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Don Blankenship

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Don Blankenship served as a director of Massey Energy Company from 1996 to 2010, and was Chairman and Chief Executive Officer from November 30, 2000 through 2010. In December 2010, Massey's Board of Directors announced Blankenship's retirement and his replacement as CEO by company president Baxter F. Phillips Jr. Admiral Bobby Ray Inman, Lead Independent Director on the Massey Board, was named as Non-Executive Chairman.[1] On January 29, 2011, about a month after Blankenship's departure, Alpha Natural Resources announced it agreed to buy Massey Energy for $7.1 billion, creating a company with 110 mines and combined coal reserves of 5 billion tons. Blankenship had reportedly been opposed to selling Massey.[2]

Blankenship has also served as a director of the Center for Energy and Economic Development, a director of the National Mining Association, Mission West Virginia Inc, and is on the U.S. Chamber of Commerce board of directors.[3][4] He is also a member of the American Council for Clean Coal Electricity.[5]

After leaving Massey, public records showed Blankenship had incorporated a new mining venture in Kentucky, the McCoy Coal Group Inc., on file since January 2011. Kentucky Energy and Environment spokesman Dick Brown said the company has yet to seek any mining permits.[6]

Professional Background

Blankenship joined a Massey subsidiary, Rawl Sales & Processing Co., in 1982. Since then he has served the company in a number of capacities. He was promoted to president of Massey Coal Services, Inc. (1989 -1991), then president and chief Operating Officer from 1990 to 1991. Blankenship has been Chairman, Chief Executive Officer, and President of A.T. Massey Coal Company, Inc., a wholly owned and sole, direct operating subsidiary, since 1992. He then went on to become Chairman and CEO of Massey Energy starting November 30, 2000.[3]

Compensation

U.S. Securities and Exchange Commission filings show Blankenship was paid $17.8 million in 2009, the highest in the coal industry. His 2009 pay represents a $6.8 million raise over 2008 and almost double his compensation package in 2007. Blankenship also received a deferred compensation package valued at $27.2 million in 2009.[7][8]

Severance

On December 3, 2010, after the Upper Big Branch Mine Disaster, Blankenship announced that he was retiring as CEO at the end of the year, and would be succeeded by Massey President Baxter F. Phillips Jr.[9] Under his $12 million severance package with Massey, Blankenship was barred from competing with his former employer for two years.[10]

Political Involvement

Don Blankenship: Friends of America Rally

In 2009, Blankenship, along with other members of the the US Chamber of Commerce like Verizon, sponsored the 2009 “Friends of America Rally.” The rally was to drum up public support against calls for government regulation of mountaintop removal mining.[11]

Controversy over Blankenship and State Supreme Justice Election

Washington political journalist Michael Tomasky, himself a native West Virginian, claims that Blankenship is "famous in West Virginia as the man who successfully bought himself a state supreme court justice in 2004 and then tried to buy himself the state legislature, failing spectacularly at the latter effort"[12].

The justice he succeeded in having replaced in 2004 was Warren McGraw. McGraw was up for reelection in 2004, and Blankenship wanted him out. That McGraw had sided with workers was not likely to stir much passionate opposition, so Blankenship found a case in which McGraw had been part of a 3–2 majority that had freed a mentally disturbed child molester who then went to work in a school. Blankenship established and funded an independent tax-deductible group called And for the Sake of the Kids, which ran ads attacking McGraw's part in the decision. McGraw was defeated, and Brent Benjamin, the conservative candidate took his seat on the court. To demonstrate that his interest in the children was sincere, Blankenship had vowed that after the election, he would endow a foundation to help the state's needy children.[12]

In 2004, Blankenship contributed $3 million to the "And For The Sake of the Kids" PAC, campaigning against the re-election of West Virginia Supreme Court of Appeals justice Warren McGraw. Brent Benjamin would go on to defeat McGraw in the general election. Speaking about the election, Blankenship said, "I helped defeat a judge who had released a pedophile to work in a local school, who had driven doctors out of state, and who had cost workers their jobs for thirty plus years. I think this effort helped unchain West Virginia's economy and benefited working families." [13]

