USA: Blankenship gets only a year's gaol for coal crimes

Published by MAC on 2016-04-07
Source: Associated Press, Bloomberg, Reuters

Bereaved families left merely "hugging tombstones"

Former coal CEO Don Blankenship gets one year in prison for deadly mine blast

One day after the sixth anniversary of the Upper Big Branch Mine explosion, which killed 29 men, a judge gave him the maximum prison time and a hefty fine

Associated Press

6 April 2016

Charleston, West Virginia - A judge sentenced former coal executive Don Blankenship to a year in prison on Wednesday for his role in the deadliest US mine explosion in four decades, saying he was part of a “dangerous conspiracy”.

One day after the sixth anniversary of the Upper Big Branch Mine explosion, which killed 29 men, US district judge Irene Berger gave the ex-Massey Energy CEO the maximum prison time and fined him the maximum of $250,000.

A federal jury convicted Blankenship on 3 December of a misdemeanor conspiracy to willfully violate mine safety standards at Upper Big Branch.

Blankenship spoke briefly during the sentencing hearing and said he wanted to reassure the families of the fallen miners that they were “great guys, great coal miners”. The main point he wanted to express, he said, was “sorrow to the families and everyone about what happened”.

In his next breath, he denied culpability.

“It is important to everyone that you know that I’m not guilty of a crime,” Blankenship said.

Blankenship’s attorneys contended he should receive probation and a fine, at most. The judge denied their motion for Blankenship to remain free as he appeals. It’s not clear when he must report to prison.

As Blankenship left the courthouse, a few family members of miners who were killed started yelling at him while he and his attorneys spoke with reporters.

“We buried our kid because of you,” said Robert Atkins, whose son Jason died in the explosion. “That’s all I got is a goddamn tombstone.”

Asked by a reporter what he had to say to the shouting family members, Blankenship said: “Well, just that the coal miners didn’t cause the accident.”

Then about a half-dozen law enforcement officers surrounded Blankenship and his team and ushered them into an awaiting van.

Four investigations found worn and broken cutting equipment created a spark that ignited accumulations of coaldust and methane gas. Broken and clogged water sprayers then allowed what should have been a minor flare-up to become an inferno.

Blankenship disputes those reports. He believes natural gas in the mine, and not methane gas and excess coaldust, was at the root of the explosion.

His sentencing capped a wide-spanning investigation into Massey following the explosion. Four others up the Massey corporate chain were convicted before Blankenship.

The judge described Blankenship’s rise from a meager, single-mother Appalachian household to one of the wealthiest, most influential figures in the region and in the coal industry.

“Instead of being to be able to tout you as a success story, we are here as a result of your part in a dangerous conspiracy,” she said.

During the trial, prosecutors called Blankenship a bullish micromanager who meddled in the smallest details of Upper Big Branch. They said Massey’s safety programs were just a facade – never backed by more money to hire additional miners or take more time on safety tasks.

Blankenship was acquitted of felonies that could have stretched his sentence to 30 years.

On Wednesday, lead defense attorney William Taylor said the former US attorney was “using this case as part of the reason to vote for him.” Booth Goodwin left the office shortly after Blankenship’s conviction to run for governor.

“Well, when all else fails, attack the prosecutor,” Goodwin said after the sentencing.

The judge already ruled that Blankenship won’t have to pay $28m in restitution to Alpha Natural Resources, helping him avoid a serious blow to his personal fortune. Alpha bought Massey in 2011 after the explosion, and wanted Blankenship to pay legal fees it covered for former Massey employees, costs to cooperate with the investigation and mine safety fines incurred at Upper Big Branch.

Berger also ruled that Blankenship would not have to pay restitution to about 100 people, including former miners and family members.

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Blankenship Gets Year in Prison Over Mine-Safety Conspiracy

Jef Feeley and George Hohmann

Bloomberg

6 April 2016

Six years after 29 miners were killed in a West Virginia coal dust explosion, the man who ran the mining company like a fiefdom -- a coal baron and power broker who earned millions of dollars a year -- learned Wednesday he’s prison-bound.

Donald Blankenship, who presided over his coalfields from a mountaintop castle, was sentenced Wednesday to a year in prison and a $250,000 fine, the maximum punishment after his misdemeanor conviction for conspiring to flout mine-safety rules. In December he became the first chief executive officer in U.S. history found guilty of a workplace-safety crime, prosecutors said.

Blankenship, 66, stood stone-faced Wednesday as U.S. District Judge Irene Berger handed down the sentence and then denied his request to remain free on bond while he appeals. The former Massey Energy CEO, who didn’t testify at trial, denied Wednesday that he masterminded a scheme to evade mining regulations and speed-up coal production.

“It’s important for everyone to know that I am not guilty of any crime,” Blankenship told Berger. “There’s no direct evidence that I committed any crime.”

While Blankenship apologized in court to the families of the miners killed in the 2010 Upper Big Branch explosion, relatives heckled him as the former coal baron was interviewed outside the federal courthouse in Charleston, West Virginia.

Tombstone Reminder

“How come you never come to apologize to me personally? You don’t have a heart!” Tommy Davis, a former Massey miner whose brother Charles was killed in the explosion, shouted at Blankenship. “For six years, he never apologized,” Davis told reporters later through tears. “He’s got family to hug him. I’ve got tombstones.”

Blankenship’s lawyers argued that the former top executive, cleared of securities fraud and making false statements, didn’t deserve to be locked up. “Probation will provide ample warning and deterrence” to other mine operators, the lawyers said in court papers.

