Petition for Writ of Certiorari — Unity Real Estate Co. v. Hudson

Supreme Court brief1999

Ask Donna

What actually matters in this document.

Text

BO 12 Jw 281999

OFFICE Cr THE CLERK

No.

IN THE

Supreme Court of the Gnited States

UNITY REAL ESTATE COMPANY, ef al.,

Petitioners,

VS.

MARTY D. HUDSON, ef al.,

Respondents.

On Petition for a Writ of Certiorari

to the United States Court of Appeals

for the Third Circuit

PETITION FOR A WRIT OF CERTIORARI

ANTHONY J. POLITO

MICHAEL D. GLASS

POLITO & SMOCK, P.C.

Four Gateway Center

Pittsburgh, PA 15222

(412) 394-3333

ROBERT H. BORK

Counsel Of Record

1150 17th Street

Washington, D.C. 20036

(202) 862-5851

DONALD B. AYER

GREGORY G. KATSAS

JONES, DAY, REAVIS & POGUE

51 Louisiana Avenue, N.W.

Washington, D.C. 20001

(202) 879-3939

Counsel for Petitioners

oe NX

QUESTION PRESENTED

Whether the severe retroactive liability imposed by the Coal

Industry Retiree Health Benefit Act of 1992 on companies that

last signed a National Bituminous Coal Wage Agreement in

1981 (eleven years before the Coal Act was enacted) or 1984

(eight years before the Coal Act was enacted) violates the

Takings Clause or the Due Process Clause of the Fifth

Amendment.

PARTIES TO THE PROCEEDINGS

Petitioners Unity Real Estate Company and Barnes &

Tucker Company were plaintiffs and appellants in the

proceedings below. Respondents Marty D. Hudson, Michael

H. Holland, Thomas O.S. Rand, Elliott A. Segal, Carlton R.

Sickles, Gail R. Wilensky, and William P. Hopgood, as trustees

of the United Mine Workers of America Combined Benefit

Fund, were defendants and appellees below. Respondents

Hudson, Holland, Thomas F. Connors, and Robert G. Wallace,

as trustees of the United Mine Workers of America 1992

Benefit Plan, also were defendants and appellees below.

Respondent United States of America was an intervenor-

defendant and appellee below. The LTV Corporation and

NACCO Industries, Inc. appeared in the court of appeals as

amici curiae supporting the appellants.

Neither Unity nor Barnes & Tucker has a parent corporation

or a publicly held company that owns 10 percent or more of its

stock. Unity is a family-owned company. Since 1986, five

individuals have owned all the stock of Barnes & Tucker.

ili

TABLE OF CONTENTS

Page

QUESTION PRESENTED ver ae oe

PARTIES TO THE PROCEEDINGS _ rae talate a oe S ll

TABLE OF AUTHORITIES ee , yea |

OPINIONS BELOW ...___. SOP ee ee a

JURISDICTION ........ er ee oe

PERTINENT PROVISIONS __ |

STATEMENT OF THECASE...... l

|. National Bituminous Coal Wage Agreements... 2

eo 6

3. Eastern Enterprises... Pe COR eee et

4. ThisLitigation..........00..00 9

REASONS FOR GRANTING THE WRIT ae 14

| THE DECISION BELOW CONFLICTS WITH

EASTERN ENTERPRISES ON THE SPECIFIC

QUESTION WHETHER THE COAL ACT IS

UNCONSTITUTIONAL ............. 14

ll_ THE DECISION BELOW IS IMPORTANT

FAR BEYOND THE SPECIFIC CONTEXT OF

eer "ih nae 23

A. The Court Should Clarify The Rules For

Construing Its Own Plurality Opinions Under

Marks v. United States ........... 24

B. The Court Should Clarify The Appropriate Legal

Principles Applicable To Constitutional Review

Of Retroactive Economic Statutes...... 27

SPER so et ras Pee aG VP eee eas

TABLE OF AUT’ | RITIES

Page

Cases

Anker Energy Corp. v. Consolidated Coal Co.,

No. 98-3451, 1999 WL 301735

(3d Cir. May 14, 1999) oo 14

Association of Bituminous ( ‘ontractors, Ine. vy. Apfel,

156 F.3d 1246 (D.C. Cir. See 22, 26

Barnes v. Glen Theatre, Inc., 501 U.S. 560 £.)) oe 27

Bowen v. Georgetown [ /niversity Hospital,

Derigghaar te Rent beac: eT 29

Calder v. Bull 3 U.S. (3 Dall.) 386 (1798) 25

In re Chateaugay Corp., 53 F.3d 478 (2d Cir.),

cert. denied, 516 U.S. 913 Li So ae 22

Central States, Southeast & Southwest Areas

Pension Fund. No. 98-2512, 1999 WL 37167]

(Ne. SED, PO 28

Concrete Pipe & Products yv. Construction Laborers

Pension Trust, 508 U.S. 602 i. - : See 8, 28

Connolly v. PBGC, 475 U.S. 21] i. eee 8, 9, 28

Curtis-Wright Corp. vy. Schoonejongen, 514 U.S. 73

cialis, Ronee a MOT Oa a eerie 2]

Davon, Inc. v. Shalala, 75 F.3d 1114 (7th Cir.),

cert. denied, 519 U.S. 808 | EES cen 14

Eastern Enterprises vy. Apfel, 118 S. Ct. 2131

GE Wtioretionokinini ee Passim

Eastern Enterprises v. Chater, 110 F.3d 150

(Ist Cir. 1997), rev'd, 118 S. Ct. 213] | 28

Holland v. Keenan Trucking Co., 102 F.3d 736

esate tig. ene 22

Hozier v. Midwest Fasteners, Inc., 908 F.2d 1155

A A Sie le 21

King v. Palmer, 950 F.2d 77] (D.C. Cir. 1991)

sain tenet SO oN Nae 26

Landgraf v. U.S.1. Film Products,

al. | a: Se Ne 29

TABLE OF AUTHORITIES (cont'd)

Litton Financial Printing v. NLRB, 501 U.S. 190

(Gp NS RO LOCA EASE CMR Deed SORT SRS RR th 17

Marks v. United States, 430 U.S. 188

5 PERT PREM Rees ro: Be oR ER IEEE DOOD 24, 26

NLRB v. American National Insurance Co.,

ST TE GE IEE” oo nceca casa lsncacesscetnascscavariassriavcsovecens 21

PBGC v. R.A. Gray & Co., 467 U.S. 717 (1984) ... 9, 16, 28

Pap’'s A.M. v. City of Erie, 719 A.2d 273 (Pa. 1998),

cert. granted, 119 S. Ct. 1753 (1999)

III ence hanes 2 asec ese Crue ceena ese kaer veces aes 27

Parella v. Retirement Board of the Rhode Island

Employees’ Retirement System, 173 F.3d 46

(Ist Cir. 1999) ........... sescuk aceasmscomnelaks kc hachn easendaesaal eeak 28

Pennsylvania v. Delaware Valley Citizens’ Council

for Clean Air, 483 U.S. 711 (1987) .............0....0ee 26

Railroad Retirement Board v. Alton R.R. Co.,

TP, SEINE oo incdie 20s satedsaseareceantiecesecdkadadeksaecscex, 28

Sprague v. General Motors Corp., 133 F.3d 388

(6th Cir.) (en banc), cert. denied, 118 S. Ct. 2312

(2 OARERAE RS Ret Ret eee alain bac Nate aeeene herr bo SE Sond 17

Turner Broadcasting System v. FCC, 512 U.S. 622

RRR A pe ta SEB IP ARE Dec nna Se de Seta ce 22

UMWA 1950 Benefit Plan & Trust v. Bituminous Coal

Operators’ Association, 898 F.2d 177

(5 ae aD ENERO ae AAS PLR Ae a a RIE 20

UMWA 1974 Pension v. Pittston Co. , 984 F. 2d 469

(D.C. Cir.), cert. denied, 509 US. 924 (1993) .......... 5,6

United Mine Workers of America v. Nobel, 720 F. Supp.

1169 (W.D. Pa. 1989), aff'd, 902 F.2d 1558 (3d Cir.

