International Union, United Mine Workers of America et al v. Consol et al Energy, Inc.

Filing 50

MEMORANDUM OPINION AND ORDER granting Plaintiffs' 8 MOTION for a Preliminary Injunction; granting in part Defendants' 40 MOTION to Dismiss to this effect: Defendants Helvetia Coal Company, Island Creek Coal Company, Laurel Run Mining Co mpany and CONSOL Amonate Facility, LLC are dismissed; and denying Defendants' 40 MOTION to Transfer this case to the Western District of Pennsyvania. A Preliminary Injunction Order of even date with this Opinion will be entered. Signed by Senior Judge David A. Faber on 3/17/2017. (certified cc: counsel of record) (arb)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF WEST VIRGINIA
AT BLUEFIELD
INTERNATIONAL UNION,
UNITED MINE WORKERS OF
AMERICA, et al.,
Plaintiffs,

v.

CIVIL ACTION NO. 1:16-12506

CONSOL ENERGY, INC., et al.,
Defendants.

I.

INTRODUCTION

This is a civil action for an order enjoining Defendant CONSOL
Energy, Inc. (“CONSOL Energy”) and its wholly owned subsidiaries
Defendants Helvetia Coal Company (“Helvetia”), Island Creek Coal
Company

(“Island

Creek”),

Laurel

Run

Mining

Company

(“Laurel

Run”), and CONSOL Amonate Facility, LLC (“CONSOL Amonate”), from
unilaterally terminating a group health insurance plan. This plan,
named National Bituminous Coal Wage Agreements (“NBCWA”) Plan, is
maintained in order to benefit retired coal miners.

The NBCWA

contains a resolution of disputes (“ROD”) mechanism, and it is
connected to the parties’ collective bargaining agreement.
Presently pending before the court is Plaintiffs’ Petition
for Preliminary Injunction.

See Doc. No. 8.

The court makes its

Findings of Fact and Conclusions of Law as set forth in this
opinion.
II.

FINDINGS OF FACT

1. Defendant CONSOL Energy is a publicly owned energy company
engaged in the operation of mines and facilities related to
the production of coal, which it sells worldwide to
electricity generators and steelmakers.

Defendant CONSOL

Energy does business in the Southern District of West
Virginia and has done so for many years.

Defendant CONSOL

Energy maintains its corporate headquarters near
Pittsburgh, Pennsylvania, and has an office in the Southern
District of West Virginia at 2481 John Nash Boulevard,
Bluefield, West Virginia 24701.
2. Plaintiff International Union, United Mine Workers of
America (“UMWA”) is a labor organization that represents
coal miners.

The UMWA maintains its principal place of

business in Triangle, Virginia, and has offices within the
Southern District of West Virginia at Beckley, Charleston,
and Chapmanville.
3. The various individual Plaintiffs are residents of the
Southern District of West Virginia; they are retired coal
miners and participants in, and beneficiaries of, the group
health insurance plan at issue in this case.

2

4. Since shortly after World War II, health and retirement
benefits in the coal industry have been provided to
employees through a multiemployer arrangement.

This

arrangement has been carried forward for over 60 years
through collective bargaining or through legislation
enacted by Congress.

Beginning in 1950, pension and health

benefits for retired miners were provided through a single
plan, known as the UMWA Welfare and Retirement Fund of
1950.

The guarantee of lifetime retiree health care

benefits was contained in numerous subsequent agreements
negotiated between the UMWA and the Bituminous Coal
Operators Association (“BCOA”), known as the National
Bituminous Coal Wage Agreements (“NBCWAs”), maintained this
structure.

The UMWA and the BCOA have negotiated a number

of NBCWAs over the years.

The most recent is the 2011

NBCWA (the “2011 Agreement”), which is now in effect.

Each

of the NBCWAs, including the 2011 Agreement, has continued
the obligation of the coal operators to provide health care
to eligible beneficiaries on a permanent lifetime basis in
accordance with a standard Employer Plan incorporated into
the collective bargaining agreement.
5. In order to ensure uniformity among the Employer Plans
established pursuant to the 1978 NBCWA, the UMWA and BCOA
established the ROD procedure.

3

Under the ROD procedure

established under that contract, disputes arising under the
separate benefit plans maintained by each individual
employer were subject to resolution by the Trustees of the
UMWA 1950 Benefit Plan.

