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Coal firms may catch break from suits
Publication: THE CHARLESTON GAZETTE
Published: Sunday, April 18, 1999
Byline: Paul J. Nyden
SUNDAY GAZETTE-MAIL A month ago, the Workers' Compensation Performance Council urged Employment Programs Commissioner William Vieweg to drop up to $200 million in lawsuits against coal companies.
Vieweg has not yet acted on the council's recommendation. If he follows the council's recommendation, he will drop lawsuits against 25 large coal companies, but keep suing smaller coal contractors that mined coal for those larger companies. Most of them have disappeared or gone bankrupt.
The owners of several of the larger companies were contributors to Gov. Cecil Underwood in 1996 and are now giving again to his re-election campaign.
These companies would save tens of millions of dollars if the lawsuits are dropped. These contributors include: A.T. Massey Coal Co.; James "Buck" Harless of Gilbert; James C. Justice II of Beckley; and James O. Bunn and Omer Bunn of Grundy, Va.
Steve White, a Charleston lawyer and co-chair of the state Democratic Party, said, "It will raise questions if the Underwood administration decides to dismiss massive collection lawsuits against companies who contributed heavily to Gov. Underwood." The Workers' Comp debts and political contributions made by owners of companies being sued include: s A.T. Massey Coal Co., which along with its contractors owes $40.3 million in unpaid compensation premiums and interest, according to a lawsuit filed last year against Massey, several of its subsidiaries and contractors.
In 1996, Massey executives raised $100,000 for Underwood. Most came from guests at an August fund-raiser at the Mingo County home of Massey President Don Blankenship. Executives from Fluor Corp., Massey's parent company, gave another $17,000 just before Election Day.
Massey contractors named in the lawsuit contributed another $1,150 to Underwood in 1996.
Two Massey subsidiaries also gave $20,000 to Underwood's inaugural festivities s Harless and three of his companies - Hampden Branch Coal Co., Chafin Branch Coal Co. and Gilbert Imported Hardwoods Inc. - which owe more than $2.5 million to the Workers' Compensation Fund.
In 1996, Harless, his executives and their wives gave Underwood $9,000. Harless spent another $7,982 independently to buy newspaper ads for Underwood just before the election, according to campaign reports filed with Secretary of State Ken Hechler.
International Industries, another Harless company, gave $10,000 to fund Underwood's inaugural celebration.
This year, Harless, his executives and their wives gave $5,000 to Underwood's 2000 campaign s Justice, Bluestone Coal Co. and 50 Bluestone coal contractors, which owe at least $9.3 million in unpaid compensation premiums and interest, according to the lawsuit filed in December 1996.
In 1996, Justice, his wife Cathy and Byrd White III, all officers of Bluestone, gave Underwood $3,000.
The Bunns own several coal companies, including Eaglehawk Carbon Inc., that owe at least $1.4 million to Workers' Compensation.
In 1996, the Bunns gave Underwood's campaign $2,600.
Northland Resources, another Bunn company, gave $5,000 to the inaugural. This year, James O. Bunn gave Underwood a $1,000 political donation.
Underwood, once an Island Creek Coal vice president, has always received major political backing from the coal industry.
In 1996, he raised more than $250,000 from coal executives, about 12 percent of $2.1 million he raised that year. Coal companies gave another $253,850 to his inaugural.
This year, Underwood is getting tens of thousands from coal companies again. It is difficult to calculate a precise total, because the finance report filed by "Team 2000 Underwood" earlier this month is incomplete.
At least $150,000 of this total came from coal companies being sued for Workers' Compensation debts.
When the Performance Council voted March 12 to urge Vieweg to drop these lawsuits, all four business members and all four labor members backed the resolution.
Fred Tucker, a retired United Mine Workers official, and Thad Epps, a retired Union Carbide spokesman, introduced the resolution that argued the lawsuits were too complex.
Tucker called the legal theory behind the suits "pie in the sky. It is unproven, untried." The suit against Bluestone was ready to go to trial in September before McDowell County Judge Booker Stephens. Coal industry lawyers delayed the trial, and all the others, by asking to move 12 of the lawsuits to federal court.
On March 23, U.S. District Judge David Faber sent them all back to state court.
Whether the trials will begin now rests in Vieweg's hands.
Underwood representatives have referred questions on this matter to Vieweg, who has not returned several telephone calls to his office seeking comment during the past month.
To contact staff writer Paul J. Nyden, call 348-5164.