ARCH COAL, INC., APPELLANT v. R. ALEXANDER ACOSTA, IN HIS OFFICIAL CAPACITY AS SECRETARY OF LABOR AND DEPARTMENT OF LABOR, APPELLEES
No. 17-5074
United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued January 8, 2018 Decided April 27, 2018
Appeal from the United States District Court for the District of Columbia (No. 1:16-cv-00669)
Mark E. Solomons argued the cause and filed the briefs for appellant. With him on the briefs was Laura Metcoff Klaus.
Daniel J. Aguilar, Attorney, U.S. Department of Justice, argued the cause for federal appellees. With him on the brief were Jessie K. Liu, U.S. Attorney, and Mark B. Stern, Attorney.
Before: MILLETT and WILKINS, Circuit Judges, and EDWARDS, Senior Circuit Judge.
Opinion for the Court filed by Senior Circuit Judge EDWARDS.
EDWARDS, Senior
The BLBA grants coal miners the right to monthly benefits payments from a former employer in the event they suffer from black lung disease as a result of employment. The Department sends a “notice of claim” to coal mine operators who are potentially liable for benefits payments under the Act. See
On November 12, 2015, the Department issued a bulletin to its staff, Bulletin No. 16-01 (“Bulletin“), instructing District Directors to send notices of claims to Arch for certain black lung benefits claims filed against a company that had acquired Arch‘s BLBA liabilities. Arch then brought this action in the District Court seeking to enjoin the administrative proceedings. Arch alleged that it was not liable for the payments under the BLBA and that the Bulletin violated the Administrative Procedure Act (“APA“) as a legislative “rule” published without notice and comment. The District Court concluded that it lacked subject matter jurisdiction over these claims.
The BLBA‘s comprehensive scheme of administrative review, followed by judicial review in a court of appeals, makes it clear that Congress implicitly precluded district court jurisdiction over the claims to which the BLBA applies. See, e.g., Elgin v. Dep‘t of Treasury, 567 U.S. 1, 10 (2012); Thunder Basin Coal Co. v. Reich, 510 U.S. 200, 207-09 (1994); Jarkesy v. SEC, 803 F.3d 9, 16-17 (D.C. Cir. 2015). We therefore agree with our sister circuits that “the scheme of review established by Congress for determinations of black lung disability benefits was intended to be exclusive.” Compensation Dep‘t of Dist. Five, United Mine Workers of Am. v. Marshall, 667 F.2d 336, 340 (3d Cir. 1981); see also Louisville & Nashville R.R. Co. v. Donovan, 713 F.2d 1243 (6th Cir. 1983). Accordingly, Arch must exhaust its administrative remedies and secure a final order from the Board before it may seek review from this court.
I. BACKGROUND
A. Statutory and Regulatory Background
The BLBA imposes liability on coal mine operators for payment of monthly benefits to coal miners who contract pneumoconiosis, or black lung disease, from their employment in the mines. See
Congress created a comprehensive administrative scheme to adjudicate benefits claims under the Act. See
Once the operator receives a notice of claim, it becomes a party to the administrative proceedings. See
Either party may appeal the District Director‘s decision and request a formal hearing before an ALJ within thirty days.
B. Factual and Procedural History
Arch is a coal mining company that was formed in 1997. The following year, Arch received the Department‘s authorization to self-insure against future BLBA liabilities. On December 31, 2005, Arch sold three of its subsidiary coal mining companies to Magnum Coal Company (“Magnum“). Arch alleges that as part of that sale, Magnum agreed to assume the BLBA liabilities of the three purchased subsidiary companies. In 2008, Magnum was acquired by Patriot Coal (“Patriot“).
Patriot declared bankruptcy in May 2015. The bankruptcy court approved the sale of Patriot‘s coal-mining operations, including Arch‘s three former subsidiaries, to other companies. That sale did not transfer Patriot‘s liability for BLBA claims.
