A pension fund class action case against controversial US mining firm Massey Energy relating to the fatal Upper Big Branch disaster two years ago has been given the go-ahead by a federal judge.
The lead plaintiff in the case is the $50bn (€37.5bn) Commonwealth of Massachusetts Pension Reserves Investment Trust (PRIT), which is managed by the Massachusetts Pension Reserves Investment Management Board (MassPRIM). Other plaintiffs are the Macomb County Employees’ Retirement System and the Firefighters’ Retirement System of Louisiana.
Judge Irene Berger, of the US District Court for the Southern District of West Virginia, denied the defendants’ motion to dismiss the suit this week. The accident cost 29 lives in the worst US coal mining disaster for decades.
The investors allege Massey’s share price was artificially inflated as it misled them about its safety and compliance record. They filed the suit just days after the accident.
Massey’s long-term CEO Don Blankenship resigned in the wake of Upper Big Branch and Massey waseventually taken over by Alpha Natural Resources in January 2011.
One twist to the case is that Lady Barbara Judge, the chair of the UK’s Pension Protection Fund, is a defendant in the case because she was a director of Massey at the time.
“The explosion and the cause of the explosion revealed to the market the fraudulent nature of which Plaintiffs complain, specifically, that Defendants mislead the market about the safety at its mines and its commitment to put production over safety,” Berger said in her ruling.
Elsewhere, securities lawyers have announced that the legal action relating to the Bank of America’s acquisition of Merrill Lynch at the height of the financial crisis has been certified as a class action by the United States District Court for the Southern District of New York.
And, staying in the US, the Common School Fund of Oregon and the Oregon Public Employee Retirement Board have been named as lead plaintiffs in the foreign exchange pricing suit against banking giant Bank of New York Mellon. Link to ruling