This news story originally provided by Lexington Herald-Leader

September 20, 2005

Coal firm settles sludge spill suit

Torrent in 2000 killed fish, blackened land

By Roger Alford
ASSOCIATED PRESS

INEZ - Yesterday, people who live in a community deluged with more than 300 million gallons of gooey black coal sludge five years ago reached an out-of-court settlement with the coal company at the center of one of the South's worst ecological disasters.

Terms of the settlement, reached on the eve of trial, were not disclosed.

The case involved the spill of a molasses-like substance that gushed in torrents from a mountaintop reservoir owned by Martin County Coal. It smothered fish, blackened the landscape, and cut off drinking water supplies for some 60 miles along the Kentucky-West Virginia border.

Ned Pillersdorf, a Prestonsburg attorney representing 12 of the people who lived in the affected area, said the settlement included a confidentiality agreement, precluding his clients from talking about the case.

However, before leaving the Martin County Courthouse, Pillersdorf blasted the U.S. Mine Safety and Health Administration, saying federal inspectors should have known the impoundment was unsafe and should have forced the company to stop using it. Pillersdorf said he and his clients hold MSHA "even more responsible" than the coal company.

"I feel like MSHA let us down," said Kay Ward, one of the plaintiffs. "They're supposed to protect us, but they let us down."

MSHA representatives could not be reached for comment.

The case against Martin County Coal and its parent company, Massey Energy of Richmond, Va., would have been the first involving the sludge spill to go to trial. All other claims involving the spill have been settled out of court.

In each case, the settlements have been confidential.

John Kirk, a Paintsville attorney, settled cases involving 435 residents who claimed to have been adversely affected by the sludge. Kirk still has a case pending that involves 25 other people, and he said he may file suit on behalf of more residents before the five-year statute of limitations runs out next month.

In Pillersdorf's lawsuit, residents living along Coldwater Creek had been asking for unspecified compensation for property damage caused by the spill.

Pillersdorf had asked for punitive damages, claiming the company showed a reckless disregard for the residents.

But in his ruling, Circuit Judge Daniel Sparks said he found no such disregard, which would be required before he could allow a jury to consider punitive damages.

"On behalf of Martin County Coal, we're extremely pleased to have been able to settle the case for the actual damages these people suffered," said Jeff Woods, the company's lead attorney in the case.

The judge, dealing with a series of pretrial motions, also said yesterday that he had seen no evidence to show that the sludge contained hazardous chemicals that might have caused cancer or killed pets, as some residents feared.

In depositions that are part of the court file, residents had voiced such concerns, saying several people along Coldwater Creek have been diagnosed with cancer since the spill.

One resident said in a deposition that her dog became mired in the sludge outside her home. The yellow lab became ill and died two days later.

Martin County Coal contends the sludge -- a mixture of water and waste products generated when coal is washed in preparation for marketing -- is basically harmless, though its weight and thickness annihilated all aquatic life in Coldwater Creek and Wolf Creek.

The coal company spent about $40 million cleaning up the spill. In 2002, it agreed to pay nearly $3.5 million in penalties and damages to the state of Kentucky.