Tag Archives: bankruptcy court

Lessons in Social Justice

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The Fairness at Patriot rally in Henderson, Ky., on Tuesday sent me tripping back through time. Here we were at the County Courthouse at the edge of Henderson’s idyllic Central Park, where I worked and played for years, demanding justice for those who mine coal while celebrating the continued importance of that resource to the community.

In this blog, I have written about the history of King Coal and Henderson, and the Mine Workers struggle for justice, including the series of rallies in St. Louis that challenged the bankruptcy court to do the right thing, which, sadly, it did not.  But nothing hit home quite so dramatically as the rally on June 4.

Again there was the deep sense of the moral outrage – expressed by politicians as well as labor leaders – for the abandonment of mining families and retirees by Peabody Energy and Arch Coal, the villains in this story. They dumped all the legacy liabilities and conveyed few of their assets onto a company that seemed to be created to fail, Patriot Coal, now in bankruptcy.

As eloquent as the speakers were, none captured the spirit of the moment as well as an associate pastor at Henderson Holy Name of Jesus Catholic Church, where I once served as an altar boy and choirboy.  Opening the rally with a homily and a prayer, the Rev. Anthony Shonis set the mood and the story for the event:

Father Shonis, a native of Pennsylvania coal country who has ministered at the Henderson parish for the past decade, told the story not only of the rally but also of the union that has struggled for justice in the coalfields since 1890, when its founding President John Mitchell led the charge against the ruthless coal barons of the day.

He also invoked the memory of John L. Lewis, the legendary president of the Mine Workers who revolutionized the labor movement by leading the CIO to organize industrial unions — from auto and steel to utilities and furniture manufacturers. The history of American labor largely began and was transformed through the Mine Workers – although the Locomotive Engineers, Carpenters and other craft unions may claim earlier roots.

It was Mine Workers’ struggle that inspired so many to strive and succeed. And in the words of Father Shonis’s prayer, that ongoing struggle may also hold the keys to the future:

Today, the fight that UMWA President Cecil Roberts calls “the Mine Workers Traveling Salvation Show” is offering a warning and a prescription to workers of every stripe, in every industry. The signs waved across the park with the legend, “Are You Next?” carry special significance in an era when U.S. corporations are using bankruptcy courts to dump retirement obligations and seek unilateral changes in existing contracts.

ImageThe UMWA campaign already has generated legislation in the House and Senate to protect retirement benefits for the miners, as well as calls for changes in the nation’s bankruptcy laws to prevent the easy relief for U.S. corporations at the expense of employees, a process that Roberts likened to “curb service” – just drive in and get what you want, few questions asked.

“Let’s just move the bankruptcy court to the Department of Motor Vehicles,” Roberts said. “They have long lines. You’ve got to have your paperwork in order. At least they have to stand in line with their paperwork!”

Roberts decried that the nation has become “a nation of the corporations, by the corporations and for the corporations,” saying that the Fairness at Patriot campaign can help the nation get back on track. “I’ve got a message for Peabody and Patriot and the judicial system in this country,” he said. “This is a movement of the people, by the people and for the people.”

I felt a sense of great pride as I listened to his words, to be a part of this democratic movement that bubbles up from the people who work for a living. And even though I’m no longer a practicing Catholic, I was also proud of Father Shonis and the Church’s longstanding campaign for social justice that he represented so well at the rally in my hometown.

The Church’s teachings about social and economic justice are lessons I will carry with me all my life. They underline the truth and the strength of the labor movement, a galvanizing influence on our people and our democracy. Thanks for the reminder, Father Shonis.

In the Court of Public Opinion

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I am going home to cover a big story, just like old times. When 4,000 United Mine Workers and community supporters rally Tuesday, June 4, at the Henderson County (Ky.) Courthouse, I’ll be there to write about it, to blog live in my hometown, where I began my career as a newspaper reporter.

This is a story that Henderson should know well, the fight by coal miners to earn a decent living, to survive in a dangerous job. Coal was King in Henderson for many years, along with corn, soybean and tobacco, now overtaken by marijuana, as markets change, including energy. Coal has fallen on hard times, but not nearly so much as the miners who spent decades underground mining the coal. Many struggle for breath, many live out their lives in pain.

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A retiree rallies in St. Louis. The rigors of coal mining have taken their toll on miners, but they’re fighting back through the United Mine Workers of America.