In the 1981 NBCWA, the parties

added language stating that the “[d]ecisions of the
Trustees shall be final and binding on the parties.”

That

language has been included in every NBCWA since 1981,
including the 2011 NBCWA.

The authority to resolve

disputes under the contractually required Employer Plan was
conferred on the four Trustees of the UMWA 1993 Benefit
Plan (the “Trustees”), two of whom are appointed by the
UMWA and two by the BCOA.
6. A number of CONSOL Energy subsidiaries—including but not
limited to the subsidiaries that formerly employed the
individual Plaintiffs—were members of the BCOA and
signatory to the 1974, 1978, 1981, 1984, 1988, 1993, 1998,
2002, 2006, 2007, and the 2011 NBCWAs.
7. During negotiations between the BCOA and the UMWA that
culminated in the 2011 NBCWA, CONSOL Chief Executive
Officer Nicholas J. DeIuliis led the BCOA Negotiating
Committee.

He personally signed for the BCOA in portions

of the 2011 NBCWA.
8. On or about March 15, 2016, CONSOL transmitted to the
retired miner participants in its Employer Plan a letter

4

stating that “[o]n February 11, 2016 we initiated
discussions with the UMWA regarding new options for
providing healthcare benefits” and promised that “[i]n all
events, we will continue to communicate with you in the
coming months about this very important matter before any
changes are implemented.”

A similar letter was sent to

participants on May 6, 2016.

Both letters encouraged

participants to contact the UMWA and UMWA staff
subsequently fielded a great number of telephone calls from
anxious retirees concerned about their health benefits.
9. Defendant CONSOL Energy indicated in correspondence to the
UMWA that it intended to terminate and replace its Employer
Plan.

Subsequent negotiations between Defendant CONSOL

Energy and Plaintiff UMWA failed to resolve disagreements
over which changes, if any, would be acceptable to the
union and its retirees.
10.

On or about October 31, 2016, CONSOL transmitted to

the UMWA an official notice pursuant to Section 8(d) of the
NLRA that all of its subsidiaries signatory to the NBCWA
“have permanently terminated their mining operations” and
that the subsidiaries would terminate the 2011 NBCWA
effective as of its expiration date, December 31, 2016.
11.

On November 1, 2016, the UMWA filed a ROD with the

Trustees noting the parties’ dispute as to whether CONSOL

5

may “implement any unilateral changes or modifications of
the benefits provided by its plan, either during the term
of the 2011 NBCWA or following its termination” and asking
for an order that CONSOL “notify its retirees that it
cannot make any changes in their benefits without the
agreement of the UMWA.”

III. CONCLUSIONS OF LAW, MEMORANDUM OPINION AND ORDER
(1)

PERSONAL JURISDICTION AND VENUE

A. CONSOL Energy has Waived its Personal Jurisdiction and
Venue Defenses
The court commences with the affirmative defenses of personal
jurisdiction and improper venue, defenses that Defendant CONSOL
Energy

first

raised

in

its

Motion

to

Dismiss

for

Lack

of

Jurisdiction. See Doc. No. 14. Plaintiffs contend that Defendants
waived these affirmative defenses by failing to raise them in their
first pre-answer motion.

See Doc. No. 39.

This court agrees in

part: Defendant CONSOL Energy has waived its personal jurisdiction
and venue defenses, but the other defendants have not.
Rule

12(b)(2)

defenses

such

as

the

lack

of

personal

jurisdiction and improper venue are deemed to be waived when they
are not raised in the first pre-answer motion.

See Elderberry of

Weber City, LLC v. Living Centers-S.E., Inc., 2013 WL 1164835, at
*2—3 (W.D. Va. 2013) (determining the defenses have been waived
where “failure to object [on such grounds] in [a defendant’s] first

6

motion to dismiss resulted in precisely the type of delay the Rule
12(g) consolidation rule is intended to prevent, prolonging the
briefing process and delaying the adjudication ...”); Fed. R. Civ.
P. 12(h) (“A defense of ... improper venue ... is waived ... if it
is neither made by motion under the rule nor included in a
responsive pleading or an amendment thereof....”); Buchanan v.
Manley, 145 F.3d 386, 388 (D.C. Cir. 1998) (stating that “the
defenses of improper venue and lack of personal jurisdiction are
waived if not raised in a timely manner. . .”).