1990), cert. denied, 499 U.S. 904 (1991) 0000... 20

United States v. Carlton, 512 U.S. 26 (1994) ....0.0.000000.. 16

United States v. Darusmont, 449 U.S. 292 (1981)

Renate oan aN rtp OU Rroo in VE once DR 16

Vii

TABLE OF AUTHORITIES (cont'd)

Unity Real Estate Co. v. Hudson, 889 F Supp. 818

Nae Becta capaci: fee eT OO er 1]

Usery v. Turner Elkhorn Mining Co.,

IE SAA BO ovticdulbcsdd ccccesccictee hi 8) 9, 28, 29

Vermont Assembly of Home Health A gencies, Inc. v.

Shalala, 18 F. Supp. 2d 355, (D. Vt. ne 28

Wisconsin Department of Revenue v.

William Wrigley, Jr., Co., 505 US. 214 (1992) ....... 15

Youngstown Sheet & Tube Co. y. Sawyer, 343 U.S. §79

ie eee RS PLS SETTER TOY ae dy 21

Statutes

Coal Industry Retiree Health Benefit Act of 1992,

yeas oe re |

wiohiagttn ca BO ea «CE ONE RO Ne NN 16

vcttby hori het pda Rn Neem ete 6

eke a EE Te ee EL, 7

he a. Ee eal, 7

WP BE sinc s6doliing csc cooesesecsheetss coca. 7, 16

tech bp, TERE LocadF 7

tadashi ics) NC l

Miscellaneous

Brief for Respondents UMWA Combined Benefit

stipe pitas Boe ROE NDF ty 25

Michelman, 7akings 1987, 88 Colum. L. Rev.

sextatets cpesny. Boe EE OE ge, 25

CRIN ccc tent Peers ame eRe ht 2: 24

Vill

TABLE OF AUTHORITIES (cont’d)

Note, Lastern Enterprises v. Apfel: Is the Court One

Step Closer to Unraveling the Takings and Due

Process Clauses, 77 N.C. L. Rev. 1524 (1999) ........... 25

Staff of the House Comm. on Ways & Means,

103d Cong., Ist Sess. Financing UMWA Coal Miner

“Orphan Retiree” Health Benefits

EN = I sr EL, aceckekeoses 20

The Supreme Court, 1997 Term — Leading Cases,

Pie Us Ge, I, BEI OOD | orvcsvnsciscvovsceccesssxetevecsees 23

L. Tribe, American Constitutional Law

gE ARR ee eNO al Bt EERE 28

PETITION FOR A WRIT OF CERTIORARI

Unity Real Estate Company and Barnes & Tucker Company

respectfully petition for a writ of certiorari to review the

judgment of the United States Court of Appeals for the Third

Circuit.

OPINIONS BELOW

The opinion of the court of appeals (Pet. App. 1a) is not yet

reported. The opinion of the district court in the { /nity case

(Pet. App. 61a) is reported at 977 F. Supp. 717. The opinion

of the district court in the Barnes & Tucker case (Pet. App

79a) is unreported.

JURISDICTION

The judgment of the court of appeals was entered on March

29, 1999. This Court has jurisdiction under 28 USC

§ 1254(1).

PERTINENT PROVISIONS

The Fifth Amendment of the Constitution and pertinent

provisions of the Coal Industry Retiree Health Benefit Act of

1992, 26 U.S.C. §§ 9701-9722. are reproduced at Pet. App.

17Sa.

STATEMENT OF THE CASE

The Coal Industry Retiree Health Benefit Act of 1992

(“Coal Act”), 26 U.S.C §§ 9701-9722, requires former

signatories of expired National Bituminous Coal Wage

Agreements (“NBCWAs”) to provide lifetime health benefits

to former employees and their spouses and dependents. In

Eastern Enterprises v. Apfel, 118 S. Ct. 213] (1998), the

Court held that the Coal Act was unconstitutional as applied to

a company that last signed an NBCWA before 1974. This case

presents the question whether the Coal Act is also

unconstitutional as applied to companies that last signed an

NBCWA either in 1981 (eleven years before the Coal Act was

enacted) or in 1984 (eight years before the Coal Act was

enacted). It involves an even more draconian application of the

Coal Act than did astern, for the liability at issue here, if

upheld, would retroactively take away all assets of both

petitioners

This case presents several important questions left unsettled

by the divided opinions in Eastern, including (1) the

appropnate legal framework for assessing the constitutionality

of retroactive economic statutes, (2) the appropriate rules for

construing plurality opinions of this Court, and (3) the scope of

the holding in Lastern itself. The Coal Act imposes on

petitioners devastating retroactive liabilities, based on activities

years before its enactment, that are unrelated to past promises

made or injuries caused by petitioners. In Lastern, five Justices

concluded that such retroactive liabilities are unconstitutional.

See id at 2149-53 (plurality opinion of O’Connor, J.) (applying

Takings Clause), id. at 2158-60 (Kennedy, J., concurring in the

judgment and dissenting in part) (applying Due Process

Clause). In this case, however, the court of appeals reached a

different result. It held that, because the plurality and the

concurrence rested on different clauses of the Fifth

Amendment, astern establishes no general constitutional or

retroactivity principles, but instead must be restricted to its

facts. Then, applying its own due process analysis, which

ciosely tracked the Eastern dissent, the court upheld the Coal

Act as applied.

1. National Bituminous Coal Wage Agreements

For over five decades, the terms of employment in

bituminous coal mines have been governed by the NBCWAs,

a series of collective bargaining agreements between the United

Mine Workers of America (“UMWA”) and the Bituminous

Coal Operators’ Association (“BCOA”). At least eleven

different NBCWAs were executed between 1947 and 1971.

See id. at 2138 (plurality), id. at 2165-66 (Breyer, J.,

dissenting). Four different NBCWAs were executed between

1974 and 1984. Pet. App. 96a-174a.

The pre-1974 NBCWAs provided pension and health

benefits to UMWA retirees and their dependents through a

single multi-employer fund. During this period, “miners and

their dependents were not promised specific benefits.” 118 S.

Ct. at 2138 (plurality). Instead, signatory employers promised

to make defined contributions to the relevant fund during the

term of each NBCWA, and the trustres of that fund were

authorized to “adjust the level of benefits __ to remain within

the budgetary constraints.” See id

The 1974 NBCWA created two new employee welfare plans

to provide health benefits to UMWA retirees (and their spouses

and dependents): the United Mine Workers of America 1950

Benefit Plan and Trust (“1950 Plan”), which provided health

benefits to miners who retired before 1976, and the United

Mine Workers of America 1974 Benefit Plan and Trust (“1974

Plan”), which provided health benefits to miners who retired

after 1975. See id at 2139.' As incorporated into the 1974

NBCWA, Article III of the 1950 Plan stated explicitly that no

benefits were guaranteed: “In the event the assets of the 1950

Benefit Trust become insufficient to pay the benefits provided

under the Plan, the benefits may be suspended or reduced to

amounts which, in the judgment of the trustees, can be paid

from the assets of the 1950 Benefit Trust.” Pet. App. 110a.

The 1974 Plan contained an identical restriction on benefits.

Pet. App. Illa-13a. Article XX(d) of the 1974 NBCWA

required signatory employers to make defined contributions to

the 1950 Plan and the 1974 Plan These obligations were

specified by reference to current production, either in terms of

cents-per-ton (for each ton of coal mined) or cents-per-hour

(for each hour of UMWA labor). Pet. App. 99a-10la. All of

'To comply with the Employee Retirement Income Security Act of 1974

(“ERISA”), the 1974 NBCWA also created two separate funds to provide

pension benefits to UMWA retirees (and their spouses and dependents).

See 118 S. Ct. at 2139 (plurality).

these obligations applied only “{d]uring the life of this agree-

ment .. . and ending when this agreement is terminated.” /d.

The 1978 NBCWA provided health benefits to three

different categories of UMWA retirees (and their spouses and

dependents). /irst, miners who retired before 1976 continued

to receive health benefits through the 1950 Plan. See 118 S.

Ct. at 2139-40 (plurality), As incorporated into the 1978

NBCWA, Article III of the 1950 Plan expressly stated that, if

plan assets “become insufficient to pay the benefits provided

under the Plan on or after March 27, 1981,” the expiration date

of the 1978 NBCWA, “the benefits may be suspended or

reduced to amounts which, in the judgment of the Trustees, can

be paid from the net assets” of the 1950 Plan. Pet. App. 13 1a.

