ROANOKE, Va. — Coal companies named in a lawsuit filed in Virginia federal court filed an answer claiming they don't owe $4 million in unpaid safety fines.
A & G Coal Corporation, BlackRiver Coal, Chestnut Land Holdings, Four StarResources, Infinity Energy Company, Kentucky Fuel Corporation, Nine Mile Mining, Premium Coal Company, S&H Mining, Sequoia Energy, Virginia Fuel Corporation, Southern Coal Corporation, Justice Coal of Alabama and Tams Management filed the answer on July 9 in U.S. District Court for the Western District of Virginia.
"The Defendants deny the allegations...as the same allege or purport to allege that the Defendants are or have been obligated to pay $4,776,370.40 in Mine Act penalties and interest," the answer states.
The defendants argue the plaintiff's complaint failed to state a claim upon which relief can be granted; is barred due to the applicable statute of limitations; is barred by the doctrines of accord and satisfaction, compromise, release, illegality, laches, duress, payment and/or waiver; is barred because the debt the plaintiff claims is owed was incurred in whole or in part by the acts and/or omissions of other persons, third parties and/or non-parties not under the direction and control of these the defendants; violates the defendants' right to due process; and is barred by the plaintiff's failure to comply with conditions precedent to the plaintiff's right to recover.
The answer also states the defendants are entitled to a set-off for all amounts paid and/or which should have been paid by independent third parties, as well as any amounts which were reduced or written down or which should have been reduced or written down; the defendants are entitled to all defenses and presumptions set forth in or arising from any rule of law or statute in Virginia and/or any other state whose law is deemed to apply in this case; and the claim asserted in the complaint is barred, in whole or in part, because the plaintiff did not incur any ascertainable loss as a result of the defendants’ conduct.
Fourteen companies denied any monetary obligations have been left unpaid.
Nine other companies that had been named in the suit objected to litigating the matter in the federal court in Roanoke, Va., arguing they have never done business, nor are headquartered in Virginia.
Double Bonus Coal Company, Dynamic Energy, Frontier Coal Company, Justice Energy Company, Justice Highwall Mining, Keystone Services Industries, M&P Services, Nufac Mining Company and Pay Car Mining Company filed their motion to dismiss for lack of personal jurisdiction on July 9.
Those companies are based in West Virginia, the motion states.
"The Court does not have general jurisdiction over the Defendants because the Defendants are not incorporated under the laws of Virginia and none of the Defendants maintain their principal place of business in Virginia," the motion states.
The West Virginia defendants argue that the Roanoke federal court cannot exercise specific jurisdiction over them because the Virginia long-arm statute does not reach the defendants’ alleged conduct.
"Even if it did, the Defendants do not have sufficient 'minimum contacts' with Virginia which would subject them to personal jurisdiction," the motion states.
The complaint was filed in May by the U.S. Attorney for the Western District of Virginia Thomas Cullen.
Cullen and the Assistant Secretary of Labor for the Mine Safety and Health Administration (MSHA) David G. Zatezalo, announced the filing of a civil action against 23 coal companies operating in Virginia, West Virginia, Tennessee, Alabama and Kentucky, seeking more than $4.7 million in unpaid penalties for violations of the Federal Mine Safety and Health Act.
Cullen claimed between May 3, 201,4 and May 3, 2019, MSHA collectively issued at least 2,297 citations to the defendant mine operators for violations of the Mine Health and Safety Act, and at the appropriate time, assessed civil penalties for each violation, pursuant to the law.
The defendants failed to pay the penalties or even notify MSHA that it contested the assessed civil penalties, according to the suit.
When defendants failed to pay the civil penalties for 100 days, despite two demand letters, MSHA referred the civil penalties to the Department of Treasury for collection and the Department of Treasury made another written demand on the defendants, but they still failed to pay, and the Department of Treasury referred the civil penalties to the Department of Justice for collection.
On Sept. 5, 2018, Cullen made a written demand on the defendants for the delinquent debts, but the defendants still failed to pay the outstanding debts.
Assistant U.S. Attorney Krista Consiglio Frith and Special Assistant U.S. Attorney Jason Grover, an attorney with the Department of Labor, are representing the United States.
The defendants are represented by Aaron B. Houchen of Houchens Law; and Christopher D. Pence of Hardy Pence.
U.S. District Court for the Western District of Virginia Case number: 7:19-cv-00354