Indeed, “Rule

12(h)(1) specifically states that a party waives a 12(b)(2) defense
by omitting to raise it in an earlier motion under Rule 12.”
Elderberry, 2013 WL 1164835 at *3.
Defenses such as want of personal jurisdiction and improper
venue are deemed to have been waived when a defendant fails to
raise them right away in the first defensive move.

Defendant

CONSOL Energy’s Motion to Dismiss for Lack of Subject Matter
Jurisdiction Under 12(b)(1), see Doc. Nos. 13—14, fails to address
personal jurisdiction and venue.

Consequently, Defendant CONSOL

Energy has waived these affirmative defenses.
However, even if Defendant CONSOL Energy had not waived these
defenses, personal jurisdiction would exist against it and this
court would serve as a proper venue.

The Fourteenth Amendment’s

Due Process Clause constrains this court’s authority to bind nonresident defendants to its judgment, see World–Wide Volkswagen

7

Corp. v. Woodson, 444 U.S. 286, 291 (1980), and requires that the
non-residents retain “certain minimum contacts” with the forum
State, International Shoe Co. v. Washington, 326 U.S. 310, 316
(1945).

The judicial inquiry into the “minimum contacts” required

for creating specific jurisdiction focuses “on the relationship
among the defendant, the forum, and the litigation.”

Keeton v.

Hustler Magazine, Inc., 465 U.S. 770, 775 (1984).
That relationship between the defendant and the forum State
must arise from contacts that the “defendant himself” creates with
the forum, Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475
(1985), and must also be analyzed with respect to “the defendant’s
contacts with the forum itself, not with persons residing there.”
Walden v. Fiore, 134 S.Ct. 1115, 1122 (2014).

In other words,

“[t]he plaintiff cannot be the only link between the defendant and
the forum.

Rather, it is the defendant’s conduct that must form

the necessary connection with the forum State that is the basis
for its jurisdiction over him.”

Id. at 1122 (emphasis added);

Burger King Corp., 471 U.S. at 475 (“Jurisdiction is proper . . .
where the contacts proximately result from actions by the defendant
himself

that

create

a

substantial

connection

with

the

forum

State.”) (citations and internal quotation marks omitted).
court

may

properly

“purposeful[]

assert

avail[ment]

.

jurisdiction

based

.

.

.

of

the

protections” that the forum has offered.

8

.

on
.

a

A

party’s

benefits

and

See Hanson v. Denckla,

357 U.S. 235, 253 (1958).

The “‘purposeful availment’ requirement

ensures that a defendant will not be haled into a jurisdiction
solely as a result of ‘random,’ ‘fortuitous,’ or ‘attenuated’
contacts.”

Burger King Corp., 471 U.S. at 475 (quoting Keeton,

465 U.S. at 774).
There is personal jurisdiction over Defendant CONSOL Energy
in this court for the same reason that venue is proper here.
Defendant CONSOL Energy held meetings throughout this judicial
district and the State of West Virginia soliciting retired miners’
enrollment in its Health Reimbursement Account (“HRA”) scheme.
Defendant

CONSOL

Energy

purposefully

availed

itself

of

benefits and protections of the State and this district.
conferred personal jurisdiction upon Defendant CONSOL Energy.

the
This
See

Hanson, 357 U.S. at 253. After all, Defendant CONSOL Energy sold
the HRA scheme to the retired miners here.

Furthermore, Defendant

CONSOL Energy and its predecessor corporations have a long history
of involvement in the coal and natural gas industries in this
district.
As for venue, the governing statute is 28 U.S.C. § 1391(b)(2)
(“a judicial district in which a substantial part of the events or
omissions giving rise to the claim occurred . . ..”).

Since, as

the court already has established, it is here that Defendant CONSOL
Energy sold the HRA scheme to the retired miners, venue is proper
here.

The court deems it inappropriate to transfer this case to

9

the federal district court in the Western District of Pennsylvania,
and the motion to transfer is DENIED.
B. There is No Personal Jurisdiction Over Defendants Helvetia,
Island Creek, Laurel Run, and CONSOL Amonate
The

court

lacks

personal

jurisdiction

over

Defendants

Helvetia, Island Creek, Laurel Run, and CONSOL Amonate.
The court already has explained the prevailing law on personal
jurisdiction.

The court analyzes the facts against that backdrop.

Here, Defendants Helvetia, Island Creek, Laurel Run, and CONSOL
Amonate have no contacts with West Virginia, let alone this
judicial district, that might open them to suit in this case.

