Source: https://mail.sourcewatch.org/index.php?title=Massey_Energy
Timestamp: 2019-04-21 22:26:47+00:00

Document:
In 2011 Massey Energy was acquired by Alpha Natural Resources.
Massey Energy describes itself as "the largest producer of Central Appalachian coal and America's 4th largest producer of coal by revenues." In 2009, the company "sold 36.7 million tons of produced coal generating produced coal revenues of $2,318.5 million. In 2008, the company had 6,743 employees. Of these, only 1.3% -- or approximately 87 -- were represented by the United Mine Workers of America. Massey states that union members were "spread out amongst five of our coal preparation plants" which handled "approximately 15.8% of our coal production." However, the company states that the "collective bargaining agreements with the UMWA have expired" and that "there are no ongoing negotiations" at present.
In 2008, Massey estimated that it controls 2.2 billion tons of coal reserves in southern West Virginia, eastern Kentucky, southwest Virginia and Tennessee, or almost one-third of the total coal reserves in Central Appalachia.
8.7 December 2011: Settlement reached as MSHA Report finds deaths were "entirely preventable"
10.11 October 30, 2009: Activists protest mountaintop removal at EPA offices throughout the U.S.
In November 2008, Massey's Board of Directors elected Baxter F. Phillips Jr. new president of the company, replacing Don Blankenship. Blankenship will continue on as chairman and CEO. Phillips has been with the company for 27 years, most recently as executive vice president and chief administrative officer. In a prepared statement, Blankenship said the promotion will help him "ensure the success of the capital expansion project we embarked on a year ago to increase production at our Central Appalachian coal mining operations."
In December 2010, Massey's Board of Directors announced that its Chairman and CEO, Don Blankenship, would retire from the company at the end of 2010. Company president Baxter F. Phillips Jr. will be the new CEO. Admiral Bobby Ray Inman, Lead Independent Director on the Massey Board, will serve as Non-Executive Chairman.
As discussed in a 2010 report in the Washington Post, former Massey CEO Stanley C. Suboleski served on the Federal Mine Safety and Health Review Commission during the George W. Bush administration, only to return to Massey as a board member. In all, the Post found "nearly a dozen former MSHA district directors who recently took jobs as executives and consultants with Massey or Murray Energy, the two U.S. mining companies with the worst safety records." The report noted that the "incentives for such job moves are significant, with industry typically paying double or triple the salary of district directors, who average about $85,000 a year."
On January 29, 2011, Alpha Natural Resources announced it agreed to buy Massey for $7.1 billion, creating a company with 110 mines and combined coal reserves of 5 billion tons. Alpha Natural Resources' chief executive said the buyout will create a "global company" built on exporting U.S. coal for steelmakers.
Massey put itself up for sale in November 2010 after posting a wider-than-expected third-quarter loss, attributed to the Upper Big Branch Mine Disaster, an explosion that killed 29 miners in April 2010. Massey shares lost more than half their value, hitting a low of $25.87 in July 2010. Shares bounced back above pre-explosion levels after reports that the company would likely be acquired, which increased with the departure of Chief Executive Don Blankenship at the end of 2010, who had reportedly been opposed to selling the company.
Morgan Stanley was lead adviser for Alpha on the deal. Citigroup also advised the company. Perella Weinberg and UBS advised Massey on the sale. Alpha obtained $3.3 billion in committed financing from Morgan Stanley and Citi, which it plans to use, along with its existing cash balance, to pay for the cash portion of the deal as well as refinance some debt of both companies.
On May 25, 2011, a group of Massey Energy shareholders filed a petition with the West Virginia Supreme Court, seeking to stop the $8.5 billion transaction that would make Massey part of Alpha Natural Resources. In similar lawsuits filed in West Virginia and Delaware district courts, lawyers for Massey shareholder groups argue that top Massey executives and board members arranged the sale to avoid personal liability for the deaths of the 29 miners killed in the Upper Big Branch explosion; that the proposed buyout greatly undervalues Massey; and that Alpha and Massey had not disclosed the complete motivation for and history of the proposed deal to shareholders.
Documents in the Delaware lawsuit also show that Alpha CEO Kevin Crutchfield was prepared to provide Massey's former, controversial chief executive, Don Blankenship, with a job as an Alpha consultant. The records also showed that experts who examined Massey as part of Alpha's "due diligence" for the transaction found major problems with Massey's safety practices and the company's management, with one Alpha document stating: "The entire Massey organization appears to be managed by an autocratic central command and control structure." The documents allege that the mine disaster has reduced Massey's economic value by more than $1 billion, along with more than $165 million in out-of-pocket costs and $320 million in lost coal revenues.
On May 31, 2011, Justices announced their 3-0 vote (with Justices Davis and Benjamin disqualified) declining to issue the requested injunction. Justices also voted, though, to unseal at least certain documents in the case, as had been requested in a legal motion filed by The Charleston Gazette and NPR. Unsealed documents filed with the West Virginia Supreme Court showed that lawyers for Massey Energy shareholders alleged that Alpha Natural Resources CEO Kevin Crutchfield made a secret deal to hire key Massey executives linked to the Upper Big Branch Mine Disaster: "Faced with the prospect of a hostile takeover by Alpha and loss of control of the company’s internal investigation and its exculpatory ‘supernatural cause of the explosion … the board, led by Defendant [Bobby] Inman, entered into a secret pact with Alpha CEO Kevin Crutchfield that the Massey Energy officers who were directing the internal investigation would be promised high-ranking positions within the post-merger company. Not coincidentally, the Massey Energy officers in charge of the internal investigation are the ones most culpable for the Upper Big Branch explosion … Defendants have hidden these and other key facts from the company’s shareholders, who are scheduled to vote on the merger at a special meeting set for June 1, 2011, by issuing a materially false and misleading Proxy statement."
