED STATES DISTRICT JUDGE

 Plaintiffs Joseph P. Connors, Sr., Donald E. Pierce, Jr., William Miller, Thomas H. Saggau, and Paul R. Dean, as trustees of the United Mine Workers of America ("UMWA") 1950 Pension Plan and the United Mine Workers of America 1974 Pension Plan, initiated this action against defendants Hi-Heat Coal Company, Inc. ("Hi-Heat") and Shannon Coleman ("Shannon") and Dennis Coleman ("Dennis"), as partners of Russell Equipment Company ("Russell"), pursuant to the Employee Retirement Income Security Act of 1974 ("ERISA"), as amended by the Multi-Employer Pension Plan Amendments Act of 1980, 29 U.S.C. §§ 1001 et seq. Plaintiffs seek to recover from defendants full withdrawal liability arising out of the termination of covered operations by Chestnut Ridge Mining Company ("Mining") and Chestnut Ridge Fuel Corporation ("Fuel") with respect to plaintiffs' 1950 and 1974 pension plans (the "Plans"). The parties have since filed cross motions for summary judgment. *fn1" For the following reasons, plaintiffs' motion is granted in part and denied in part, and defendants' motion is granted in part and denied in part.

 I. BACKGROUND

 Chestnut Ridge Fuel Corporation and Chestnut Ridge Mining Company, Inc. were Virginia corporations engaged in the business of producing coal and maintaining coal-mine sites. Both Fuel and Mining were signatories to the National Bituminous Coal Wage Agreements of 1978 and 1981. Pursuant to those agreements, Fuel and Mining were participating employers in the Plans and contributed to them on behalf of their employees.

 Fuel permanently ceased covered operations under the Plans and ceased making contributions to the Plans in or around September 1984, and Mining permanently ceased covered operations under the Plans more than one year later, in November 1985. In May 1986, however, Fuel and Mining filed voluntary petitions for bankruptcy under Chapter 7 of Title 11 of the United States Code and thus, are not named as defendants in the instant case.

 From September 27, 1980 until December 6, 1985, defendants Shannon and Dennis each owned 50 percent of the stock of Mining, and from October 23, 1982 until December 5, 1985, Fuel was wholly and equally owned by Shannon and Dennis. From April 17, 1984 until March 8, 1986, Shannon and Dennis conducted business as Russell Equipment Company, *fn2" a partnership which owns surface mining equipment, and were the only general partners of Russell, each owning a 50 percent partnership interest in that company.

 By letters dated October 20, 1986, addressed to Dennis Coleman as president of "Chestnut Ridge Coal Company," rather than Chestnut Ridge Fuel or Chestnut Ridge Mining, the Plans notified defendants of the amount of liability in relation to the 1950 and 1974 Plans and demanded payment thereof. Specifically, the letters advised of the amount of liability, established a schedule of payments, and indicated that the first payment to each Plan was due December 29, 1986. The letters further advised about the right to contest the Plans' determinations, as well as the liability of "controlled group" members.

 The Plans again demanded payment by letters dated March 31, 1987 of all past due withdrawal liability payments, plus interest, and advised that unless all past due payments were made by June 9, 1987, the entire liability to the Plans would become due and payable without further demand. The second notice was also addressed to Dennis Coleman as president of "Chestnut Ridge Coal Company," rather than Chestnut Ridge Fuel or Chestnut Ridge Mining.

 Defendants neither made withdrawal liability payments to the 1950 or 1974 Plans nor requested review of the Plans' liability determinations. Moreover, defendants did not demand arbitration under § 4221(a)(1) of ERISA, 29 U.S.C. § 1401(a)(1).

 II. DISCUSSION

 Summary judgment is appropriate when there is "no genuine issue as to any material fact and . . . the moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c). "The inquiry performed is the threshold inquiry of determining whether there is a need for trial -- whether, in other words, there are any genuine issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986). In considering a motion for summary judgment, the "evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn in his favor." Id. at 255. At the same time, however, Rule 56 places a burden on the nonmoving party to "go beyond the pleadings and by her own affidavits, or by the 'depositions, answers to interrogatories, and admissions on file,' designate 'specific facts showing that there is a genuine issue for trial.'" Celotex Corp. v. Catrett, 477 U.S. 317, 324, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986).

 A. NOTICE AND ...


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