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In re Massey Energy Company Derivative and Class Action Litigation
Citation:2011 Del. Ch. LEXIS 83. (2011)
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Plaintiffs are stockholders of Massey Energy Company. Convinced that it knew better than the public authorities charged with enforcing laws designed to make mining a safer business, Massey management, with board knowledge, fostered an adversarial relationship with the company’s regulators and accepted as ordinary the idea that the company would regularly be accused of violating important safety regulations. On April 5, 2010, a massive explosion occurred at Massey’s Upper Big Branch mine and as a result 29 miners died. The present derivative suit alleges the directors continued to disregard their fiduciary duties. Plaintiffs allege that Blankenship knowingly flouted applicable miner safety laws, believing he knew better about how to run mines safely than the MSHA, and made the conscious choice to put miners at risk in order to cut cost-corners and up mining profits.
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