Second, miners who retired after 1975, if their former employer

remained in the coal mining business, received benefits through

newly-created individual-employer plans (“IEPs”). See 118 S.

Ct. at 2140 (plurality). Article XX(c)(3)(i) of the 1978

NBCWA stated that “[t]he benefits provided pursuant to such

{LEPs] shall be guaranteed during the term of this Agreement.”

Pet. App. 117a. 7hird, miners who retired after 1975, if their

former employer was no longer in the coal mining business,

continued to receive benefits through the 1974 Plan. See 118

S. Ct. at 2140 (plurality). Article XX(c)(3)(iii) of the 1978

NBCWA provided that the “sole purpose” of the 1974 Plan

was to provide health benefits “during the term of this

Agreement.” Pet. App. 117a. Similarly, Article III of the 1974

Plan stated that, if plan assets “become insufficient to pay the

benefits provided hereunder, on or after March 27, 1981, the

benefits may be suspended or reduced to amounts which, in the

judgment of the Trustees, can be paid from the net assets” of

the 1974 Plan. Pet. App. 132a.

The 1978 NBCWA contained several provisions to ensure

adequate funding for these benefits. Like its predecessor

provision, Article XX(d) of the 1978 NBCWA required

signatory employers to make defined cents-per-ton or cents-

EEE ee

per-hour contributions to the UMWA plans “during the life of

this Agreement . . . and ending when this Agreement is

terminated.” Pet. App. 118a-2la Moreover, the 1978

NBCWA contained a new Article XX(h), the so-called

“Guarantee Clause,” under which signatory employers agreed

to “fully guarantee” all of the promised benefits. Pet App.

12la. The Guarantee Clause further provided for contribution

rates to be increased “[i]n order to fully fund these guaranteed

benefits.” /d. By its express terms, the Guarantee Clause also

applied only “during the term of this Agreement.” /d?

Successor NBCWAs were executed in 1981 and 1984

These agreements left essentially unchanged the structure

through which UMWA retirees (and their spouses and

dependents) received health benefits The 1981 NBCWA

carned forward the various term-of-the-agreement limitations

contained in Article XX(c) (Pet. App. 135a-37a), in Article

XX(d) (Pet. App. 137a-39a), in Article XX(h) (Pet. App.

140a), and in Article III of the incorporated 1950 Plan and

1974 Plan (Pet. App. 152a-53a). The 1984 NBCWA also

carried forward all of these same term-of-the-agreement

limitations. Pet. App. 1S6a-61a, 173a-74a.

* The 1978 NBCWA also incorporated a new so-called “Evergreen

Clause,” which required former NBCWA signatories to contribute to the

UMWA benefit plans “at the rates Specified in the current NBCWA.

irrespective of the employer’s failure [to] sign that NBCWA.” UA(W4

1974 Pension v. Pittston Co., 984 F.2d 469, 473 (D.C. Cir.), cert. denied.

509 U.S. 924 (1993). The Evergreen Clause “addressed only employer

funding, not the scope of the underlying employee benefits.” Pet. App

59a (concurrence). As the majority below recognized, because the

NBCWAs have always specified contribution obligations in terms of

current production, the Evergreen Clause “has no bearing” on former

signatories who have ceased mining bituminous coal entirely. Pet. App.

36a.

2. The Coal Act

Following a long strike against the Pittston Coal Company

in 1989,* Secretary of Labor Elizabeth Dole created the

Advisory Commission on United Mine Workers of America

Retiree Health Benefits (“Coal Commission”). In its final

report to Secretary Dole, the Coal Commission asserted that

“coal miners have been promised and guaranteed health care

benefits for life.’” See 118 S.Ct. at 2141 (plurality) (quoting

report). That report did not discuss any contractual terms of

the pre- or post-1974 NBCWAs, and did not state where,

when, or by whom this alleged promise of lifetime health

benefits had been made* However, in testimony before

Congress, the Chairman of the Coal Commission stated that

this alleged promise “‘began in the collective bargaining

process nearly 50 years ago.’” See 118 S. Ct. at 2141

(plurality) (quoting testimony by W.J. Usery, Jr.).

The Coal Act merged the 1950 Plan and the 1974 Plan into

a successor United Mine Workers of America Combined

Benefit Fund (“Combined Fund”) 26 U.S.C. § 9702(a)(2).

Eligible beneficiaries of that fund include all retirees who were

* That strike arose because Pittston mined coal, but refused to contribute

to the UMWA funds, during the term of the 1988 NBCWA. Ultimately,

the D.C. Circuit held that the Evergreen Clauses contained in pre-1988

NBCWAs, which Pittson had signed, required the company to contribute

to the UMWA funds so long as it mined coal during the term of the 1988

NBCWA. See 984 F.2d at 471-75.

* The Coal Commission appears never to have examined the actual

NBCWAs at all, for its final report acknowledged that the Commission

rclied only on secondary materials “prepared and presented” by the

UMWA and the BCOA. See Coal Comm'n Report at 15 n.1, reprinted in

CA3 Supp. App. at 375 n.1. Those entities had every incentive to contend

that former signatories of expired NBCWAs had continuing obligations

even after they had ceased mining bituminous coal entirely. In contrast

to the UMWA and the BCOA, such former signatories were not

represented on the Coal Commission.

eligible to receive benefits and were receiving benefits from a

predecessor UMWA plan on July 20, 1992. /d. § 9703(f).

These beneficiaries are entitled to receive, for the rest of their

lives, “substantially the same” health benefits that they

previously had received under the predecessor UMWA plans.

Id. § 9703(b)(1). The Coal Act funds these benefits through

retroactive liabilities imposed on former signatories of expired

NBCWAs. /d. § 9704(a)(1) & (b)(1).°

The Coal Act also created a new United Mine Workers of

America 1992 Benefit Plan (“1992 Fund”) — Eligible

beneficiaries of the 1992 Fund are miners who would otherwise

receive no Coal Act benefits, who retired on or before

September 30, 1994, and who would have been eligible to

receive benefits (but for enactment of the Coal Act) under the

predecessor UMWA plans as of February 1, 1993. /d

§ 9712(b)(2). These beneficiaries also are entitled to receive,

for the rest of their lives, “substantially the same” benefits that

they would have received under the predecessor UMWA plans.

Id. § 9712(c)\(1). These benefits also are financed by

retroactive liabilities imposed on former signatories of expired

NBCWAs. /d. § 9712(d)(1)(B), (d)(3)

3. Eastern Enterprises

Fastern involved a company that had signed eight NBCWAs

between 1947 and 1964 and left the coal mining industry in

1965. See 118 S. Ct. at 2142-43 (plurality). There was no

majority opinion: four Justices concluded that the Coal Act as

applied in that case violated the Takings Clause, one Justice

concluded that the Coal Act as applied violated the Due

* Each former signatory must pay a “health benefit premium” to cover

benefits for all beneficianes “assigned” to it. 26 U.S.C. § 9704(a)(1) &

(b)(1). Beneficiaries are “assigned” to a former employer according to

criteria set forth in § 9706. The Coal Act also imposes on cach former

signatory an additional “death benefit premium” (id. § 9704(c)) and

“unassigned beneficiaries premium” (id. § 9704(d)).

Process Clause, and four Justices concluded that the Coal Act

as applied violated neither clause. Nonetheless, five Justices

agreed that the Coal Act was unconstitutional as applied

because of its severe, disproportionate, and unjustified

retroactivity. See id. at 2151 (“Retroactivity is generally

disfavored in the law, in accordance with ‘fundamental notions

of justice’ that have been recognized throughout history.”’)

(citations omitted), id. at 2158-59 (concurrence) (“for centuries

our law has harbored a singular distrust of retroactive

statutes’).