The

principal place of business for these Defendants is Canonsburg,
Pennsylvania, which is also Defendant CONSOL Energy’s corporate
headquarters.
therefore,
center.”

See

would

Doc.

also

No.

be

16.

Canonsburg,

considered

the

Pennsylvania,

Defendants’

Hertz Corp. v. Friend, 559 U.S. 77, 80 (2010).

“nerve
While

some or all of these Defendants have conducted mining operations
in West Virginia in the past, they have long since ceased to do
so.
There is neither general nor specific jurisdiction over these
Defendants since they are not situated in West Virginia and they
have committed no substantial activities here that would open them
to being sued here.
of

the

benefits

They have not purposefully availed themselves

here.

Thus,

at

10

best,

the

contacts

between

Defendants Helvetia, Island Creek, Laurel Run, and CONSOL Amonate
and the forum are “attenuated” for the purposes of the personal
jurisdiction analysis.

Keeton, 465 U.S. at 774.

(2)

DISCUSSION ON THE MERITS

A. Defendant CONSOL Energy
Defendant CONSOL Energy is the corporate parent.

Defendant

CONSOL Energy claims that it is “a non-signatory to the expired
2011 NBCWA,” and as such “has never agreed to arbitrate disputes
under that Agreement.”

Doc. No. 42.

The court finds that, in fact and deed, Defendant CONSOL
Energy is the agent of Defendant subsidiaries, none of which have
employees or other personnel to make any significant operational
or administrative decisions or exercise control over the Employer
Plan independent of Defendant CONSOL Energy.

It was Defendant

CONSOL Energy, the court already has observed, that held meetings
throughout this judicial district and the State of West Virginia
soliciting retired miners’ enrollment in its HRA scheme.

As such,

the court concludes that Defendant CONSOL Energy is the real party
in interest and is subject to the court’s power to issue an
injunction.
B. Interplay between the Labor Management Relations Act
(“LMRA”) and the Norris-LaGuardia Act (“NLGA”)
Section 301 of the LMRA provides:
Suits for violation of contracts between an
employer and a labor organization

11

representing employees in an industry
affecting commerce as defined in this
chapter, or between any such labor
organizations, may be brought in any
district court of the United States having
jurisdiction of the parties, without respect
to the amount in controversy or without
regard to the citizenship of the parties.
29 U.S.C. § 185(a).

Despite Defendant CONSOL Energy’s assertions

in its Motion to Dismiss, see Doc. Nos. 13—14, that this court
lacks

jurisdiction

over

this

case

“because

Defendant

[CONSOL

Energy] is not (and was never) signatory to a labor agreement with
the

Plaintiff,”

CONSOL

Energy

is

signatory

to

bargaining agreement at issue in this matter.

a

collective

This is evidenced

by CONSOL Energy’s July 1, 2011 agreement to adopt the 2011 NBCWA
Employer Plan, executed by Nicholas DeIuliis, who was then a top
executive of CONSOL Energy.
Energy,

and

not

its

See Doc. No. 8.

individual

Defendant CONSOL

subsidiaries,

administers

Employer Plan and benefits at issue in this matter.
CONSOL

Energy,

not

any

of

its

individual

the

Notably,

subsidiaries,

has

undertaken the conduct and has, to that end, even transmitted the
salient

correspondence

letterhead).

See id.

(invariably

on

“CONSOL

Energy,

Inc.”

Defendant CONSOL Energy’s conduct threatens

to deprive Plaintiffs of a benefit guaranteed to them under the
contract-based plan that Defendant CONSOL Energy manages.

As far

as § 301 of the LMRA is concerned, this dispute arises “for
violation of contracts between an employer and a labor organization

12

representing

employees

in

an

industry

affecting

commerce.”

Accordingly, the court may exercise subject matter jurisdiction,
the anti-injunction stipulations of the NLGA notwithstanding.
The role of arbitration in labor disputes is important to
recount; it goes to the power of this court to issue a
preliminary injunction here.

In Boys Markets, Inc. v. Retail

Clerk’s Union, Local 770, 398 U.S. 235, 243 (1970), the United
States Supreme Court held that “the importance of arbitration as
an instrument of federal policy for resolving disputes between
labor and management” means that the NLGA should not be
construed to categorically prohibit injunctions preserving the
status quo in labor disputes.