In response to Patriot‘s bankruptcy, the Department‘s Office of Workers’ Compensation Programs issued Bulletin No. 16-01 to its staff. See U.S. Dep‘t of Labor, BLBA Bulletin No. 16-01 (Nov. 12, 2015), available at https://www.dol.gov/owcp/dcmwc/blba/indexes/BL16.01OCR.pdf. The Bulletin‘s purpose was “[t]o provide guidance for district office staff in adjudicating claims in which the miner‘s last coal-mine employment of at least one year was with one of the 50 subsidiary companies that have been affected by the Patriot Coal Corporation bankruptcy.” Id. at 1. With respect to newly filed claims against the former Arch subsidiaries, the Bulletin instructs
Following distribution of the Bulletin, District Directors sent Arch notices of claims. The notices reflect the Department‘s initial determination that Arch is potentially liable for the claims of miners who worked for Arch during its period of self-insurance. In April 2016, Arch filed this action in District Court, seeking declaratory relief and an injunction barring the Department from sending Arch notices of claims pursuant to the Bulletin, Compl. 22 para. 97, and from “imposing on Arch Coal, Patriot‘s liability for the black lung claims,” id. at 18 para. 72. The Complaint alleges that the Bulletin was a substantive “rule” and, as such, it should have been subject to notice and comment under
The Department moved to dismiss the Complaint under Federal Rule of Civil Procedure 12(b)(1) and (6), for lack of subject matter jurisdiction and for failing to state a claim upon which relief could be granted. On March 16, 2017, the District Court granted the motion to dismiss for lack of jurisdiction, holding that the BLBA “assigns exclusive jurisdiction” over Arch‘s challenges “to the Department‘s administrative process and then the relevant federal court of appeals.” Arch Coal, 242 F. Supp. 3d at 18-19. Arch then filed an appeal with this court.
II. ANALYSIS
A. Standard of Review
“We review de novo a dismissal for lack of subject matter jurisdiction.” United States ex rel. Oliver v. Philip Morris USA Inc., 826 F.3d 466, 471 (D.C. Cir. 2016). In so doing, we “must accept the factual allegations in the complaint as true.” Sturm, Ruger & Co., Inc. v. Chao, 300 F.3d 867, 871 (D.C. Cir. 2002).
B. Jurisdiction
As we explained in Jarkesy:
Litigants generally may seek review of agency action in district court under any applicable jurisdictional grant.
If a special statutory review scheme exists, however, it is ordinarily supposed that Congress intended that procedure to be the exclusive means of obtaining judicial review in those cases to which it applies....
Our analysis proceeds in accordance with the two-part approach set forth in Thunder Basin Coal Co. v. Reich. Under Thunder Basin‘s framework, courts determine that Congress intended that a litigant proceed exclusively through a statutory scheme of administrative and judicial review when (i) such intent is fairly discernible in the statutory scheme, and (ii) the litigant‘s claims are of the type Congress intended to be reviewed within [the] statutory structure.
803 F.3d at 15 (citations and internal quotation marks omitted). In this case, both
1. Exclusivity of the Statutory Scheme
The “fairly discernible” test is easily satisfied in this case. The terms of the BLBA make it clear that Congress intended mine operators to contest their liability for benefits payments exclusively through the statutory review scheme. “Generally, when Congress creates procedures designed to permit agency expertise to be brought to bear on particular problems, those procedures are to be exclusive.” Free Enter. Fund v. Pub. Co. Accounting Oversight Bd., 561 U.S. 477, 489 (2010) (citation and internal quotation marks omitted). As described above, the BLBA establishes exactly such a detailed and comprehensive process for adjudicating black lung benefits claims. See
In all relevant respects, the BLBA resembles other statutory schemes held to preclude district court jurisdiction. In Thunder Basin, a coal company sought injunctive relief in district court for alleged statutory and constitutional violations emanating from an anticipated enforcement proceeding under the Federal Mine Safety and Health Amendments Act of 1977 (“Mine Act“). 510 U.S. at 204-05. Under the Mine Act‘s scheme, a party sanctioned by the Mine Safety and Health Administration may bring a challenge before an ALJ, appeal the ALJ‘s decision to a Commission within the agency, and appeal the Commission‘s final order to a court of appeals. Id. at 207-08. “The [Mine] Act expressly authorizes district court jurisdiction in only two provisions,” which allow the agency to seek enforcement orders in court. Id. at 209. Mine operators have no “corresponding right” to district court jurisdiction. Id. The Supreme Court concluded that the detailed statutory scheme “demonstrate[d] that Congress intended to preclude [the plaintiff‘s] challenges.” Id. at 208; see also Elgin, 567 U.S. at 5-6 (holding that the Civil Service Reform Act‘s scheme for reviewing personnel actions – involving a hearing before the agency, review by a board within the agency, and appeal to the Federal Circuit – was exclusive of district court jurisdiction); Jarkesy, 803 F.3d at 16 (involving similar judicial review provisions under the Securities Exchange Act and holding that they indicated exclusivity); Sturm, Ruger & Co., 300 F.3d at 871-73 (holding the same with respect to the Occupational Safety and Health Act‘s scheme of administrative and judicial review).