The astern plurality proposed a four-part test for assessing

the constitutionality of retroactive employee benefits funding

legislation. They concluded that if a statute

singles out certain employers to bear a burden that is [1]

substantial in amount, [2] based on the employers’ conduct

far in the past, and [3] unrelated to any commitment that the

employers made [4] or to any injury they caused, the

governmental action implecates fundamental principles of

fairness underlying the Takings Clause

118 S. Ct. at 2153. Applying that test, the plurality concluded

that the Coal Act was unconstitutional as applied because (1)

it imposed on Eastern a “considerable” liability of at least $50

million, id. at 2149; (2) that liability arose out of conduct

concluded in 1965, long before the Coal Act was enacted in

1992, id. at 2150, (3) neither Eastern nor any other pre-1974

NBCWA signatory had made “any agreement — implicit or

otherwise” to provide lifetime retiree health benefits, id. at

2152; and (4) Eastern did not cause its employees’ need for

general health benefits, id. at 2152-53. The plurality explained

that the absence of any prior employer commitment

distinguished Connolly v. PBGC, 475 U.S. 211 (1986), and

Concrete Pipe & Products v. Construction Laborers Pension

Trust, 508 U.S. 602 (1993), which had upheld the withdrawal

liability provisions of the Multiemployer Pension Plan

Amendments Act of 1980 (“MPPAA”) as sufficiently

“calibrated” to past promises. See 118 S. Ct. at 2152°

Similarly, the plurality explained that the absence of any causal

connection between past employment and the retirees’ current

need for general health benefits distinguished Usery v. Turner

Llkhorn Mining Co., 428 U.S. 1 (1976), which had upheld the

imposition of retroactive liability for black lung disease caused

by past employment in coal mines. See 118 S. Ct. at 2152-53

Justice Kennedy concluded that the same considerations

establish a violation of due process. Like the plurality, he

stressed that the Coal Act “imposes a staggering financial

burden,” sd at 2154, “has a retroactive effect of unprecedented

scope,” id. at 2159, and “bears no legitimate relation” to any

asserted governmental interest, id. On the latter point, Justice

Kennedy specifically agreed with the plurality that the absence

of any past commitments made, or injuries caused, by pre-1974

NBCWA signatories distinguished this Court’s prior decisions

upholding the imposition of retroactive liability on employers

See id. Justice Kennedy stressed that he and the plurality relied

on the same “retroactivity precedents” (id at 2158) and that his

analysis was “in full accord with many of the plurality’s

conclusions” (id. at 2154)

4. This Litigation

This case involves application of the Coal Act to petitioners

Unity Real Estate Company and Barnes & Tucker Company

Through a subsidiary, Unity last signed an NBCWA and ceased

all of its coal mining operations in 1981 (eleven years before

the Coal Act was enacted). Pet. App. 8a. Barnes & Tucker

* MPPAA requires employers withdrawing from a multi-employer pension

plan to pay their proportionate share of the plan’s “unfunded vested

benefits.” See, e.g, Connolly, 475 U.S. at 217 (emphasis added and

citations omitted). Thus, MPPAA merely sought to ensure that employees

would be “fully compensated” with pension benefits that their employers

previously had promised. See PBGC v. R.A. Gray & Co., 467 U.S. 717,

725, 733-34 (1984).

last signed an NBCWA in 1984 (eight years before the Coal

Act was enacted) and ceased the last of its coal mining

operations in 1986 (six years before the Coal Act was enacted).

Pet. App. 9a. Application of the Coal Act would bankrupt

Unity immediately and would bankrupt Barnes & Tucker within

two years. Pet. App. 9a-10a

Unity is a family business that owns a small commercial

building and a parking lot. It employs two individuals, a

corporate officer who earns $7000 per year and a janitor. Its

net worth is approximately $85,000. Pet. App. 9a. Unity’s

predecessor companies signed NBCWAs between 1947 and

1961, and a subsidiary signed the 1974, 1978, and 1981

NBCWAs. Unity ceased all of its coal mining operations in

1981. Pet. App. 8a. In 1992, however, Unity was assigned 76

Coal Act beneficiaries. By 1996, its accrued and unpaid Coal

Act liabilities exceeded $450,000. Those liabilities are “over

six times its total assets.” Pet. App. 9a.’

Barnes & Tucker signed NBCWAs in 1971, 1974, 1978, and

1981. In 1984, it signed a “me-too” agreement incorporating

the 1984 NBCWA. It closed its last coal mining operation in

1986. Since then, its activities have been confined to paying

workers’ compensation and black lung claims, treating acid

mine drainage from its closed mines, and leasing property to

third parties. In 1992, Barnes & Tucker was assigned 1564

Coal Act beneficiaries. Pet. App. 9a. Its Coal Act liability is

approximately $2.5 million per year. Pet. App. 4la.* By

contrast, its average gross revenue, between 1992 and 1996,

was barely over $1 million per year. CA3 App. at 338. Thus,

’ As the court of appeals acknowledged: “Unity’s assets are tiny, and its

Coal Act liabilities dwarf them. If we uphold the defendants’ position,

this small family business will be bankrupted instantly.” Pet. App. 53a.

* Barnes & Tucker estimated that its total Coal Act liability is approxi-

mately $50 million. See CA3 App. at 337-38.

if Barnes & Tucker “is forced to continue paying its Coal Act

liabilities, all of its assets will be consumed in less than two

years.” Pet. App. 10a.’

Petitioners filed separate actions to challenge the

constitutionality of the Coal Act as applied. In the Unity case,

the district court granted a preliminary injunction on takings

grounds, noting that Unity’s past employment relationships

“did not create any legitimate expectation of lifetime benefits.”

Unity Real Estate Co. v. Hudson, 889 F. Supp. 818, 832 (W_D.

Pa. 1995). Despite that decision, however, the district court

later granted summary judgment against both petitioners. Pet.

App. 6la, 79a. A divided panel affirmed, but only with

“substantial hesitation” about what it characterized as an

“exceedingly close question.” Pet. App. 3a.'°

In Part II of its opinion, the majority below addressed the

extent to which /asfern controls other cases. The majority

held that the lower courts are not bound by the points of

agreement between the retroactivity analyses of the Eastern

plurality and concurrence, because those opinions rested on the

Takings Clause and the Due Process Clause respectively, and

because “neither constitutional ground is a more limited version

of the other.” Pet. App. 16a. Instead, the majority concluded,

Eastern controls only “substantially identical” cases involving

the constitutionality of the Coal Act as applied to companies

that last signed an NBCWA prior to 1974. Pet. App. 16a-17a.

At the same time, however, the majority held that the lower

courts are bound by the points of agreement between the

* In April 1996, Barnes & Tucker estimated that its Coal Act liabilities

would lead to its complete liquidation and bankruptcy within approxi-

mately four years (i.e., by April 2000). CA3 App. at 338.

'° Consistent with that characterization, the Third Circuit took the

extraordinary course of holding two oral arguments and ordering three

rounds of briefing.

takings analyses of the astern concurrence and dissent, both

of which had stated that impact on a “specific” property

interest is an essential element of any Takings Clause claim.

Pet. App. 17a (“we are bound to follow the five-four vote

against the takings claim in astern’)

In Part III of its opinion, the court of appeals rejected

petitioners’ claims under its own due process analysis. The

lynchpin of the court’s analysis was its conclusion that the post-

1974 NBCWAs created a “reasonable expectation” (or could

reasonably be construed to create a “reasonable expectation’)

that retirees would receive lifetime health benefits from the

UMWA funds. Pet. App. 26a-36a. The court acknowledged

that, under the plain language of the post-1974 NBCWAs and

the incorporated fund documents, the trustees of the UMWA

funds “were obligated to provide benefits only ‘during the term

of this agreement,’ just as the companies were only required to

contribute during the term of the contract.” Pet. App. 34a

Nonetheless, the court relied heavily on what it characterized

as “contradictory language” (id ) in a “General Description” of

benefits attached to the post-1974 NBCWAs, which refers to

beneficiaries’ retaining a health services card “for life” or “until

death.” Pet. App. 29a-30a.'' The court also relied heavily on

“(t]he fact that NBCWAs continue[d]” through a series of

successor agreements. Pet. App. 31a, see also Pet. App. 33a

n.9 (noting “the fact that the NBCWAs persisted for decades”).

The court asserted two further rationales for imposing

perpetual obligations on former signatories of expired

NBCWAs: their purported “responsibility” for the UMWA

funds’ financial difficulties (Pet. App. 21a-25a) and the fact that

“(t]he coal industry has been heavily regulated for decades”

'! In discussing “Other Contractual Provisions” (Pet. App. 36a-37a), the

court mentioned only the Evergreen Clause, which it acknowledged is

inapplicable to former NBCWA signatories who have left the coal mining

industry (Pet. App. 36a), and the Guarantee Clause, which by its terms

applied only “during the term” of cach NBCWA (e.g., Pet. App. 12 1a).

