ROANOKE, Virginia – A federal judge has grounded a helicopter owned by Gov. Jim Justice’s companies to sell it to satisfy a debt.
U.S. District Judge Robert Ballou issued an order January 17 in the foreign judgment case filed by Caroleng Investments Limited, the parent company of Russian mining company Mechel, against Bluestone Resources Inc., which is owned by Justice’s family.
“The helicopter shall continue to stay where it is currently housed and may not be used or moved by Bluestone, its agents or representatives, for any purpose,” Ballou wrote in the four-page order, also noting there could be other claims for first right to the money from the sale of the 2009 Bell helicopter.
Bellou’s decision will allow U.S. marshals to seize the helicopter. He also orders the sides to work together to decide how the helicopter will be sold. That includes who would conduct the sale and who would pay the costs of the sale as well as where the helicopter will be kept until it’s sold and confirming the helicopter is bonded and insured.
The helicopter is estimated to be worth about $1.2 million.
Caroleng wants the helicopter to pay for part of a debt Justice’s companies owes. Justice sold the family coal business to Mechel in 2009 for $426 million plus 83.3 million preferred shares of Mechel stock. Justice then bought back Bluestone in 2015 for $5 million and reopened mines Mechel had closed. The repurchase also included a plan to pay Caroleng $3 a ton in royalties for mined coal as well as a portion of future sales.
Caroleng alleged Bluestone didn’t make the royalty payments and sued. The International Chamber of Commerce awarded Mechel $8.4 million plus interest in 2019 during arbitration of the case. Caroleng has been seeking enforcement of that award in federal court since 2021.
Bluestone has fought the seizure, saying Caroleng is controlled by a Russian oligarch and that, if the helicopter is liquidated, it should go to other lenders, such as 1st Source Bank of Indiana, which has said it should get the money first. That bank says Bluestone owes it more than $5 million for various loans, including one for the helicopter.
Despite Bluestone’s objections, Ballou refused to stay the sale of the helicopter. 1st Source Bank also objected to the stay.
“1st Source Bank’s argument that it wishes to maintain the status quo with its lending relationship, without any specific indication of how it will be negatively affected if the stay is lifted and the writ is executed, is not sufficient,” Ballou wrote. “As Caroleng points out in its opposition to the motion to stay, Caroleng has a valid, enforceable money judgment and the proceeds from the sale of the helicopter will be subject to all valid liens.”
U.S. District Court for the Western District of Virginia case number 7:23-cv-10010
