Jury hears Blankenship lament his compensation in recordings

Jurors in the criminal case against Don Blankenship on Friday afternoon listened to the former Massey CEO complain that the company’s board wouldn’t pay him enough and that his personal wealth was tied closely through stock ownership to the financial fortunes of Massey Energy.

“I don’t know why they are so unappreciative,” Blankenship said, discussing the board members in a phone call recording that prosecutors played to the jury just before court closed for the three-day weekend.

In another call, Blankenship complained that the board’s proposal would have limited his annual pay for 2010 to $12 million, when Massey’s corporate value was nearly $6 billion.

“Although $12 million is a lot of money, it’s not a lot of money compared to $5 or $6 billion,” Blankenship said.

As they ended the day’s testimony, Assistant U.S. Attorney Greg McVey played for the jury five recordings out of about 18 that U.S. District Judge Irene Berger admitted into evidence over repeated objections from Blankenship’s defense team.

Prosecutors have promised to play more of those recordings, which they say will show jurors that Blankenship was aware of and dismissed concerns about serious violations at Massey and that he pushed the company to put coal production, corporate profits and his own personal fortune ahead of worker safety in the time period leading up to the April 2010 explosion that killed 29 miners at Massey’s Upper Big Branch Mine.

The recordings provided a dramatic end to the third day of a landmark trial in which Blankenship faces three felony counts alleging that he conspired to violate mine safety standards and thwart government inspectors to cover up the resulting hazards to workers. He also is charged with making false statements to securities regulators and with securities fraud. Those charges allege that Blankenship issued false public statements touting Massey’s safety practices to try to stop company stock — and his personal fortune — from plummeting after the Upper Big Branch disaster.

When court opened on Friday, with the jury not in the room, Berger ruled from the bench in response to a last-ditch effort by Blankenship’s defense team to block jurors from hearing the phone call recordings. The judge agreed to exclude from the trial only three of nearly two dozen phone calls recordings that prosecutors want to use as evidence against Blankenship.

Precise details about the three excluded calls are not publicly available, but Berger indicated that they included only conversations about stock prices and the sale of stock, which she said were not relevant to the case. Other calls discussing the links between Blankenship’s personal wealth and Massey’s financial success are relevant to the securities charges against the former CEO and can be played for the jury, the judge said.

Defense lawyers had argued that the recordings were all irrelevant to the case and that prosecutors wanted to play only select portions that were taken out of context.

Under a court ruling sought by the Charleston Gazette-Mail and West Virginia Public Broadcasting, both sides in the case have been forced to release each day’s trial exhibits. U.S. Attorney Booth Goodwin is posting his team’s exhibits — including the Blankenship recordings — on his office’s website at http://www.justice.gov/usao-sdwv/us-v-blankenship and Blankenship’s defense team is posting their on the website of the Zuckerman Spaeder law firm at http://www.zuckerman.com/blankenship-defense.

In one recording of a phone call with a woman prosecutors have said Blankenship was dating, the former Massey CEO laments having a rough day, but said he’s glad the woman liked the flowers he sent her. “Oh my gosh, they’re gorgeous,” the woman says.

Blankenship then complains that photos of he and former state Supreme Court Justice Spike Maynard vacationing together in the French Riviera were “all over WSAZ.”

“Yeah, they’re going to do that for the rest of my life,” Blankenship tells the woman. Maynard recused himself from a major appeal involving Massey after the vacation photos of him surfaced.

Blankenship told the woman that the Massey executive compensation issue “is not such a big deal,” but added that Massey board members in a meeting “refer to me as a dictator” or “refer to me as monolithic.”

In another telephone call, Blankenship explained a recent sale of Massey stock by saying that he was trying to get the share of his “personal wealth” that was invested in the company down to about 25 percent.

“But you know, it’s really more than 25 percent to the standpoint that, you know, my income is coming from that, and stock, and options as well,” Blankenship said. “So, you know, I get to where I’m heavily dependent on Massey if I don’t diversify it some and, of course, I’ve been here for what, 28 years in January, so.”

The recordings were entered into evidence as part of the trial testimony of Sandra Davis, who was Blankenship’s executive assistant at Massey from 2002 until he left the company in December 2010.

