For 3rd time, W.Va. Supreme Court finds for Massey

AP News
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Posted: Nov 13, 2009 9:39 AM

A multimillion-dollar coal contract dispute that went all the way to the U.S. Supreme Court took its latest turn Thursday with another ruling in favor of Massey Energy Co.

For the third time in nearly two years, West Virginia's Supreme Court has overturned a $50 million jury verdict against the Richmond, Va.-based coal producer. Post-judgment interest had increased the award to $86.2 million.

The 4-1 ruling was again written by Justice Robin Davis, and again concludes that Harman Mining and its president, Hugh Caperton, should have pursued their claims in Virginia under a clause in the contract at issue.

Justice Margaret Workman dissented and may issue a separate opinion explaining her stance.

"We have always stated that the West Virginia Supreme Court's initial decision in favor of Massey was correct, the essential facts in this case have not changed, and no legal arguments were presented by our opponent that would have merited reversal," said Shane Harvey, a Massey lawyer and vice president in a statement. "The Court's decision represents a total vindication of Massey Energy's longstanding legal position."

Lawyers for Harman and Caperton both expressed disappointment with the outcome.

"It is a shame that there has been yet another miscarriage of justice in this lengthy saga," said Bruce Stanley, a lawyer for Caperton. "Certainly we will consider all alternative avenues of relief going forward."

A 2002 Boone County jury had found that Massey bankrupted Harman and Caperton after hijacking a coal supply contract. When it ruled for Massey the first time, in November 2007, the state Supreme Court concluded that while the company's "conduct warranted the type of judgment rendered in this case," the law "simply did not permit this case to be filed in West Virginia."

But the state high court agreed to give the case a second look last year, after photos surfaced showing then-Chief Justice Elliott "Spike" Maynard vacationing with Massey Chief Executive Don Blankenship in Monaco. Maynard had helped form a 3-2 majority in the initial ruling.

After Maynard recused himself from rehearing the appeal, the state court again ruled 3-2 to reverse. That prompted lawyers for Harman and Caperton to petition the U.S. Supreme Court. They focused on the $3 million that Blankenship had spent helping another justice, Brent Benjamin, win his seat in the 2004 election.

Faulting Benjamin for remaining in the case, the nation's top court concluded in June that elected judges must step aside when large campaign contributions from interested parties create the appearance of bias.

"It is a shame that the remedy for these wrongs has been set aside," David Fawcett, a lawyer for Harman, said in a statement. "Nonetheless, we are proud of our effort and the important precedent set in this case by the United Supreme Court in establishing limits to the improper influence of money in judicial elections."

That 5-4 ruling sent the case back to West Virginia for a third review, and barred Benjamin from again hearing it. A retired county circuit judge, James Holliday, sat in his place for Thursday's ruling. Workman and the remaining two justices were new to the appeal: Menis Ketchum was elected along with Workman in November, while Thomas McHugh was appointed following the March death of Justice Joseph Albright.

In a separate ruling Thursday, also decided 4-1 and written by Davis, the state Supreme Court ruled against The Associated Press in a case involving a Freedom of Information Act request it had filed seeking communications between Maynard and Blankenship in the wake of the Riviera photo's release.