The former Massey Energy CEO was indicted on Thursday in relation to safety violations leading to 29 Miners’ deaths in the Upper Big Branch Mine Disaster.
[Photo from p. 33 of “Upper Big Branch, The April 5, 2010, explosion: a failure of basic coal mine safety practices Report to the Governor Governor’s Independent Investigation Panel“, May 2011.] See: https://miningawareness.wordpress.com/2013/12/12/upper-big-branch-mine-disaster-2010-29-died-on-easter-monday/
“There were many factors that led to this disaster. But there is only one source for all of them: A rogue corporation, acting without real regard for mine safety and health law and regulations, that established a physical working environment that can only be described as a bomb waiting to go off. /
And that same company established a working environment where, operating through subterfuge, fear and intimidation, management prevented any opportunity for the workers to know the full range of dangerous conditions in the mine, or to effectively protest them even if they did know.” United Mine Workers of America: http://www.umwa.org/files/documents/134334-Upper-Big-Branch.pdf (The mine was not unionized so the workers had no one to help with safety concerns. After the catastrophe the UMWA were called to help evaluate the situation).
“FOR IMMEDIATE RELEASE
November 13, 2014
FORMER MASSEY ENERGY CEO INDICTED
Donald Blankenship Faces Four Charges Including Conspiracy, Fraud and Making False Statements
CHARLESTON, W.Va. – United States Attorney Booth Goodwin announced that a federal grand jury today returned an indictment charging Donald L. Blankenship, former Chief Executive Officer of Massey Energy Company, with four criminal offenses. The indictment charges Blankenship with conspiracy to violate mandatory federal mine safety and health standards, conspiracy to impede federal mine safety officials, making false statements to the United States Securities and Exchange Commission (SEC), and securities fraud.
The indictment alleges that from about January 1, 2008, through about April 9, 2010, Blankenship conspired to commit and cause routine, willful violations of mandatory federal mine safety and health standards at Massey Energy’s Upper Big Branch mine, located in Raleigh County, West Virginia. The indictment alleges that during this same period of time, Blankenship was part of a conspiracy to impede and hinder federal mine safety officials from carrying out their duties at Upper Big Branch by providing advance warning of federal mine safety inspection activities, so their underground operations could conceal and cover up safety violations that they routinely committed.
The indictment further alleges that after a major, fatal explosion occurred at Upper Big Branch on April 5, 2010, Blankenship made and caused to be made false statements and representations to the SEC concerning Massey Energy’s safety practices prior to the explosion. Additionally, the indictment alleges that, after this explosion, Blankenship made and caused to be made materially false statements and representations, as well as materially misleading omissions, in connection with the purchase and sale of Massey Energy stock.
The FBI and the United States Department of Labor’s Office of Inspector General are in charge of the investigation. United States Attorney Booth Goodwin, Counsel to the United States Attorney Steven Ruby, and Assistant United States Attorney Gabriele Wohl are handling the prosecution.
The four counts charged carry a maximum combined penalty of 31 years’ imprisonment.
… An indictment is only an allegation, and the defendant is presumed innocent unless and until proven guilty.” http://www.justice.gov/usao/wvs/press_releases/2014-11-Nov/attachments/1113142_Blankenship_Indictment.html
From the indictment:
1 . Beginning no later than January 1, 2008 and continuing through April 9, 2010 (the “Indictment Period”), defendant DONALD L. BLANKENSHIP (‘BLANKENSHIP”), the Chief Executive Officer (“CEO’) and Chairman of the Board of Directors of coal producer Massey Energy Company (“Massey”) conspired to commit and cause routine violations of mandatory federal mine safety standards at Massey’s Upper Big Branch-South mine (“UBB”).* Throughout the Indictment period, BLANKENSHIP himself closely managed UBB, the coal from which was critical to Massey’s financial performance. BLANKENSHIP knew that UBB was committing hundreds of safety-law violations every year and that he had the ability to prevent most of the violations that UBB was committing. Yet he fostered and participated in an understanding that perpetuated UBB’s practice of routine safety violations, in order to produce more coal, avoid the costs of following safety laws, and make more money. (* Allegations herein are made with reference to the Indictment Period unless otherwise noted.)
2. Throughout the Indictment Period, BLANKENSHIP also conspired to defraud the United States by impeding the federal Mine Safety and Health Administration (“MSHA”) in carrying out its duties at UBB.
3. Following a major, fatal explosion at UBB on April 5, 2070, BLANKENSHIP made, and caused to be made, materially false and misleading statements and representations, and omitted and caused to be omitted statements of material facts, regarding his and Massey’s practice of willful violations of safety laws at that mine. These included materially false statements and representations made to the United States Securities and Exchange Commission (“SEC”) and materially false statements and representations, and materially misleading omissions, made in connection with the purchase and sale of Massey stock.”
“During the Indictment Period, UBB was cited approximately 835 times for violations of mandatory federal mine safety and health standards. This was one of the highest levels of safety-law violations of any Massey mine. Approximately 319 of these violations were in an especially serious category of violations: those that could significantly and substantially contribute to the cause and effect of a safety or health hazard. Approximately 283 of UBB’s safety-law violations during the Indictment period were violations of the laws on mine ventilation, which operate to prevent explosions and fires in coal mines and to minimize deaths and serious injuries in the event an explosion or fire does occur. Approximately 59 of UBB’s safety-law violations during the Indictment Period resulted in shutdown orders closing all or part of the mine until the violation was abated, pursuant to Title 30, United States Code, Section 814(d), Violations resulting in such shutdown orders were among the most serious category of violations that can occur in a coal mine. UBB ranked among the worst mines in the United States in such shutdown orders during the Indictment Period.
9. During the Indictment Period, UBB was important to Massey’s financial performance. UBB produced a type of coal called metallurgical coal, which was used for manufacturing steel. During the Indictment Period, metallurgical coal sold for substantially more per ton than Massey’s other major product, which was steam coal used to generate electricity. Metallurgical
coal from UBB was particularly important to Massey’s sales of metallurgical coal, because it was an essential ingredient in a blend of metallurgical coal that also included coal from a group of other Massey mines near UBB. In 2009, this UBB-centered group of mines generated revenues of approximately $331 million, which represented approximately 14% of Massey’s approximately $2.3 billion in revenue-more than any of Massey’s numerous other mining groups. For 2010, Massey projected UBB-group revenue of approximately $432 million, approximately 16% of Massey’s projected revenue of approximately $2.7 billion and more than the projected revenue for any other Massey mining group.” Read the Indictment here: http://www.justice.gov/usao/wvs/press_releases/2014-11-Nov/attachments/2014-11-13_Donald_Blankenship_Indictment.pdf (UNITED STATES DISTRICT COURT TOR FHE SOUTHERN DISTRICT OF WEST VIRGINIA, CHARLESTON, GRAND JURY 2014 NOVEMBER 12, 2014 SESSION, UNITED STATES OF AMERICA v. DONALD L. BLANKENSHIP, INDICTMENT).
From the United Mine Workers of America findings, document is here: http://www.umwa.org/files/documents/134334-Upper-Big-Branch.pdf