(Pet. App. 25a).'""_ After concluding that the post-1974

NBCWAs created a “reasonable expectation” of lifetime health

benefits, the court had little trouble holding that the Coal Act

was constitutional despite its “quite long” periods of

retroactivity (Pet. App. 39a) and its “substantial” economic

burdens (Pet. App. 42a).

Judge Aldisert concurred only in the majority's judgment

He stated emphatically that “the Wage Agreements expressly

limited all of the promised retiree health benefits to the term of

each agreement”

I simply can find no evidence of any “promise” of lifetime

benefits contained in any Wage Agreement. Any reliance on

extra-contractual “promises” looks to a novel theory of law

that turns a blind eye to the centuries-old law of contracts

and to the current law on collective bargaining agreements.

* * * *

To the miner, the actual contract controlled, not the

expectation of future agreements. Without the contract in

hand, the miners would not pick up their lamps at the lamp

house and descend into the shafts. They worked under the

precise language in a given contract and under no other

representations.

Pet. App. 58a-59a. Judge Aldisert concluded that the Coal Act

could be sustained “for one reason only”: because the Coal

Commisson had construed the post-1974 NBCWAs differently,

The court rejected a separate argument, which it incorrectly attributed

0 petitioners, that the Coal Act is unconstitutional solely because it

imposes retroactive liability for benefits unrelated to past mining injuries.

Pet. App. 20a-2la. What petitioners argued, however, is that this feature

of the Coal Act merely forecloses the particular justification for retroactive

liability approved by this Court in Turner Elkhorn.

and because its report was among the materials considered by

Congress. Pet. App. 55a-56a."’

REASONS FOR GRANTING THE WRIT

I. THE DECISION BELOW CONFLICTS WITH

EASTERN ENTERPRISES ON THE SPECIFIC

QUESTION WHETHER THE COAL ACT IS

UNCONSTITUTIONAL

Five Justices in Eastern, reasoning from the common

premise that retroactivity is highly disfavored in our legal

culture, concluded that retroactive employee benefits funding

legislation is unconstitutional if it imposes on employers a

“substantial” economic burden, based on conduct “far in the

past,” that is “unrelated to any commitment that the employers

made or to any injury they caused.” See 118 S. Ct. at 2153

(plurality); id. at 2158-60 (concurrence). The court of appeals

failed to apply that rule, however, for it concluded that the

retroactivity analyses of the astern plurality and concurrence

control only “substantially identical” cases involving companies

that signed only pre-1974 NBCWAs. Pet. App. 1Sa-17a Had

the court applied the retroactivity principles endorsed by five

Justices in Eastern, it would have had to invalidate the Coal

Act as applied to companies that signed post-1974 NBCWAs.

As another court of appeals has explicitly recognized, for

purposes of assessing the constitutionality of the Coal Act as

applied, “[n]othing radical happened in 1974.” Davon, Inc. v.

Shalala, 75 F.3d 1114, 1128 (7th Cir.), cert. denied, 519 U.S.

808 (1996).

'’ In Anker Energy Corp. v. Consolidated Coal Co., No. 98-3451, 1999

WL 301735 (3d Cir. May 14, 1999), the court of appeals confirmed its

view that Eastern contains no binding legal holdings (id. at *8-*11) and

that the Coal Act is constitutional as applied to companies that signed

post-1974 NBCWAs (id. at *11-*13).

A. Under the retroactivity principles endorsed by five

Justices in astern, the Coal Act is plainly unconstitutional as

applied to companies that, as former signatories of expired

post-1974 NBCWAs, are burdened by severe, dispropor-

tionate, and retroactive Coal Act liabilities. Each of the four

elements of the retroactivity analysis adopted by the Eastern

plurality, and endorsed by the astern concurrence, is present

in this case.

First, as the court of appeals acknowledged, the Coal Act

liabilities imposed on Unity (over $450,000 by 1996) and

Barnes & Tucker (estimated to total approximately $50

million) are “certainly substantial” under any rational measure

Pet. App. 42a. They are obviously substantial in absolute

amount.'* More importantly, they are substantial relative to the

limited three- or four-year commitments undertaken by Unity

on three occasions between 1974 and 1981, and by Barnes &

Tucker on four occasions between 1974 and 1984. Finally,

they are substantial relative to the total size of both petitioners,

for the court of appeals acknowledged that application of the

Coal Act would “put these particular [petitioners] out of

business.” Pet. App. 42a. That fact underscores not only the

severe burden imposed on petitioners in this case, but also the

crucial importance of the question presented to small

businesses throughout the coal mining industry. As Judge

Aldisert ominously noted, “the operation of the present

Statutory solution to the vexing health benefit problem of

retirees . . . may serve as a full employment program for

bankruptcy lawyers.” Pet. App. 60a.

'* The court of appeals observed that a small absolute liability might be

constitutional even if it were disproportionate. Pet. App. 4la-42a

(hypothetical involving “a one-dollar burden”). However, this case is

obviously not governed by the maxim that “the law cares not for trifles.”

see, e.g., Wisconsin Dep't of Rev. v. William Wrigley, Jr., Co., 505 U.S.

214, 231 (1992).

Second, as the court of appeals acknowledged, the degree

of retroactivity at issue here, although less extreme than that

present in Eastern, “is still quite long.” Pet. App. 39a. The

Coal Act imposed liability in this case eleven years after Unity

last signed an NBCWA and ceased mining coal, eight years

after Barnes & Tucker last signed an NBCWA, and six years

after Barnes & Tucker terminated the last of its coal mining

operations. Pet. App. 8a-9a. This multi-year reachback cannot

be defended as “confined to short and limited periods required

by the practicalities of producing national legislation,” United

States v. Darusmont, 449 U.S. 292, 296-97 (1981) (per

curiam). That justification for retroactivity typically applies to

statutes with a reachback period of not more than one year.

See, e.g., United States v. Carlton, 512 U.S. 26, 32-33 (1994)

(one-year retroactivity period designed to cure drafting error);

PBGC v. R.A. Gray & Co., 467 U.S. 717, 730-31 (1984) (five-

month retroactivity period designed to prevent strategic

behavior “while Congress debated necessary revisions in the

statute”).'°

Third, the retroactive Coal Act liabilities imposed on

petitioners are vastly broader than any of their past promises or

commitments. On their face, the post-1974 NBCWAs made

absolutely clear that both the retiree entitlements (to receive

defined health benefits) and the corresponding employer duties

(to pay for those benefits) were limited to the term of each

contract: Article XX(c) of each NBCWA limited retiree

'’ The court of appeals held that the relevant retroactivity period for

Barnes & Tucker was only four years (measured from the expiration date

of the 1984 NBCWA). Pet. App. 38a-39a. That analysis is incorrect

because Coal Act liability is triggered by the signing of an NBCWA or

“me too” agreement, see 26 U.S.C. §§ 9701(c)(1), 9706 — an event that,

for Barnes & Tucker, last occurred in 1984. The court of appeals’ error

in this regard is immaterial, however, because even a four-year

retroactivity period cannot possibly be justified by “the practicalities of

producing national legislation” (Darusmont, 449 U.S. at 296-97).

entitlements to “the term of this Agreement” (e.g., Pet. App.

116a-117a); Article XX(d) of each NBCWA limited employer

contribution requirements to “the life of this Agreement” (e.g.,

Pet. App. 118a-121a); Article XX(h) of each NBCWA limited

the guarantee of full funding to “the term of this Agreement”

(e.g., Pet. App. 121a); and Article III of the incorporated plan

documents stated that all defined benefits could be “suspended

or reduced” after expiration of the underlying NBCWA (e.g.,

Pet. App. 152a-153a). The judges below repeatedly acknowl-

edged these clear contractual limitations. £.g., Pet. App. 34a

(majority) (“the Trustees were obligated to provide benefits

only ‘during the term of this agreement,’ just as the companies

were only required to contribute during the term of the

contract”); Pet. App. 58a (concurrence) (“the Wage Agree-

ments expressly limited all of the promised retiree health

benefits to the term of each agreement”)."°

Fourth, the broad package of health benefits afforded under

the Coal Act is in no sense a remedy for injuries caused by past

employment in coal mines. Five Justices reached that conclu-

sion in Eastern, see 118 S. Ct. at 2152-53 (plurality); id. at

2159 (concurrence), and their analysis in this regard applies to

signatories of post-1974 NBCWAs no less than to signatories

of pre-1974 NBCWAs.

