West Virginia's Supreme Court of Appeals yesterday unanimously threw out a $75 million decision in favor of Massey Energy and agreed to rehear the case amid allegations of bias and impropriety at the state's highest court.
The decision nullifies the court's 3-2 ruling Nov. 21 that Massey did not have to pay a $75 million judgment to Hugh Caperton and three of his mining companies. Mr. Caperton sued Massey affiliates for fraud in 1998 and won at a lower court trial held in 2002. Massey appealed that decision to the supreme court.
The supreme court yesterday ruled without Chief Justice Elliott Maynard, who had sided with Massey in November. He recused himself from the case last week after photos of him vacationing with Massey Energy Chief Executive Officer Don Blankenship were filed with the court by Mr. Caperton's attorneys.
Mr. Caperton also sought the recusal of Justice Brent Benjamin, citing the more than $3 million Mr. Blankenship spent to defeat Justice Benjamin's opponent in the 2004 supreme court election. Last week, Justice Benjamin declined to step aside and appointed Circuit Court Judge Donald H. Cookman to take Chief Justice Maynard's place in the Caperton case.
Bruce Stanley and David Fawcett, the Pittsburgh attorneys representing Mr. Caperton and his companies, said the court's decision yesterday "should not come as a surprise given recent events."
"The question now is whether the court will use the rehearing to deliver justice," they said in a joint statement.
The court scheduled the rehearing for March 12.
Mr. Caperton's attorneys yesterday also renewed their request that Justice Benjamin step aside and said a third justice, Larry V. Starcher, should do the same. Justice Starcher ruled against Massey in November and has been openly critical of the campaign expenditures Mr. Blankenship made to defeat Justice Benjamin's opponent. The statements have prompted allegations that Justice Starcher cannot be impartial in cases involving Massey.
In yesterday's order, Justice Starcher said he has "an absolute right and duty" to comment on the campaign spending, "although my language should have been more temperate."
Earlier this week, Justice Starcher disclosed he has received allegations that raise "extremely serious legal and ethical issues as well as questions about the proper and legal administration of justice and this court."
"Some of the alleged matters raise issues that are within the jurisdiction of authorities other than those directly associated with this court," he wrote in a three-page letter to court administrator Steven D. Canterbury.
The allegations go beyond the information about the relationship between Mr. Blankenship and Chief Justice Maynard filed by Mr. Caperton's attorneys on Jan. 14, Justice Starcher said.
That filing included 34 photographs, several of which show the chief justice and Massey's CEO smiling and looking directly into the camera. Ten photos depicting two women who apparently traveled to Monaco with Chief Justice Maynard and Mr. Blankenship in July 2006 were filed under seal.
Mr. Stanley said the photos raise "the specter of corruption or worse" over the court.