The BLBA cannot be distinguished from the foregoing statutory schemes. Under the BLBA, mine operators may challenge adverse liability decisions before an ALJ and obtain review of the ALJ‘s decision by a Board established by the Act within the agency for that purpose. Only after the Board has issued a final order may an adversely affected party obtain judicial review, and that review is available only in a U.S. court of appeals. See
2. Arch‘s Claims Are of the Type that Congress Intended to Be Reviewed Within the BLBA Statutory Structure
Arch argues that even if the BLBA is exclusive with respect to claims that fall within its compass, the claims at issue in this case are not of the type that Congress intended to be reviewed within the BLBA‘s statutory structure. We disagree.
A claim will be found to fall outside of the scope of a special statutory scheme in only limited circumstances, when (1) a finding of preclusion might foreclose all meaningful judicial review; (2) the claim is wholly collateral to the statutory review provisions; and (3) the claims are beyond the expertise of the agency. Free Enter., 561 U.S. at 489; Thunder Basin, 510 U.S. at 212-13. These exceptions are not applied pursuant to any “strict mathematical formula.” Jarkesy, 803 F.3d at 17. Rather, the exceptions reflect “general guideposts useful for channeling the inquiry into whether the particular claims at issue fall outside an overarching congressional design.” Id.
In its complaint, Arch attempted to fit its claims within an exception to the Thunder Basin rule, arguing that it should not be forced to defend the compensation claims at issue because, for a number of reasons, it is not liable for them as a matter of law under the BLBA. This argument obviously fails because operator challenges to potential liability under the BLBA are quintessentially the type of claims that are within the exclusive compass of the BLBA‘s statutory scheme. They fall squarely within the Department‘s authority and expertise to assess liability for benefits payments under the BLBA. Indeed, benefit liability disputes “arise from actions [taken by the Department] in the course of the administrative enforcement scheme,” Jarkesy, 803 F.3d at 23, and meaningful judicial review is available in the courts of appeals, see
On appeal, Arch argues that the disputed Bulletin is a substantive “rule” that was issued without required procedures and with impermissible retroactive effects. Therefore, Arch maintains that its claims may be heard in the District Court pursuant to National Mining Association v. Department of Labor, 292 F.3d 849 (D.C. Cir. 2002) (per curiam). In that decision, the court held that the District Court had jurisdiction over a challenge to regulations issued pursuant to notice-and-comment rule making by the Secretary of Labor under the BLBA. Nat‘l Mining, 292 F.3d at 858-59. The decision in National Mining is plainly inapposite.
National Mining distinguished the claims before it from those at issue in two circuit court decisions, both of which had held that the BLBA‘s statutory review scheme precluded district court jurisdiction. See Louisville & Nashville R.R., 713 F.2d at 1244 (remanding with instructions to vacate District Court‘s award of injunction preventing Secretary from extending coverage of the BLBA to railroad employees on the basis of Department‘s guidelines); Compensation Dep‘t, 667 F.2d at 340 (holding District Court lacked jurisdiction over claim that Department‘s policy for reviewing claimants’ X-ray evidence violated the BLBA). The National Mining court explained that the plaintiffs in the two cited cases did not challenge “a formal regulation, as is true in our case,” but had
If anything, the decision in National Mining clearly supports our judgment in this case. For example, the court pointed out that in a case of the sort that Arch seeks to pursue here, “there [is] no reason to believe that [the operator‘s] legal position, if correct, could not be fully remedied through review in the Court of Appeals.” Nat‘l Mining, 292 F.3d at 858.
