The lawsuit was filed last week in Kanawha County Circuit
Court on behalf of Manville Personal Injury Trust, which owns stock in Massey
It crossed a legal hurdle yesterday, when a Kanawha
County judge issued an order in its
favor. The order says Massey Energy's Board of Directors must prove that it did
meet terms of a lawsuit settlement reached in 2008 or else the board will be
held in contempt of court.
Badge Humphries is an attorney with South Carolina-based law
firm Motley Rice LLC.
“The initial case back in 2007 and the case we filed last
week on Thursday, the allegations are that the Board had red flags about
violations of laws, rules and regulations concerning mine safety,” he said.
knowing of those problems, either utterly failed to institute any system to
monitor for compliance, or else having instituted an informational system, just
chose to disregard the information that came up from the subsidiaries and just
disabled themselves from the process.”
As part of the settlement from the lawsuit filed after the
Aracoma fire, Massey was required to set up a monitoring and reporting system
for mine safety and environmental violations. This information was supposed to be
shared with investors. Humphries says at least some of that didn’t happen.
“What we know is that they didn’t include a report to the
shareholders. We don’t know where along the chain information has been lost,”
“But in light of the events leading up to Upper Big Branch and what
happened at Upper Big Branch, there appear to be fundamental problems such that
we argue it’s undeniable that there are more problems to be uncovered with the
board’s compliance with this order.”
Humphries says this new lawsuit attempts to make Massey’s
Board of Directors accountable for the Upper Big Branch disaster, and its
impact on the company’s bottom line.
“We want to make sure that the persons responsible at the
highest levels of Massey Energy are ultimately held accountable for this
disaster and the damages to the company,” he said.
“And by that, it will also
we believe prevent similar disasters from occurring in the future and prevent
similar histories of violations from developing at particular mines that
increase the likelihood of such disasters.”
lawyer Andy MacQueen is also working on the case. He says Massey's safety
record needs to be addressed soon, to make sure miners are not working in
“It has been reported that because of the close of this mine
that Massey intends to ramp up production at other mines and facilities,”
“And we think it’s absolutely imperative that we get really good
solid information about what’s being done to ensure these other mine sites are
not potentially the same kind of dangerous situation as the Upper Big Branch
Though the lawsuit doesn’t demand a change in the company’s
leadership, both attorneys say it would probably be in the shareholder’s best
interest. Massey issued a press release yesterday emphasizing the Board of
Director’s support of CEO Don Blankenship.