The state Supreme Court heard arguments Wednesday afternoon over whether to reverse its November ruling that dismissed a $76 million verdict against Massey Energy, after photos surfaced of the state's chief justice and Massey's chief executive together on vacation along the French Riviera.
The state Supreme Court heard arguments Wednesday afternoon over whether to reverse its November ruling that dismissed a $76 million verdict against Massey Energy, after photos surfaced of the state's chief justice and Massey's chief executive together on vacation along the French Riviera.
Wednesday's arguments were heard without Chief Justice Elliott "Spike" Maynard, who recused himself from the case after the photos of him and Massey President and CEO Donald L. Blankenship were included in a filing by lawyers for Harman Mining, a bankrupt coal company, and its owner, Hugh Caperton.
Justice Larry Starcher also recused himself. Massey's lawyers had asked him to do so because of public comments he made about Blankenship, calling him a "clown" and "stupid."
Judges Fred Fox (left) of the 16th Circuit and Donald Cookman of the 22nd Circuit listen to arguments in a rehearing of a $76 million judgment awarded to Harman Mining Co. against Massey Energy Co. before the state Supreme Court in Charleston Wednesday. Judges Fox and Cookman replace Justices Larry Starcher and Elliott “Spike” Maynard respectively.
Starcher and lawyers for Harman and Caperton have also repeatedly asked Justice Brent Benjamin to recuse himself as well, because Blankenship spent about $3.5 million to help Benjamin get elected in 2004. Benjamin has repeatedly refused to step down from the case, and is acting as chief justice in Maynard's absence.
Benjamin named two circuit judges to replace Maynard and Starcher for Wednesday's proceedings: Donald H. Cookman of Hampshire County and Fred L. Fox II of Marion County.
The initial verdict against Massey came in 2002. After a seven-week trial, a Boone County jury found Massey guilty of hijacking a coal-supply contract that Harman had to supply metallurgical coal to LTV Steel, which operated a steel mill in Pittsburgh.
The original verdict was $60 million. With interest, it would now be more than $76 million.
In November, the Supreme Court overturned that verdict in a 3-2 ruling written by Justice Robin Davis, who argued the Boone County lawsuit was improperly filed because Harman had already won a $6 million jury verdict in Virginia for breach of contract.
Maynard and Benjamin sided with Davis. Starcher and Justice Joe Albright dissented.
On Wednesday, Davis vigorously defended her November opinion, arguing that Virginia law required Harman and Caperton to file only one lawsuit against Massey.
But David B. Fawcett III and Bruce Stanley, lawyers for Caperton and Harman, argued the Virginia jury verdict focused simply on how Massey breached Harman's coal-supply contract after buying Wellmore Coal Co., which had a long-term supply contact with LTV.
The state Supreme Court heard arguments Wednesday afternoon over whether to reverse its November ruling that dismissed a $76 million verdict against Massey Energy, after photos surfaced of the state's chief justice and Massey's chief executive together on vacation along the French Riviera.
Wednesday's arguments were heard without Chief Justice Elliott "Spike" Maynard, who recused himself from the case after the photos of him and Massey President and CEO Donald L. Blankenship were included in a filing by lawyers for Harman Mining, a bankrupt coal company, and its owner, Hugh Caperton.
Justice Larry Starcher also recused himself. Massey's lawyers had asked him to do so because of public comments he made about Blankenship, calling him a "clown" and "stupid."
Starcher and lawyers for Harman and Caperton have also repeatedly asked Justice Brent Benjamin to recuse himself as well, because Blankenship spent about $3.5 million to help Benjamin get elected in 2004. Benjamin has repeatedly refused to step down from the case, and is acting as chief justice in Maynard's absence.
Benjamin named two circuit judges to replace Maynard and Starcher for Wednesday's proceedings: Donald H. Cookman of Hampshire County and Fred L. Fox II of Marion County.
The initial verdict against Massey came in 2002. After a seven-week trial, a Boone County jury found Massey guilty of hijacking a coal-supply contract that Harman had to supply metallurgical coal to LTV Steel, which operated a steel mill in Pittsburgh.
The original verdict was $60 million. With interest, it would now be more than $76 million.
In November, the Supreme Court overturned that verdict in a 3-2 ruling written by Justice Robin Davis, who argued the Boone County lawsuit was improperly filed because Harman had already won a $6 million jury verdict in Virginia for breach of contract.
Maynard and Benjamin sided with Davis. Starcher and Justice Joe Albright dissented.
On Wednesday, Davis vigorously defended her November opinion, arguing that Virginia law required Harman and Caperton to file only one lawsuit against Massey.
But David B. Fawcett III and Bruce Stanley, lawyers for Caperton and Harman, argued the Virginia jury verdict focused simply on how Massey breached Harman's coal-supply contract after buying Wellmore Coal Co., which had a long-term supply contact with LTV.
Justice Joseph Albright, who was in the minority on Nov. 21 to uphold the Boone County verdict, said Massey's "activities and misconduct" were much broader than violations "involving the coal supply agreement" - the focus of the Virginia verdict.
"The law of Virginia is not as crystal clear as we would like it to be," Albright said Wednesday. "This court has some obligation to look at what the totality of that development [the collapse of Harman Mining] was."
But D.C. Offutt Jr., a lawyer representing Massey Energy, argued that the Nov. 21 ruling was a good one.
"If you look at the breach of the contract supply agreement, that's what triggered the economic failure of the Harman companies," Offutt said. "That's what led to the bankruptcy.
"Virginia law is clear, that they had to bring those claims in Virginia, that they were part of the same transaction," he said.
Fawcett stressed that Massey executives, including Blankenship, had obtained confidential corporate information when they met with Caperton in late 1997 to discuss buying Harman Mining.
Massey executives then used information from "negotiations to buy Harman to collapse the deal," Fawcett argued. They then purchased mining rights to a nearby wall of coal from Pittston, which effectively prevented Harman from expanding its mining operations and helped bankrupt the company, he said.
Today, the Grundy mine still operates, but with nonunion workers.
Phil Smith, a spokesman for the United Mine Workers attended Wednesday's hearing in Charleston with three Virginia union miners who lost their jobs.
The court is likely to release a decision sometime this spring. Whichever side loses could appeal the decision to the U.S. Supreme Court.
The Associated Press contributed to this report. To contact staff writer Paul J. Nyden, use e-mail or call 348-5164.
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