Three lawsuits filed against the Jackson Kelly law firm, alleging a pattern of fraud and deceit in the firm’s handling of black lung cases on behalf of coal companies, are headed back to Raleigh County Circuit Court after U.S. District Judge Thomas E. Johnston remanded them on Monday. Jackson Kelly had removed the cases to federal court, arguing that the cases belong there in part because the they hinge on whether the conduct in question was allowed under the rules governing the Black Lung Benefits Act, which is exclusively federal.
In his order, which provides a helpful summary of the allegations and the issues at hand, Johnston concluded that the plaintiffs could prove their allegations of fraudulent misrepresentation under state law without having to raise a substantial issue of federal law. Johnston wrote:
Jackson Kelly relies too heavily on the BLBA as setting the standard of conduct applicable in these cases, particularly when it argues that [this] Court has subject matter jurisdiction because one issue is “whether conduct is at odds with the . . . BLBA.” At oral argument, Jackson Kelly reiterated this point when it claimed that, in order to prove their prima facie case, Plaintiffs must demonstrate that Jackson Kelly violated the provisions of 29 C.F.R. § 18.14, concerning the scope of discovery in black lung proceedings before the Department of Labor. Not one element of Plaintiffs’ claims requires resolution of this, or any other, federal question. A court may well turn to the issue of compliance with the BLBA’s provisions as a proxy or indicator of whether Jackson Kelly perpetrated a fraud as alleged, but nothing in the laws of West Virginia requires illegal conduct to satisfy the elements of common law fraudulent misrepresentation. Even if Jackson Kelly’s conduct fully complied with all applicable BLBA standards, Plaintiffs could still establish every element of their fraud claims; conversely, if Jackson Kelly failed to comply with BLBA standards, Plaintiffs would not automatically establish fraudulent misrepresentation under West Virginia law.
Later in the opinion, Johnston concludes:
Although Jackson Kelly’s briefing adequately summarizes BLBA regulations concerning discovery and evidence, at no point does Jackson Kelly identify specific regulations that must be answered to establish one or more elements of Plaintiffs’ fraudulent misrepresentation or legal malpractice claims. Instead, Jackson Kelly argues in the abstract, stating that the BLBA is so comprehensive that any dispute approaching the BLBA process must turn on substantial questions of federal law. Such an argument is utterly insufficient to carry Jackson Kelly’s burden of demonstrating the suitability of federal jurisdiction.
Jackson Kelly has raised this issue before, notably before the West Virginia Supreme Court of Appeals as it was deciding the fate of Douglas A. Smoot, a member of the firm’s black lung practice. Ultimately, a unanimous court sanctioned Smoot for withholding evidence from a retired miner who was representing himself as he sought black lung benefits. As I reported earlier this month, Jackson Kelly is apparently considering appealing Smoot’s suspension to the U.S. Supreme Court, having asked for (and been granted) a 90-day stay of mandate.
Black lung law is so byzantine and complicated, the argument goes, that those who don’t practice in the field can’t fully understand what is and is not allowed. However, I’m aware of orders from at least two administrative law judges who preside over black lung cases, that take exception to the way Jackson Kelly has handled black lung cases. You can read Judge Michael P. Lesniak’s order here and Judge Thomas M. Burke’s order here, and previous coverage here, here and here.