Patriot, the judge said in her ruling, incorporated two units in New York in the weeks leading up to its bankruptcy, essentially for the purpose of establishing venue there—a move that, while technically legal, was “simply not fair.” Patriot filed for bankruptcy in July, five years after being spun off by Peabody Energy and Arch Coal.
Chapman also criticized the union in her 62-page ruling, which she said aimed to define “the meaning of justice.” The union wanted to move the case to a West Virginia court where it felt judges would be more sympathetic to its cause, Chapman said. “It is not in the interest of justice merely to swap one party’s perceived home field advantage for another,” the judge said, citing court hearings in which union lawyers expressed a desire for judges who “understand” and “worship” coal miners.
In court papers, Patriot has said its current labor obligations are “unsustainable” without cutting some benefits as it restructures. The UMWA has more than 10,000 retiree members whose pension and health obligations are administered by Patriot, though many never worked for Patriot and retired before the Peabody spin-off. The union has vowed to protect its benefits through the bankruptcy, and has also sued Peabody Energy, saying it should cover benefits if Patriot cannot.
Chapman chose St. Louis, she said, because Patriot and many of its officers are based there. She added that she was influenced by hundreds of “compelling” letters from retirees, widows and families who wish to participate in the case.