B. Every justification asserted by the court below for

upholding the Coal Act as applied is inconsistent with the

retroactivity principles endorsed by five Justices in Eastern.

'© General labor-law and ERISA principles confirm this straightforward

interpretation of the NBCWAs. See, e.g., Litton Financial Printing Div.

v. NLRB, 501 U.S. 190, 207 (1991) (employee benefits are presumed to

“cease, in the ordinary course, upon termination of the [collective]

bargaining agreement”), Sprague v. General Motors Corp., 133 F.3d 388,

400 (6th Cir.) (en banc) (“Because vesting of welfare plan benefits is not

required by law, an employer’s commitment to vest such benefits is not to

be inferred lightly.”), cert. denied, 118 S. Ct. 2312 (1998).

First, the Coal Act cannot be upheld on the ground (Pet.

App. 29a-34a) that a “reasonable expectation” of lifetime

health benefits arose from statements in the “General Descrip-

tion” that retirees would retain a health services card “for life”

or “until death.” The record in Eastern contained various

statements by contracting parties indicating that the pre-1974

NBCWAs had “promised lifetime health benefits.” See 118 S.

Ct. at 2139 (plurality).'’ Nonetheless, five Justices held that,

where the applicable contractual limitations are clear, such

statements cannot support the imposition of a severe

retroactive liability. The contention that employers had

promised lifetime benefits, the Court concluded, “is not

supported by the pre-1974 NBCWA’s,” and “[n]Jo contrary

conclusion can be drawn from the few isolated statements of

individuals involved in the coal industry.” 118 S. Ct. at 2152

(plurality); see id. at 2159 (concurrence) (endorsing this

reasoning). The “General Description” is analogous to these

extra-contractual statements because, although it was attached

to the post-1974 NBCWAs, it was plainly not a source of bene-

fits above and beyond those specified in Article XX or in the

incorporated plan documents. The “General Description”

stated at the outset:

The following is a general description of certain information

contained in the [UMWA plans]. This description is

intended merely to highlight certain information; it is not a

complete statement of all of the provisions of the Plans and

Trusts, nor is it intended to be a Summary Plan Description

as defined in [ERISA], and is qualified in its entirety by,

and subject to the more detailed information contained in,

the Plans and Trusts.

" For example, the president of the Southern Coal Operators’ Association

stated in 1953 that miners had been “promised and grown accustomed

to’” continuing health benefits, and a UMWA official stated in 1951 that

miners had been promised benefits ““without limit as to duration.

118 S. Ct. at 2166 (dissent).

%99

See

E.g., Pet. App. 121a (emphasis added). Moreover, the

NBCWAs contained repeated and even more emphatic

statements that “[t]he specific provisions of the plans will

govern in the event of any inconsistency between the general

description and the plans.” Pet. App. 133a, 140a, 154a, 16la.

Accordingly, under the retroactivity principles adopted by five

Justices in Eastern, the “General Description” could not

support the imposition of retroactive Coal Act liability even if

it did contain statements about the alleged promise of lifetime

health benefits."*

Second, the Coal Act cannot be upheld on the ground (Pet.

App. 31a-33a) that an “expectation” of lifetime benefits arose

because the NBCWAs had been repeatedly renewed. Five

Justices rejected that reasoning in Eastern, which invalidated

the Coal Act as applied to a company that had signed eight

NBCWAs during the eighteen years between 1947 and 1965

(see 118 S. Ct. at 2142-43 (plurality). If repeated renewal of

those NBCWAs was insufficient to sustain the Coal Act as

applied in Eastern, it is also insufficient to sustain the Coal Act

as applied here to Unity, which signed approximately seven

NBCWAs during the fourteen years between 1947 and 1961,

and three NBCWAs during the seven years between 1974 and

1981 (Pet. App. 8a-9a), and to Bames & Tucker, which signed

three NBCWAs and one “me-too” agreement during the

thirteen years between 1971 and 1984 (Pet. App. 9a). In

Eastern, five Justices plainly recognized that the imposition of

retroactive liability can be justified only by reference to past

commitments made by the company at issue, not by reference

'8 The majority’s interpretation of the “General Description” is untenable

in any event, because the “General Description” itself confirmed that the

health benefits referenced in each NBCWA were guaranteed only “during

the term of this Agreement.” F.g., Pet. App. 129a. As Judge Aldisert

charitably put it, “[t]o suggest that the clear language limiting benefits to

the term of the Wage Agreement is trumped by the ‘lifetime’ health card

is a stretch.” Pet. App. 58a.

to commitments made by other companies in successor or

predecessor agreements. See 118 S. Ct. at 2152 (plurality)

(“the question is not whether miners had an expectation of

lifetime benefits, but whether Eastern should bear the cost of

those benefits”); id. at 2159 (concurrence) (endorsing this

analysis). In other words, contrary to the decision below, the

analysis of employee “expectations” cannot be divorced from

the analysis of past commitments by the employer in question.

Third, the Coal Act cannot be upheld on the ground (Pet.

App. 22a) that petitioners’ actions “helped to create the finan-

cial crisis” in the UMWA plans. The majority reasoned that

petitioners, by not signing successor NBCWAs when they “left

the industry,” created “obligations on the part of other

companies to increase contributions to the benefit funds.” Pet.

App. 23a-24a. That analysis, however, presupposes that

petitioners’ retirees reasonably expected to receive lifetime

health benefits even though petitioners and other signatories

had promised to provide benefits and funding only during the

term of each underlying NBCWA. As explained above, five

Justices in Eastern squarely rejected any retroactivity analysis

based on employee expectations so completely divorced from

past employer promises. See 118 S. Ct. at 2152-53 (plurality);

id. at 2158-59 (concurrence). The cost of providing health

benefits during the term of an NBCWA reflected promises

made only by the signatories of that particular agreement.'”

'’ The “financial crisis” referred to by the court of appeals arose because

the 1988 NBCWA, in contrast to its predecessors, was intentionally

underfunded. See, e.g., United Mine Workers of America v. Nobel, 720

F. Supp. 1169, 1177 (W.D. Pa. 1989), aff'd, 902 F.2d 1558 (3d Cir. 1990),

cert. denied, 499 U.S. 904 (1991); UMWA 1950 Benefit Plan & Trust v.

Bituminous Coal Operators’ Ass'n, 898 F.2d 177, 180-82 (D.C. Cir.

1990). As a result, the financial condition of the 1950 and 1974 Plans

deteriorated from a combined surplus of $33 million in 1987, the last full

year during which the 1984 NBCWA remained effective, to a combined

deficit of over $109 million in 1990, mid-way through the term of the

1988 NBCWA. See Staff of the House Comm. on Ways & Means, 103d

dnshisiabaicnatt wisseonnnnniailall

Fourth, the Coal Act cannot be upheld on the ground (Pet.

App. 25a) that “[t]he coal industry has been heavily regulated

for decades.” The same regulatory history was asserted as a

ground for upholding the Coal Act in Eastern. See 118 S. Ct.

at 2166-67 (dissent). Nonetheless, five Justices concluded that

the extent of government involvement, at least as of 1965,

could not justify the imposition of retroactive Coal Act

liabilities.2° The only significant post-1965 legal development

not considered in Eastern was the enactment of ERISA in

1974. That event undercuts the regulated field argument even

more, for the framers of ERISA made conscious decisions to

create no “substantive entitlement to employer-provided health

benefits,” Curtis-Wright Corp. v. Schoonejongen, 514 U.S. 73,

78 (1995), and to impose no vesting requirements on employee

welfare plans such as the UMWA plans at issue here, see, e.g.,

Hozier v. Midwest Fasteners, Inc., 908 F.2d 1155, 1160 (3d

Cir. 1990).

