Carver et al v. Foresight Energy LP et al

Filing 34

OPINION entered by Judge Sue E. Myerscough on 7/12/2016. Defendants' Motions to Dismiss Plaintiffs' First Amended Class Complaint, d/e 22 and 25 are DENIED. Plaintiffs' Request for Oral Argument is DENIED. Defendants shall file an answer to the First Amended Complaint on or before 7/29/2016. (MAS, ilcd)

E-FILED

Wednesday, 13 July, 2016 11:50:48 AM
Clerk, U.S. District Court, ILCD

IN THE UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF ILLINOIS
SPRINGFIELD DIVISION
NICK CARVER, WADE JACOBS,
DALE BASIL, MIKE LEBETER,
and ERIC WALLACE, individually
and on behalf of others similarly
situated,
Plaintiffs,
v.
FORESIGHT ENERGY LP,
MURRAY ENERGY
CORPORATION, MURRAY
AMERICAN COAL, INC,
FORESIGHT ENERGY GP LLC,
FORESIGHT ENERGY LLC,
FORESIGHT ENERGY SERVICES
LLC, PATTON MINING LLC,
HILLSBORO ENERGY LLC,
HILLSBORO ENERGY LLC d/b/a
DEER RUN MINE, MURRAY
ENERGY HOLDINGS COMPANY,
FORESIGHT RESERVES LP,
THE CLINE GROUP LLC,
CHRISTOPHER CLINE, and
DOE DEFENDANTS 1B10
Defendants.

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No. 3:16-cv-3013

OPINION
SUE E. MYERSCOUGH, U.S. District Judge.
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This cause is before the Court on the Motion to Dismiss
Plaintiffs= First Amended Class Complaint (d/e 22) filed by
Defendants Murray Energy Corporation; Murray American Coal,
Inc.; and Murray Energy Holdings Company (the Murray
Defendants), and the Motion to Dismiss Plaintiffs= First Amended
Class Action Complaint (d/e 25) filed by Defendants Foresight
Energy LP; Foresight Energy GP LLC; Foresight Energy LLC;
Foresight Energy Services LLC; Patton Mining LLC; Hillsboro Energy
LLC; Hillsboro Energy LLC d/b/a Deer Run Mine; and Foresight
Reserves LLP (the Foresight Energy Defendants). Defendants argue
that Plaintiffs= First Amended Complaint establishes that 60 days’
notice under the Worker Adjustment and Retraining Notification Act
of 1988 (WARN Act) was excused for the closure of the Deer Run
Mine under the Act=s natural disaster exception because the
combustion events which led to the closure qualify as a natural
disaster.
Because Plaintiff=s Amended Complaint plausibly states a
claim under the WARN Act and does not unambiguously establish
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that affirmative defense to the Act, Defendants= Motions to Dismiss
are DENIED. In addition, Plaintiffs= request for oral argument on
the motions is DENIED.
I. JURISDICTION AND VENUE
This Court has subject matter jurisdiction because Plaintiffs=
claims are based on the WARN Act, 29 U.S.C. ' 2102, a federal law.
See 28 U.S.C. ' 1331 (AThe district courts shall have original
jurisdiction of all civil actions arising under the Constitution, laws,
or treaties of the United States@). Venue is proper because a
substantial part of the events or omissions giving rise to Plaintiffs=
claims occurred in this district.
28 U.S.C. ' 1391(b)(2).
II. BACKGROUND
In March 2016, Plaintiffs Nick Carver, Wade Jacobs, Dale
Basil, Mike Lebeter, and Eric Wallace, on behalf of themselves and
on behalf of a class of similarly situated individuals, filed a First
Amended Complaint against Defendants. Plaintiffs allege that
Defendants violated the WARN Act, 29 U.S.C. ' 2102, by failing to
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give 60 days’ notice of their employment loss or the closing of the
Deer Run Mine. The First Amended Complaint contains the
following allegations:
The Deer Run Mine is a bituminous coal mine operated by the
Defendants in Hillsboro, Illinois. First Am. Compl. && 1, 2. The
Deer Run Mine employed approximately 160 workers, including
Plaintiffs. Id. at && 4, 12, 61B64.
Plaintiffs allege that between July 2014 and January 2016, the
mine was plagued by Acoal fires,@ which increased carbon monoxide
levels in the mine. First Am. Compl. & 48. This led to employee
evacuations and operation shutdowns in July 2014, March 2015,
August 2015, and November 2015. Id. at && 48, 49, 51, 53, 54, 56,
60. Though referred to as Afires,@ the events are in fact a form of
spontaneous combustion which can occur when coal is exposed to
oxygen and oxidizes, causing the coal to smolder and release carbon
monoxide. Id. at & 48 n.2. Such combustion events can also be
fueled by Apoor underground housekeeping, such as failure to
properly clean up spilled oil and grease . . . .@ Id. Plaintiffs allege
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that the events were ignited by oxygen exposed to the coal by the
mine=s ventilation system. Id. at && 6, 7, 8, 10.
The fires recurred, despite Foresight=s efforts to extinguish and
control them by pumping water and nitrogen into the mine. First
Am. Compl. && 50, 58. During this period, Foresight also began
installation of a new ventilation system in the mine. Id. at & 57.
The named Plaintiffs were told that they would return to work on
January 4, 2016. Id. at & 65. But, in early January 2016, the mine
closed and all miners were terminated. Id. at & 78. The miners were
not given 60 days’ notice before the mine=s closing. Id. at & 11.
In April 2016, the Murray Defendants filed a Motion to
Dismiss Plaintiffs= First Amended Class Complaint (d/e 22) and
memorandum in support arguing that the combustion events were
a natural disaster and that the mine=s closure was therefore covered
by an exception to the WARN Act. The Foresight Defendants also
filed a Motion to Dismiss Plaintiffs= First Amended Class Action
Complaint (d/e 25) and adopted by reference the Murray
Defendants= memorandum in support. Plaintiffs filed a
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memorandum in opposition (d/e 27), arguing that WARN Act
exception determinations are an inappropriate basis for dismissal
and that the Amended Complaint alleges that the combustion
events did not constitute a natural disaster.
III. LEGAL STANDARD
When considering a motion to dismiss under Rule 12(b)(6), the
Court construes the complaint in the light most favorable to the
plaintiff, accepting all well-pleaded allegations as true and
construing all reasonable inferences in the plaintiff=s favor. Tamayo
v. Blagojevich, 526 F.3d 1074, 1081 (7th Cir. 2008). However, the
complaint must set forth facts that plausibly demonstrate a claim
for relief. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 547 (2007).
Plausibility means the plaintiff has alleged facts that allow the
court to reasonably infer that the defendant is liable for the
misconduct alleged. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
Merely reciting the elements of a cause of action or supporting
claims with conclusory statements is insufficient to state a cause of
action. Id.
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A[C]omplaints do not have to anticipate affirmative defenses to
survive a motion to dismiss.@ United States v. Lewis, 411 F.3d 838,
842 (7th Cir. 2005); Tregenza v. Great Am. Commc'ns Co., 12 F.3d
717, 718 (7th Cir. 1993) (Aa plaintiff is not required to negate an
affirmative defense in his complaint@). For an affirmative defense to
justify a dismissal, the facts alleged in the complaint must fully and
clearly make out the defense. Hyson USA, Inc. v. Hyson 2U, Ltd.,--F.3d ---, No. 14B3261, 2016 WL 2849334, at *2 (7th Cir. May 16,
2016) (Adismissal is appropriate only when the factual allegations in
the complaint unambiguously establish all the elements of the
defense@) (emphasis in original).
IV. ANALYSIS
A.