According to an analysis by Rainforest Action Network, Massey paid no federal income taxes for 2010. Alpha Natural Resources paid 4.1%. The corporate rate is 35%.
As of early 2010, Massey Energy operated 56 mines, including 42 underground mines and 14 surface mines in West Virginia, Kentucky and Virginia. These mines supply coal to 23 processing and shipping centers, which the company refers to as "resource groups" many of which process coal from number of mines. In a prospectus document issued in March 2010, Massey states that "in the year ended December 31, 2009, 72% of our produced coal tons sold was attributed to steam coal, 20% was attributed to metallurgical coal and 8% was attributed to industrial coal." Massey states that while metallurgical coal accounted for 20% of the volume sold it accounted for 30% of its revenue.
It was announced in November 2010 that Massey Energy began building a $65 million processing plant in southern West Virginia. Massey stated the plant will serve several operations producing metallurgical coal used for steelmaking. Massey stated that they are beefing up its ability to produce metallurgical coal to cash in on growing demand from Asian steelmakers.
In a March 2010 prospectus document, Massey Energy stated that it supplies coal from its mines to "a broad base of over 100 steam, metallurgical and industrial customers."
"The majority of these customers purchase coal under long-term contracts with terms of one year or longer. Many of our customers are well-established utilities who have been our customers for a number of years. In recent years, through our established sales network, we have increased our international customer base and sales into the global metallurgical market, taking advantage of increased worldwide demand for metallurgical coal, especially in China and India. We intend to continue to focus on identifying additional international opportunities for the sale of metallurgical coal. Additionally, the proximity of our mines to export terminals and to many of our domestic customers provides us with an advantage over suppliers from western U.S. coal basins in terms of freight cost and delivery time," it stated.
Massey states that as of December 31, 2009, we controlled an estimated 2.4 billion tons of proven and probable coal reserves "nearly all of which are in the Central Appalachian region". The company states that of its total 2.4 billion tons in proven and probable reserves, "approximately 1.5 billion tons ... contain less than 1% sulfur, of which approximately 0.9 billion tons are compliance coal reserves that meet the current sulfur emission standards of the Clean Air Act." It also states that it has approximately 1 billion tons ("based on internal estimates") of metallurgical coal.
Aside from promises to improve productivity and safety, Massey's stated strategic gaols are to expand underground mining and pursue acquisitions of other coal companies. Massey states that it aims to expand underground mining operations as a response to what it describes as "an increasingly regulated environment where it has become increasingly more costly and time consuming to obtain surface mining permits." The company states that its acquisition strategy is aimed at making the company "the largest producer in Central Appalachia". In March 2010, Massey entered into an agreement with the Cumberland Resources Corporation (“CRC”) and Powell River Resources Corporation for the purchase of their coal operations and associated reserves in Southwest Virginia and Eastern Kentucky for $960 million in cash and stocks.
Massey documents state that domestic and international moves to reduce greenhouse gas emissions could adversely affect the saleability of coal generally and specific grades of coal. In its March 2010 Prospectus, Massey stated that "the majority of our coal supply agreements contain provisions that allow a purchaser to terminate its contract if legislation is passed that either restricts the use or type of coal permissible at the purchaser’s plant or results in specified increases in the cost of coal or its use."
The company also stated that "the ultimate outcome of the Copenhagen Accord and any treaty or other arrangement ultimately adopted by the U.S. or other countries, may be to materially reduce the demand and the price we can obtain for coal. This is particularly true if cost effective technology for the capture and sequestration of carbon dioxide is not sufficiently developed."
While noting that in July 2008 the U.S. Environmental Protection Agency had proposed rules that would establish "requirements specifically for wells used to inject carbon dioxide into geologic formations, Massey noted that "the issue of carbon sequestration results in considerable uncertainty, not only regarding rules that may become applicable to carbon dioxide injection wells but also concerning liability for potential impacts of injection, such as groundwater contamination or seismic activity. In addition, technical, environmental, economic, or other factors may delay, limit, or preclude large-scale commercial deployment of such technologies, which could ultimately provide little or no significant reduction of greenhouse gas emissions from coal combustion."
As of 2010, Massey leads the nation in mountaintop removal mining. In 2008, the company extracted more than 21 million tons of coal using mountaintop removal, and has mined nearly 190 million tons of coal in Appalachia over the past decade using mountaintop removal, according to opensourcecoal.org. In 2008, JPMorgan acted as lead manager on a $690 million bond offering by Massey, according to financial records.
In April 2009, EPA issued objections to three more mountaintop removal mining permits pending issue from the Army Corps of Engineers. The specific mines are Massey's Republic Energy Mine in Kanawha County, West Virginia; Frasure Creek Mining’s Spring Fork Surface Mine in Mingo County, West Virginia; and A&G Coal Corp.’s Ison Rock Ridge Surface Mine in Wise County, Virginia. According to the EPA letters, the three mining operations would bury about eight miles of streams.
At a November 2008 meeting of the Tug Valley Mining Institute in West Virginia, Don Blankenship described environmental groups, along with Al Gore, Nancy Pelosi, and Harry Reid, as "Totally wrong. Nonsense. Absolutely crazy." He referred to reporters at the Charleston Gazette, a paper that has published numerous articles about the environmental effects of coal, as "communists" and "atheists." He also argued that the international scope of greenhouse gas emissions makes it futile to reduce carbon emissions in the U.S., saying, "Its nonsensical, its idiotic... If Pelosi thinks that decreasing CO2 in this country is going to save the polar bears, she’s crazy. If CO2 emissions are going to kill the polar bears, it’s going to happen. What we do here [in the US] is not going to [do] it." Blankenship also declared that business interests should come before environmental issues, and he questioned the ability of the general public to understand anything beyond simple environmental concepts.
