Gov. Jim Justice (R-WV) is facing increased scrutiny over his substantial debt and allegations of stiffing employees, creditors, and others after throwing his hat in the ring to challenge Sen. Joe Manchin (D-WV) for his coveted seat next year.
Justice is the Democrat-turned-Republican governor of West Virginia who boasts impressively high approval ratings. Being term-limited, Justice had mulled his political future for months before deciding to officially launch a bid to unseat Manchin late last month. The governor's family business owns an empire of coal mines, processing facilities, agricultural companies, and the landmark Greenbrier Resort in his home state, where he made his 2024 announcement.
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Described as the state's richest man, Justice's net worth rose to its highest point in 2009, when he was valued at $1.7 billion after selling Bluestone Resources Inc., the company that oversees the family’s coal operations, to Mechel PAO, a Russian coal producer, for more than $400 million in cash and several hundred million dollars in stock options. The deal was estimated to be worth over $1.5 billion. The value of his vast fortune plummeted, however, after Justice bought back Bluestone in 2015 for just $5 million plus royalty payments on future coal sales.
Despite the price drop, buying back Bluestone appeared to be the beginning of Justice's financial woes. The firm was a money pit, facing scores of lawsuits that continue to damage the company's overall financial position. While coal prices rebounded early last year after Russia invaded Ukraine, it has not been enough to revive the firm.
Making matters more difficult for Justice is the $850 million in personally-backed loans he and his children took out from Greensill Capital, which collapsed in early 2021. Justice and his children, whom he handed control of the family companies over to upon taking office as governor, have been in dispute with Credit Suisse Group AG, Grensill's main financing partner, over paying back the sum since the firm went under.
They struck a repayment agreement last summer that would have Justice pay back as much as $320 million in installments from cash generated through Bluestone. The deal reduced how much Justice would be responsible for paying back from $850 million to $620 million.
Justice has said he turned to Greensill for help with rebuilding the company and described the debt in June of 2021 as "a burden on our family beyond belief, and we’ll have to deal with it. It’s tough. It is really tough."
He has also denied any wrongdoing by him or his companies, saying "we didn’t have one earthly clue" of the problems that would emerge from borrowing so much from Greensill.
Steve Ruby, a lawyer for the Justices' businesses, told the Wall Street Journal in March that the family was working on selling Bluestone once again to make creditors whole and eliminate a large amount of the debt. He said the Justices had retained Perella Weinberg Partners, the financial services firm, to advise on selling the family's coal operations.
“The intent of a sale process would be to pay off the Bluestone debt in full so that the company will be debt-free going forward,” Ruby told the outlet, adding that the governor's Senate bid played no role in his decisions about financial dealings.
Addressing the Greensill matter by selling Bluestone will not completely solve Justice's money woes.
Carter Bank & Trust, a longtime banking partner of Justice and his family, filed a lawsuit last week seeking to collect on an unrelated debt of $300 million. Jay Justice, the governor's son, has since claimed that the bank has refused a reasonable repayment plan proposed by his family.
The governor is also in the midst of pending litigation with Citizens Bank, which sought to seize Justice's annual salary in March to cover an unpaid personal guarantee of a business loan.
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Asked about the Citizens matter in late March, Justice said that, "Immediately when I heard about this, I called my son. He said they were in the process of satisfying this judgment. I think equipment has been delivered even to the bank. I know all of this will go away. I don’t want to be critical to the bank, but it’s just a political grandstand. It’s just a way to hit back. I probably sympathize with the bank if the bank is frustrated and everything."
Representatives for Justice and his Senate campaign did not respond to the Washington Examiner's requests for comment on the governor's financial situation.