Templeton v. Appolo Fuels, Inc.

• Decision Date: 10 March 2021
• Docket Number: No. 6:19-CV-71-REW,6:19-CV-71-REW
• Citation: 525 F.Supp.3d 802
• Court: U.S. District Court — Eastern District of Kentucky
• Parties: Danny A. TEMPLETON, Plaintiff, v. APPOLO FUELS, INC., et al., Defendants.

525 F.Supp.3d 802

Danny A. TEMPLETON, Plaintiff,

v.APPOLO FUELS, INC., et al., Defendants.

No. 6:19-CV-71-REW

United States District Court, E.D. Kentucky, Southern Division. London.

Signed March 10, 2021

Evan Barret Smith, AppalReD Legal Aid, Prestonsburg, KY, James Wesley Addington, Appalachian Citizens’ Law Center, Whitesburg, KY, for Plaintiff.

Randall S. May, Davidson & Associates, Hazard, KY, for Defendants Appolo Fuels, Inc., Gary Asher.

John F. Kelley, Jr., Williams & Towe Law Group, PLLC, London, KY, Otis Doan, Jr., Harlan, KY, for Defendants Debra Lynn Coals, Inc., Thomas K. Evans, Sr., Debra L. Anderson.

Appolo Fuels, Inc., Pro Se.

Gary Asher, Pro Se.

OPINION & ORDER

Robert E. Wier, United States District Judge

INTRODUCTION

Plaintiff Danny Templeton worked as a miner for Debra Lynn Coals, Inc. (DLC) from March 1978 through November 1978 and then from July 1980 until February 14, 1996. DE 70-3. In September of 2010, citing shortness of breath and inability to walk more than a short distance, Templeton filed for benefits under the Black Lung

Benefits Act (BLBA). DE 70-11. Seven years and many convolutions later, a Department of Labor Administrative Law Judge approved the claim, finding Templeton eligible for benefits going back to February of 2011. DE 70-1. Under the BLBA, the primary responsibility for payment of claims falls on mine operators and their insurers—in this case, per the DOL, DLC and Appolo Fuels Inc. (AFI), respectively (although the nature of AFI's insurance contract with DLC is disputed). After Templeton's claim was approved and served, the DOL notified AFI that DLC was obligated to "pay monthly benefits to claimant beginning January 2018 at the rate of $660.10 [and] pay [Templeton] $50,277.80" for past benefits owed. DE 70-2.¹ The DOL also granted Templeton's request for $18,076.98 (cumulatively) in attorney fees. DE 70-20.

Neither DLC nor AFI has made any of the required payments. Templeton now moves for summary judgment to enjoin DLC, and its officers Thomas K. Evans and Debra Anderson, and AFI, and its president and secretary, Gary Asher, (collectively, Defendants), to pay: (1) his benefits as awarded by the ALJ on September 25, 2017 and as calculated per DE 70-2; (2) interest on the unpaid benefits; (3) 20% additional compensation, a statutory non-payment penalty; and (4) interest on the 20% additional compensation. DE 70 at 1, 29. Templeton also seeks the awarded unpaid attorney fees plus interest. DE 70 at 19. Defendants oppose the motion. DE 77 (AFI and Asher Response in Opposition); DE 78 (DLC, Evans, and Anderson Response in Opposition). Templeton has replied to those responses. DE 79. The matter, now fully briefed, is ripe for review.

Templeton, with an award in hand, is entitled to payment. Defendants invite a game of musical chairs where each posits a theory to shirk liability, effectively hollowing Templeton's victory and leaving him standing alone, with no real remedy. That is not what Congress intended; the Act and record will not countenance such a result here. The Court GRANTS in part and DENIES in part Templeton's motion for summary judgment. Defendants DLC, Thomas Evans, Debra Anderson, and AFI are together jointly and severally liable for benefits and penalties owed, interest on those benefits and penalties, and Plaintiff's attorney fees. For the reasons discussed below, Defendant DLC is liable as the responsible operator, Evans and Anderson are liable as the officers of the responsible operator, and AFI is liable as the insurer. However, Defendant Gary Asher is not personally liable. The Court enjoins those liable to comply with the applicable orders and pay what they owe.²

JURISDICTION & STANDARD OF REVIEW

The Longshore Harbor Workers’ Compensation Act (LHWCA) gives federal district courts jurisdiction to enforce properly made and served final orders awarding benefits under the act. 33 U.S.C. § 921(d) ("If the court determines that the order was made and served in accordance with law, and that such employer or his officers or agents have failed to comply therewith, the court shall enforce obedience to the order[.]"). The LHWCA's procedures are incorporated into the Black Lung

Benefits Act via 30 U.S.C. § 932(a). Thacker on behalf of Estate of Clevenger v. Old Republic Ins. Co. , 416 F. Supp. 3d 651, 660 (E.D. Ky. 2019) (" 33 U.S.C. § 921(d) is incorporated by reference into the BLBA.").³

A court may grant a motion for summary judgment only if there is "no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). "The evidence, all facts, and any inferences that may permissibly be drawn from the facts must be viewed in the light most favorable to the nonmoving party." Combs v. Meijer, Inc. , No. 5:12-CV-209-KSF, 2012 WL 3962383, at *2 (E.D. Ky. Sept. 10, 2012) (citing Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp. , 475 U.S. 574, 587, 106 S. Ct. 1348, 89 L. Ed.2d 538 (1986) )." To defeat a motion for summary judgment, the adverse party "must set forth specific facts showing that there is a genuine issue for trial." Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 250, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Accordingly, the Court now proceeds to a "threshold inquiry of determining whether there is a need for a trial—whether, in other words, there are any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party." Id.