These are men and women dependent on health care benefits that St. Louis-based Peabody Energy and Arch Coal promised to deliver but dodged artfully through a corporate swindle – I don’t know how else to describe it. They have offloaded their retirement obligations to these miners onto a little company that may have been “created to fail.” Patriot Coal filed for bankruptcy last year and is getting a gentle hand from U.S. bankruptcy court, even as Peabody and Arch wash their hands, like Pontius Pilate.

And here’s the lead: Patriot Coal on Wednesday, May 28, was awarded a bankruptcy court ruling that essentially gave the company the green light to gut the contracts of 1,700 active Mine Workers and strip life-saving health care benefits from 23,000 retirees and their family members. The Mine Workers immediately announced they would appeal the ruling, and continue their fight in other courts, in Congress and in the court of public opinion.

Now the story is coming to Henderson, and I believe it is a place where miners can get a fair hearing – at least in the court of public opinion. Patriot operates the Highland mine in adjoining Union County, and until last summer operated the Freedom mine in Henderson. Patriot shut down Freedom and others in West Virginia, and many are operating well below capacity. It’s a bittersweet reminder for citizens of Henderson that coal has always held both promise and peril.

Every coalfield family has been affected by the rigors of coal mining.  They’ve all lost friends and relatives to pneumoconiosis (black lung) and other respiratory diseases, or to the dangerous life underground. Coal is part of the DNA of these communities, and UMWA health care is a lifeline to the next day. Sadly, every American is affected by the erosion of health benefits, and by courts that increasingly favor the rights of corporations over the rights of individuals.

That is where we are today, facing a judicial system that somehow gives corporations the rights of people, while diminishing the rights of real people. “As often happens under American bankruptcy law, the short-term interests of the company are valued more than the dedication and sacrifice of the workers, who actually produce the profits that make a company successful,” said Cecil Roberts, president of the United Mine Workers of America (UMWA).

Roberts has vowed to continue the fight in every forum, including in federal court in Charleston, where the UMWA has sued Peabody and Arch for violations of the Employee Retirement Income Security Act (ERISA), alleging the companies conspired to deny benefits to their longtime employees and their families.

“Peabody and Arch can decide to live up to their obligations and end this problem tomorrow,” Robert said. “But if they don’t, we will continue our litigation against them and are optimistic about our chances.”

The rally in Henderson next week continues an aggressive campaign by the Mine Workers to make the miners’ case for justice in the communities where they live, where they raised their kids and contributed to local economies often driven by coal. As a young reporter, I waded through records at the Henderson County Courthouse, tracking the trade in mineral rights, to Peabody, Reynolds and other industry heavyweights of the day.

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The Henderson County (Ky.) Courthouse, where 4,000 Mine Worker and their supporters will rally next Tuesday.

Now it’s come to this: Giant coal companies that extracted the mineral wealth of communities now discard the workers who made their fortunes on a gob pile, like they were merely the waste of the operation – a sad reflection on corporate America. But we also are witnessing the courage and the determination of the miners and their union.

While the UMWA train stops in Henderson as it searches for justice, inevitably it is on its way to Washington, D.C., where the voices of miners already are being heard.

U.S. Sen. Joe Manchin (D-W.Va.), denouncing the bankruptcy court ruling as a “travesty,” declared, “It is wrong that Peabody can set up a company such as Patriot, fill that company with its liabilities and then spin that company off for the sole purpose of avoiding its contractual and moral obligations to its workers. I don’t think bankruptcy laws were ever designed to shield corporations from their promises and responsibilities. I will continue to fight for fairness in the bankruptcy system.”

This is a fight that affects us all. Stay tuned. You will be able to follow the action in Henderson via the live blog, or watch it via livestream video here, beginning at 10 a.m. CT Tuesday, June 4.

Faith and Justice

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As Mine Workers and their supporters prepare to descend on St. Louis Tuesday to again raise their voices outside the federal courthouse, they are bolstered by a new report by religious leaders that finds the miners’ battle against Peabody Energy, Arch Coal and the bastard child Patriot Coal to be right and just.

And they are heartened by their own sense of faith and hope that justice will be served – if not by the ruling by the bankruptcy judge sometime before May 29, then in the federal court in Charleston, W.Va., where the United Mine Workers of America has sued the coal companies for violating federal law, or in the U.S. Congress, where relief legislation has been introduced in both the Senate and the House.

But there are huge mountains to climb to preserve the health care coverage for coal miners and their retirees, and nobody knows that better than the union that has been fighting for the rights of these energy pioneers since 1890. It’s no secret that corporations increasingly are using the bankruptcy courts to dump retiree benefits.

“This has happened to steelworkers, airline workers, bakery workers, glass workers and now mine workers,” said Mike Caputo, a UMWA vice president and majority whip in the West Virginia House of Delegates. “Enough is enough. It’s time to take a stand.”

