Nine Justice Companies Maintain They Should Be Dismissed From Federal Lawsuit in Virginia
By Brad McElhinny
August 6, 2019 - Nine companies owned by Gov. Jim Justice and his family continue to maintain they should not be a part of a lawsuit filed in U.S. District Court for the Western District of Virginia.
The companies say they were part of a company reorganization that recently brought them under headquarters in Daniels, West Virginia.
Twenty-three Justice coal companies that were sued in May by federal prosecutors and the federal agency that oversees mine safety over millions of dollars in unpaid safety fines.
Nine of the Justice companies last month asked for the lawsuit to be dismissed, saying their operations are actually in West Virginia and that they have no coal operations in Virginia.
In response, federal prosecutors contended that a separate lawsuit filed by the Justice companies this spring listed all nine with headquarters in Roanoke, Va.
“Movants’ stunning assertion now that they have no ties to the Western District of Virginia is negated by the ample evidence to the contrary,” wrote U.S. Attorney Thomas Cullen, the chief federal prosecutor in that district.
The prosecutors also say the companies fall under the structure of Bluestone Energy of Roanoke, Va. The prosecutors pointed to a March 14 deposition of Steve Ball, vice president and general counsel.
In a reply that was filed last week, lawyers for the Justice companies said that information is outdated.
“It is also true that, as of March 14, 2019, Bluestone Resources Inc., was in the midst of a corporate reorganization with the intent to relocate certain functions of the Bluestone Resources Inc.’s subsidiaries to Daniels, West Virginia,” wrote lawyers for the Justice companies.
Although a separate lawsuit by Justice companies against the U.S. Office of Surface Mining Reclamation and Enforcement listed the nine companies with a Roanoke address, “The attorneys were unaware of the detailed corporate activities of the Bluestone Resources Inc., at the time the OSMRE complaint was filed.”
The discrepancy, the lawyers continued, was “A mistake. An inadvertent oversight. It was not the intent to mislead this court.”
An affidavit that was included with the filing is a statement from a lawyer in the suit against OSM, saying that previous work and familiarity with the Justice companies led to the error.
“At the time of drafting of the complaint in the OSM action, we assumed that the companies identified therein were based in Roanoke, Virginia,” wrote Thomas Ezzell, a lawyer with Getty Law Group. “We based this assumption on our previous work for Mr. Justice and his companies.”
“At the time of the filing of the complaint, we were unaware that certain individuals had been hired and that certain operations had previously been relocated from Roanoke, Virginia, to West Virginia.”
The Justice companies seeking to be dismissed also contend that the venue should take into account where their mining operations have been, rather than the location of their accounting functions.
Those listed on the motion to dismiss include Double Bonus Coal, Dynamic Energy, Frontier Coal, Justice Energy Company, Justice Highwall Mining, Keystone Services Industries, M&P Services, Nufac Mining, and Pay Car Mining Company.
“The corporate office is West Virginia, the corporate officers and employees are in West Virginia, and many potential witnesses for trial are in West Virginia,” wrote lawyers for the Justice companies in the original motion to dismiss.
The 23 defendants are: Southern Coal Corporation; Justice Coal of Alabama; A&G Coal Corporation; Black River Coal; Chestnut Land Holdings; Double Bonus Coal Company; Dynamic Energy; Four Star Resources; Frontier Coal Company; Infinity Energy; Justice Energy Company; Justice Highwall Mining; Kentucky Fuel Corporation; Keystone Service Industries; M&P Services; Nine Mile Mining; Nufac Mining Company; Pay Car Mining; Premium Coal Company; S and H Mining; Sequoia Energy; Tams Management; and Virginia Fuel Corporation.
According to court documents, MSHA collectively issued at least 2,297 citations to the operations for violations of the Mine Health and Safety Act between May 3, 2014, and May 3, 2019.
“The defendants failed to pay the penalties or even notify MSHA that it contested the assessed civil penalties,” according to a statementput out by the U.S. Attorney’s Office.