According to a USA Today editorial dated March 3, 2009 Blankenship's ads were "venomous" and Blankenship "has vividly illustrated how big money corrupts judicial elections. It puts justice up for sale to the highest bidder."[14] Although Blankenship was the primary donor to "And For the Sake of Kids," other groups, including Doctors for Justice, contributed over $1 million to ASK. Another group, Citizens for Quality Health Care, funded in part by the West Virginia Chamber of Commerce, spent over $350,000 to defeat McGraw.[15] Meanwhile, several groups spent millions opposing Benjamin and supporting McGraw, including West Virginia Consumers for Justice and Hugh Caperton, CEO of Harmon Development Corporation.[16]

Photographs of Blankenship vacationing on the French Riviera with West Virginia Supreme Court Justice Elliott "Spike" Maynard, while Massey had a case pending before that court, appeared in the New York Times.[17] On Feb. 14, 2009, Blankenship told the New York Times "I’ve been around West Virginia long enough to know that politicians don’t stay bought, particularly ones that are going to be in office for 12 years ... So I would never go out and spend money to try to gain favor with a politician. Eliminating a bad politician makes sense. Electing somebody hoping he’s going to be in your favor doesn’t make any sense at all." [18]

Following the incident, Justice Maynard lost his bid for re-election to the West Virginia Supreme Court in the West Virginia primary election [19].

Lawsuit filed in Mingo County, WV

700 people filed a lawsuit against against Massey subsidiary Rawl Sales in 2004 before Mingo County Circuit Judge Michael Thornsbury. In the lawsuit, the residents claim Massey injected more than 1.4 billion gallons of coal slurry underground - seven times the amount of the oil spilled in the BP Deepwater Horizon disaster - into 1,000 acres of former underground mines. The suit also claims Massey knew the mines were cracked and would allow for leaching into drinking water supplies. The slurry then migrated to their wells, eventually bubbling through their water systems "in varying degrees, from highly toxic to simply toxic." The state Department of Environmental Protection imposed a temporary ban on new injection sites, and a team of West Virginia University researchers advised lawmakers in 2010 to start monitoring coal slurry, but plaintiffs and supporters want legislators to ban the process altogether. The plaintiffs suffer from chronic gastrointestinal disorders, skin cancers, learning disabilities, and major organ cancers they say is tied to the slurry. Later, State Supreme Court Chief Justice Robin Davis required Thornsbury to recuse himself after learning Thornsbury represented Rawl Sales in earlier blasting litigation in the same areas where coal slurry allegedly contaminated wells.[20] [21]

In November 2010, a panel of judges ordered plaintiffs to appear at the Charleston Civic Center for the start of a three-day settlement conference. If a settlement is reached, a 2011 trial would be averted. Mediation talks broke down, however, and a trial is set for Aug. 1, 2011.[21]

According to Jeff Goodell in Rolling Stone, after injecting coal slurry into his own neighborhood, Massey paid to build a waterline to bring clean, treated water directly to CEO Don Blankenship's house from Matewan, a few miles away.[22]

Caperton v. A.T. Massey Coal Co.

In a $77 million case, Caperton v. A. T. Massey Coal Co., a smaller coal mining company, Harman Mining, alleged contract interference by Massey [23]. After Massey prevailed in the case in the West Virginia Supreme Court, the U.S. Supreme Court in November, 2008 agreed to hear Harman Mining's appeal. Wal-Mart, PepsiCo, Intel, Lockheed Martin, Common Cause, and Public Citizen filed briefs urging the Supreme Court to throw out the West Virginia Supreme Court's decision in favor of Massey. The corporations contended that Justice Brent Benjamin was biased in the case. Although Don Blankenship had only contributed $1,000 to Benjamin's campaign, Blankenship's $3 million in independent expenditures to defeat Benjamin's incumbent opponent, Warren McGraw, had been crucial in determining the outcome of the election. On June 9, 2009 The New York Times opined that the case involved "egregious ethical myopia" on the part of Justice Benjamin. [24]

In June 2009, the Court found for Caperton and Harman Mining, remanding the case back to the West Virginia Supreme Court. Justice Anthony M. Kennedy wrote for the majority, joined by Justices Stevens, Souter, Ginsburg, and Breyer. Chief Justice John G. Roberts wrote the dissent and was joined by Justices Scalia, Thomas, and Alito. Justice Scalia also filed a separate dissenting opinion.