The WARN Act Requires 60 Days’ Notice Before a Plant
Closure or Mass Layoff Subject to Certain Exceptions
The WARN Act requires employers of 100 or more employees to

give notice 60 days before a plant closure or mass layoff. 29 U.S.C.
'' 2101- 2102. However, the WARN Act provides three exceptions
which excuse employers from providing 60 days’ notice: (1) the
faltering business exception; (2) the unforeseen business
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circumstances exception; and (3) the natural disaster exception.
The natural disaster exception provides:
No notice under this chapter shall be required if the plant
closing or mass layoff is due to any form of natural
disaster, such as a flood, earthquake, or the drought
currently ravaging the farmlands of the United States.
29 U.S.C. ' 2102(b)(2)(B).
The Department of Labor has issued regulations further
elaborating the WARN Act=s exceptions. 29 U.S.C. ' 2107 (directing
the Department of Labor to prescribe regulations); 20 C.F.R. '
639.9. Section 639.9(c) lists some examples of natural disasters
and provides that the exception only applies if the plant closing is a
direct result of the natural disaster:
(1) Floods, earthquakes, droughts, storms, tidal waves or
tsunamis and similar effects of nature are natural
disasters under this provision.
(2) To qualify for this exception, an employer must be
able to demonstrate that its plant closing or mass layoff
is a direct result of a natural disaster.
(3) While a disaster may preclude full or any advance
notice, such notice as is practicable, containing as much
of the information required in ' 639.7 as is available in
the circumstances of the disaster still must be given,
whether in advance or after the fact of an employment
loss caused by a natural disaster.
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(4) Where a plant closing or mass layoff occurs as an
indirect result of a natural disaster, the exception does
not apply but the Aunforeseen business circumstance@
exception described in paragraph (b) of this section may
be applicable.
20 C.F.R. ' 639.9(c).
The exceptions function as affirmative defenses, with the
burden of proof placed on the defendant. See 20 C.F.R. ' 639.9
(AThe employer bears the burden of proof that conditions for the
exceptions have been met@). Moreover, whether a WARN Act
exception applies is a fact intensive determination. See In re
Protected Vehicles, Inc., 392 B.R. 633, 636 (Bankr. D.S.C. 2008)
(noting the three defenses to the notice requirement and stating
A[w]hether a particular defense is available, as well as the
determination of whether proper notice was provided, is fact
intensive@); see also, e.g., In re MF Glob. Holdings Ltd., 481 B.R.
268, 278 (Bankr. S.D.N.Y. 2012) (noting that the first two
exceptions may be applicable in the case and that Athese defenses
are fact intensive and are thus not conducive to the motion to
dismiss stage@).
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B.