William Taylor, Blankenship’s lead lawyer, argued Wednesday that federal prosecutors in West Virginia charged the coal baron for political purposes. He noted Booth Goodwin, who stepped down as U.S. Attorney in Charleston in December to run for governor, had made Blankenship’s conviction the centerpiece of his campaign.

Vote Getter

Blankenship’s conviction is being trumpeted “as the reason to vote” for Goodwin even though the defense expects an appeals court to conclude “the government did not prove” the former CEO committed any crime, Taylor told the judge.

A blunt taskmaster who bullied underlings and controlled virtually all of Massey’s operations, Blankenship turned the mining company into the U.S.’s fourth-largest coal producer. West Virginia officials said Massey grew into a “towering presence in the Appalachian coalfields,” with workers’ homes flying the company’s flag, a picture of a flame leaping out of an M.

Blankenship, a Republican, spent heavily to back politicians and judges friendly to the coal industry, according to state reports. He spent $3 million in 2004 to support a candidate for the West Virginia Supreme Court of Appeals. The winning judge later helped overturn a $50 million jury award against some of Massey’s units. In 2009, the U.S. Supreme Court ruled that the judge shouldn’t have participated in the case.

Investigators began probing the fatal blast at the Upper Big Branch facility, located about 30 miles (50 kilometers) south of Charleston, the state capital, immediately after rescue crews removed workers’ remains.

State Findings

A state panel concluded that Massey managers forced miners to ignore basic safety measures, such as controlling coal dust and ensuring the mine had proper ventilation, as part of a push to increase production. The company operated the site in a “profoundly reckless manner,” the panel said.

Blankenship disputed the state findings, contending the explosion was caused by a stray spark from a mining machine and federal regulators had refused to allow Massey to use the company’s preferred ventilation plan.

The disaster should’ve sparked reforms on mine safety, said Phil Smith, spokesman for the United Mine Workers of America in Triangle, Virginia. But if changes didn’t come within weeks or months of the deaths of the miners, Smith said he doesn’t expect them to come now.

“Don Blankenship deserves to go to jail, for that is surely where he belongs,” Smith said. “Although this sentence will not begin to make him atone for his crimes, there is a higher court he will answer to someday, and I have complete faith that the justice he receives there will be more than adequate.”

Compensation Boost

Prosecutors argued at trial that Blankenship pushed managers to emphasize coal production over safety concerns so he could fatten his annual compensation packages. Annual coal tonnage figured into the CEO’s bonus pool, according to court filings.

At trial, prosecutors presented evidence showing that in 2009 alone Blankenship made more than $18 million. He stepped down as Massey’s top executive in 2010 with a $12 million retirement package. Five months later Alpha Resources Inc. acquired the company for $7.1 billion.

“Mr. Blankenship gambled with the lives of miners all for the sake of money,” Assistant U.S. Attorney Steve Ruby told Berger Wednesday. Ruby has been nominated to replace Goodwin as U.S. Attorney in Charleston.

Officials of Alpha, which filed for bankruptcy protection in August, asked for $28 million in restitution from Blankenship to cover legal expenses and fines tied to the Upper Big Branch disaster. The judge denied the request earlier this week along with restitution requests from miners’ families.

Recorded Talks

Even though Blankenship didn’t take the witness stand during his trial, his own words came back to haunt him as jurors reviewed internal memos and listened again and again over seven weeks to recordings he secretly made of telephone conversations.

Blankenship said Massey managers should keep quiet about safety issues and focus on what “pays the bills,” according to one memo. Their job, he said, was simply to “run coal.”

It’s likely the Bureau of Prisons will assign him to a minimum-security facility because of his short stay, said Larry Levine, who served 10 years in federal prisons and now advises on how to survive time behind bars.

Each day will start at 6 a.m. as a loudspeaker blares, “The Compound is Now Open!” Levine said. Blankenship will probably be assigned a demeaning job and may not get to pick whether he sleeps on a bottom or top bunk bed, the consultant said. Meals will feature beans, rice and tortillas.

“It’s going to be a rude awakening for somebody who made $18 million in salary and bonuses one year to go to making 12 cents an hour scrubbing showers and toilets,” Levine said.

The case is U.S. v. Blankenship, 14-cr-00244, U.S. District Court, Southern District of West Virginia (Charleston).

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Former Kentucky state lawmaker sentenced to seven years for bribery

By Steve Bittenbender

http://www.reuters.com/article/us-kentucky-corruption-idUSKCN0WQ2D1

24 March 2016

LOUISVILLE, Ky. - A former Kentucky lawmaker received a seven-year prison sentence on Thursday for bribing an inspector to overlook violations at his coal mining companies, his attorney said.

Former state Representative W. Keith Hall, 56, who was convicted in federal court in June 2015 of paying $46,000 over a five-year period to former mining inspector Kelly Shortridge, was also fined $25,000, said his attorney, Brent Caldwell.

Prosecutors said at Hall's trial in Lexington that most of the funds were funneled from Hall’s companies to a shell company the two men created in the name of Shortridge’s wife.

Shortridge reached a plea agreement and testified against Hall. He is slated to start his 24-month sentence next week.

According to court documents, sentencing guidelines for Hall called for more than eight years in prison.

His attorneys argued a sentence closer to the minimum 6-1/2 years was more appropriate. Caldwell said on Thursday an appeal was still possible, adding his client disagreed with the verdict.

Hall, a Democrat, served 14 years in the Kentucky General Assembly before losing a primary election in May 2014. His indictment came five months later. His companies listed in the indictment included Beech Creek Coal Co, LLC & HEI Services LLC.

(Reporting by Steve Bittenbender, Editing by Ben Klayman and Peter Cooney)