In a January 2010 debate, Blankenship said it's practically impossible to engage in MTR mining without violating the Clean Water Act.
In November 2007, the West Virginia Supreme Court overturned a $50 million jury verdict against Massey, brought by mining companies that said Massey had driven them out of business. However, the Court agreed to hear the case again when photographs surfaced of Chief Justice Elliott E. Maynard and Massey CEO Don Blankenship vacationing together while the case was still pending. Maynard recused himself from the case, but Justice Brent D. Benjamin, who was elected to the Court in 2004 with the help of $3 million of support from Blankenship, refused to disqualify himself. The court again decided in Massey’s favor.
On November 14, 2008, the U.S. Supreme Court agreed to hear Harman Mining Corp.'s appeal of the overturned jury verdict. Harman's appeal said its constitutional due process rights had been violated, and asked the Supreme Court to consider whether Justice Benjamin should have disqualified himself from the case because of his connections to Massey. The Supreme Court will hear arguments in the case February or March. A decision is expected by the end of June. In June 2009, the Court issued its ruling, finding that Justice Benjamin should have recused himself and remanding the case back to the West Virginia Supreme Court.
In November 2009, the West Virgina Supreme Court again overturned the $50 million verdict against Massey Energy, concluding that the case must be heard in Virginia. On December 2, 2009, Hugh Caperton of Harman Mining Corp. filed another request with the Court to reconsider its ruling, saying that it wrongly bars him from pursing his case in West Virginia.
In February 2009, about 250 people filed suit against coal companies they allege poisoned wells in two communities in southern West Virginia. The lawsuit contends that coal companies pumped waste coal slurry empty mines, and that underground cracks allowed the waste to pollute the aquifer. The state Department of Environmental Protection said it has been unable to definitively link the wells to the injection site.
The lawsuit targeted eight coal companies, including Massey Energy, Peabody Energy and subsidiary Pine Ridge Coal, and West Virginia's Federal Coal Co.
In April 2009, a settlement agreement was reached and was awaiting judge approval. The settlement calls for the coal companies to contribute $45,000 to a fund to provide drinking water to residents in the Seth-Prenter area. The companies stated as part of the agreement that the payment does not constitute any admission of guilt and is inadmissible in court.
In November 2010, a panel of judges ordered plaintiffs to appear at the Charleston Civic Center for the start of a three-day settlement conference. If a settlement is reached, a 2011 trial would be averted. Mediation talks broke down, however, and a trial is set for Aug. 1, 2011. According to Jeff Goodell in Rolling Stone, after injecting coal slurry into his own neighborhood, Massey paid to build a waterline to bring clean, treated water directly to CEO Don Blankenship's house from Matewan, a few miles away.
In July 2011, Massey offered $35 million to settle the lawsuit. The settlement is confidential, but The Associated Press obtained a letter sent to the plaintiffs that lays out some details, including that the $35 million is in addition to $5 million that Massey and a subsidiary, Rawl Sales & Processing, had previously agreed to put into a medical monitoring fund.
On Feb. 17, 2011, Judge Harry L. Kirkpatrick III ruled that a medical monitoring lawsuit claiming hundreds of children were exposed to coal dust from a Massey Energy Co. coal silo may go to trial on March 14, 2011. The class-action lawsuit, which began in 2006, claims that Massey and a subsidiary, Goals Coal Co., had created a public nuisance by building the silo 235 feet from a school. Williamson attorney Kevin Thompson is suing Massey and Goals Coal Co. over long-term exposure from the silo, which sits about 235 feet from Marsh Fork Elementary School near Sundial, seeking monitoring of diseases that have yet to develop. Trains pull up to the silo to fill their cars, and the plaintiffs argue that creates dust that puts children at risk for asthma and other lung ailments. During a two-hour hearing before the judge, Massey attorneys Jon Anderson and Dan Stickler argued Thompson has failed to present any evidence to justify the demand for a medical monitoring program. To win monitoring, the plaintiffs must prove key legal elements — that they have suffered significant exposure to a proven hazard, and that the exposure increases their risk of developing serious latent diseases.
Kirkpatrick has granted class-action status to the case, although it's unclear how many plaintiffs could benefit. Thompson has previously said as many as 300 children could have been exposed, but he noted in court that the Raleigh County Board of Education is resisting efforts to produce student records. The lawsuit was filed on behalf of Woodrow and Elva Dillon and their two children. It accuses Massey of negligence and creating a public nuisance, and it demands unspecified punitive damages. The 70-year-old elementary school served as a media center during the Upper Big Branch Mine Disaster that killed 29 men in April 2010, and it has been the subject of a fierce public battle for years. Residents and anti-Massey activists have long complained about the dangers to children, not only from the silo but also from a massive dam that sits above the school and holds billions of gallons of coal slurry. Plans for a new school in Rock Creek are now in the works.
On March 25, 2011, jurors in Raleigh County Circuit Court sided with Massey and rejected claims that the silo exposed hundreds of children to possible health problems, as well as the plaintiffs' requests for a medical monitoring program. To win medical monitoring in West Virginia, plaintiffs must prove key legal elements — that they have suffered significant exposure to a proven hazard, and that the exposure increases their risk of developing serious latent diseases. Judge Harry L. Kirkpatrick III said at a pretrial hearing that depositions given in the case failed to produce clear statements that coal dust is dangerous or that children will get sick from breathing it. During the trial, he observed that an expert witness was unable to say how much dust came from the silo. Massey also argued that no regulators ever found that dust had gotten into the school. Plans for a new school in Rock Creek are still in the works.