On November 12, 2009, West Virginia Supreme Court again overturned the case on a vote of 4 to 1. The ruling held that Caperton should have pursued his claims in Virginia rather than in West Virginia.

Attack on ABC Camera Man

On April 3, 2008, ABC News reported that Blankenship attacked an ABC News cameraman at a Massey facility near Belfry, Kentucky as the camera man attempted to question Blankenship about the photos published in the New York Times showing Blankenship on vacation in Monaco with West Virginia Supreme Court Justice Elliott "Spike" Maynard. "If you're going to start taking pictures of me, you're liable to get shot," Blankenship stated in the video[25].

Global Warming Denial Speech

The Big Lies of Big Coal: Don Blankenship Speaks

At a public speech to the Tug Valley Mining Institute on Nov 20 Blankenship called House Speaker Nancy Pelosi, Senator Harry Reid and former Vice President Al Gore "crazies" and "greeniacs" and stated, "I don't believe climate change is real." He referred to the support of President Jimmy Carter for energy conservation in the 1970s to communism: "Buy a smaller car? Conserve? I have spent quite a bit of time in Russia and China, and that's the first stage":

In a letter to the editor of the Charleston (WV) Gazette dated Oct. 30, 2009 Blankenship denied that global warming exists, and stated: "Why should we trust a report by the United Nations? The United Nations includes countries like Venezuela, North Korea and Iran." [26]

As the director of the US Chamber of Commerce, Blankenship has helped buttress the Chamber’s tough position against any kind of climate change legislation.[27]

Blankenship Profiled in Rolling Stone Magazine

In the January 2010 edition of Rolling Stone Magazine, journalist Tim Dickinson profiled the top 17 United States "polluters and deniers who are derailing efforts to curb global warming". Below is an excerpt from the article titled "Climate Killers" about Don Blankenship.[28]

In an age when most CEOs are canny enough to at least pay lip service to the realities of climate change, Blankenship stands apart as corporate America's most unabashed denier. Global warming, he insists, is nothing but "a hoax and a Ponzi scheme." His fortune depends on such lies: Massey Energy, the nation's fourth-largest coal-mining operation, unearths more than 40 million tons of the fossil fuel each year — often by blowing the tops off of Appalachian mountains.
The country's highest-paid coal executive, Blankenship is a villain ripped straight from the comic books: a jowly, mustache-sporting, union-busting coal baron who uses his fortune to bend politics to his will. He recently financed a $3.5 million campaign to oust a state Supreme Court justice who frequently ruled against his company, and he hung out on the French Riviera with another judge who was weighing an appeal by Massey. "Don Blankenship would actually be less powerful if he were in elected office," Rep. Nick Rahall of West Virginia once observed. "He would be twice as accountable and half as feared."
On the national level, Blankenship enjoys a position of influence on the board of the U.S. Chamber of Commerce, which has led the fight to kill climate legislation. He enjoys inveighing against the "greeniacs" — including Nancy Pelosi, Harry Reid and Al Gore — who are "taking over the world." And he has even taken to tweeting about climate change: "We must demand that more coal be burned to save the Earth from global cooling."
In more unguarded moments, however, Blankenship confesses that his over-the-top rhetoric is strategic. "If it weren't for guys like me," he says, "the middle would be further to the left." He also admits that his efforts to block climate legislation are ultimately self-serving: "It would probably cut our business in half."[28]

