Don Blankenship

Don Blankenship
Picture of Don Blankenship
Born Donald Leon Blankenship
(1950-03-14) March 14, 1950
Stopover, Kentucky
Residence Imprisoned at FCI Taft, California
Alma mater Marshall University
Occupation Coal magnate
Years active 1972 - 2010
Known for Coal industry; mine disaster
Criminal charge conspiracy to violate mine safety and health standards
Criminal penalty 1 year in federal prison; $250,000 fine
Children 2
Website www.donblankenship.com

Donald Leon "Don" Blankenship (born March 14, 1950) is retired American business executive. He was Chairman and CEO of the Massey Energy Company — the sixth largest coal company (by 2008 production) in the United States[1] — from 2000 until his retirement in 2010.[2] A federal grand jury indicted Blankenship on November 13, 2014, for conspiracy to violate mandatory federal mine safety and health standards, conspiracy to impede federal mine safety officials, making false statements to the Securities and Exchange Commission, as well as securities fraud.

As a result of the Upper Big Branch Mine disaster, in which 29 miners were killed in Raleigh County, West Virginia on April 5, 2010, he faced up to 30 years in prison on several charges including felony conspiracy.[3] On March 5, 2015, the 4th US Circuit Court of Appeals overturned a gag order that had been keeping anyone involved in the case (including relatives of victims), from talking about the accident.[4]

Blankenship is a financial backer of the Republican party and participant in local and state politics in his home state of West Virginia.[5] He has frequently spoken out about politics, the environment, unions, and coal production.

Blankenship is featured unflatteringly in Michael Shnayerson's 2008 book Coal River and in Laurence Leamer's 2013 book, The Price of Justice: A True Story of Greed and Corruption.[6]

Blankenship was paid $17.8 million in 2009, the highest in the coal industry. It was 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]

On December 3, 2010, 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.[8]

On December 3, 2015, Blankenship was found guilty of one misdemeanor charge of conspiring to wilfully violate mine safety and health standards. He was acquitted of felony charges for lying about safety procedures in Massey's Upper Big Branch Mine that caused an explosion in 2010 before his retirement.[9] On Dec. 28, 2015, U.S. Magistrate Judge Clarke VanDevort lowered his bond from $5 million to $1 million, and he was permitted to return to his home in Las Vegas, and travel freely in the U.S.

On April 6, 2016, he was sentenced to 1 year in jail and fined $250,000. On May 12, 2016, his appeal rejected in federal court, he reported to FCI Taft, in California north of Los Angeles, to begin serving his sentence.[10]

Life and career

Blankenship was born in Stopover, Kentucky and raised in Delorme, West Virginia. His father served in the Korean War and his mother, Nancy McCoy, was a member of the McCoy family; they divorced soon after Don was born, and Don's mother ran a convenience store and gas station with her divorce settlement money for 40 years.[11] Three years after graduating from Matewan High School, West Virginia,[12] he earned a bachelor's degree in accounting from Marshall University in 1972.[13][14] He was the recipient of Marshall University's "Most Distinguished Alumni" award and inducted into the Lewis College of Business Hall of Fame in 1999.[15]

Blankenship is certified as a public accountant.[16] In 2002, he was inducted into the American Institute of Certified Public Accountants' Business and Industry Hall of Fame[17] and, in 2002, was recognized by the West Virginia Society of Certified Public Accountants as an Outstanding Member in Business and Industry.[15] Blankenship was also inducted into the Tug Valley Mining Institute Hall of Fame.[16]

Blankenship joined a Massey subsidiary, Rawl Sales & Processing Co., in 1982. Since then he has served the company in a number of capacities.[18] He was promoted to president of Massey Coal Services, Inc. (1989–1991), then president and chief Operating Officer from 1990 to 1991.[19]

In 1992, Blankenship was named president, chairman of the board of A.T. Massey.[19] He is the first non-Massey family member to be in charge of the company. When A.T. Massey was spun off from Fluor Corporation as Massey Energy in 2000,[20] Blankenship became the newly independent company's chairman and CEO.

