Merged Company Tries To Retire Massey's Legacy

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The most infamous company name in the American coal industry is now officially retired. But the Massey Energy legacy persists at Alpha Natural Resources, which absorbed Massey in a friendly takeover Wednesday.

That's because Alpha has folded into its management team Massey executives and officials linked to the company's poor safety record and last year's Upper Big Branch coal mine explosion, which killed 29 mine workers.

An independent investigative report about the tragedy blamed a Massey corporate "culture in which wrongdoing became acceptable, where deviation became the norm."

"We're going to run right and we're going to lead by example," declared Alpha CEO Kevin Crutchfield, in a reference to Alpha's safety program, known as "Running Right."

"We'll let our performance be our public relations effort," he said. "We're willing to be judged by what happens from this day forward."

But deep in the Coal River Valley, not far from the Upper Big Branch mine, the transition was met with skepticism.

"Nothing's going to change," said Gary Quarles, a Massey miner himself who lost his son Gary Wayne in the Massey mine explosion that took 29 lives.

"The name will change and that's all," Quarles continued. "These men here do not know how to go about doing stuff right."

That's a reference to the coal miners, executives and managers used to doing it the Massey way. In the last two months, Alpha announced it was moving about a dozen Massey officials into Alpha management. Crutchfield defended that lingering hold on the Massey legacy in an interview with NPR.

"Those are the decisions that have been made to date," Crutchfield said. "We stand by them. But, if there's a need to create a course correction in the future that's exactly what we'll do."

Chris Adkins' Departure

And then Crutchfield suddenly disclosed a course correction involving Massey chief operating officer Chris Adkins, who was tapped to help integrate Alpha's Running Right safety program in the newly-merged company.

That move triggered fierce criticism because Adkins presided over Massey while it compiled one of the worst safety records in the industry, including two deadly mine disasters. The company was held criminally liable after one of them, an explosion and fire at the Aracoma Alma mine that left two workers dead.

The Adkins move to Alpha was singled out in a recent report on the recent independent investigative report on the Upper Big Branch (UBB) disaster.

"One need look no further than UBB, where conditions, as described in this report, reflected a mine in which safety standards were swept aside in the rush to produce coal," the report said, in raising questions about Alpha's hiring of Adkins.

In recent weeks, the United Mine Workers of America condemned the job assignment, and Congressman George Miller (D-CA) and Congresswoman Lynn Woolsey (D-CA) cited it in a letter to Crutchfield.

"We are troubled by indications that, as Chief Executive, you could think that miners are fairly served by perpetuating Massey's safety culture for even one minute longer," Miller and Woolsey wrote.

In the NPR interview Wednesday, as Crutchfield was pressed by the hiring of Adkins and other Massey executives, the Alpha CEO suddenly said, "Chris will not be joining Alpha. I'm not going to say any more about it than just that."

Crutchfield would not say whether Adkins made that choice or Alpha made it for him. Adkins walks away with a departure package worth $11 million, according to an analysis conducted by investment banking firm Cypress Associates on behalf of the of families of seven Upper Big Branch victims and a survivor suing Massey Energy.

Status Unclear Of Two Massey Execs

Crutchfield also would neither confirm nor deny the hiring of Chris Blanchard and Jason Whitehead, two executives at the Massey subsidiary responsible for the Upper Big Branch mine. The two spent four hours underground and unsupervised immediately following the deadly explosion last year. State and federal mine safety officials and investigators have expressed concern that the pair may have tampered with evidence.

Blanchard and Whitehead were among nine Massey executives and managers named by Crutchfield in a deposition three weeks ago, before he said, "There's a reasonable likelihood every one of those will be extended an offer" for jobs after the merger.

The deposition is among more than 5,000 documents unsealed Wednesday in a West Virginia court in response to a motion filed jointly by NPR and the Charleston Gazette.

In the NPR interview, Crutchfield refused to discuss the status of any other Massey official. But he defended his decision to consider them for jobs.

"We made our selections based on who we thought would be appropriate and fit within the Alpha culture and being able to take Alpha to a new level," Crutchfield explained.

Shareholders Fear 'Secret Pact' For Jobs

The court documents are part of a lawsuit by several large institutional Massey shareholders who allege that the job offers were part of a "secret pact" to make sure Alpha bought Massey. The documents also show that another company, Arch Coal, had offered more money but had a merger plan that "straightens out Massey," according to a Crutchfield e-mail.

The shareholders claim that the job offers transformed the Alpha bid from hostile to friendly and protected Massey executives and board members from liability if the lawsuit succeeded.

"I don't give the conspiracy theory much thought," Crutchfield responded.

Crutchfield said Alpha would launch a massive training effort, involving nearly 600 sessions, to change the safety culture at the former Massey mines. Alpha has a better safety record, according to documents on file at the federal Mine Safety and Health Administration.

