Background
In the nineteen nineties, miners worked for Apogee Coal Company, a subsidiary of Arch Resources, Inc. Arch self-insured Apogee against black lung claims rather than purchasing commercial insurance. In two thousand and five, Arch sold Apogee and its liabilities to Magnum Coal, which was later acquired by Patriot Coal. When Patriot went bankrupt in two thousand and fifteen, the Department of Labor instructed its district directors to hold Arch liable as the responsible insurer for claims accrued during the period Arch owned Apogee. The miners applied for benefits between two thousand and fifteen and two thousand and seventeen. Administrative law judges and the Benefits Review Board affirmed the district directors’ decisions, and Arch petitioned the Sixth Circuit for review.
The court’s reasoning
The court reviews the Board’s legal conclusions de novo. The petitioners argued that the Board erred in holding Arch liable. However, Arch and Apogee conceded that they were making the same arguments based on materially identical facts that the court had rejected in a published decision two years prior. The court noted that the prior decision binds it. Consequently, the court denied the petitions.
What it means going forward
The ruling confirms that a parent corporation that self-insured a subsidiary for black lung benefits remains liable for those claims even after selling the subsidiary, provided the arguments against liability have already been rejected by the court in a binding precedent.