April 5, 2010: 29 killed in blast at Massey coal mine

For more information, see Upper Big Branch Mine Disaster

W.V. Coal Mine Had 53 Safety Violations In March Alone

On April 5, 2010, an explosion at a Massey Energy's underground Upper Big Branch Mine in southern West Virginia killed 29 miners, with two hospitalized.[29] Mine-safety experts said explosions are typically caused by high levels of methane produced during longwall mining, which mining companies try to dilute with ventilation systems, although Massey has been repeatedly cited for violating this requirement.[30][31]

According to Mine Safety and Health Administration data, the Upper Big Branch mine has had six violations related to ventilation since January and four since March 17, including for failing to control coal dust; improperly planning to ventilate the mine of dust and the combustible gas methane; inadequate protection from roof falls; failing to maintain proper escapeways; and allowing the accumulation of combustible materials.[32]

In 2009, the mine had 50 "unwarrantable failure citations," the most serious findings of negligence a mine inspector can issue. MSHA had proposed penalties of $900,000 in 2009 resulting from 458 total safety violations at the mine.[31]

Since January 1, 2010, the Miner Safety and Health Administration has issued Performance Coal 115 safety violations for the Upper Big Branch mine. For six of the past ten years, it has exceeded the national average in safety violations.[33] There have been three other fatalities at the Upper Big Branch mine in the last 12 years.[30]

In October 2010, Massey management stated that coal dust did not play a role in the disaster, as government investigators previously stated. Computer models and other evidence, said CEO Don Blankenship, suggested methane gas alone fueled the mine explosion, which remained at odds with government findings.

"We don't feel like that we contributed in any way to the accident," he said. "We do not believe that coal dust was a meaningful factor."[34]

Massey and Unions

Don Blankenship: "Sell Coal Cheaper And Drive Union Coal Out of Business"

In 2008, Massey had 6,743 employees.[35] Of these, only 1.3% -- or approximately 87 -- were represented by the United Mine Workers of America. In a March 2010 prospectus, Massey stated that union members were "spread out amongst five of our coal preparation plants" which handled "approximately 15.8% of our coal production." However, the company states that the "collective bargaining agreements with the UMWA have expired" and that "there are no ongoing negotiations" at present.[36][37]

The company, particularly under Blankenship, has actively worked to suppress union membership, preferring to pay legal fees than hire unionized mine workers.[38]In a 1986 film documenting his role in stopping striking miners at Massey operations in Appalachia (see video), Blankenship was frank about his goals to destroy unionization, in order to sell coal cheaper: "non-union competitors have a tremendous advantage and therefore they sell coal cheaper and drive union coal operations out of business."[39]

The United Mine Workers once represented nearly 90 percent of the U.S.'s 400,000 mine workers in the 1960s, but in 2010 represents less than a third of the remaining 10,000 or so coal miners. Part of the decline has been attributed to Blankenship, who was a division manager for Massey in the mid-1980s and helped run a successful, aggressive campaign to destroy the union's role in the company's mines in Appalachia, reminiscent of the early days of coal mining when miners were harassed and intimidated from joining unions. According to truthout, the United Mine Workers tried three times to organize the Upper Big Branch mine, but even with getting nearly 70 percent of workers to sign cards saying they favored union membership, Blankenship personally met with workers to threaten them with closing down the mine and losing their jobs if they voted for a union.[40]

According to former Massey miner Chuck Nelson, not being part of a union "means that the worker, when he was told to do something, you cannot file a grievance. You had to more or less do what they say—what they tell you to do, or else they’ll tell you, 'Well, we have a man to replace you for the next day. You can just go home. You don’t need this job anymore.'”[41] A report from the March 28, 2007, hearing on Protecting the Health and Safety of America's Mine Workers released by the House Committee on Education and Labor, found that less than one-fifth of coal mining fatalities occurred in union mines.[42]

Protests Directed at Don Blankenship

July 22, 2010: Rainforest Action Network Disrupt Massey CEO Don Blankenship’s talk at the National Press Club in Washington, DC

Rainforest Action Network (RAN) attended Massey Energy CEO Don Blankenship’s National Press Club speaking event on July 22, 2010. RAN disrupted Blankenship's talk by holding signs that stated "Massey Coal: Not Clean, Safe or Forever". The focus of the protest focused on Massey's moutaintop removal strip mines and their ongoing safety violations which led to the death of 29 miners in the Upper Big Branch Mine Disaster in West Virginia. The protesters were escorted out by security.