He also serves as a director of the Center for Energy and Economic Development, a director of the National Mining Association, Mission West Virginia Inc, and was on the U.S. Chamber of Commerce board of directors.[21][22]

He is divorced and lives in Rawl, West Virginia. Blankenship has two children.[23] His son, John Blankenship, is a dirt track car racer, although his father has shut down his team and put its assets up for sale.[24]

Coal mining

McCoy Coal Group

In 2011, Blankenship incorporated a coal company in Kentucky named McCoy Coal Group (not to be confused with the James River Coal Company subsidiary McCoy-Elkhorn Coal Corp). McCoy has yet to seek mining permits.[25]

In 2012, in an interview with the Wall Street Journal, Blankenship stated, "It is easier to make money in the stock market than coal". He also stated that he didn't have plans to seek mining permits or buy up reserves.[26]

Upper Big Branch explosion

On April 5, 2010, an explosion at Massey's Upper Big Branch mine killed 29 miners. It was the worst U.S. coal mining disaster since 1970, when an explosion killed 38 in Hyden, Kentucky. In 2006, a fatal accident at Aracoma Alma (also owned by Massey Coal Co.) was one of the explosions prompting Congress to upgrade federal mine safety laws for the first time since 1977.[27] As Blankenship came under increased scrutiny, a Business Week article said that he had a reputation for resistance to spending money, willingness to litigate, and personally going into mines to persuade workers to abandon union organizing efforts.[28] On April 12, New York State Comptroller Thomas DiNapoli, the sole trustee of the New York State Common Retirement Fund which holds 303,550 shares of Massey stock worth about $14.1 million, called for Blankenship to resign immediately. "Massey's cavalier attitude toward risk and callous disregard for the safety of its employees has exacted a horrible cost on dozens of hard-working miners and their loved ones," DiNapoli said in a public statement reported by Reuters and others. "This tragedy was a failure both of risk management and effective board oversight. Blankenship must step down and make room for more responsible leadership at Massey."[29] On April 22, Massey Energy's lead independent director Bobby R. Inman announced that "Blankenship has the full support and confidence of the Massey Energy Board of Directors."[30] On April 25, President Barack Obama, Vice President Joe Biden, and state officials paid tribute to the 29 coal miners at a memorial service in Beckley, West Virginia.[31]

The former superintendent of a U.S. mine at the time of explosion at Massey's Upper Big Branch mine pleaded guilty Thursday March 29, 2011 to a federal fraud charge. "Prosecutors said Massey manipulated the ventilation system during inspections of the Upper Big Branch mine to fool safety officials and disabled a methane monitor on a cutting machine a few months before the explosion on April 5, 2010.... ...Prosecutors have refused to say whether they are targeting former Massey CEO Don Blankenship, whose company was cited for violations so frequently that union critics accused him of regarding fines as simply the cost of doing business....[32]

In March 2013, at a plea hearing in a federal court, Blankenship was directly implicated in conspiring to skirt safety regulations. A former Massey Energy official accused Blankenship of conspiring and plotting to hide safety violations from federal safety inspectors. The implication was that Blankenship would order his officials to warn mine operators when the federal inspectors were coming for "surprise" visits, and to quickly cover up any safety violations.[33]

Controversy

“ If any of you have been asked by your group presidents, your supervisors, engineers or anyone else to do anything other than run coal (i.e., build overcasts, do construction jobs, or whatever) you need to ignore them and run coal. This memo is necessary only because we seem not to understand that coal pays the bills. ”

Warren McGraw

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 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." [39] However, USA Today called Blankenship's ads "venomous." [40] According to a USA Today editorial dated March 3, 2009, Blankenship "has vividly illustrated how big money corrupts judicial elections. It puts justice up for sale to the highest bidder."[40]

Washington political journalist Michael Tomasky, himself a native West Virginian, claimed that Blankenship was "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."[41] Tomasky wrote:

“ 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.[41] ”