Strict attention to safety "is not a suggestion," Crutchfield insists. "This is the way we will run our company...A ton of coal is not worth a life under any set of circumstances."

Still, skepticism lingers. That's because the merged Alpha management team includes Shane Harvey, Massey's general counsel and spokesman, who persistently pressed the company's theory that the UBB explosion was due to an unpredictable and unpreventable infusion of natural or methane gas. Mine disaster investigators say there's no evidence to support that theory.

Also moving to Alpha is Charlie Bearse, president of the Massey subsidiary responsible for the Freedom #1 mine in Kentucky, which was targeted for the Labor Department's first ever federal court injunction. Massey settled the case before the mine could be placed under federal court supervision.

Freedom "has a high risk level for a fatal accident ... on any given day," wrote mine safety official James Poynter in a court document.

Alpha's own assessment of the Massey culture concluded it "is driven by a strong focus on production...with...employee safety and regulatory compliance receiving minimal consideration," according to documents unsealed in another shareholder lawsuit in Delaware.

Massey executives and managers who were part of, and responsible for, that culture are still part of the Alpha management team. That may make Crutchfield's efforts to keep the focus forward elusive.

Copyright 2015 NPR. To see more, visit http://www.npr.org/.

Copyright NPR. View this article on npr.org.

Transcript

RENEE MONTAGNE, host:

The most infamous company name in the American coal industry is now officially retired. Massey Energy owned the West Virginia mine that experienced the most deadly explosion in decades. Yesterday, Massey Energy was absorbed by Alpha Natural Resources in a friendly takeover. NPR's Howard Berkes reports that the company's new owner is trying to retire, not just the Massey name, but also its legacy.

HOWARD BERKES: Two coal miners with reflective stripes on their clothes pulled down a dark sheet, yesterday, at what had been Massey Energy's West Virginia headquarters.

(Soundbite of applause)

It was a new sign, a big green A and the words Alpha Natural Resources. And it was a new day for the people who'd worked for Massey. At least that's what Alpha CEO Kevin Crutchfield told the crowd.

Mr. KEVIN CRUTCHFIELD (CEO, Alpha Natural Resources): We're going to run right and we're going to lead by example. We'll let our performance be our public relations effort. We're willing to be judged by what happens from this day forward.

BERKES: When Alpha's approach to safety, a program called Running Right, is infused into Massey's mines. Leave behind Massey's litany of safety violations, its two deadly mine disasters and its anti-regulation fervor.

Sitting at home near the Upper Big Branch coal mine, Gary Quarles was skeptical. A Massey miner himself, Quarles lost his son, Gary Wayne, in the explosion last year that took 29 lives.

Mr. GARY QUARLES (Coal miner): Nothing's going to change. The name will change and that's all. These men here do not know how to go about doing stuff right.

BERKES: That's a reference to the coal miners, executives and managers used to doing it the Massey way. Alpha had announced it was moving about a dozen Massey officials into its own management ranks. CEO Crutchfield defended that lingering hold on the Massey legacy in an interview later in the day.

Mr. CRUTCHFIELD: Those are the decisions that have been made to date. We stand by them, but if there's a need to create a course correction in the future, then that's exactly what we'll do.

BERKES: And then Crutchfield suddenly disclosed a course correction, involving Massey chief operating officer Chris Adkins. He'd been tapped to help integrate the Running Right safety program in the newly-merged company. That decision triggered fierce criticism, because Adkins presided over Massey while it compiled one of the worst safety records in the industry.

Mr. CRUTCHFIELD: Chris - it's fairly, fairly new news. I haven't shared it with anybody, but Chris will not be joining Alpha. I'm not going to say any more about it than just that.

BERKES: Crutchfield also wouldn't confirm whether he'd hired Chris Blanchard and Jason Whitehead. They were responsible for the Upper Big Branch mine and they spent four hours underground and unsupervised, immediately following the deadly explosion. Federal mine safety officials and investigators were concerned they may have tampered with evidence.

Crutchfield said last fall, that he'd likely hire Blanchard and Whitehead and others as part of a merger deal. That was revealed in court documents unsealed yesterday.

Mr. CRUTCHFIELD: We made our selections based on who we thought would be appropriate and fit within the Alpha culture and being able to take Alpha to a new level, so I dont give the conspiracy theory much thought.

BERKES: That's a reference to claims by some Massey shareholders that the merger was rigged to give executives jobs and shield them from liability.

Crutchfield said Alpha would launch a massive training effort to change the safety practices at the former Massey mines. Alpha itself has criticized Massey's culture, so including in Alpha's management, people responsible for that culture, feeds skepticism about running Alpha right.

Howard Berkes, NPR News.

(Soundbite of music)

MONTAGNE: This is NPR News. Transcript provided by NPR, Copyright NPR.