Sanctions Loom Over Justice Companies In 2 Federal Courts

A company owned by Gov. Jim Justice faces possible contempt in federal court over failure to pay for mine safety violations. Another federal court has found the governor’s son in contempt for failing to appear at a hearing last week.

A U.S. Attorney in the Western District of Virginia wants a federal judge to hold Southern Coal and its affiliates in contempt over their failure to pay $579,000 in Mine Safety and Health Administration penalties.

Southern Coal agreed to pay $5 million in MSHA fines in 2020, and has paid roughly $4 million.

However, the Justice-owned company has said it has no assets and cannot pay the balance. Southern Coal did make a payment of $10,000 on July 12, according to court documents.

U.S. Attorney Christopher Kavanaugh responded this week that Southern Coal has offered no evidence of an inability to pay and that the company has not sought bankruptcy protection.

Southern Coal has said its assets are collateral for nearly $300 million owed to Virginia-based Carter Bank. In June, the Justice family reached a settlement with the bank, one of its biggest creditors.

A federal judge in Alabama, meanwhile, has held the governor’s son, Jay Justice, in contempt. 

Chief U.S. District Judge R. David Proctor of the Northern District of Alabama last week declared Jay Justice and Bluestone Coke, a company the family owns, in contempt for violating three previous orders.

Among other missteps, Justice and Bluestone failed to appear in person for an Aug. 21 hearing.

Blackwater Riverkeeper and a local public health group sued Bluestone Coke last year over water pollution from a shuttered North Birmingham industrial facility the Justices own.

Proctor had earlier directed the parties into mediation.

Proctor gave Justice and Bluestone until Sept. 11 to comply with the court’s orders, including paying plaintiffs’ fees, responding to discovery requests and submitting dates for mediation.

Failure to cooperate or participate could result in penalties, an order of default, or “other appropriate sanctions,” Proctor ordered.

In 2022, Bluestone Coke was ordered to pay a $925,000 fine for air pollution violations. That, according to the Southern Environmental Law Center, is the largest single penalty ever issued by the Jefferson County, Alabama, Department of Health.

Justice’s numerous companies owe hundreds of millions of dollars to various creditors.

The Greenbrier Hotel, owned by the Justice family, was slated to be auctioned this month. However, the Justice family reached an agreement with one of his creditors to stop the sale — at least until October.

The Justice family owed $40.2 million on a loan for the property and had fallen behind on payments since the loan was taken out.