The simple point here is that Arch‘s challenges to the Bulletin are the exact sort of claims that National Mining took pains to distinguish from its holding. Arch requests district court relief that would circumvent the statutory scheme based on objections to an enforcement policy, not a legislative “rule.” See
It is well understood that the notice-and-comment provisions of section 553 of the APA do not apply to agency bulletins, policy statements, directives, guidances, opinion letters, press releases, advisories, warnings, or manuals that do not have the force of law. See EDWARDS & ELLIOTT, FEDERAL STANDARDS OF REVIEW: REVIEW OF DISTRICT COURT DECISIONS AND AGENCY ACTIONS 196-97 (3d ed. 2018). Indeed, such actions normally are not subject to judicial review unless the agency relies on the policy to support an agency action in a particular case. Id. at 198-99.
All of the matters with respect to which Arch complains are related to actions that the Department has taken pursuant to the BLBA‘s statutory scheme. Therefore, Arch is required to exhaust its administrative remedies and secure a final order from the Board before it may seek review from this court. Arch‘s challenge to the Bulletin in the District Court surely was not “wholly collateral” to the BLBA‘s review scheme. Rather, the suit in District Court was an attempt by Arch to jump the gun and make an end run around the BLBA‘s statutory scheme. See Sturm, Ruger & Co., 300 F.3d at 876 (“Indeed, the company is attempting to end the [statutory review] process altogether: its complaint seeks an injunction . . . that would terminate the [currently pending] proceeding.“).
Arch‘s counsel conceded at oral argument before this court that the company will be able to raise its objections to the Bulletin and any enforcement actions taken against it during the course of the administrative process. See Oral Arg. Recording 9:29-10:13. Counsel also acknowledged
Arch maintains that judicial review will not be meaningful because the Department will not afford it adequate discovery to develop its claims during the administrative proceedings. This argument is premature. Arch is entitled to reasonable discovery before the Department to the full extent allowed by the BLBA and its implementing regulations. See
C. Finality
Finally, Arch asserts that “the Department‘s allocation of Patriot‘s self-insurance and bankruptcy assets is final agency action not subject to adjudication in the claims process.” Arch Br. 37. In other words, Arch seems to assume that the Department has disposed of some matters on the merits and, therefore, it is entitled to review now. The Department responds that the company is simply wrong on this point because “Arch is fully able to raise its claims through the Black Lung Act‘s statutory review scheme, and its claims will be meaningfully considered through that process.” Department Br. 28. The record supports the Department on this point. The Department also points out that there is nothing for this court to review on the merits because “Arch has not challenged final agency action as required by
The Bulletin is not a final agency action because it does not reflect “the consummation of the agency‘s decisionmaking process” and it does not offer a decision “by which rights or obligations have been determined, or from which legal consequences will flow.” Bennett v. Spear, 520 U.S. 154, 177-78 (1997) (citations and internal quotation marks omitted). The Bulletin merely instructs District Directors to issue notices of claims making Arch a party to administrative proceedings and thereby initiate the process by which Arch‘s obligations
“It is firmly established that agency action is not final merely because it has the effect of requiring a party to participate in an agency proceeding.” CSX Transp., Inc. v. Surface Transp. Bd., 774 F.3d 25, 30 (D.C. Cir. 2014) (quoting Aluminum Co. of Am. v. United States, 790 F.2d 938, 941 (D.C. Cir. 1986)); see also FTC v. Standard Oil Co. of Cal., 449 U.S. 232, 241 (1980) (holding that the issuance of an administrative complaint is not final agency action because a complaint is “not a definitive statement of position” but instead a “threshold determination that further inquiry is warranted“).
Arch argues that the inconvenience of having to defend a claim on the merits should render its designation as a potentially responsible operator reviewable. But the Supreme Court‘s decision in Standard Oil rejected this exact argument. See Standard Oil, 449 U.S. at 242 (a party‘s “burden of responding to the charges made against it” before an agency “is different in kind and legal effect from the burdens attending what heretofore has been considered to be final agency action“).
Nor does Arch‘s mere claim that the Bulletin is an improperly adopted “rule” establish any exception to the final order rule. We have held that “[t]his is a matter that can be raised by [a party] if it elects to appeal the Board‘s final decision at the conclusion of the adjudication.” CSX, 774 F.3d at 28. Were the courts to “permit[] a party to seek interlocutory review on the ground that an agency has allegedly adopted a new legislative rule during the course of an adjudication . . . [it] would wreak havoc with the final order rule.” Id. at 33.
III. CONCLUSION
For the reasons set forth above, we affirm the District Court‘s dismissal of Arch‘s complaint.