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More arrests in Peabody Energy protest

AN ESTIMATED 1000 people, including union labor officials, miners and their families, took to the...

Donna Schmidt
More arrests in Peabody Energy protest

The morning protest was the fourth by the United Mine Workers of America and its many retirees who claim Peabody has failed to meet its obligations to take care of workers whose tenures were for Peabody spin-off company Patriot Coal and Arch subsidiary Magnum Coal.

Patriot filed Chapter 11 bankruptcy reorganization last July.

A majority of the protests have aligned with scheduled hearings in that case.

The UMWA claims in part that it was a “scheme by executives of Peabody, Arch Coal and Patriot Coal to create Patriot as a subsidiary that was designed to fail, in order to avoid payment of health care obligations to retired miners and surviving spouses”

One miner told a CBS affiliate in St Louis that Peabody’s moved to shift labor contracts to the spinoff, a company for which he never worked, was wrong.

“I had 35 years with Peabody,” Patrick Haussin said. “I’ve never worked for Patriot … this was a spinoff they did back in ’07. Our contract was with Peabody.”

Peabody officials previously told the St Louis Post-Dispatch that the UMWA’s claims of Patriot’s destiny to fail is "a desperate attempt to rewrite history”

Additionally, in an interview late last year Peabody spokeswoman Meg Gallagher told ILN that, contrary to UMWA claims, one of its subsidiaries had assumed obligation to pay more than $600 million in healthcare liabilities under the spin-off.

“While these are administered by Patriot, Peabody has paid for these healthcare benefits since the spin-off and continues to do so today,” she said.

“The UMWA was fully aware of the plan regarding retiree healthcare benefits at the time of the spin-off and assented to the payment arrangement.

“And, contrary to union claims, Patriot was a viable company when it was spun-off in 2007 and substantial events inside and outside Patriot’s control significantly altered its future.”

Gallagher went on to say that the company and the world had both significantly changed since October 2007 when the Patriot spin-off came into existence.

“These changes include Patriot’s transformational acquisition of Magnum Coal Company, significant changes in Patriot’s capital structure, decreased demand for US coal due to sharp declines in natural gas prices, the softening of global steel markets and more burdensome regulations,” she said.

“Patriot notes many of these same factors in its filings with the bankruptcy court.”

Earlier this week, UMWA president Cecil Roberts questioned in a press conference why the St Louis-headquartered miner had spent an estimated $16 million in legal fees and expenses so far in its efforts to emerge from Chapter 11 bankruptcy protection yet was asking for changes to healthcare coverage for union retirees.

He said the company also had asked for permission to pay its executives another $7 million, and all the while trying to amend that infrastructure.

Patriot did not issue a public statement on Robert’s remarks by press time, and Peabody did not respond to an ILN request for comment on the latest protest by press time Tuesday.

Patriot announced on July 9, 2012, that it and its wholly owned subsidiaries had filed for Chapter 11 bankruptcy, citing market conditions.

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