“Massey is the BP of the coal industry: reckless, arrogant and an obstacle to the clean energy future that the president and the country is calling for,” said Amanda Starbuck of the Rainforest Action Network in a press release about the action. “The bottom line is that clean, safe and forever are three words that Massey Energy can never credibly say.”[43]

Rather than discuss any regrets over the Massey Upper Big Branch Mine Disaster, Blankenship used the speaking event to discuss the need for less federal government regulation, among other topics. Additionally, Blankenship said mountaintop removal was actually bringing "more wildlife" and "more wetlands" to Appalachia, and he dismissed reports that Massey miners live in fear of him: "We feel very good about what we've achieved in the area of communication with our employees." As an example, he said the reason that all six recent union drives at Massey mines have failed was that the miners know how much the company cares about them.[44]

In an interview later that day on Bloomberg Television’s “InBusiness,” Blankenship said increased scrutiny from MSHA puts miner safety at risk because the coal industry’s engineers are better than government: “The feeling of the industry is that we’re regulated too much and not too little. Tragedies lead to more regulation." According to Blankenship, Massey miners are experiencing a “psychological” impact in the aftermath of the accident that’s affecting production: “It’s impacting production in that people are trying to make sure they’re in compliance with every rule."[45]

Campaign Contributions

Articles and resources

Sources

  1. Ken Ward Jr., "Breaking news: Don Blankenship to retire," Coal Tattoo, December 3, 2010
  2. Mario Parker and Zachary R. Mider, "Alpha Natural Agrees to Buy Massey Energy for $7.1 Billion" Bloomberg, Jan. 29, 2011.
  3. 3.0 3.1 "Don Blankenship" Littlesis Website, accessed December 2009
  4. "Board of Directors: Don Blankenship" U.S. Chamber of Commerce Website, accessed December 2009
  5. Pete Altman,"ACCCE: the American Chamber of Connected Coal Executives" NRDC Switchboard, October 15, 2009
  6. "Don Blankenship Resurfaces, Forms Ky. Coal Company" WSAZ, Dec 8, 2011.
  7. Berkes, Howard. Massey CEO's Pay Soared As Mine Concerns Grew. NPR. Retrieved on 2010-04-23.
  8. The Massey mine disaster isn't just tragic, it's criminal. OregonLive.com (2010-04-15). Retrieved on 2010-04-23.
  9. Parker, Mario (2010-12-03). Massey's Blankenship to Retire Dec. 30, Be Replaced by President Phillips. Bloomberg. Retrieved on 2010-12-03.
  10. "Ex-Massey CEO resurfaces, forms Ky. coal company" AP, Dec. 8, 2011.
  11. "Friends of America crowd smaller than anticipated" West Virginia Public Broadcasting, September 7, 2009.
  12. 12.0 12.1 Michael Tomasky, “Night Comes to the Appalachians” New York Review of Books, Volume 55, Number 14; 25 September 2008.
  13. [http://www.reuters.com/article/pressRelease/idUS159711+10-Jun-2009+PRN20090610 "Don L. Blankenship Addresses the U.S. Supreme Court Ruling on Caperton v. A.T. Massey Coal Company" Reuters Online, June 10, 2009
  14. [http://www.usatoday.com/printedition/news/20090303/editorial03_st.art.htm "Mining case shows sooty side of big-money judicial elections" USA Today Editorial, March 3, 2009
  15. Paul Nyden, "Coal, Doctor's Groups Donated to Anti-McGraw Effort," Charleston Gazette, January 7, 2005
  16. John O'Brien, "Caperton was Anti-Benjamin from the Start,"West Virginia Record, Jan. 24, 2008