Plaintiffs= First Amended Complaint Sufficiently Alleges
That Defendants Violated the WARN Act and Does Not
Unambiguously Establish the Elements of an Affirmative
Defense
Defendants argue that the combustion events described in the

First Amended Complaint constitute a natural disaster within the
meaning of the WARN Act and that Plaintiffs= Amended Complaint
pleads facts sufficient to establish that the combustion events
caused the mine closure. Defendants assert that they were
therefore not required to give pre-closure notice to the affected
employees and Plaintiffs= Amended Complaint is deficient as a
matter of law because the Amended Complaint merely makes
conclusory statements that the events were not natural.
Plaintiffs argue that WARN Act exception determinations are
fact intensive and are not an appropriate basis to dismiss under
Rule 12(b)(6). Plaintiffs further argue that they have alleged that
the combustion events were not a natural disaster, describing the
events as artificial throughout the Amended Complaint. See, e.g.,
First. Am. Compl. && 6, 7, 8, 10. Finally, Plaintiffs assert that, even
if the events qualified as a natural disaster, Defendants are not
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excused from giving notice because the closure was an indirect
result of the combustion events.
As noted above, Plaintiffs are not required to anticipate and
counter affirmative defenses in their complaints. Lewis, 411 F.3d at
842. Plaintiffs must only make a plausible claim that they are
entitled to relief. Twombly, 550 U.S. at 547.
To establish a claim under the WARN Act, Plaintiffs must show
that the employer was covered by the Act by employing 100 or more
workers, that 50 or more employees lost their jobs at a single site
shutdown, and that the affected employees were not given notice 60
days before the shutdown. 29 U.S.C. '' 2101B2102. Here,
Plaintiffs have alleged that the Deer Run Mine employed
approximately 160 workers, that 50 or more employees lost their
jobs when the mine was closed down, and that notice was not given
to workers 60 days prior to the closing. First Am. Compl. && 4, 8,
11.
Before a motion to dismiss is granted based on an affirmative
defense, Plaintiffs must have effectively pleaded themselves out of
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court by alleging facts that unambiguously establish all the
elements of the defense. Hyson, 2016 WL 2849334, at *2. Here,
Plaintiffs= factual allegations do not unambiguously establish that
the combustion events qualify as a natural disaster under the
WARN Act. The facts alleged in the Amended Complaint do not
establish that the combustion events constituted a Anatural
disaster@ as contemplated by the WARN Act.
Plaintiffs amended their original complaint to append the
words Aman-made@ or Aartificial@ to nearly every mention of the
combustion events. See, e.g., First. Am. Compl. && 6, 7, 8, 10.
These assertions are indeed conclusory, and Plaintiffs= suggestion
that the combustion events might have been caused by negligent
mine upkeep are too speculative to pass the Twombly/Iqbal
plausibility threshold. However, these are not the necessary
elements to allege a claim for relief under the WARN Act. Those
elements (employer with more than 100 employees, 50 or more jobs
lost at a single site, notice not given of shutdown 60 days in
advance) have been plausibly alleged. Therefore while Plaintiffs
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have not made more than conclusory allegations that the
combustion events were not a natural disaster, they have not
unambiguously established that the combustion events were a
natural disaster.
Defendants argue that the Amended Complaint establishes
that the combustion events were a natural disaster because
Plaintiffs explain that the events are a result of an interaction
between oxygen and coal, both of which exist in nature. Therefore,
Defendants reason, any combustion that results from the
combination of these natural substances must also be natural, even
if the substances were brought together by human interference.
Neither party cites, nor has this court found, any cases
interpreting the natural disaster exception of the WARN Act.
Applying a plain reading of the statute, human involvement in the
origins of the combustion events would seem to preclude the events
from being considered a natural disaster. Something is natural if it
is A[e]xisting in or caused by nature; not made or caused by
humankind.@ Natural, Oxford Dictionaries, (2016)
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http://www.oxforddictionaries.com/definition/american_english/n
atural (last visited June 30, 2016). Thus, if natural substances are
combined by human intervention, the results would not meet the
definition of Anatural@.
Nothing in the Amended Complaint identifies a natural
disaster under the WARN Act. Because Plaintiffs allege all of the
required elements for a claim under the WARN Act, Plaintiffs have
stated a claim for relief and do not allege facts which
unambiguously establish that the natural disaster exception to the
Act applies..
V. CONCLUSION
Because Plaintiffs= Amended Complaint alleges facts which
plausibly demonstrate a claim for relief under the WARN Act and
does not allege facts which unambiguously establish that the
natural disaster exception to the Act applies, Defendants= Motions
to Dismiss Plaintiffs= First Amended Class Complaint (d/e 22) (d/e
25) are DENIED. Plaintiffs= Request for Oral Argument is DENIED.

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Defendants shall file an answer to the First Amended Complaint on
or before July 29, 2016.
ENTER: July 12, 2016
FOR THE COURT:
s/Sue E. Myerscough
SUE E. MYERSCOUGH
UNITED STATES DISTRICT JUDGE

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