In a landmark settlement in January 2008, Massey Energy agreed to pay $20 million in fines to the EPA to resolve Clean Water Act violations in West Virginia and Kentucky. The company also agreed invest approximately $10 million to establish new protocol at all its facilities to prevent an estimated 380 million pounds of sediment and other pollutants resulting from its mountaintop removal mining practices from entering the country's waterways each year. The settlement constitutes the largest civil penalty in the EPA's history for water permit violations.
An EPA press release stated that "in a complaint filed on May 10, 2007 [that led up to the settlement], the government alleged that Massey violated its Clean Water Act permits more than 4,500 times between January 2000 and December 2006. The complaint alleged that Massey discharged excess amounts of metals, sediment, and acid mine drainage into hundreds of rivers and streams in West Virginia and Kentucky. Many of the pollutants were discharged in amounts 40 percent or more than allowed. Some pollutants were discharged at levels more than 10 times over the permit limits. The complaint also alleged that Massey spilled large amounts of coal slurry into local waterways numerous times. Sediment can clog streams and harm fish habitats. The spills occurred as a result of failures in the processing, storage, and transportation of coal slurry."
Yet an intent to sue filed by environmental groups in 2010 stated that: "The complaint in United States v. Massey alleged over 60,000 [discharge] violations over a six-year period" and "the Consent Decree in United States v. Massey... had little or no effect on Massey’s compliance with its effluent limitations.... Between April 1, 2008, and March 31, 2009, Massey violated its effluent limits at its various operations at least 971 times, and accrued 12,977 days of violation during that 12-month period."
In April 2010, four environmental groups filed a water pollution lawsuit against Massey for allegedly violating permit limits for toxic aluminum at as many as 16 mines covered by seven Clean Water Act permits in West Virginia. The suit named Massey subsidiaries Elk Run Coal Co., Independence Coal Co., Marfork Coal Co., Peerless Eagle Coal Coal, and Power Mountain Coal Co. Some of the mines involved were also accused of violating permit limits for other pollutants, including iron, pH, and suspended solids, totaling approximately 3,300 days of permit violations from April 2008 through December 2009. Massey had previously paid a record $20 million in penalties to settle a federal government lawsuit over water pollution from its coal mines across the West Virginia and Kentucky coalfields.
In November 2010, U.S. District Judge John T. Copenhaver Jr. ruled that the previous settlement with the federal Environmental Protection Agency did not insulate Massey Energy from citizen lawsuits over new water pollution violations at the company’s operations. The judge ruled that the EPA deal covered only violations that were specifically spelled out in the agency’s agreement with Massey, not future violations, like those alleged by the citizen group lawsuit.
In May 2011, the Sierra Club and Massey Energy reached a tentative settlement over the lawsuit. The deal sets up compliance requirements and a schedule of stipulated penalties for future water permit limit violations. It requires Massey to pay the federal government a fine of $40,000 and $400,000 to the West Virginia Land Trust, to help with an environmental law clinic at the West Virginia University College of Law, which is working to protect riparian area protection projects.
The Martin County Sludge Spill occurred after midnight on October 11, 2000 when the bottom of a coal sludge impoundment owned by Massey Energy in Martin County, Kentucky, broke into an abandoned underground mine below. The slurry came out of the mine openings, sending an estimated 306 million gallons (1.16 billion liters) of sludge down two tributaries of the Tug Fork River. By morning, Wolf Creek was oozing with the black waste; on Coldwater Fork, a ten-foot (3 m) wide stream became a 100-yard (91 m) expanse of thick sludge.
The spill was over five feet deep in places and covered nearby residents' yards. The spill polluted hundreds of miles of the Big Sandy and Ohio Rivers. The water supply for over 27,000 residents was contaminated, and all aquatic life in Coldwater Fork and Wolf Creek was killed. Heavy metals were found in the sludge, including mercury, lead, arsenic, copper and chromium. According to the EPA, the spill was 30 times larger than the Exxon Valdez oil spill (12 million gallons) and one of the worst environmental disasters ever in the southeastern United States, comparable to the TVA Kingston Fossil Plant coal ash spill in 2008.
A federal investigation into the spill began during the end of the Bill Clinton administration and completed after President George W. Bush took office, and has become a bitter controversy marked by allegations of political favoritism, negligence, and indifference to the people affected by the spill. Jack Spadaro, head of the National Mine Health and Safety Academy during the spill, investigated it and reported negligence on the part of Martin County Coal, a subsidiary of Massey, and lax enforcement by the federal Mine Safety and Health Administration. According to Spadaro, the slurry pond had a spill in 1994 and Massey knew another break was nearly inevitable. Spadaro’s former boss at Mine Safety, Davitt McAteer, defended Spadaro, telling 60 Minutes that major coal sludge fatalities are avoided only "by the grace of God," and that officials expected a report that recommended violations, fines, and possible criminal charges. After Bush took office, McAteer was replaced. Spadaro was accused of abusing his authority, and was reassigned to a Pittsburgh office four hours from his home. He resigned.
