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Holland v. Valley Services

May 7, 2009

MICHAEL HOLLAND ET AL., PLAINTIFFS,
v.
VALLEY SERVICES, INC. ET AL., DEFENDANTS.



The opinion of the court was delivered by: Ricardo M. Urbina United States District Judge

Document Nos. 8, 9

MEMORANDUM OPINION

GRANTING IN PART AND DENYING IN PART THE DEFENDANT'S MOTION FOR SUMMARY JUDGMENT; GRANTING IN PART AND DENYING IN PART THE PLAINTIFFS'MOTION FOR SUMMARY JUDGMENT; ORDERING FURTHER BRIEFING ON DAMAGES

I. INTRODUCTION

This matter is before the court on the parties' cross-motions for summary judgment. The plaintiffs are trustees of the United Mine Workers of America 1992 Benefit Plan ("the 1992 Plan") who seek to recover from defendant Bibeau Construction Company, Inc. ("the defendant")*fn1 amounts paid to certain beneficiaries pursuant to the Coal Industry Retiree Health Benefit Act of 1992 ("the Coal Act" or "the Act"), 26 U.S.C. § 9712, and the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1002(21)(A). The plaintiffs argue that, in addition to the amounts paid to the beneficiaries, the defendant is also liable for interest, liquidated damages and attorneys' fees and costs under the Coal Act. In contrast, the defendant contends that the applicable statute of limitations and the equitable doctrine of laches bar the plaintiffs' claims. Because the statute of limitations bars the plaintiffs' claims for premiums payable before May 15, 2001, the court grants the defendant's motion for summary judgment as to those claims. The court denies the defendant's motion for summary judgment as to claims arising after May 15, 2001 and grants the plaintiffs' motion for summary judgment with respect to those claims only. On the issue of damages, the court orders further briefing for the reasons explained below.

II. BACKGROUND

A. Statutory Framework

The Coal Actrepresents Congress's attempt to stabilize health plan funding for retired miners and identify employers responsible for guaranteed lifetime health benefits for those miners. E. Enters. v. Apfel, 524 U.S. 498, 514 (1998). As part of its response to the failure of coal companies to pay the health benefits promised to their miners, Congress created the 1992 Plan as part of the Coal Act. Holland v. Williams Mountain Coal Co., 496 F.3d 670, 671 (D.C. Cir. 2007). As it pertains to this case, the Act provides that the "last signatory operator," i.e., the most recent coal industry employer of a retired miner, and "related persons"*fn2 bear the primary responsibility to pay a monthly premium into the 1992 Plan to finance health benefits for a retiree eligible under the Act. Id. (citing 26 U.S.C. § 9701(c)(4)).

B. Factual & Procedural History

In 1962, Valley Services, Inc. was incorporated for the purpose of operating a coal mine. Pls.' Statement of Material Facts ("Pls.' Statement") ¶ 3; Def.'s Response to Pls.' Statement of Material Facts ("Def.'s Statement") ¶ 3. Ovila Bibeau and Dorothy (Bibeau) Kilbourne, husband and wife at the time, became owners of Valley Services in 1975. Pls.' Statement ¶ 4; Def.'s Statement ¶ 4. Valley Services ceased operations in November 1979 and formally dissolved shortly thereafter. Pls.' Statement ¶ 6; Def.'s Statement ¶ 6. Defendant Bibeau Construction, owned entirely by Ovila Bibeau, was established in approximately 1962 and remains in operation. Pls.' Statement ¶ 14-15; Def.'s Statement ¶ 14-15.

On September 25, 1979, Arthur Marcum, Jr., a Valley Services employee, injured his back when he jumped from a bulldozer he was operating. Pls.' Statement ¶ 10; Def.'s Statement ¶ 10. On April 4, 1995, the 1992 Plan approved Marcum's application for retiree health benefits coverage. Pls.' Statement ¶ 11; Def.'s Statement ¶ 11. Because Marcum was eligible to receive benefits retroactive to 1988, the 1992 Plan was obligated to pay for his health care costs dating back to February 1, 1993, the date the 1992 Plan was established. Pls.' Statement ¶ 12; Def.'s Statement ¶ 12; Def.'s Mot. at 6.

On December 4, 2004,*fn3 the 1992 Plan notified the defendant that the defendant is a "related person" to Valley Services under the Coal Act and, therefore, jointly and severally liable for the payment of monthly premiums for Marcum. Pls.' Statement ¶ 24; Def.'s Statement ¶ 23. It requested payment within 20 days. Compl. ¶ 12 Apparently receiving no response, on October 17, 2005, the 1992 Plan again contacted the defendant, demanding payment and cautioning that if it did not receive payment within 15 days, it would treat the defendant's failure to pay as a delinquency. Id. ¶ 13. The defendant, to date, has not paid the premiums, and the plaintiffs allege that it owes $120,625.16 in principal, plus interest, liquidated damages and attorneys' fees and costs. Pls.' Mot., Ex. C ("Stover Decl.") ¶ 6.

The plaintiffs initiated this action on February 1, 2006, see generally Compl., and on September 5, 2007, they moved for summary judgment, Pls.' Mot. at 12. Five days later, the defendant also moved for summary judgment. See ...


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