Michael Shnayerson, in his book Coal River (2008), reports that no such foundation was ever set up and that Blankenship's tactics didn't help other Republicans in the state. In 2006, the $3 million that he had provided to forty Republican challengers to Democratic state legislators brought just a single victory.[42] 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, which was funded in part by the West Virginia Chamber of Commerce, spent over $350,000 to defeat McGraw.[43] Meanwhile, several groups spent millions opposing Benjamin and supporting McGraw, including West Virginia Consumers for Justice and Hugh Caperton, CEO of Harmon Development Corporation.[44]

Blankenship is featured in Laurence Leamer's 2013 book, The Price of Justice: A True Story of Greed and Corruption[6] and in Peter Galuszka's 2012 book, Thunder on the Mountain: Death at Massey and the Dirty Secrets Behind Big Coal.[45]

Justice Spike Maynard

On January 15, 2008, photographs of Blankenship vacationing on the French Riviera with West Virginia Supreme Court Justice Spike Maynard, while Massey had a case pending before that court, appeared in the New York Times.[46] On April 3, 2008, ABC News reported that Blankenship attacked an ABC News photographer at a Massey facility near Belfry, Kentucky as the photographer attempted to question Blankenship about photos published in the New York Times [46] 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.[47] Justice Maynard later lost his bid for re-election to the West Virginia Supreme Court in the West Virginia primary election.[48] On February 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."[49]

Political views

Blankenship is a Republican and an active participant in West Virginia politics.[50] During a speech at the Tug Valley Mining Institute on November 20, 2008, Blankenship called House Speaker Nancy Pelosi, Senator Harry Reid and former Vice President Al Gore "crazies" and "greeniacs."[51] In the same speech, he also stated, "I don't believe climate change is real."[52] He associated President Jimmy Carter's support for energy conservation in the 1970s with communism: "Buy a smaller car? Conserve? I have spent quite a bit of time in Russia and China, and that's the first stage." Blankenship's views on global warming were reiterated in interviews conducted by The Hill and Forbes.[53][54]

In a letter to the editor of the Charleston (WV) Gazette dated October 30, 2009, Blankenship denied that climate change, or "global warming," existed, and stated: "Why should we trust a report by the United Nations? The United Nations includes countries like Venezuela, North Korea and Iran." [55]

At a 2009 Labor Day pro-coal rally in West Virginia,[56] Blankenship expressed his true views on the role of the federal government and state authorities in ensuring miner safety:[57]

We also endure a Mine Safety and Health Administration that seeks power over coal miners versus improving their safety and their health. As someone who has overseen the mining of more coal than anyone else in the history of central Appalachia, I know that the safety and health of coal miners is my most important job. I don't need Washington politicians to tell me that, and neither do you. But I also know — I also know Washington and state politicians have no idea how to improve miner safety. The very idea that they care more about coal miner safety than we do is as silly as global warming.

In a 1980s documentary, he stated "It's like a jungle, where a jungle is survival of the fittest. Unions, communities, people — everybody's gonna have to learn to accept that in the United States you have a capitalist society, and that capitalism, from a business standpoint, is survival of the most productive."[58]

Charity

Blankenship founded Massey Energy Spousal Groups that led all charitable work for the company and its employees. The Massey website described them as providing "financial support to the Groups as they assist children, the elderly, fire departments and many other deserving individuals and programs. Projects included town and stream cleanups, school book fairs, local park improvement, senior citizen appreciation dinners and the annual Christmas Extravaganzas." [59]

In October 2012, Marshall University announced that Blankenship committed $300K in scholarships for students attending the Joan C. Edwards School of Medicine. The pledge was made in the name of Blankenship's mother, Nancy Marie McCoy, and $100K of the pledge was received in early September 2012.[15]