Notably, the Court has a cabined role under § 921(d), that of enforcement. The statute directs scrutiny of whether the compensation order "was made and served in accordance with law." If so, and if the employer and its agents have not complied, enforcement is a mandate. Thus,

It is clear from the statutory scheme that our enforcement powers under s 921(d) ... are not of substantive dimension. That is to say s 921(d) reposes in this court the responsibility of screening compensation orders for procedural defects and thus affording responsible employers a measure of procedural due process before enforcement can be effected.

Marshall v. Barnes & Tucker Co. , 432 F. Supp. 935, 939 (W.D. Pa. 1977) ; see also Grimm v. Vortex Marine Constr. , 921 F.3d 845, 847 (9th Cir. 2019) (noting that the statute gives district courts no jurisdiction "over the merits of the litigation," that a district court "cannot affirm, modify, suspend, or set aside the order" but that "jurisdiction extends only to the enforcement of compensation orders") (quoting Thompson v. Potashnick Const. Co. , 812 F.2d 574, 576 (1987) ). Defendants here do not attack the procedural formulation or foundation of the compensation order, and they do not claim to have complied with its directions.

THE BLACK LUNG

BENEFITS ACT (BLBA)

Congress passed the Black Lung

Benefits Act (BLBA) to ensure financial support to former coal miners (and their heirs) rendered totally disabled by pneumoconiosis contracted from working in a mine. Appleton & Ratliff Coal Corp. v. Ratliff , 664 F. App'x 470, 471 (6th Cir. 2016).⁴ Disabled former miners bring claims for benefits under the BLBA to the Department of Labor. The DOL then determines whether the miner is eligible and, if so, what party is responsible for paying those benefits. Id. at 471-72 ; Thacker , 416 F. Supp.3d at 656. Congress intended for the BLBA to shift risk and liability for benefits onto the mining industry. Arkansas Coals, Inc. v. Lawson , 739 F.3d 309, 313 (6th Cir. 2014) (citing Director, OWCP v. Oglebay Norton Co. , 877 F.2d 1300, 1304 (6th Cir. 1989) ). Accordingly, coal mine operators have the "sole duty to provide benefits under the BLBA[.]" Travelers Ins. Co. v. Blackstone Min. Co. , No. 2007-CA-001610-MR, 2012 WL 2603623, at *1 (Ky. Ct. App. July 6, 2012) ; see also §§ 933 ; 726.4. The guiding principle of the DOL regulations is ensuring that "coal mine operators are liable ‘to the maximum extent feasible’ for awarded claims." Ark. Coals, Inc. , 739 F.3d at 313 (citation omitted).

To establish a reliable, alternate source of revenue (in the event of operator insolvency, for example), the BLBA requires financially liable operators "to either qualify as a self-insurer or purchase insurance to cover any BLBA liability." Karst Robbins Coal Co. v. Dir., Office of Workers’ Comp. Programs , 969 F.3d 316, 320 (6th Cir. 2020) (citing § 933(a) ; § 725.494(e)).⁵ Commercially purchased insurance policies must guarantee " ‘the payment of benefits as required’ under the BLBA." Travelers Ins. Co. , 2012 WL 2603623, at *1 (citing §§ 726.201–726.202).⁶ As a result, all BLBA insurance contracts obligate the carrier to " ‘cover fully all of the coal operator's liabilities under the BLBA,’ and ... pay benefits equal to those provided under the BLBA." Id. (quoting Lovilia Coal Co. v. Williams , 143 F.3d 317, 322 (7th Cir. 1998) ); §§ 726.204–726.207. BLBA insurance carriers therefore "step[ ] into the shoes" of the operator so that, from a claimant's or the government's perspective, there is no disruption in the event of an operator's inability or refusal to pay. Tazco, Inc. v. Dir., Office of Workers Comp. Program, U.S. Dep't of Labor , 895 F.2d 949, 951 (4th Cir. 1990). If there is no responsible operator or insurer able to pay benefits, the Black Lung Disability Trust Fund exists as a final fail-safe to provide benefits to eligible claimants. Karst , 969 F.3d at 320 ; see also 26 U.S.C. § 9501(d)(1).⁷

THE CLAIMS PROCESS

After a miner files a claim with "the applicable district director for the Office of Workers’ Compensation Programs[,]" the district director "investigates the claim and makes a preliminary determination of the miner's eligibility and" which operator (i.e. , former employer) is responsible for paying benefits. Arch Coal, Inc. , 242 F. Supp. 3d at 16 (citing 33 U.S.C. § 919; § 725.401-23).⁸ The district director then provides the claimant and the potentially responsible operator with...