The stand by the Mine Workers has galvanized support not only from the labor movement, but also from consumer, civil rights, environmental and religious organizations. On April 29, at the last rally in St. Louis, UMWA President Cecil Roberts was joined in civil disobedience, and arrest, by 15 supporters that included CWA President Larry Cohen, National Consumers League Director Sally Greenberg, and Van Jones, executive director of Rebuild the Dream and a former Obama aide.

The support from the religious community has been consistent throughout the campaign, reflecting the fact that churches are the bedrock institution of mining communities throughout Appalachia and along the Ohio Valley, where Peabody and Arch have hauled away their fortunes.

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Mine Workers and their supporters bow their heads in prayer during a candlelight vigil outside the federal courthouse in St. Louis April 29.

Two of the Mine Workers interviewed by the religious groups in their report, “Schemes From the Board Room,” released May 1, are also Free Will Baptist preachers, and they portrayed the dire straits faced by their coworkers in starkly religious terms.

“The Lord may have called me to open my big mouth,” said David McCloud, who retired from a Peabody mine. “Peabody defrauded workers at their mines. They made promises they didn’t mean to keep. They oppress the poor and working people. I know we are supposed to depend on the Lord to provide, but sometimes we need to speak out and do something ourselves.”

Another miner-preacher speaking up was Elbert Collins Jr., who noted, “Ninety-five percent of our church members are miners. Thank the Lord for life and health benefits. But now we’ve come to a time of crisis.” His wife is on the wait list for cancer treatment, Collins said. “If we didn’t have a health care, the bills would overwhelm us.”

The fact-finders heard from Shirley Inman, a diminutive woman who left a well-paying job in Chicago to return home to West Virginia to work in coalmines because of the guaranteed health care benefit. She worked for Arch for nearly 30 years as an equipment operator but was forced into retirement by injuries to her spine and neck. “A cancer survivor, she is now experiencing spinal deterioration and other health problems, and relies on multiple prescriptions,” the report stated.

The rigors of coal mining has been on display at the rallies in St. Louis and Charleston, as some marchers carried oxygen equipment and others were consigned to wheel chairs as they struggled to breathe through the ravages of black lung, the scourge of coal miners. “People know that coal dust is bad, but they tend to overlook it to keep bread on the table,” Dr. Dan Doyle of the Cabin Creek (W.Va.) Health System told the fact-finders.

It’s not just mining families but entire communities that stand to lose if the courts allow Patriot to walk away from some $1.5 billion in health care liabilities, benefits promised to the miners. Brian Sanson, the UMWA Health and Retirement Fund liaison and the union’s director of research, said coalfield communities could lose $1.3 billion a year in pension and health care dollars.

“In 2012, Patriot and the UMWA Health and Retirement Funds provided health care payments that totaled over $320 million to West Virginia, $107 million to Kentucky, $58 million to Illinois and $33 million to Indiana,” Sanson told the religious fact-finding mission. “The retirees, widows and dependents do not have the financial means to pay for these benefits.” Most would be forced into personal bankruptcy or forced onto welfare rolls, he said.

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Religious Leaders for Coalfield Justice and Interfaith Worker Justice held hearings at St. Agnes Catholic Church in Charleston, W.Va., back in March, producing this report.

Of the 10,633 families receiving retiree health benefits from Patriot, 90 percent never worked a day for Patriot or Magnum, which Patriot absorbed from Arch, Sanson said. “Clearly, the primary motivation behind the Arch/Magnum transaction and the Peabody/Patriot spinoff was to avoid the liabilities to its former employees.”

The report, produced by Interfaith Worker Justice and Religious Leaders for Coalfield Justice, accuses Arch and Peabody of abandoning coalfield communities and their own families — people who have built their companies — for the sake of misguided notions of economic freedom. Quoting Psalms, the religious leaders urge people of all faiths to “stand with mine workers, their families and communities as they seek a just solution to their plight. And we invite prayers for them, as well as for owners and managers of Arch, Peabody and Patriot.”

You can read the full report here.

Meanwhile, miners continue their demonstrations to dramatize the unfairness of the scheme by the giant coal companies to steal their benefits, maintaining their faith in the U.S. justice system. They also are working to make sure that Congress gets the message. The Coalfield Accountability and Retired Employee (CARE) Act, sponsored by Sen. Jay Rockefeller in the Senate and by Rep. Nick Rahall in the House, would extend the federally guaranteed welfare and retirement system for coal miners and their dependents, in place since 1946.

