W.Va. Justices hear Massey arguments for third time

Steve Korris Sep. 8, 2009, 8:37pm



CHARLESTON, W.Va. (Legal Newsline) - Twice the West Virginia Supreme Court of Appeals overturned a $50 million verdict against Massey Coal, but both decisions fell through.

Now, a new Court must decide the case once and for all.

On Sept. 8, the Justices heard oral argument on Massey Coal's appeal of a Boone County verdict in favor of former mine owner Hugh Caperton and his company.

Massey Coal's lawyer pleaded that Caperton litigated the same claim, that Massey Coal purposely drove him into bankruptcy, in a Virginia court.

Caperton's lawyer pleaded that the cases involved different conduct and claims.

The Court has heard the same argument three years in a row, with different Justices on the bench each time.

Only Justice Robin Davis remains from the previous decisions. On both occasions she wrote opinions in Massey's favor, for majorities of three to two.

In the first decision, Justices Spike Maynard and Brent Benjamin joined Davis, while Justices Larry Starcher and the late Joseph Albright dissented.

That decision fell through after the public saw photographs of Maynard on a Riviera vacation with Massey Coal owner Don Blankenship.

The Court granted rehearing. Maynard disqualified himself and so did Starcher, who had expressed harsh personal views about Blankenship.

On rehearing, circuit judges Donald Cookman and Fred Fox replaced Maynard and Starcher.

Fox sided with Davis and Benjamin, and Cookman dissented with Albright.

Caperton appealed to the U.S. Supreme Court, claiming Benjamin should have disqualified himself because Blankenship helped him win a seat on the Court in 2004.

Blankenship spent about $3 million on advertising that attacked Benjamin's opponent, Warren McGraw.

In June, the U.S. Supreme Court ordered Benjamin to disqualify himself.

By then Albright had died, Starcher had retired and voters had rejected Maynard.

At the third hearing on Tuesday, Justice Thomas McHugh and newly elected Justices Menis Ketchum and Margaret Workman heard the case for the first time. Retired Putnam Circuit Judge James Holliday occupied Benjamin's chair by temporary assignment.

For Massey Coal, D.C. Offutt argued that the coal supply contract at the heart of the case required resolution of disputes in Buchanan County, Va.

He argued that a court judgment in Virginia precluded any litigation in West Virginia under the doctrine of "res judicata," which in Latin means "a matter decided."

For Caperton's business, David Fawcett of Pittsburgh argued that Massey Coal committed a series of unlawful acts that the Virginia court didn't address.

He said the Virginia court heard a breach of contract claim, while the West Virginia court heard claims of tortuous interference and fraud.

He said Caperton's business, Harman Development, would have stayed in business if the only blow had been the breach of contract.

Fawcett said West Virginia venue was proper because bad acts occurred in the state.

Ketchum asked, "Were there any bad acts in Boone County?"

Fawcett said, "Oh sure." He said Massey Coal arranged to substitute its coal for coal that would have come from Boone County.

He said Massey Coal "seeks to take advantage of a contract it destroyed."

For Caperton personally, Bruce Stanley of Pittsburgh said the primary injury occurred after the breach of contract.

He said Caperton negotiated with Massey Coal and the deal crashed.

He said Caperton found himself on a government "blackball list" that banned him from coal mining.

He said Massey Coal used confidential information from the negotiations for improper purposes.

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