Davis testified that Blankenship had recording devices installed in their offices so that he could record his phone calls. The recording devices, along with hard drives and discs — including one that investigators referred to as “Total Recall,” based on the name of the recording device — that contained the recordings were turned over to the FBI in September 2011 by Alpha Natural Resources, which bought Massey in June 2011. Prosecutors brought the devices, discs and drives to court to show the jury and FBI Special Agent Brent Stanze testified about how he listened to the recordings.

During her testimony, Davis also told jurors that she maintained Blankenship’s corporate email account, checking his messages and printing them out for him to read. She knew he had read them when she would receive the printouts back with handwritten notes that she was to send in response to company officials, Davis told the jury.

For more than an hour Friday afternoon, Davis identified various memos, emails and reports so that prosecutors could get them into evidence. Copies of documents were briefly shown on a large video screen on the wall behind where Davis sat in the witness stand.

Jurors leaned over in their seats to see them on smaller video screens mounted in the jury box. Occasionally, Blankenship would put on reading glasses, and lean over to look at the records and then discuss them with his attorneys. Behind Blankenship in the gallery, several family members of miners who died at Upper Big Branch stretched to also see the documents on the computer screen being used by the prosecution’s courtroom technician.

Eric Delinksy, a defense lawyer for Blankenship, objected to each of the documents and recordings coming into evidence. Berger overruled his objections.

Also during Friday’s court session, U.S. Mine Safety and Health Administration program analyst Tyler Childress took the stand. Childress testified about numbers he pulled from MSHA’s nationwide mine safety database showing that the Upper Big Branch Mine was cited for 836 violations between January 2008 and April 2010, the time period covered by the indictment against Blankenship. Showing the jury slides he prepared with graphics depicting the MSHA data, Childress said that agency inspectors also issued 59 orders citing “unwarrantable failure” to follow safety rules — shutdown orders that are among the most serious enforcement actions MSHA can take — during the period covered by the indictment.

Assistant U.S. Attorney Steve Ruby methodically questioned Childress, going through a mine-by-mine list of operations similar to Upper Big Branch to show that those other mines received far fewer citations and closure orders during the same period of time. Childress said that Upper Big Branch received the third highest number of “unwarrantable failure” citations of any mine in the nation.

Jurors in the trial get the day off Monday for the federal holiday. Court is scheduled to resume at 9 a.m. Tuesday at the Robert C. Byrd United States Courthouse in Charleston.

Check the Gazette-Mail’s Coal Tattoo blog for frequent updates on testimony in the Blankenship case, and visit the Blankenship trial page for a timeline and other features.

Reach Ken Ward Jr. at kward@wvgazette.com, 304-348-1702 or follow @kenwardjr on Twitter.

Funerals for Monday, January 27, 2020

Davis, Valerie - 11 a.m., Cunningham Memorial Park, St. Albans.

Hamrick, Leonard - 1 p.m., Waters Funeral Chapel, Summersville.

Hughes Jr., Denver - 1 p.m., Curry Funeral Home, Alum Creek.

Keen, Cora - 2 p.m., Tyler Mountain Memory Gardens, Cross Lanes.

Lazear, Elizabeth - 7 p.m., Keller Funeral Home, Dunbar.

Masters, Delores - 1 p.m., Glen Ferris Apostolic Church, Glen Ferris.

Milroy, Miller - 11 a.m., Simons-Coleman Funeral Home, Richwood.

Petro, Edith - 11 a.m., Cunningham-Parker-Johnson Funeral Home, Charleston.

Phelps, Herbert - 2 p.m., Chapman Funeral Home, Hurricane.

Stanley, Gary - 1 p.m., Pryor Funeral Home, East Bank.

Stewart, Donna - 1 p.m., First United Methodist Church, South Charleston.

Walker, Iva - 1 p.m., Roush Funeral Home, Ravenswood.

Wilkinson, Catharine - Noon, Raynes Funeral Home, Eleanor Chapel.

Williams, Joseph - 3 p.m., Tyler Mountain Memory Gardens, Cross Lanes.