External links

References

  1. ↑ "Major U.S. Coal Producers". Energy Information Administration. September 18, 2009. Retrieved April 7, 2010.
  2. ↑ T Allen, "Investors Tout Their Role in Massey's Leadership Change" (December 7, 2010) Riskmetrics
  3. ↑ Ken Ward (November 13, 2014). "Longtime Massey Energy CEO Don Blankenship indicted". Charleston Gazette.
  4. ↑ Associated Press (March 5, 2015). "Appeals court tosses gag order in ex-coal company CEO's case". The Washington Post.
  5. ↑ http://www.newsmeat.com/ceo_political_donations/Don_Blankenship.php
  6. 1 2 http://www.publishersweekly.com/978-0-8050-9471-8
  7. ↑ Berkes, Howard. "Massey CEO's Pay Soared As Mine Concerns Grew". NPR. Retrieved April 23, 2010.
  8. ↑ Parker, Mario (December 3, 2010). "Massey's Blankenship to Retire Dec. 30, Be Replaced by President Phillips". Bloomberg. Retrieved December 3, 2010.
  9. ↑ http://www.wchstv.com/news/features/eyewitness-news/stories/Jurors-Convict-Don-Blankenship-On-Conspiracy-Charge-238644.shtml#.VmHdRnarTIU
  10. ↑ Ken Ward Jr. (2016-05-12). "Massey CEO Blankenship now in California federal prison". Charleston Gazette-Mail. Retrieved 2016-07-12.
  11. ↑ Michael Shnayerson (January 8, 2008). Coal River. Macmillan. pp. 152–. ISBN 978-0-374-12514-1. Retrieved September 1, 2012.
  12. ↑ "Ohio Valley Environmental Coalition". Ohvec.org. Retrieved April 6, 2010.
  13. ↑ Deborah Solomon (February 13, 2006). "A Coal CEO's Unusual Pastime: Firing Up West Virginia Politics". The Wall Street Journal, page A1. Retrieved May 21, 2010.
  14. ↑ "Blankenship to speak at energy symposium". The Herald Dispatch. October 23, 2008. Retrieved April 6, 2010.
  15. 1 2 3 "Marshall graduate pledges $300,000 for Medical School scholarships". Marshall.edu. Retrieved October 9, 2012.
  16. 1 2 http://www.williamsondailynews.com/view/full_story/2650489/article-Massey-CEO-to-speak-at-Tug-Valley-Chamber-banquet
  17. ↑ "American Accounting Association — News Archive". Aaahq.org. Retrieved April 6, 2010.
  18. ↑ http://investing.businessweek.com/research/stocks/people/person.asp?personId=658508&symbol=MEE o http://www.wvec.com/sharedcontent/APStories/stories/D8E477907.html
  19. 1 2 Don L. Blankenship. "Don Blankenship: Executive Profile & Biography". Business Week. Retrieved April 6, 2010.
  20. ↑ http://investor.fluor.com/phoenix.zhtml?c=124955&p=irol-newsArticle&ID=134404&highlight=
  21. ↑ o http://www.uschamber.com/about/board/all.htm Archived June 14, 2012, at the Wayback Machine.
  22. ↑ "Corporate Governance || Massey Energy". Phx.corporate-ir.net. Retrieved April 6, 2010.
  23. ↑ http://web.archive.org/web/20081203161432/http://www.wvec.com/sharedcontent/APStories/stories/D8E477907.html
  24. ↑ "The Official Website of Dirt Late Model Driver John Blankenship". JohnBlankenship23.com. Retrieved September 2, 2012.
  25. ↑ Don Blankenship Resurfaces, Forms Ky. Coal Company
  26. ↑ Massey's Ex-CEO Ponders Next Step
  27. ↑ "Churchgoers Honor 29 Dead Miners _ and Profession — ABC News". Abcnews.go.com. Retrieved April 23, 2010.
  28. ↑ "Massey's Blankenship Fought Regulators, Town, Maid as Coal CEO". Business Week. April 10, 2010. Archived from the original on April 13, 2010. Retrieved April 23, 2010.
  29. ↑ Steve James (April 13, 2010). "Massey faces shareholder anger over mine disaster". Reuters. Retrieved April 23, 2010.
  30. ↑ Coal Boss Don Blankenship Has Full Support of Massey Energy Board