On January 19, 2006, two miners died at the Aracoma Alma No. 1 Mine in West Virginia, at Massey's Logan County Complex, after a conveyor belt caught fire. The widows of the miners filed suit against Massey, on the grounds that the company should have anticipated that the lack of an air control wall would allow smoke to fill escape routes. In the complaint, the women accused Massey CEO Blankenship of "personally engendering a corporate attitude of indifference and hostility towards safety measures which stood in the way of profit." The lawsuit was settled on November 17, 2008, although the terms were not disclosed. Seven miners who were injured in the same fire have also filed suit against Massey, seeking punitive damages for their injuries.
On April 15, 2009, a federal judge approved a plea deal with Massey subsidiary Aracoma Coal Company. Aracoma pleaded guilty to 10 criminal charges for the 2006 fire. The company was fined $2.5 million and must also pay $1.7 million for violations cited by the federal Mine Safety and Health Administration. The plea deal included a provision preventing Massey and its officials from being prosecuted.
See Upper Big Branch Mine Disaster for more details.
On April 5, 2010, an explosion at a Massey Energy's underground Upper Big Branch Mine in southern West Virginia killed 29 miners, with two hospitalized. Mine-safety experts said explosions are typically caused by high levels of methane produced during longwall mining, which mining companies try to dilute with ventilation systems, although Massey has been repeatedly cited for violating this requirement. The Upper Big Branch mine has had six violations related to ventilation since January and four since March 17, according to Mine Safety and Health Administration data. In 2009, the mine had 50 "unwarrantable failure citations," the most serious findings of negligence a mine inspector can issue. One citation was for not properly marking escape routes for miners in case of an accident. MSHA had proposed penalties of $900,000 last year resulting from 458 total safety violations at the mine. There have been three other fatalities at the Upper Big Branch mine in the last 12 years.
On April 15, 2010 President Obama told reporters that he believed the accident could have been averted by Massey Energy management. "This tragedy was triggered by a failure at the Upper Big Branch mine, a failure first and foremost of management, but also a failure of oversight and a failure of laws so riddled with loopholes that they allow unsafe conditions to continue," said President Obama, adding, "Owners responsible for conditions in the Upper Big Branch mine should be held accountable for decisions they made and preventive measures they failed to take. Stronger mine safety laws were passed in 2006 ... but safety violators like Massey have still been able to find ways to put their bottom line before the safety of their workers, filing endless appeals instead of paying fines and fixing safety problems," President Obama said.
Shortly after the accident President Obama ordered mine safety officials to report on the explosion, including the mine's safety record and what steps the government could take to prevent further disasters. Other critics blamed Massey management for the failure. The company defended its record, saying that its accident rate hit an all-time low.
In October 2010, Massey management stated that coal dust did not play a role in the disaster, as government investigators previously stated. Computer models and other evidence, said CEO Don Blankenship, suggested methane gas alone fueled the mine explosion, which remained at odds with government findings: "We don't feel like that we contributed in any way to the accident," he said. "We do not believe that coal dust was a meaningful factor."
On June 9, 2010 it was announced that the public pension for California's teachers is joining two other Massey investors in suing the company for having an "abysmal" safety record leading up to an April disaster that killed 29 people at a West Virginia coal mine. The pension owns 336,000 shares in the company.
In November 2010 the U.S. Department of Labor filed a preliminary injunction in U.S. District Court against Massey Energy for its perpetual mine violations. The government cited persistently dangerous conditions in Massey Energy's Freedom Mine No. 1 in Pike County, Kentucky. The action, which is the toughest enforcement action available to federal regulators, would shut down the mine until the company addresses safety hazards and demonstrates it can operate the mine safely. The suit, filed in U.S. District Court in Kentucky, cited nearly 2,000 safety violations since mid-2008, including a deadly mine explosion in early 2010. The suit said that six roof falls occurred at the mine since Aug. 11, 2010.
On December 1, 2010, Massey Energy said it had idled the Freedom Mine amid increased regulatory scrutiny. The Freedom Mine No. 1 is one of three Massey-operated mines the U.S. Mine Safety and Health Administration had listed as having a pattern of safety violations, opening them up to greater oversight and potential closure if problems aren't fixed. The other two mines listed by MSHA as having a pattern of safety violations are the Upper Big Branch Mine and the Ruby Energy Mine, also in West Virginia.
The company's board is exploring options, including whether to pursue a sale and open a formal auction. A variety of companies have been reported as having interest in Massey including Alpha Natural Resources, the nation's fourth-largest coal producer, and ArcelorMittal, the world's biggest steelmaker. Massey is also is examining a recapitalization of the company to pay investors a dividend or buy back shares.
In May 2011, the first comprehensive state report on the 2010 explosion faulted Massey Energy for the disaster, concluding that it had “made life difficult” for miners who tried to address safety and built “a culture in which wrongdoing became acceptable.” The report, issued by an independent team appointed by the former West Virginia governor, Joe Manchin, and led by the former federal mine safety chief Davitt McAteer, echoed preliminary findings by federal officials that the blast could have been prevented if Massey had observed minimal safety standards.
December 2011: Settlement reached as MSHA Report finds deaths were "entirely preventable"
In a deal worked out by U.S. Attorney Booth Goodwin, Massey owner Alpha agreed to pay $10.8 million to resolve civil penalties related to Upper Big Branch, as part of paying off $35 million in fines pending from former Massey operations. The fines are part of a larger, $209.5 million settlement announced hours before the release of the MSHA report.
MSHA records show that, between 2000 and 2009, Massey was tied with Consol Energy for the worst fatality record for miners of any U.S. coal company. The companies each had 23 fatalities. Massey also gathered over 62,000 violations during that decade, over 25,000 of which were deemed "significant and substantial," with fines at nearly $45 million.
