Judge denies millions in restitution in ex-coal CEO case

Convicted former energy company CEO Don Blankenship won’t have to pay a coal producer $28 million in restitution related to a mine explosion in 2010 that killed 29 men, a federal judge ruled Monday.

In her order, Judge Irene Berger said Blankenship doesn’t have to pay the money to Alpha Natural Resources, which bought Massey in 2011 after the explosion. The Bristol, Virginia-based coal company filed for bankruptcy in August.

The ruling was a win for Blankenship, helping him avoid a substantial blow to a personal fortune that he refused to disclose to prosecutors.

“We are pleased by the ruling. It is obviously correct,” said William Taylor, Blankenship’s lead defense attorney. “It is hard to see how Alpha could acquire Massey at a discounted price knowing of its problems and claim to be a victim in this case.”

Blankenship was convicted on Dec. 3 of a misdemeanor conspiracy to willfully violate mine safety standards at Upper Big Branch Mine in southern West Virginia. He faces a maximum of one year in prison and a $250,000 fine. He was acquitted of felonies that could have stretched his sentence to 30 years.

Blankenship will be sentenced Wednesday.

According to Berger’s order, Alpha paid $13.5 million to cooperate with the investigation into the explosion at Upper Big Branch.

The company incurred $10 million in mine safety violation penalties at the mine and spent $4.3 million to represent seven former Massey officers and employees who participated in the investigation, the order said.

Berger wrote that Alpha was dealt the financial hardships at least a year after Blankenship’s indictment period — after Alpha bought Massey in 2011 and voluntarily entered a non-prosecution agreement with the government.

Alpha and the U.S. Attorney’s office in southern West Virginia declined to comment on the ruling.

Blankenship’s defense also has called for Berger to dismiss 94 other claims for restitution from former Massey coal miners and family members.

comments powered by Disqus