According to the press release dated April 29, 2010, the complaint charges Massey and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Massey produces, processes, and sells bituminous coal extracted from 56 mines in West Virginia, Kentucky and Virginia, and claims to be the largest coal company in Central Appalachia.
Specifically, the complaint alleges that prior to and during the Class Period, Massey claimed to be one of the safest mine operators in the industry, regularly touting its safety achievements and telling investors that safety was its number one priority. In fact, safety at Massey’s mines was repeatedly sacrificed so that aggressive production goals could be met, and Massey had received numerous undisclosed citations arising from serious uncorrected safety and other regulatory violations. Then, on April 5, 2010, an explosion at the Upper Big Branch mine near Montcoal, West Virginia, revealed the falsity of Massey’s repeated representations about the safety of its mining operations when twenty-nine miners lost their lives in the deadliest U.S. mine accident in nearly 40 years. In the days following the tragedy, hundreds of incidents of uncorrected safety violations at Massey’s operations came to light. The price of Massey common stock plunged following the explosion and subsequent revelations regarding Massey’s safety violations. On April 21, 2010, eight Massey mines were the target of surprise inspections by federal mine safety officials. Then, after the market closed, Massey announced its first quarter earnings and told investors that it would take up to $150 million in charges in the second quarter to account for the potential costs and liabilities associated with the Upper Big Branch tragedy. On these events, and despite the fact that the Company’s first quarter earnings had purportedly beat the Street by $0.11 per share, Massey’s stock fell to as low as $41.30 per share on April 22, 2010 before closing at $42.93 per share.
On January 10, 2011, Judge Irene C. Berger consolidated several actions under lead case, "IN RE MASSEY ENERGY CO. SECURITIES LITIGATION, Civil Action No. 5:10-cv-00689." Further, according to the Order, Massachusetts PRIT is appointed as Lead Plaintiff in the Consolidated Action, and Labaton Sucharow LLP and Robbins Geller Rudman & Dowd LLP are approved as Co-Lead Counsel and James F. Humphreys & Associates, L.C. is approved as Liaison Counsel for the Class. On March 11, 2011, the lead plaintiff filed a Consolidated Amended Class Action Complaint. The defendants responded by filing motions to dismiss on April 25, 2011.
On March 27, 2012, the Court issued an Order denying the defendants' motions to dismiss.
On February 5, 2014, a Stipulation and Agreement of Settlement was entered into the Court's docket. This Settlement was preliminarily approved by the Court on the 14 days later.