In November 2010 the U.S. Department of Labor filed a preliminary injunction in U.S. District Court against Massey Energy for its perpetual mine violations at its Freedom Mine No. 1 in Pike County, Kentucky. The action, which is the toughest enforcement action available to federal regulators, would shut down the mine until the company addresses safety hazards and demonstrates it can operate the mine safely. The suit, filed in U.S. District Court in Kentucky, cited nearly 2,000 safety violations since mid-2008, including a deadly mine explosion in early 2010. The suit said that six roof falls occurred at the mine since Aug. 11, 2010.
On April 29, 2011, federal regulators evacuated coal miners from portions of Massey's Randolph Mine after finding two dozen safety violations that could have triggered fires or explosions. The surprise inspection resulted in 20 "withdrawal" orders and five citations for excessive coal dust, weak water sprayers on mining equipment, illegal use of mining machines and failure to properly ventilate areas being mined. Eleven of the orders were issued for violations of the ventilation plan at the underground coal mine. According to assistant secretary of labor Joe Main: "The conduct and behavior exhibited when we caught the mine operator by surprise is nothing short of outrageous. The conditions observed at Randolph Mine place miners at serious risk to the threat of fire, explosion and black lung." Main also says some mining companies "still aren't getting it... despite the tragedy at Upper Big Branch last year."
Federal inspectors found some of the same safety violations at the Randolph mine during a surprise inspection a year ago.
WV citizens arrested on June 30, 2005 after refusing to leave Massey's Richmond VA headquarters until their demands heard.
On May 31, 2005, 16 people were arrested after crossing into Massey Energy property in Sundial, West Virginia at a protest against Massey's coal processing plant near the Marsh Fork Elementary School. The arrestees were taken to the Whitesville State Police detachment, where they were given citations and released, Vessels said. Vessels did not have a list of names, but said one woman was 80 years old, one was from Alabama, another from Tucson, Ariz., and some were local residents.
Following the lead established by students at Santa Clara University, who convinced the school's president to divest the university from Massey Energy stock, more schools are instigating similar campaigns. Senior Nate Blumenshine at Middlebury College planned a "Freeze on Coal" to launch a campaign to convince the administration to divest from coal. On March 10th, 40 students froze in place while getting lunch in the busiest cafeteria on campus. The activists held a pieces of charcoal in their hands. The "freeze" lasted for two minutes, after which the students continued with their meal, explaining to onlookers what had just happened.
Five people were arrested when activists from Climate Ground Zero unfurled a 40-foot-tall banner that read, "EPA stop MTR" at Massey's Edwight mountaintop removal mine. Massey recently starting blasting at the mine directly above the town of Naoma. Activists are concerned because the blasting is near a slurry dam, which poses a risk to the local Marsh Fork Elementary School.
State police removed eleven activists from two civil disobedience actions in West Virginia. In one action, six people locked themselves to mining equipment at a Patriot Coal mine on Kayford Mountain. Another group raised a 20-by-60-foot banner at Massey's Brushy Fork coal slurry impoundment near Pettus. The protesters are part of a coalition that includes Mountain Justice, Climate Ground Zero, and concerned citizens. Two of the eleven activists arrested were released from custody by May 25. Mike Roselle, the director of Climate Ground Zero, said the group was raising money to pay bail for the others.
Four protesters visited Massey's Twilight mountaintop removal site in Boone County, WV, and climbed a 20-story strip mining machine called a dragline. The activists unfurled a 15 foot by 150 foot banner that read, "Just Stop Mountaintop Removal." The action launched a week of protests at West Virginia MTR sites, leading up to a special action on June 23 in the Coal River Valley area. The June 23rd action will include local coalfield residents, NASA climate scientist James Hansen, actress Daryl Hannah, former US Representative Ken Hechler, and many others.
Ken Hechler discusses June 23 Massey Energy protest in WV.
Protesters from Climate Ground Zero and Mountain Justice occupied treetops at the edge of Massey Energy’s Edwight mountaintop removal site in Raleigh County, West Virginia. The activists unrolled banners reading "Stop Mountain Top Removal" and "DEP – Don’t Expect Protection." They were less than 30 feet from the mine and less than 300 feet from the blasting activity, which was forced to stop because of their close proximity. The protest lasted six days, when the last activist finally descended and was arrested. A spokesman for Climate Ground Zero said sleep deprivation had been endangering the protesters.
Two activists locked themselves to a drill rig and two others unfurled a banner reading "Save Coal River Mountain" to protest Massey's blasting at the Bee Tree mountaintop removal site. Residents are concerned because the blasts are 200 feet from the Brushy Fork Impoundment, which is permitted to hold nine billion gallons of coal sludge. Massey itself estimates that 998 people would die if the dam breaks. The activists said they plan to remain locked down until they are arrested.
Three non-violent climate change activists associated with Climate Ground Zero, perched themselves on 60-foot high platforms to protest the Bee Tree Mine on Coal River Mountain. Reports indicate that the protesters halted the day's operations. The activists were David Aaron Smith, Amber Nitchman and Eric Blevins. According to Climate Ground Zero reports, the three scaled trees by the access road to Massey Energy's infamous mountaintop removal operation near the company's Brushy Fork Impoundment.
Mike Roselle and two other environmental activists affiliated with Climate Ground Zero delivered a citizen's arrest warrant to the president of Marfork Complex on February 18, 2010, a subsidiary of Massey Energy, for allegedly violating West Virginia State Code §61-3E-10 for "wanton endangerment involving destructive devices, explosive materials or incendiary devices." The three were arrested after chaining themselves to chairs in the company's lobby. A cash bail was set for $5,000 to two of the activists, Joseph Hamsher and Thomas Smyth, causing the two to go on a hunger strike in protest of what they believed to be too high of a bail fee. As of February 22, 2010 the three remained in jail. A receptionist for the company was said to have had an anxiety attack following the event.
