A coal company owned by West Virginia Gov. Jim Justice has been found in contempt by a federal judge for not following an order to pay an insurance company to maintain collateral for financial obligations.
U.S. District Judge Elizabeth Dillon found Southern Coal Corp. in civil contempt Monday and granted the insurance company's request to fine it $2,500 per day until it complies with the order, the Charleston Gazette-Mail reported.
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The ruling dismissed Southern Coal’s argument that it was unable to comply with the order for payment, issued five months ago, because it isn't actively mining coal and has no income.
That September order said Southern Coal failed to satisfy contractual obligations and must pay Charleston-based BrickStreet Mutual Insurance Co. $503,985 to maintain collateral for financial obligations, along with attorney fees. BrickStreet provides workers' compensation and employers' liability insurance.
Southern Coal argued that other Justice-controlled companies could no longer pay the company's debts because of recent judgments against them, but the judge said in the contempt order that no evidence had been presented to support that assertion.
Southern Coal has seven days to comply before the daily fine begins, according to the order.
The Justice family has been named in multiple lawsuits regarding business dealings. A Virginia bank said this month it would delay plans to auction off land at Justice’s posh resort, the Greenbrier Sporting Club, in an attempt to recover more than $300 million on defaulted business loans by the Republican governor’s family.