The CARE Act would shore up the UMWA 1974 pension plan, undermined by the 2008 recession, and give union retirees who lose health care benefits because of company bankruptcy eligibility for the 1992 benefit plan and hold employers accountable for contributions.

For the time being, the campaign is playing out in the streets of St. Louis, but it will not stop there. Capitol Hill looms on the horizon. Federal Courts, the Congress, the President. The Mine Workers are prepared to leave no stone unturned in the search for justice. They say faith moves mountains.

If you can’t be in St. Louis tomorrow, you can follow the rally via live stream here.

Voices from the Coalfields

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In issuing her order to move Patriot Coal’s bankruptcy case from New York to St. Louis, Bankruptcy Judge Shelley Chapman pointed to the “hundreds of hand-written
letters … received by the Court from the people whose hands mine the Debtors’ coal and their widows and children.”

These very personal and emotional statements clearly influenced her decision. The United Mine Workers had made a strong case that the bankruptcy court should not decide this case in the financial capital of New York, but in the heartland where coal was mined and lives were affected by the outcome.

Many of the letters, Judge Chapman wrote “enclosed family pictures, or lists of ailments and medications. Some of them asked for a personal response. All of them were respectful, and compelling. This decision reflects the Court’s attempt to craft a just and balanced solution to the question of which bankruptcy court will become the next custodian not only of these cases but also of these letters.”

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That’s a powerful statement about the validity of the comments from the coalfields, from these mining families that had given their lives to the success of Peabody Coal Co., which in turn had dumped them. They landed in a Peabody shell, a new company, Patriot Coal, which got little of the lucrative business but lots of human liabilities. And now they are in dire need of the benefits they were promised by Peabody, before they were discarded like chattel.

Roger Elkins of Beckley, W.Va., wrote that he suffers “from cervical fusion in the 5th and 6th vertebrae of my neck, a crushed vertebrae in my lumbar back, a broken ankle, a broken wrist and two operations on this wrist. I suffered from severe burns on my hands from an exploding cable, plus numerous soft tissue injuries from my employment” at Peabody.

In short, he had given his life to Peabody. But Peabody apparently could care less about him or any of the thousands of other retirees, widows and orphans. Wrote one widow, “(I have) heart trouble, a pacemaker. (I had) a stroke, on oxygen daily, arthritic, can hardly walk, three discs out in my back. I am 74 years old … I take daily medications. I cannot live alone … I need this insurance badly.”

Her husband worked 38 years in the Peabody mines, “lost his leg at Dugger Mines in Indiana in 1971, went back to work and retired in 1974. We moved back to Kentucky in 2000.” Now he was gone, and she was pleading with the court for survival.

Here’s Sharron Diane Small, a widow of a miner from Marissa, Ill.:

“I will lose everything if I lose my insurance and medicine. I have colon problems … I have nerve problems. I’m losing my house, and have lost my son, brother, husband, mother-in-law, mother and father, and nephew – one each year for the last eight years.

“I realize it’s not any one person’s fault but what are we suppose to do? I have to take at least 12 different kind of medicine a day. … Please help all of us who are losing. I will wait as long as I can before going to the doctor and try to do without all the medicine I can. Thank you for listening. God bless.”

These are courageous people living out their lives after spending their youth building a great American energy company, and heartless corporate scoundrel. Patriot Coal may go bankrupt, but Peabody expects to walk away scot free.

Fortunately, the United Mine Workers will not walk away from the fight with Peabody, and is pressing not only in bankruptcy court, but also in U.S. district court in West Virginia, where the union has sued Peabody for violating the Employee Retirement and Income Security Act by colluding to deprive its workers and retirees of earned benefits.

“This … promises to be a long battle for the workers, retirees, their dependents and widows at Patriot who seek only fairness,” Roberts said. “Company executives who try to evade their obligations through a slick transfer of corporate assets need to know that the UMWA will fight in every way possible to make sure a promise made is a promise kept.”

As Roberts explained in October when he accepted the National Consumer League’s 2012 Trumpeter Award, fighting for the rights of all workers against the injustice of greedy coal companies is embedded in the UMW DNA, and is at the heart of the labor movement:

“What this movement needs is a little more militancy … a little more militancy,” Roberts repeated as he moved the crowd to stand and shout. The union has taken this fight to the courts, and it is ready to go to the streets. A lot of people who were promised benefits for a life of hard work and sacrifice are depending on it.

We’ll keep on eye on those court cases, and on the fight for survival by miners and their families. And we’ll look at the future of coal and mining communities that have depended on it for not only survival, but prosperity.