On March 9, 2010 two of the activists, Nick Martin and Josh Graupera, appeared before a Magistrate in Raleigh County for charges stemming from the November 21, 2009 drill rig lockdown and a January treesit on Coal River Mountain protesting Massey Energy.
Nick Martin locked himself to the actual drill itself, refusing to unlock, and was charged with trespassing , conspiracy, obstruction and littering. He was also accused of violating his bail agreement by failing to appear for an earlier court date; however, he never received notice of his court date due to postal service mistakes. Magistrate Massie refused to return the $2000 bail unless Martin plead guilty to trespassing and obstruction, which he did. Martin was sentenced to seven days in jail and $55 in fines for the two charges, while the conspiracy and littering charges were dropped. He began serving his sentence immediately. Martin had faced up to two and a half years in jail and thousands of dollars in fines.
Josh Graupera provided initial direct support to the treesitters on Coal River Mountain and was charged with trespassing and conspiracy. He plead guilty to both charges today and received a sentence of $100 in fines and no jail time.
In June 2011, the groups Free Speech for People and Appalachian Voices filed a "Request to Investigate Revocation of Massey Energy Company Corporate Charters" (PDF) for Delaware Attorney General Beau Biden to revoke the corporate charter of Massey Energy, citing a pattern of lawlessness on the part of Massey leading up to the Upper Big Branch Mine Disaster. The request states that during the 10 years leading up to the disaster, 54 Massey miners died--a death rate that is more than 15 times the death rate of other coal companies--and that the company had accumulated 62,923 reported violations. The report states that limited liability and the other privileges of a corporate charter are conditioned on good behavior and serving the public interest, and that Massey lost those privileges by breaking the law 62,923 times in 10 years and putting workers' lives in unnecessary danger. The report also goes on to address Massey's political activity, including past cases of large campaign contributions to elect appeals judges who overturn Massey's convictions. Delaware Attorney General Beau Biden is the son of Vice President Joe Biden.
On Sep. 16, 2011, over 35,000 signatures were delivered to the office of Delaware Attorney General Beau Biden by West Virginia residents, calling for General Biden to revoke Massey’s Corporate Charter. Biden received the petition and responded that he will review the matter.
In April 2009, Massey Energy announced it was cutting coal production and laying off employees in West Virginia because of market conditions. Massey idled the Black Castle Surface Mine in Boone County and laid off about 300 people.
On March 11, 2010 it was announced that the West Virginia Dept. of Environmental Quality (DEP) denied local citizens a public hearing regarding a show cause order for the Edwight Surface Mine. According to West Virginia state law, show cause orders, intended to be the final step prior to the DEP shutting down a mine site, are supposed to be settled in public hearings. Despite the West Virginia law, the DEP has decided not to hold a public hearing in the case of Edwight, and instead opted to privately negotiate a consent order with the mine operator, Alex Energy, a subsidiary company of Massey Energy.
As of March 2010, there have been 33 cited violations on the Edwight Surface Mine.
↑ 1.00 1.01 1.02 1.03 1.04 1.05 1.06 1.07 1.08 1.09 1.10 Massey Energy, "Preliminary Prospectus Supllement", Filed with the U.S. Securities and Exchange commission, March 22, 2010.
↑ "About Massey Energy - Corporate Coal Reserves," Massey Energy website, accessed September 2008.
↑ "Massey Energy Names New Company President," PR Newswire, November 13, 2008.
↑ Kimberly Kindy and Dan Eggen, "W.Va. mine disaster calls attention to revolving door between industry, government" Washington Post, April 18, 2010.
↑ 7.0 7.1 7.2 Mario Parker and Zachary R. Mider, "Alpha Natural Agrees to Buy Massey Energy for $7.1 Billion" Bloomberg, Jan. 29, 2011.
↑ Tim Huber, "Alpha CEO says Massey deal is about coal exports" Bloomberg, Jan. 31, 2011.
↑ Ken Ward Jr., "Massey-Alpha merger challenge hits state Supreme Court" Charleston Gazette, May 25, 2011.
↑ Ken Ward Jr., "Documents: Alpha CEO Crutchfield made secret deal to hire Massey execs linked to UBB disaster" Coal Tattoo, May 31, 2011.
↑ Clifford Kraus, "Shareholders Approve Massey Energy Sale to Alpha" NY Times, June 1, 2011.
↑ Becky Tarbotton, "Corporate Tax Dodgers: The Dirtiest Dozen" RAN, April 14, 2011.
↑ "Massey Energy starts work on W.Va. prep plant" Associated Press, November 19, 2010.
↑ Paul J. Nyden "Court: Ex-Massey subsidiary must refund Bayer $10M" Charleston Gazette, July 16, 2011.
↑ "Massey Energy has deal to buy Cumberland Resources Corp," PR Newswire, March 16, 2010.
↑ 16.0 16.1 Andy Kroll,"JPMorgan’s War on Nature" Mother Jones, March 30, 2010.
↑ "Coal CEO calls environmentalists crazy," Williamson Daily News, November 22, 2008.
↑ "West Virginia Judge Steps Out of Case Involving a Travel Companion," New York Times, January 19, 2008.
↑ "Too Generous," New York Times, September 7, 2008.
↑ "US top court to decide Massey Energy case", Reuters, November 14, 2008.