“[T]he [NLGA] itself manifests a

policy determination that arbitration should be encouraged.”
Id. at 242.

Indeed, the United States Supreme Court has also

observed that § 8 of the NLGA requires parties to make “‘every
reasonable effort’ to settle the dispute by negotiation,
mediation, or ‘voluntary arbitration.’”

Textile Workers v.

Lincoln Mills, 353 U.S. 448, 458 (1957) (quoting 29 U.S.C. §
108).
The United States Court of Appeals for the Fourth Circuit
reaffirmed the emphasis on encouraging arbitration in labor
disputes in Lever Brothers Co. v. Int’l Chemical Workers Union,
Local 217, 554 F.2d 115 (4th Cir. 1976).

In Lever Brothers, the

Fourth Circuit affirmed a district court’s grant of a

13

preliminary injunction blocking an employer’s decision to
transfer a facility from one state to another, thereby depriving
the workers of their jobs.

The Fourth Circuit held that

a plaintiff, without regard to whether he is
the employer or the union, seeking to
maintain the status quo pending arbitration
pursuant to the principles of Boys Markets
need only establish that the position he
will espouse in arbitration is sufficiently
sound to prevent the arbitration from being
a futile endeavor. If there is a genuine
dispute with respect to an arbitrable issue,
the barrier [to the issuance of an
injunction] we believe appropriate[ly] has
been cleared.
Id. at 120.

The Lever Brothers Court noted that such

injunctions may issue
where it is necessary to prevent conduct by
the party enjoined from rendering the
arbitral process a hollow formality in those
instances where, as here, the arbitral award
when rendered could not return the parties
substantially to the status quo ante.
Id. at 123.
Later courts have followed Lever Brothers’ policy of
promoting and encouraging arbitration of labor disputes.

They

grant preliminary relief in aid of arbitration where a plaintiff
demonstrates “[1] that he is likely to succeed on the merits,
[2] that he is likely to suffer irreparable harm in the absence
of preliminary relief, [3] that the balance of equities tips in
his favor, and [4] that an injunction is in the public
interest.”

Real Truth About Obama, Inc. v. Fed. Election

14

Comm’n, 575 F.3d 342, 346 (4th Cir. 2009).

To be sure, “[a]

preliminary injunction is an extraordinary remedy, to be granted
only if the moving party clearly establishes entitlement to the
relief sought.”

Manning v. Hunt, 119 F.3d 254, 263 (4th Cir.

1997) (emphasis added and internal quotation marks and
alteration omitted).1
In the case of a preliminary, as opposed to a permanent
injunction, “[t]he evidentiary standard applied in determining
whether a plaintiff has established all four necessary elements
is substantially relaxed, given that the purpose of a
preliminary injunction is merely to preserve the relative
positions of the parties until a trial on the merits can be
held.”

Marietta Memorial Hospital, et. al v. West Virginia

Health Care Auth., 2016 WL 7363052 (S.D.W. Va. December 19,
2016) (citing Univ. of Texas v. Camenisch, 451 U.S. 390, 395
(1981)).
Lever Brothers provides that injunctive relief should issue
to preserve the status quo if the “hollow formality” standard

1

The movant must meet each of these factors in order to
obtain a preliminary injunction. However, satisfying these
factors will not automatically guarantee an injunction. In
particular, “‘[i]n exercising their sound discretion, courts of
equity should pay particular regard for the public consequences
in employing the extraordinary remedy of injunction.’” Winter
v. Natural Res. Def. Council, Inc., 555 U.S. 7, 24 (2008)
(quoting Weinberger v. Romero–Barcelo, 456 U.S. 305, 312
(1982)).
15

and ordinary principles of equity are satisfied and,
consequently, the Boys Markets exception to the anti-injunction
provisions of the NLGA applies.

Nursing H. & Hosp. Union v. Sky

Vue Terrace, 759 F.2d 1094, 1098 (3d Cir. 1985).

Termination of

Plaintiffs’ group health insurance benefits is likely to cause
harm that cannot be remedied by the arbitrator, threatening to
make arbitration but a “hollow formality.”

Id.

The “hollow

formality” test, id., is identical to the judicial inquiry
whether the party seeking the injunction will be irreparably
harmed without this relief.