Finally, the concurrence below erred in asserting that

reviewing courts are powerless to look beyond the Coal Com-

Cong., Ist Sess., Financing UMWA Coal Miner “Orphan Retiree” Health

Benefits 9 (Comm. Print, 1993) (citing Funds’ annual reports). Of course,

petitioners cannot be charged with responsibility for the underfunding of

an agreement to which they were not a party.

seizure of the coal mines in 1946 and the 1948 execution of the Krug-

Lewis agreement, which effectively imposed collective-bargaining terms

on the mining industry. Pet. App. 4a-5a, 25a. In 1952, however, it

became clear that the mine seizure had been unconstitutional, see

Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579 (1952), and that

the executive branch has no statutory authority to “compel concessions or

otherwise sit in judgment upon the substantive terms of collective

bargaining agreements,” NLRB v. American Nat'l Ins. Co, 343 U.S. 395,

404 (1952). Thus, even apart from Eastern, the events cited by the court

below cannot possibly demonstrate that the coal industry was a “heavily

regulated” field that petitioners entered only at their pen.

mission’s mistaken conclusion that UMWA retirees had been

promised “health care benefits for life” (Pet. App. 56a-57a) —

even though, in fact, “the Wage Agreements expressly limited

all of the promised retiree health benefits to the term of each

agreement” (Pet. App. 58a). In Eastern, five Justices invali-

dated the Coal Act as applied to a company that last signed an

NBCWA in 1964, despite congressional testimony from the

Coal Commission’s Chairman that legislation was necessary to

vindicate “‘promises that began in the collective bargaining

process nearly 50 years ago.’” See 118 S. Ct. at 2141 (plural-

ity) (quoting testimony). Those Justices did not hesitate to

conclude that this mistaken assertion was “not supported” by

the actual terms of the governing contracts. See id. at 2152; id.

at 2159 (concurrence). Thus, a patently incorrect construction

of the underlying NBCWAs is not dispositive, even if made by

the Coal Commission and even if accepted by Congress.”

C. The constitutionality of the Coal Act as applied to

signatories of the post-1974 NBCWAs is an obviously

important and recurring question. This question has been

frequently litigated, both before Lastern, see, e.g., Holland v.

Keenan Trucking Co., 102 F.3d 736 (4th Cir. 1996), Jn re

Chateaugay Corp., 53 F.3d 478 (2d Cir.), cert. denied, 516

U.S. 913 (1995), and after, see, e.g., Association of Bitumi-

nous Contractors, Inc. v. Apfel, 156 F.3d 1246 (D.C. Cir.

1998) (“ABC”), Pet. App. la. Indeed, this question has far

more practical significance than the question whether the Coal

*! The court of appeals concluded that Congress’s assessment of the

antecedent NBCWAs was subject only to “substantial evidence” review.

Pet. App. 18a-19a (majority), 56a-57a (concurrence). Judge Aldisert’s

analysis cannot be justified even under that deferential standard, which

“does not mean” that Congress’s factual determinations “are insulated

from meaningful judicial review altogether.” Turner Broadcasting Sys.

v. FCC, 512 U.S. 622, 666 (1994). As five Justices implicitly recognized

in Eastern, a patently incorrect construction of the antecedent NBCWAs

is not “substantial” evidence.

Act is unconstitutional as applied to companies that last signed

a pre-1974 NBCWA, because the vast majority of companies

subject to the Coal Act are signatories of post-1974 NBCWAs.

Moreover, the coal industry contains “literally thousands of

individual mines” run by small companies like petitioners. Coal

Comm'n Report at 9, CA3 Supp. App. at 369. As Judge

Aldisert noted (Pet. App. 60a), the Coal Act threatens the very

survival of these companies. The Court should grant review

because of the importance of the question presented and

because, as explained above, the decision below conflicts with

this Court’s decision in Lastern.

Il. THE DECISION BELOW IS IMPORTANT FAR

BEYOND THE SPECIFIC CONTEXT OF THE

COAL ACT

The court of appeals’ holding that Kasfern contains no

binding retroactivity principles raises questions with

significance far beyond the specific context of the Coal Act. In

Eastern, five Justices agreed that the Fifth Amendment

provides significant protection against the operation of

retroactive economic civil statutes, and further agreed on what

specific protection applies in the context of retroactive

employee benefits funding legislation. However, these Justices

divided on whether the controlling retroactivity principles arise

out of the Takings Clause or the Due Process Clause. As one

commentator explained, these Justices “agreed on legal

principles,” and disagreed only on “doctrinal categorization.”

The Supreme Court, 1997 Term — Leading Cases, 112 Harv.

L. Rev. 122, 219 (1998) (discussing Kastern). The court of

appeals’ conclusion that the operative retroactivity principles

govern only Eastern itself and “substantially identical” cases —

i.e. Coal Act cases involving signatories of pre-1974

NBCWAs (Pet. App. 15a-17a) — raises troubling and

important questions about the rules for construing plurality

opinions of this Court and about the appropriate legal standards

for assessing the constitutionality of retroactive economic

statutes

A. The Court Should Clarify The Rules For Construing

Its Own Plurality Opinions Under Marks v. United

States

In Marks v. United States, 430 U.S. 188, 193 (1977), this

Court held that “[w]hen a fragmented Court decides a case and

no single rationale explaining the result enjoys the assent of five

Justices, ‘the holding of the Court may be viewed as that

position taken by those Members who concurred in the

judgments on the narrowest grounds’” (citation omitted). The

proper application of Marks is an important question given this

Court’s increasingly frequent issuance of plurality opinions.”

The decision below raises three distinct Marks issues

warranting this Court’s review.

1. The court of appeals refused to give effect to the points

of agreement between the ‘astern plurality and concurrence.

The court reasoned that, despite five Justices’ agreement about

the relevant retroactivity principles, “[t]here is a fundamental

conceptual difference between a takings claim and a due

process claim,” so that a retroactivity analysis grounded in the

Takings Clause is not “a more limited version” of one grounded

in the Due Process Clause, or vice versa. Pet. App. 15a-16a.

The court thus held that agreement over substantive “legal

principles” is irrelevant under Marks, and that disagreement

over “doctrinal categorization” is dispositive.

The court of appeals’ analysis is both mistaken and

troubling. It is mistaken because, where five Justices agree

* During the 154 years between 1801 and 1955, the Court issued only 45

plurality opinions, by contrast, during the ten years between 1981 and

1991, the Court issued no fewer than 103 plurality opinions. See Note, A

Legitimacy Model for the Interpretation of Plurality Decisions, 77 Cornell

L. Rev. 1593, 1593 n.3 (1992)

about the controlling legal principles, those principles are

themselves a “common denominator” between the competing

opinions, which the lower courts can readily apply even absent

agreement about the “precise theoretical underpinnings.” See

J. Davis & W. Reynolds, Juridical Cripples: Plurality

Opinions in the Supreme ( ‘ourt, 1974 Duke L.J. 59, 72. The

court of appeals’ analysis is troubling because five Justices

currently agree about the need for meaningful constitutional

protection against retroactive civil statutes, even though the

Court has long disagreed about what clause of the Constitution

embodies that protection.*> Under the court of appeals’

analysis, as long as the latter disagreement persists, this Court

cannot establish any legal framework for assessing the constitu-

tionality of retroactive civil statutes, because it is impossible —

regardless of the extent of agreement on the appropriate

retroactivity principles — to establish a Marks majority for

those principles. The Court should grant review either to

determine what clause of the Constitution applies in these

circumstances, or to confirm that agreement on that point is

unnecessary to the development of a meaningful retroactivity

jurisprudence.

™ The Court's disagreement about what clause of the Constitution affords

protection against retroactive economic statutes has been longstanding.

See, e.g., Note, Eastern Enterprises v. Apfel: Is the Court One Step

Closer to Unraveling the Takings and Due Process Clauses, 77 N.C. L.

Rev. 1524, 1524 (1999) (“the Supreme Court has made a muddled mess

of the Takings and the Due Process Clauses”), Michelman, 7akings, 198 7,

88 Colum. L. Rev. 1600, 1607 n.40 (1988) (“judges and commentators

have [not] always maintained a clear distinction between the ‘due process’

and ‘takings’ inquiries”). In astern, Justice Thomas suggested that the

Ex Post Facto Clause might also apply in this context. See 118 S. Ct. at

2154 (concurrence). Although Calder v. Bull, 3 U.S. (3 Dall.) 386 (1798),

restricted the Ex Post Facto Clause to criminal statutes, that decision

presupposed (contrary to statements by the Fasfern concurrence and

dissent) that the Takings Clause does apply in this context. See 118 S. Ct.

at 2151 (plurality).