  31. ↑ Obama eulogizes 29 West Virginia miners -- 'Don't let this happen again'
  32. ↑ JOHN RABY — Associated Press — Associated Press (March 29, 2012). "Ex-mine leader pleads guilty in deadly US blast | R&D Mag". Rdmag.com. Archived from the original on December 3, 2014. Retrieved September 2, 2012.
  33. ↑ "Coal Baron Don Blankenship Implicated In The Death Of 29 Miners". The Contributor. Retrieved March 27, 2013.
  34. ↑ http://dailymail.com/News/Kanawha/200804010144
  35. ↑ Margaret Cronin Fisk; Brian K. Sullivan; Karen Freifeld. "Massey Energy: The Accountant of Coal". BusinessWeek. Retrieved April 15, 2010.
  36. ↑ Length: 1 minute, 22 seconds (October 19, 2005). "Mine Safety, Company Panel — C-SPAN Video Library". C-spanvideo.org. Retrieved September 2, 2012.
  37. ↑ Goodell, Jeff (November 11, 2010). Don Blankenship: The Dark Lord of Coal Country. Rolling Stone. Retrieved December 10, 2010
  38. ↑
  39. ↑ "Don L. Blankenship Addresses the U.S. Supreme Court Ruling on Caperton v. A.T. Massey...". Reuters. June 10, 2009. Retrieved April 6, 2010.
  40. 1 2 "Usatoday.Com". Usatoday.Com. March 2, 2009. Retrieved April 6, 2010.
  41. 1 2 Tomasky, Michael, "Night Comes to the Appalachians" New York Review of Books, Volume 55, Number 14; September 25, 2008.
  42. ↑ Shnayerson, Michael (2008), Coal River, New York, New York: Farrar, Straus and Giroux
  43. ↑ Nyden, Paul (January 7, 2005, Charleston Gazette), "Coal, Doctor's Groups Donated to Anti-McGraw Effort."
  44. ↑ O'Brien, John (West Virginia Record January 24, 2008) "Caperton was Anti-Benjamin from the Start."
  45. ↑ http://www.publishersweekly.com:8080/978-1-250-00021-7
  46. 1 2 Liptak, Adam (January 15, 2008). "Motion Ties W. Virginia Justice to Coal Executive". The New York Times.
  47. ↑ "Coal Boss: If You Take Photos, 'You're Liable to Get Shot'". ABC News. April 3, 2008. Retrieved April 6, 2010.
  48. ↑ Urbina, Ian (May 15, 2008). "West Virginia's Top Judge Loses His Re-election Bid". The New York Times.
  49. ↑ Liptak, Adam (February 15, 2009). "Case May Alter Judge Elections Across Country". The New York Times.
  50. ↑ Segal, David (20 June 2015). "The People v. the Coal Baron". Retrieved 21 June 2015.
  51. ↑ "The Big Lies Of Big Coal: Don Blankenship Speaks". YouTube. December 10, 2008. Retrieved April 6, 2010.
  52. ↑ "Big Coal, Big Lies #1: Climate change does not exist". YouTube. December 9, 2008. Retrieved April 6, 2010.
  53. ↑ Snyder, Jim (November 16, 2009). "Q&A with Don Blankenship, CEO of Massey Energy Co. - The Hill — covering Congress, Politics, Political Campaigns and Capitol Hill". TheHill.com. Retrieved October 9, 2012.
  54. ↑ "Seeing Red On Cap And Trade". Forbes.com. September 28, 2009. Retrieved October 9, 2012.
  55. ↑ "Charleston Gazette – Letter to the Editor from Don Blankenship". Coal Zoom. Retrieved October 9, 2012.
  56. ↑ "Friends of America Rally". Friends of America Rally. September 7, 2009. Retrieved April 23, 2010.
  57. ↑ "Don Blankenship called safety regulators "as silly as global warming" « Climate Progress". Climateprogress.org. April 12, 2010. Retrieved April 23, 2010.
  58. ↑ Chris Hedges and Joe Sacco (2012). Days of Destruction, Days of Revolt. p. 168. Nation Books. ISBN 1568586434
  59. ↑ "Community || Massey Energy Company". Massey Energy. Retrieved April 6, 2010.

59. Medium.com Letter from West Virginia; The United States of America V. Don Blankenship by Tracy Edmonds Herz

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