CHARLESTON, W.Va. — Federal prosecutors are disputing claims by several companies owned by Gov. Jim Justice and his family that they shouldn’t be in federal court in Virginia, pointing to the companies’ own recent filings.
“Movants’ stunning assertion now that they have no ties to the Western District of Virginia is negated by the ample evidence to the contrary,” wrote U.S. Attorney Thomas Cullen, the chief federal prosecutor in that district.
Federal prosecutors and the federal agency that oversees mine safety filed suit in May against 23 Justice coal companies in U.S. District Court for the Western District of Virginia over longstanding, unpaid safety violations.
Nine of the Justice companies this month asked for the lawsuit to be dismissed, saying their operations are actually in West Virginia and that they have no coal operations in Virginia.
Those listed on the motion to dismiss include Double Bonus Coal, Dynamic Energy, Frontier Coal, Justice Energy Company, Justice Highwall Mining, Keystone Services Industries, M&P Services, Nufac Mining, and Pay Car Mining Company.
The headquarters listed for those companies by lawyers for the Justice family businesses were based on incorporation documents.
“The corporate office is West Virginia, the corporate officers and employees are in West Virginia, and many potential witnesses for trial are in West Virginia,” wrote lawyers for the Justice companies.
On Tuesday, federal prosecutors filed a response in opposition to the dismissal.
U.S. Attorney Cullen wrote, “Each movant argues — some in flat contradiction to their own court filings in other cases in this district — that the court lacks general personal jurisdiction because the company is not incorporated in Virginia and allegedly does not maintain its principal place of business in Virginia.”
Prosecutors say federal court in western Virginia is the proper venue for several reasons.
One is the Federal Debt Collection Procedures Act under which government officials are trying to collect $4,776,370.40 in mine act penalties and interest. The prosecutors say there is national jurisdiction under the act.
Another is the structure of the Justice companies.
The prosecutors say the companies fall under the structure of Bluestone Energy, which has its headquarters in Roanoke, Va.
They point to sworn testimony by Justice Energy vice president Stephen Ball that the company is headquartered at 302 South Jefferson Street, Roanoke, Virginia.
The “intimate nature of the parent-subsidiary relationship between Bluestone and movants” means that consolidated administrative and financial services, group insurance policy, a consolidated tax return and payroll flow from Bluestone, prosecutors state.
Finally, the prosecutors point to recent court filings to conclude that four of the nine companies asking to be dismissed are actually headquartered in Roanoke anyway.
Those include Dynamic Energy, Frontier Coal, Justice Energy and Pay Car Mining.
Those companies were part of a federal lawsuit Justice Companies filed in May against the U.S. Office of Surface Mining Reclamation.
The Justice Companies filed the lawsuit in U.S. District Court for the Western District of Virginia.
“In that complaint, the four movants stated that their principal places of business are in Roanoke, Virginia,” Cullen wrote.
“Then on July 9, 2019, the same four movants, represented by the same counsel, filed a motion to dismiss the government’s complaint in this case, claiming that the four companies do not have their places of business in Roanoke, Virginia. These statements are flatly contradictory.”
U.S. Attorney Cullen concludes by saying federal court in Roanoke makes the most sense, is the most convenient and the most efficient allocation of resources.
“The United States would have to put on the same witnesses twice in two different states, and those witnesses are local to neither Virginia nor West Virginia,” he wrote.
“To force the United States to expend resources to litigate this case in two separate courts when it has already spent tremendous resources to collect these unpaid civil penalties is against the interests of Justice.”