See Oil, Chem. & Atomic Workers

Int’l Union v. Amoco Oil Co., 885 F.2d 697, 704 (10th Cir.
1989); Aluminum Workers Int’l Union v. Consolidated Aluminum
Corp., 696 F.2d 437, 443 (6th Cir. 1982); Int’l Ass’n of
Machinists & Aerospace Workers v. Panoramic Corp., 668 F.2d 276,
286 (7th Cir. 1981).
Boys Markets injunctions under § 301 of the LMRA are
forward-looking.

The United States Supreme Court in Textron

Lycoming Reciprocating Engine Div., Avco Corp. v. UAW, 523 U.S.
653 (1998), did not suggest that courts are powerless under the
Boys Markets line of precedent to enjoin future conduct that
threatens to undermine the arbitral process.

Just recently, a

sister court within our own Circuit enjoined an employer’s
future conduct to preserve the arbitral process.

See Int’l

Brotherhood of Teamsters, Local Union No. 639 v. Airgas, Inc.,

16

Civ No. 17-cv-00577, Doc. No. 19 (D. Md. March 3, 2017)
(enjoining future “relocation of the operations to other plants
and the loss of 13 Union positions . . . [because it] cannot, as
a practical matter, be fully unwound.”).

Moreover, prosecuting

an action to compel arbitration would be clearly inadequate to
preserve the status quo pending an arbitration decision; and
judicial intervention is unnecessary to compel the ROD’s
arbitration since an arbitral decision on the dispute will issue
irrespective of Defendants’ participation.
Plaintiffs’ pre-expiration ROD requesting an order from the
Trustees addressing pre-and post-expiration communications
unjustifiably threatening termination of the Employer Plan is
arbitrable and the Trustees are processing it.

Even if the ROD

had been filed following expiration of the NBCWA or concerned
exclusively post-expiration conduct, it is settled law that ROD
disputes addressing benefits that survive the expiration of a
labor agreement remain arbitrable after the agreement’s
expiration.

See Litton Financial Printing Div. v. NLRB, 501

U.S. 190 (1991); Cumberland Typographical Union No. 244 v. Times
and Alleganian Co., 943 F.2d 401, 404 (4th Cir. 1991).
Defendant may be estopped from claiming Plaintiffs’ vested
right to benefits and access to the ROD process terminate upon
expiration.

Judicial constructions accorded labor contract

terms carry over to subsequent labor contracts, unless the

17

parties choose to alter the same.
444 U.S. 212, 222 (1979).

See Carbon Fuel Co. v. UMWA,

Importantly, this court already has

interpreted the language contained in the NBCWA and Employer
Plan as creating a vested lifetime right to the Employer Plan
benefits; and post-expiration access to the ROD process did not
change in subsequent negotiations with Defendant CONSOL Energy.
See Parsons v. Power Mtn. Coal Co., 2009 WL 899457 (S.D.W. Va.
Mar. 31, 2009), aff’d, 604 F.3d 177, 178 (4th Cir. 2010).

In

fact, “the type of benefits at issue here are vested benefits,
the right to which extends beyond the termination of the
contract.”

Id. at *6; see also Lewis v. Howell, No. 5:05–0525

(S.D.W. Va. Apr. 7, 2006) (Faber, J.); UMWA v. Falcon Energy,
Inc., No. 1:99–0388 (S.D.W. Va. Mar. 19, 2002) (Faber, J.); UMWA
v. BethEnergy Mines, Inc., No. 2:99–0738, 2001 U.S. Dist. LEXIS
6242 (S.D.W. Va. Mar. 19, 2001) (Goodwin, J.); District 29, UMWA
v. Royal Coal Co., No. 5:85–0292, 1987 U.S. Dist. LEXIS 14578
(S.D.W. Va. Jan. 5, 1987) (Knapp, J.).

Here, as in the Parsons

case, the “retirement health benefits [of some of the retirees]
vested prior to the expiration of the [2011 NBCWA and Employer
Plan].”

2009 WL 899457, *6.

In any event, the 2011 NBCWA was

executed and the Employer Plan adopted.

“If these

interpretations” the courts have given to the labor-contract
terms “did not accord with the parties’ understanding of their
contract, they had ample opportunity to make their own

18

understanding explicit.

Failure to do so strongly suggests the

parties incorporated the courts’ interpretation of the
agreement.”

Tr. at 222.

