Massey and Alpha: The Great Merge or a Buyout Splurge?

By Jillian Randel

Alpha Natural Resources announced on June 1 that it will acquiesce Massey Energy—a much anticipated move that has left many outraged.

Massey Energy—one of the largest coal operators in the nation—is also one of the most shameful players in the industry. Violations of human safety and environmental health get kicked around their coal fields faster than a soccer ball.

Controversy over the transfer of Massey executives—who will maintain management roles in the merged company—has simply added insult to injury. Many of them are believed to be responsible for the inadequate safety measures that resulted in the death of 29 miners during the Upper Big Branch mine disaster last year.

The announcement came after an attempted challenge in court by Massey shareholders who wanted the merger blocked. The same shareholders brought an initial suit against Massey executives for failing to monitor mine safety properly after the Upper Big Branch disaster. The merger, claimed shareholders, was a way for top executives to avoid paying for the losses—in the hundreds of millions of dollars—incurred from the disaster.

Union leaders and mine safety workers are fired up about the transfer. There were 71 deaths from mining incidents in the U.S. in 2010, a sharp increase from the previous year, and 28 of those deaths were Massey workers. Mine safety is a recurring topic and it is hard to believe that Alpha can step up its game on safety and health standards while acquiescing one of the biggest culprits in the industry.

Commenting on Massey, an Alpha report cited, “The Massey culture is driven by a strong focus on production and its associated components with other facets of the operations such as employee safety and regulatory compliance receiving minimal consideration.”

Ironic that Alpha would merge with a company it so clearly sees fault in—or not? Alpha itself does not have a clean record. In 2007, it was cited for safety violations following a roof collapse that killed two workers. Another of Alpha’s mines was cited for ventilation and coal dust violations. It seems the pot is calling the kettle black here, then hopping in bed with it as an afterthought.

Last year’s Upper Big Branch disaster sent Massey’s stock tumbling from $54 per share to below $30 per share. Selling the company has not only allowed top officials to possibly avoid lawsuits, but avoid further financial loss that resulted from the disaster.

Allowing high ranking officials to escape from their offenses is no unfamiliar accomplishment for Massey. Former CEO Don Blankenship was excused from his duties last year after a ten year stint running what many have dubbed “the deadliest coal company in America.”

While Blankenship was in “power” safety violations flew off the handle. It was under his leadership that the Upper Big Branch disaster occurred, one which he referred to as “an act of God” and “unavoidable,” despite the fact that in the year leading up to the incident, the Mine Safety and Health Administration cited Massey for over 500 violations.

Upon retirement, Blankenship received a $12 million dollar package to walk away from his war on Appalachia. He is like the Latin American dictator we never knew we had in our honeymoon version of a democracy. Justice seems to be buried so far below the earth’s surface in Blankenship’s world that victims of big coal have no hope of ever finding it.

The latest actions on behalf of Alpha prove that careless, reckless and greed-driven qualities are resume-standard skills for big coal leaders. Stuart Grant, a lawyer serving on behalf of the shareholders, commented to The New York Times, “These people are just going to walk. This ruling says you can be the worst C.E.O., you can violate all the laws you want, then you can arrange a sweetheart merger and just walk away.”

Well, merge they have. The public is still unsure whether or not Massey executives will have the opportunity to wipe their dirty hands clean and strut away from this mess. As of today, the suits will proceed in court, both for the Upper Big Branch disaster and a January 2006 fire that killed two Massey workers. Hold your breath though, Blankenship may still have the courts bought, and if so, there may be little in the way to stop him.

Large corporations are allowed to conduct business through the issuance of a corporate charter. Since corporate charters are a privilege, not a right, they can be revoked. Appalachian Voices, along with Free Speech for People, have officially petitioned state Attorney of Delaware Beau Biden to investigate and revoke Massey Energy’s corporate charter due to their disregard of Appalachian communities, including the unsafe working conditions that led to the death of 29 miners in the spring of 2010 at the Upper Big Branch mine. Since Alpha has bought Massey as wholly owned subsidiary, Massey Energy’s corporate charter still exists. Join Appalachian Voices in asking that Massey’s corporate charter be revoked. Simply visit appvoices.org/revoke-massey-charter.

About Jillian Randel

An avid reader, hiker and dog lover, Jillian served as Associate Editor of The Appalachian Voice and Americorps Communications Outreach member from 2010-11.