  17. Adam Liptak,"Motion Ties W. Virginia Justice to Coal Executive" New York Times, January 15, 2008
  18. Adam Liptak,[http://www.nytimes.com/2009/02/15/washington/15scotus.html?ref=washington "Case May Alter Judge Elections Across Country" New York Times, February 14, 2009
  19. Ian Urbina,"West Virginia’s Top Judge Loses His Re-election Bid" NY Times, May 15, 2008
  20. Ken Sard Jr., "Mediation sessions today in Mingo coal-slurry case" Charleston Gazette, Nov. 15, 2010.
  21. 21.0 21.1 Vicki Smith, "Judges begin mediation of Massey suit in W.Va." Bloomberg, Nov. 15, 2010.
  22. Jeff Goodell, "The Dark Lord of Coal Country" Rolling Stone, December 9, 2010.
  23. "U.S. Supreme Court still weighing mining appeal" The Charleston Gazette, November 9, 2008
  24. "Honest Justice" New York Times Editorial, June 8, 2009
  25. Brian Ross and Maddy Sauer,"Coal Boss: If You Take Photos, 'You're Liable to Get Shot'" ABC News, April 3, 2008
  26. "Coal; Rosie the Riveter; global warming: Stand up and stop the war on coal mining" The Charleston Gazette, October 29, 2009
  27. "Massey Energy Mine Cited for 1,300+ Safety Violations in Years Leading up to Deadly Explosion" Democracy Now, April 7, 2010.
  28. 28.0 28.1 "The Climate Killers" Tim Dickinson, Rolling Stone Magazine, January 2010.
  29. Massey Energy, "Update on Rescue Efforts From Massey Energy", Media Release, April 10, 2010.
  30. 30.0 30.1 Bob Drogin and Nicole Santa Cruz,"25 miners killed in West Virginia explosion" LA Times, April 6, 2010.
  31. 31.0 31.1 "West Virginia Mine Blast Kills Seven" The Wall Street Journal, April 5, 2010.
  32. Jeff Biggers,"What Killed the Miners? Profits Over Safety?" Huffington Post, April 6, 2010.
  33. "Tragic Mine Explosion in Coal River Valley" Coal River Mountain Watch News Release, posted On Coal River, April 6, 2010.
  34. "Massey Energy chief discounts coal dust as a factor in deadly W.Va. mine explosion" Tim Huber, CBonline.com, October 27, 2010.
  35. Massey Energy, "2008 Annual Report", Massey Energy, page 2.
  36. Massey Energy, "Preliminary Prospectus Supllement", Filed with the U.S. Securities and Exchange commission, March 22, 2010.
  37. Brian Pfeifer,"Dozens killed in explosion at non-union coal mine" Workers World, April 7, 2010.
  38. "Miners win settlement of age discrimination suit against Massey subsidiary, Blankenship" UMWA Press Release, October 30, 2009.
  39. Pat Garofalo, "Blankenship’s Union-Busting Goal: ‘Sell Coal Cheaper And Drive Union Coal Operations Out Of Business’" Wonk Room, April 9, 2010.
  40. Art Levine,"Missing Lesson From the Mine Tragedy: Union-Busting = Death" truthout, April 12, 2010.
  41. "Massey Energy Mine Cited for 1,300+ Safety Violations in Years Leading up to Deadly Explosion" Democracy Now, April 7, 2010.
  42. Meteor Blades,"Want Safer Mines? Unionize Them" Daily Kos, April 7, 2010.
  43. [http://understory.ran.org/2010/07/22/ran-activists-send-message-to-massey-ceo-don-blankenship-at-the-national-press-club-%E2%80%9Cyour-coal-is-not-clean-safe-or-forever-%E2%80%9D/#more-7720 "BREAKING: RAN Activists Send Message to Massey CEO Don Blankenship"> RAN Press Release, July 22, 2010.
  44. Dan Froomkin, "Massey CEO Blankenship On Mine Disaster: No Regrets" HuffPo, July 22, 2010.
  45. "Massey Energy's Blankenship Says Regulation of Coal Industry Is Excessive" Bloomberg, July 22, 2010.

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