Additionally, with respect to Litton, an explicit agreement
to arbitrate post-expiration disputes is only one of several
circumstances in which courts find post-expiration disputes
arbitrable:
[A] post expiration grievance can be said to
arise under the contract only [1] where it
involves facts and occurrences that arose
before expiration, [2] where an action taken
after expiration infringes on a right that
accrued or vested under the agreement, [3]
or where, under normal principles of
contract interpretation, the disputed
contractual right survives expiration of the
remainder of the agreement.
Parsons, 2009 WL 899457 at *7 (internal citations and quotation
marks omitted).
The nature of the harm at issue in this case is of critical
importance.

Defendants are threatening to terminate employer

plan group insurance benefits and if they succeed, then retirees
may be left without health coverage.

In light of the Lever

Brothers analysis, it suffices for Plaintiffs to show that in
the absence of an injunction preserving the status quo, the
company’s conduct is likely to harm the arbitral process itself.
This would harm the arbitral process.

In addition, an

arbitrator is not likely to be able to remedy the termination of

19

retiree health insurance that threatens harm, and such
terminations should be preliminary enjoined.

Courts assess such

harm against a background of generally known facts, including
(1) most retired union members are not rich,
(2) most live on fixed incomes, (3) many
will get sick and need medical care, (4)
medical care is expensive, (5) medical
insurance is, therefore, a necessity and (6)
some retired workers may find it difficult
to obtain insurance on their own while
others can pay for it only out of money that
they need for other necessities of life. We
should then conclude that retired workers
would likely suffer emotional distress,
concern about potential financial disaster,
and possibly deprivation of life’s
necessities (in order to keep up insurance
payments).
Textron, 836 F.2d at 8.

Analyzed in this light, the record

evidence clearly shows a likelihood of irreparable harm to the
members of Plaintiff union.
First, Defendant has threatened to terminate the HRA Scheme
“at any time, for any reason.”

Doc. No. 9.

Defendant

frequently has stated that it reserves the right to terminate or
modify the replacement HRA scheme “at any time, for any reason,”
id., and that “‘CONSOL Energy makes no representation or
warranty regarding the adequacy of your HRA to cover all of your
health care expenses now or in the future.’”

Doc. No. 9

(quoting Decl. of B. Sanson at ¶21—22; Exhibits Y and Z).
Second, in this case the arbitral process itself appears to
be threatened by a decision on the merits from a different

20

forum.

The Fourth Circuit has held that the harm caused when an

arbitration is allowed to proceed but the decision later is
vacated is insignificant compared to the “irreparable harm that
exists when arbitration is denied ab initio, or when an
injunction [staying judicial proceedings on the merits of an
arbitral dispute pending arbitration] is denied.”

Taylor v.

Nelson, 788 F.2d 220, 224 (4th Cir. 1986) (emphasis added).

In

a more recent case, Judge Chambers found irreparable harm to the
negotiated benefit of an arbitration agreement where one party
to that agreement sought resolution of a covered dispute in
another forum.

See GMRI, Inc. v. Garrett, 2014 WL 1351126

(S.D.W. Va. April 4, 2014).

In Garrett, the court enjoined the

West Virginia Human Rights Commission from adjudicating an
individual employment dispute and compelled its arbitration; the
court reasoned that any other course of action “would . . .
deprive[]” the employer “of the benefits of its arbitration
agreement” with the employee who sought relief at the
Commission.

Id. at *4.

A decision on the merits from any forum other than the ROD
process would undermine the bargained-for benefit of that
process, through which the Trustees would be able to secure
expert review of full information about the company’s plan,
including an assessment of specialty drug coverage, see Tr. 184,
and creation of a disruption report, see Tr. 180.

21

Furthermore,

unlike the courts, the Trustees are directed to ensure
consistent interpretation of individual signatory companies’
Employer Plans.

See Parsons at *12 (recognizing the “stated

goal” in the NBCWA “that the Employer Plans be administered
consistently . . .”).
Defendants seem to want a non-arbitral decision as to their
NBCWA and Employer obligations in another forum.

See Helvetia

Coal Co. et al v. United Mine Workers of America, Int’l Union,
Case No. 17-00002 (filed Jan 2, 2017 W.D. Pa.).

They have only

threatened even greater harms since in a January 12, 2017 letter
to beneficiaries, they appear to have repudiated their prior
agreement to resolve disputes through the ROD process and have
purported to limit the forum for resolution of health benefit
disputes to the Western District of Pennsylvania.
32.

See Pls.’ Ex.

