This article originally provided by The Herald-Dispatch

January 24, 2008

In wake of photos, recusal, Supreme Court to rehear Massey case

Associated Press Writer

CHARLESTON, W.Va. (AP) -- West Virginia's Supreme Court unanimously voted Thursday to reconsider its reversal of a $76.3 million judgment against Massey Energy Co., in a case roiled by conflict of interest allegations directed at the justices.

The 5-0 decision erases November's ruling that had overturned a 3-2 verdict won by Harman Mining Co. and its president, Hugh Caperton, in a coal contract dispute with Massey.

Chief Justice Elliott "Spike" Maynard did not take part in Thursday's action. He recused himself after the release of vacation photos showing him with Don Blankenship, Massey's chairman, president and chief executive officer, while the judgment was headed for appeal.

Hampshire County Circuit Judge Donald Cookman replaced Maynard for the rehearing petition. Justices Brent Benjamin and Larry Starcher also took part, having weathered allegations of bias regarding Massey as well.

The Supreme Court will hear arguments in the case March 12, and will allow written pleadings from each side, court spokeswoman Jennifer Bundy said.

In a statement, Massey said it respects "the Court's decision to take another look at this case."

"We remain confident, however, that the Court will ultimately uphold its prior decision," the statement said. "While there has been a great deal of media attention regarding this case, nothing has changed the facts or the law that the Court will consider in reaching its final decision."

Lawyers for Caperton or Harman could not immediately be reached for comment Thursday.

A 2002 Boone County jury had concluded that Massey hijacked a coal supply contract from Harman, plunging both it and Caperton into bankruptcy. The verdict awarded $50 million to Harman and Caperton, with post-trial interest increasing the amount to $76.3 million.

While agreeing that Massey's misconduct justified the verdict, November's 3-2 ruling concluded the entire case was negated by a clause in the underlying coal contract and by an earlier, related lawsuit filed in Virginia.

The Virginia case had yielded a $6 million verdict against a Massey subsidiary in favor of Harman.

After asking the court to reconsider, Caperton filed dozens of photos showing Maynard and Blankenship together in Monaco in July 2006. Massey had already announced plans to appeal the Boone County verdict by that time, and the Supreme Court had ruled on more than a half-dozen matters stemming from the case.

Maynard and Blankenship later said they had met up on the Riviera while on separate occasions and that their longtime friendship was no secret. After calling allegations of impropriety "nonsense," the chief justice agreed last week to disqualify himself.

"The mere appearance of impropriety, regardless of whether it is supported by fact, can compromise the public confidence in the courts," Maynard wrote. "For that reason - and that reason alone - I will recuse myself from this case."

Harman had joined the bid for Maynard's recusal by then, while also asking Benjamin to step down. A Republican, Benjamin was elected in 2004 after Blankenship spent millions on ads that promoted his candidacy by attacking his Democratic opponent.

Benjamin refused, and as acting chief justice appointed Cookman in Maynard's stead.

Massey had earlier alleged bias by Starcher, citing a series of public comments attacking the company and Blankenship. Some of those comments addressed the 2004 campaign.

Since the Monaco photos grabbed national headlines, Starcher has asked for an independent probe to examine other allegations he said "raise extremely serious legal and ethical issues." While providing no details in a Tuesday memo to court administrators, Starcher said he is prepared to share what he knows with investigators.

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