Bankrupt Westmoreland Coal Wins Bid to Modify Retirees’ Plans

Westmoreland Coal Co. can modify retirees’ health-care benefits after a Fifth Circuit ruling that some bankrupt coal companies can override a federal law banning such changes.

The federal Coal Act bans coal mining companies from changing retiree health benefits to avoid retirement plan liability. But there’s no clear indication that Congress intended the ban to be an exception to a Bankruptcy Code provision that allows retirement plan changes in certain circumstances, the U.S. Court of Appeals for the Fifth Circuit said Tuesday.

Section 1114 of the Bankruptcy Code lets bankrupt companies make such modifications if a bankruptcy court finds that ...