SCOTT DEPOT, W.Va., May 3, 2011 /PRNewswire/ -- International Coal Group, Inc. (NYSE: ICO) ("ICG" or "Company") announced that it received on Monday afternoon, May 2, 2011, an adverse trial court ruling in the action filed by Allegheny Energy Supply and Monongahela Power Company ("Allegheny") in the Court of Common Pleas of Allegheny County, Pennsylvania. In its ruling today, the trial court judge held that ICG's Wolf Run subsidiary breached its coal supply agreement with Allegheny and is liable for past and future damages and interest in the total amount of $104,103,893.
Allegheny, the sole customer of coal produced at Wolf Run's Sycamore No. 2 mine, filed a lawsuit in 2006 claiming that Wolf Run breached a coal supply contract when it declared force majeure upon temporarily idling the mine in the third quarter of that year. Allegheny also claimed that Wolf Run continued to breach the contract by failing to ship thereafter the volumes referenced in the contract. The court held a non-jury trial of this matter in January 2011.
"We are disappointed in the court's ruling today, and believe that the court misinterpreted both the factual underpinnings of the case as well as the applicable law," said Roger Nicholson, ICG's Senior Vice-President and General Counsel. "We intend to avail ourselves of post-verdict remedies and to appeal the ruling, if necessary."
In the event of an appeal, the Company believes it has sufficient cash on hand and credit capacity to post any necessary appeal bond.
Prior to the ruling, ICG and Arch Coal, Inc. (NYSE: ACI) had announced their intentions to merge. The Company does not expect the court's ruling to adversely affect the completion of the merger.
International Coal Group is a leading producer of coal in Northern and Central Appalachia and the Illinois Basin. The Company has 13 active mining complexes, of which 12 are located in Northern and Central Appalachia, and one in Central Illinois. ICG's mining operations and reserves are strategically located to serve utility, metallurgical and industrial customers domestically and internationally.
SOURCE International Coal Group, Inc.