Courts Consider Blocking Massey Mine Merger Courts in West Virginia and Delaware will consider preliminary injunctions Tuesday against Wednesday's expected merger of coal mine giants Massey Energy and Alpha Natural Resources. Massey owns the Upper Big Branch mine in West Virginia where 29 mine workers died in a massive explosion last year. The disaster figures into the attempts to block the merger by institutional investors.
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Courts Consider Blocking Massey Mine Merger

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Courts Consider Blocking Massey Mine Merger

Courts Consider Blocking Massey Mine Merger

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MELISSA BLOCK, Host:

NPR's Howard Berkes reports that some shareholders believe the takeover will shield Massey executives and board members from liability for last year's disaster.

HOWARD BERKES: The two Massey Energy shareholder lawsuits, in Delaware and West Virginia, are based on this belief...

BLOCK: The mine explosion last year was not some bolt of lightning hitting a corporate factory, where there's really nobody to blame.

BERKES: Mark Lebovitch is an attorney representing the New Jersey Building Laborers Pension Fund and other institutional investors in Massey Energy.

BLOCK: What you had with Massey was a board and a senior management team that over the course of years, put profits ahead of safety, and it really showed contempt for anyone on the outside who was warning them, saying you are running this business in a way that is dangerous, and you're going to harm people, kill people - and frankly, destroy corporate value.

BERKES: The depositions that supposedly support that belief were filed under seal, and NPR and the Charleston Gazette have jointly asked the West Virginia Supreme Court to unseal them. Sean McGinley represents the Gazette and NPR in the case.

BLOCK: Certainly the public, shareholders, people have a right to know what impact the Upper Big Branch tragedy has on this proposed merger.

BERKES: The shareholders worry their lawsuits become moot after the merger because Massey and its board would cease to exist. Alpha could continue the lawsuits, but the company announced it's keeping some of those Massey executives, including chief operating officer Chris Adkins, who will help integrate Alpha's safety program in the merged company. So it's unlikely Alpha will make...

BLOCK: ...a claim against their new co-head of safety, asserting that he's responsible for the Upper Big Branch disaster. It's just not going to happen.

BERKES: Badge Humphries represents the California State Teachers Retirement System and other institutional Massey shareholders suing in West Virginia. Injunctions are necessary, he says, because a merger vote is scheduled Wednesday morning.

BLOCK: Trying to undo a merger after it's closed - the courts have compared to unscrambling an egg.

BERKES: Independent Upper Big Branch investigator Davitt McAteer hopes court documents will be unsealed because they include depositions with Massey executives who declined to be interviewed in the disaster investigation.

BLOCK: So that the opening of the sealed transcripts - or the sealed depositions would be helpful to us, to try to understand what was occurring just prior to the big explosion, and did the actions of management have any impact on that.

BERKES: Howard Berkes, NPR News.

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