The possibility that Defendants would succeed in their

effort to obtain a non-arbitral decision on the merits of the
ROD dispute threatens real and imminent harm.
Third, come April 1, 2017, some of the most vulnerable
retirees likely would lose insurance coverage altogether.
Several retirees would lose the bargained-for benefit of
comprehensive coverage for all Food and Drug Administration
(“FDA”)-approved prescription drugs as they are forced into a
drug plan that does not cover all FDA-approved drugs.
182-84.

22

See Tr.

The group health insurance benefits under which the
Employer bears all risk would be lost.

Under the benefits plan,

all FDA-approved drugs are covered and disputes are resolved
through a negotiated process.

This too would be lost.

Moreover, the most vulnerable beneficiaries would likely lose
health insurance coverage altogether. Those incapacitated by old
age or common diseases would be left completely without
insurance coverage as of April 1, 2017, if they predictably are
unable to take the affirmative step of enrolling in their own
individual insurance plan.
Fourth, on April 1, 2017, the retirees would be encumbered
with novel administrative burdens and risk.

Courts addressing

employers’ similar attempts to unilaterally terminate group
health insurance and substitute an HRA scheme have recognized
the considerable burdens shifted from employer to retired
beneficiary.

In United Steel Workers v. Kelsey-Hayes Co., 2016

WL 337467, at *2 (E.D. Mich. Jan. 28, 2016), the court upheld
its prior injunction in a case where the employer terminated
group health insurance for retirees and substituted an HRA
scheme.

This action led Plaintiffs to allege: “the change to

HRAs meant that retirees bore the administrative and financial
risks and responsibilities formerly borne by Defendants [and] .
. . the HRA program subjected them to time-consuming and
frustrating administrative burdens, anxiety, and uncertainty.”

23

Id. at *2; see also United Steel Workers v. Resolute Forest
Products, Inc., 1:16-CV-00048, Doc. No. 42 (E.D. Teen. Mar. 1,
2017) (denying motion to dismiss Plaintiffs’ complaint that the
employer “replaced these [group insurance] health care benefits
with ‘limited funds’ provided through a Health Reimbursement
Account.”).
The same administrative burdens and risk shifting threaten
harm to Employer Plan beneficiaries in this case.

Starting

April 1, 2017, the retiree beneficiaries would be encumbered
with new administrative burdens and risks that Defendant CONSOL
Energy had agreed in the NBCWA and Employer Plan to carry for
their lifetimes.

Even if the HRAs do ultimately end up paying,

Defendant CONSOL Energy has yet to implement a scheme to protect
retirees from having to first pay out-of-pocket, and then wait
for reimbursement.

See Tr. 165.

Consequently, Plaintiffs will

be irreparably harmed were this court to refuse to preserve the
status quo with a preliminary injunction.
C. The Rest of the Preliminary Injunction Inquiry is Satisfied
The court has concluded as set out above that members of
Plaintiff union will suffer irreparable harm in the absence of
an injunction.

The remaining three considerations of the

analysis also are in Plaintiffs’ favor.

Because of the policy

favoring arbitration in labor disputes and the long-standing
obligation of coal companies to provide medical care for UMWA

24

members, Plaintiffs are likely to succeed on the merits.

The

balance of equities clearly tips in favor of Plaintiffs.

In the

absence of an injunction, medical benefits may be lost.
Defendant CONSOL Energy, should it ultimately prevail, and be
deemed entitled to cancel or change benefits, can still do so
after the matter is concluded.

Because of the public policy

favoring injunctions in such cases and the desire throughout
society to provide medical benefits for the sick and the
injured, an injunction is in the public interest.
*

*

*

Plaintiffs’ Motion for a Preliminary Injunction, see Doc. No.
8, is GRANTED; Defendants’ Motion to Dismiss, see Doc. No. 41, is
GRANTED in part to this effect: Defendants Helvetia Coal Company
Helvetia, Island Creek Coal Company, Laurel Run Mining Company,
and

CONSOL

Motion

to

Amonate
Transfer

Facility,
this

LLC,

case

to

are
the

dismissed;
Western

Defendants’
District

of

Pennsylvania is DENIED; and a Preliminary Injunction Order of even
date with this Opinion will be entered.
The Clerk is DIRECTED to forward a copy of this Memorandum
Opinion and Order to counsel of record.
IT IS SO ORDERED this 17th day of March, 2017.
ENTER:

David A. Faber
Senior United States District Judge
25