↑ Scott Finn, "Caperton v. Massey: what a long, strange case it's been," West Virginia Public Broadcasting, June 9, 2009.
↑ "W.Va. court asked to reconsider Massey ruling," Associated Press, December 3, 2009.
↑ "W.Va. towns with bad well water sue coal companies," Associated Press, February 3, 2009.
↑ "Settlement would direct coal dollars to water fund," Charleston Daily Mail, April 7, 2009.
↑ Ken Sard Jr., "Mediation sessions today in Mingo coal-slurry case" Charleston Gazette, Nov. 15, 2010.
↑ Jeff Goodell, "The Dark Lord of Coal Country" Rolling Stone, December 9, 2010.
↑ Vickie Smith "Slurry suit against Massey stands" Associated Press, July 22, 2011.
↑ Ken Ward "Coal Slurry Case Settled" Charleston WV Gazette, July 27, 2011.
↑ Ken Ward Jr., "AP: Slurry deal to cost Alpha/Massey $40 million" Coal Tattoo, Aug. 9, 2011.
↑ "Massey wins lawsuit over coal dust at W.Va. school" BusinessWeek, March 25, 2011.
↑ Vicki Smith, "Massey Wins Lawsuit Over Coal Dust at W.Va. School" ABC, March 25, 2011.
↑ Ken Ward "Suit by respirator maker blames black lung on Massey" Charleston WV Gazette, July 20, 2011.
↑ "Massey Energy to Pay Largest Civil Penalty Ever for Water Permit Violations," EPA website, January 17, 2008.
↑ "Massey Energy to Pay Largest Civil Penalty Ever for Water Permit Violations" EPA, Jan. 17, 2008.
↑ Ken Ward Jr., "Despite EPA deal, Massey water violations more frequent" Coal Tattoo, Jan. 11, 2010.
↑ Ken Ward Jr., "New water pollution suit filed against Massey" Coal Tattoo, April 27, 2010.
↑ Ken Ward Jr., "Judge Copenhaver: EPA settlement doesn’t block citizen suits over Massey water violations" Coal Tattoo, November 30, 2010.
↑ Ken Ward Jr., "Massey settles water pollution case with Sierra Club" Coal Tattoo, May 12, 2011.
↑ "Judge allows some Kentucky coal spill info to remain secret" Reporters Committee for Freedom of the Press, July 27, 2011.
↑ "Coal mine fire suit settled," West Virginia Record, November 17, 2008.
↑ "Miners injured at Aracoma seek damages," West Virginia Record, July 17, 2007.
↑ "Massey subsidiary fined $2.5M for fatal mine fire," Associated Press, April 15, 2009.
↑ 61.0 61.1 Bob Drogin and Nicole Santa Cruz,"25 miners killed in West Virginia explosion" LA Times, April 6, 2010.
↑ "Calif. teachers pension sues Massey Energy" Bloomberg Business Week, June 9, 2010.
↑ 66.0 66.1 66.2 66.3 66.4 Matt Whittaker, "Massey Idles Mine Amid Regulatory Scrutiny" Wall Street Journal, Dec. 1, 2010.
↑ 68.0 68.1 Kris Maher, "Mine-Blast Probe Finds Malfunctioning System, Equipment" Wall Street Journal, Jan. 19, 2011.
↑ 69.0 69.1 69.2 Howard Berkes, "Safety System Dysfunctional Before Mine Blast" NPR, Jan. 14, 2011.
↑ Jacob Fenton, Giovanni Russonello, "Coal mine deaths, fines and significant violations for the 10 largest coal mine controllers, 2000-2009" American University, Nov. 22, 2010.
↑ Howard Berkes, "Serious Safety Lapses Shut Down Parts Of Massey Coal Mine" NPR, May 3, 2011.
↑ Coalfield citizens arrested delivering demands to Massey headquarters, Mountain Justice Summer, June 30, 2005.
↑ Coalfield citizens arrested delivering demands to Massey headquarters, Richmond Times Dispatch, June 30, 2005.
↑ " E. Gordon Gee retires from controversial company", Ohio Citizen Action, June 2009.
↑ Jeff Biggers, "Green Commencement Speech: OSU President Gee Should Resign from Massey Board", Huffington Post, May 5, 2009.
↑ Mountain Justice, "The Martin County Coal Slurry Spill", YouTube, December 22, 2008.
↑ Jeff Biggers, "Mamas, Don't Let Your Babies Grow Up to be Mike Roselle" HuffingtonPost.com, February 19, 2010.
↑ Kennie Bass, "Massey Employee Returns To Work After Treatment" WCHS, February 22, 2010.
↑ "Two Pro-Mountain Activists Go to Court; One Goes to Jail" Climate Ground Zero, March 10, 2010.
↑ Amanda Starbuck, "35,000 People Call For Massey’s Corporate Charter to be Revoked" RAN, Sep. 19, 2011.
↑ "Massey, Cliffs idle WVa coal mines," Associated Press, April 10, 2009.
↑ "DEP Denies Public Hearing For Edwight Show Cause" Climate Ground Zero, March 11, 2010.
↑ 111.0 111.1 111.2 Dan Barry, "As the Mountaintops Fall, a Coal Town Vanishes" New York Times, April 12, 2011.
↑ Massey Energy, "Management Team", Massey Energy website, accessed April 2010.
↑ Massey Energy, "Board of Directors", Massey Energy website, accessed April 2010.
Andrew Clevenger, "'Legal experts' weigh in on U.S. Supreme Court's Benjamin ruling," "Managed Outrage" blog of The Charleston Gazette (West Virginia), June 9, 2009.
This page was last edited on 17 March 2015, at 15:53.

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