2. The court of appeals did give effect to the agreement

between the astern concurrence and dissent that a burden on

a “specific” property interest is an essential element of any

Takings Clause claim. Pet. App. 17a (“we are bound to follow

the five-four vote against the takings claim in Eastern”). By

creating a Marks majority out of a concurrence and dissent, the

decision below conflicts both with Marks itself, which applies

only to positions taken by Justices “*who concurred in the

judgments,’” 430 U.S. at 193, and with King v. Palmer, 950

F.2d 771, 783 (D.C. Cir. 1991) (en banc), in which the D.C

Circuit held that “we do not think we are free to combine a

dissent with a concurrence to form a Marks majority.”

Applying that principle, the Ang court expressly refused to

create a Marks majority out of the points of agreement between

the concurrence and the dissent in this Court’s decision in

Pennsylvama v. Delaware Valley Citizens’ Council for Clean

Air, 483 U.S. 711 (1987). See 950 F.2d at 779-85. The Court

should grant review to resolve the circuit conflict between the

decision below and King.

3. Finally, the combined effect of the court of appeals’ two

Marks rulings — giving effect to the points of agreement

between the Lasfern concurrence and dissent, but not giving

effect to the points of agreement between the astern plurality

and concurrence — is to adopt, as the law of the land for

virtually all cases, the position urged by the Eastern dissent.”

4 Although the decision below would give effect to Eastern in the narrow

range of cases involving challenges to the Coal Act brought by pre-1974

NBCWA signatories, the D.C. Circuit has refused to do even that. In

ABC, the D.C. Circuit held that “the only binding aspect of Eastern

Enterprises is its specific result — holding the Coal Act unconstitutional

as applied to Eastern”, it held that “our basic inquiry in resolving [a] due

process challenge remains the same after Eastern as it was before”; and

it cited as valid authority several pre-Eastern decisions upholding the Coal

Act even as applied to pre-1974 NBCWA signatories, including the

reversed First Circuit decision in Eastern itself (which it cited as reversed

“on other grounds”). See 156 F.3d at 1255.

That position seems to reflect not a plausible approach to

Marks, but downright hostility to Eastern itself. This Court

recently granted certiorari to review a similarly result-oriented

application of Marks in Pap's A.M. v. City of Erie, 719 A.2d

273 (Pa. 1998), cert. granted, 119 S. Ct. 1753 (1999) (No. 98-

1161). Pap’s involved a nude dancing ordinance similar to one

that five Justices had upheld, in three fragmented opinions, in

Barnes v. Glen Theatre, Inc., 501 U.S. 560 (1991). In Pap ’s,

the Pennsylvania Supreme Court held that none of these

opinions constituted “binding precedent” under Marks, and it

proceeded to adopt and apply the First Amendment analysis of

the Barnes dissent. See 719 A.2d at 277-79. The Court should

grant review here, as it did in Pap’s, to prevent its decisions

from being so lightly disregarded.”

B. The Court Should Clarify The Appropriate Legal

Principles Applicable To Constitutional Review Of

Retroactive Economic Statutes

Under the court of appeals’ conclusion that Kastern controls

only a narrow range of “substantially identical” cases, that

decision raises, but does not itself answer, a series of

fundamental questions about application of the Fifth

Amendment to retroactive economic statutes. This Court

should grant review to establish an appropriate legal framework

for such constitutional challenges, assuming that astern has

not already done so.

1. After Eastern, the lower courts are divided about

whether the burdening of a “specific” property interest is an

essential element of any Takings Clause claim. Before that

decision, this Court had routinely conducted a regulatory

takings analysis in assessing the constitutionality of economic

statutes that, like the Coal Act, impose only general monetary

5 Alternatively, the Court should hold this case pending its resolution of

the \farks issues in Pap’s.

liabilities. See, e.g., Concrete Pipe, 508 U.S. at 641-47,

Connolly, 475 U.S. at 221-28. Following -astern, however,

at least two courts have held that a “specific” property interest

is now an essential element of any Takings Clause claim. See

Parella v. Retirement Bd. of the Rhode Island Employees’

Retirement Sys., 173 F.3d 46, 58-59 & n.10 (Ist Cir. 1999);

Pet. App. 15a-16a. Two other courts, however, have

continued to apply a regulatory takings analysis to assess the

constitutionality of statutes imposing general monetary

liabilities. See Central States, Southeast & Southwest Areas

Pension Fund v. Midwest Motor Express, Inc., No. 98-2512,

1999 WL 371671, at *7-*9 (7th Cir. June 9, 1999) (MPPAA

liability), Vermont Assembly of Home Health Agencies, Inc. v.

Shalala, 18 F. Supp. 2d 355, 369 (D. Vt. 1998) (Medicare

liability). The Court should grant review to address that

important takings question.

2. As construed below, Eastern also creates substantial

unceriainty regarding the appropriate parameters for due

process challenges to retroactive economic statutes.

Prior to Eastern, the Court had not struck down a

retroactive economic statute on due process grounds in over

six decades. See Lastern Enterprises v. Chater, 110 F.3d 150,

158-59 (1st Cir. 1997) (citing Railroad Retirement Board v.

Alton R.R. Co., 295 U.S. 330 (1935)), rev'd, 118 S. Ct. 2131

(1998). Moreover, this Court’s retroactivity precedents were

dominated by sweeping, and as a practical matter dispositive,

statements that statutes “adjusting the burdens and benefits of

economic life come to the Court with a presumption of

constitutionality,” 7urner Elkhorn, 428 U.S. at 15, and that

retroactivity need only be “justified by a rational legislative

purpose,” Gray, 467 U.S. at 730. See also L. Tribe, American

Constitutional Law 622 (2d ed. 1988) (noting “minimal

review” standard applied in 7urner Elkhorn). Not surprisingly,

the lower courts had unanimously concluded that the Coal Act

was constitutional in all of its possible applications. See Brief

nies

PP Ft LFS

wie ‘3 » "

heath apa Sedat sii yds ico edo IN aS eR SS

For Respondents UMWA Combined Benefit Fund and its

Trustees at 31 & n.31, Eastern Enterprises v. Apfel, 118 S. Ct.

2131 (1998) (No. 97-42).

In Eastern, however, the Court substantially changed its

emphasis and tone. For the first time ever, five Justices

incorporated into a constitutional analysis the principle,

developed in this Court’s recent statutory presumption cases,

that “[rJetroactivity is generally disfavored.” 118 S. Ct. at

2151 (plurality) (citing Landgraf v. USI Film Prods., 511 U.S

244 (1994), and Bowen v. Georgetown Univ. Hosp., 488 U.S

204 (1988)); id. at 2159 (concurrence) (“retroactive lawmaking

is a particular concern”) (citing Landgraf).”° And, for the first

time in decades, the Court actually invalidated a retroactive

economic statute.

The Court should grant review to determine whether due

process or other constitutional challenges to retroactive

economic statutes should be governed by a strong

“presumption of constitutionality” (7urner Elkhorn, 428 U.S

at 15), as they routinely were prior to Eastern, or whether, as

five Justices concluded in that case, such challenges should be

governed by the reverse presumption that “[rJetroactivity is

generally disfavored” (118 S. Ct. at 2151).

x * * *

By diminishing Eastern to a precedent only for “substantially

identical” cases, and by uphclding application of the Coal Act

in this case, the court of appeals has made Eastern effectively

meaningless and has announced that there are virtually no limits

on the government’s ability to appropriate private property by

imposing retroactive monetary liabilities. Under the decision

below, private parties need only tell Congress that they

2° Although the plurality engaged in only a Takings Clause analysis, it

substantially relied, as Justice Kennedy noted, on due process precedents.

See 118 S. Ct. at 2158 (concurrence).

expected to be given money or benefits from other private

parties, even if their “expectation” has no basis in any prior law,

contract, promise, or injury. The Court should grant review

because its obvious concern about unfair retroactivity has been

inverted and because, if that concern had been given effect in

this case, the Coal Act would plainly have been invalidated

CONCLUSION

The petition for a writ of certiorari should be granted

Respectfully submitted,

ANTHONY J. POLITO ROBERT H. BORK

MICHAEL D. GLASS Counsel of Record

POLITO & SMOCK, P.C 1150 17th Street

Four Gateway Center Washington, D.C. 20036

Pittsburgh, PA 15222 (202) 862-5851