West Virginia Gov. Jim Justice, a businessman turned politician, has been pursued in court for years by banks, governments, business partners and former employees over millions of dollars in unpaid debts.
And for a long time, Mr. Justice and his family’s company fended off one threat after another with clever legal tactics, especially at odds with the lovable personality that has endeared him to so many West Virginians. On Tuesday, he is heavily favored to win the Republican Senate primary and move closer to victory in the general election, especially after Democratic incumbent Joe Manchin III left the party.
But now, as he finishes his second term as governor and campaigns for the U.S. Senate, things are even more volatile. Like Donald J. Trump, to whom he is often compared, and to whom he is often compared, Mr. Justice has faced a series of expensive judgments and legal setbacks.
And this time, some suspect, it will be too much for Mr. Justice 73 and his family to fend them all off.
“It’s a simple math problem,” said Steven New, an attorney in Justice’s childhood hometown of Beckley, West Virginia. He, like many coal country lawyers, has ties to Justice.
Mr. New said Mr. Justice and its numerous companies could handle some of these potentially multi-million dollar judgments on their own. But “when you add it all up and put the sentence together in the near term, it’s going to look like it’s not enough for him,” he said.
Mr. Justice, the son of a coal magnate, took over the family business in 1993 and expanded his interests beyond coal, including acquisitions in agriculture and high-end hospitality. Like many large corporations, Justice Corporation has a large amount of debt. But they are also known for not paying their salaries, and that may be starting to catch up with them.
A bank in neighboring Virginia that has served the Justice family for decades has begun the process of recovering more than $300 million in defaulted loans. Some of the family business’s most valuable assets, particularly the 246-year-old Greenbrier Resort, are in the bank’s sights, raising the possibility that the governor’s personal bank accounts and even his home could be repossessed. Efforts have already begun in Virginia to seize the assets of Mr. Justice’s son, James C. Justice III, the president of the family company.
In West Virginia, tax officials placed a lien on Greenbrier property for millions of dollars in unpaid taxes, just months after the governor auctioned off tax-delinquent properties he owns elsewhere in the state.
The collection of such large debts pitted creditors against each other, sometimes to the benefit of judges. Last month, one bank sued Mr. Justice, along with several other banks, after discovering that one of the loans, a piece of land near Greenbrier, had been pledged by a number of other lenders.
In another case, a federal judge forced a judge-owned coal business to turn over its helicopters to one creditor who owed millions of dollars, and the creditor then transferred the proceeds from the sale of the helicopters to another creditor. agrees to share with the company and is also owed millions of dollars. Still, lawsuits, judgments, and recovery efforts continue to pile up.
Neither the governor’s office nor attorneys for the Justice Company responded to questions. In response to questions about his mounting business troubles, Mr. Justice reiterated that his children oversee the company’s day-to-day operations and that he is focused on his duties as governor.
“There is no way on earth that I would take my focus off my job for even a second from day one,” he told reporters in February. “I’ve been putting up with this nonsense the whole time I’ve been here. But I can never take my eye off the ball.”
The most serious of Mr. Justice’s problems involves Carter Bank & Trust, a regional bank based in southern Virginia. Carter Bank has been lending to the Justice family for decades, at one point lending approximately $775 million to Justice’s businesses, a quarter of the bank’s total net lending at the time. was equivalent to 1 or more.
Justice Affiliates continued to make steady payments, but in April it defaulted on the remainder of its debt, a $302 million loan that had been personally guaranteed by the governor and his family. The bank demanded immediate repayment.
For the justices, this was a “huge crisis,” as described in a deposition last summer by Mr. Justice’s son. In November, the governor, his family, and more than a dozen of his businesses sued Carter Bank in federal court for $1 billion, alleging that the bank used unfair and coercive tactics that made loan repayments impossible. Ta.
Lawsuits against the banks did not slow things down. In January, a Virginia state court judge sided with Carter Bank, and the bank immediately began collection proceedings.
The trial company filed a lawsuit in the Virginia Court of Appeals, arguing it cannot pay the bond and saying the amount could range widely. Once the amount reaches much more than $25 million to $300 million, the recovery process may come to a halt. The court said it cannot stop the recovery operation.
Meanwhile, the bank announced it would put Justice’s Greenbrier Sports Club up for auction, much to the consternation of club members who own multimillion-dollar homes near the club’s golf course.
The auction is being contested in court, and Carter Bank’s lawyers said in a filing that the April hearing will be held as discussions continue “to arrive at a resolution that addresses the concerns of all parties.” He said it has been postponed.
But the potential loss of the sports club foreshadowed a threat to the crown jewel of the Justice empire, the Greenbriar Resort. Justice’s decision to buy the resort out of bankruptcy in 2009 made him a state hero, and the resort, valued at well over $500 million, has since become the site of a training camp for Republican lawmakers and a professional football team. We have hosted training camps and people with lots of money. Golf tournaments, including tournaments from LIV Golf, a league created by Saudi Arabia’s sovereign wealth fund.
This includes Carter Bank as well as Carter Bank’s collateral. A loan of up to $50 million from JPMorgan Chase & Co. to Mr. Justice is also partially secured by Greenbrier. Legal issues involving Justice’s businesses often reveal a tangle of overlapping debts, and the dispute with Carter Bank is no exception. In February, Credit Suisse, the Justice empire’s largest creditor, intervened and sued Carter Bank. Credit Suisse, which owes about $850 million, alleges in its lawsuit that Carter Bank’s collection efforts have made it difficult for Credit Suisse to collect debts from Justice’s businesses on its own. ing.
Lawyers for companies affiliated with Justice have frequently argued that the companies being sued cannot pay because they simply don’t have the money. But the plaintiffs say this is a diversion, with law enforcement agencies quietly emptying the accounts of companies targeted by creditors and moving the funds to other accounts, frustrating debt collection efforts. claims.
A federal judge in Kentucky has cited Justice Company’s efforts to avoid turning over financial information as a company seeks to collect tens of millions of dollars in judgments over the years. called it “the most egregious legal malpractice.” bench. The federal judge overseeing the case is currently considering whether to hold Justice executives in contempt.
As these threats pile up, Justice insists it’s all just a distraction. He listed assets worth up to about $2 billion and debts of less than $110 million on his federal candidate disclosure form. However, this list does not include loans from Carter Bank or Credit Suisse, in which his company was the borrower and he was the guarantor.
He always says, “Everything will work out in the end.”
“Our family has built an empire that employs so many people,” Justice said at a news conference. “It seems like everything is going to be okay after all.”
His creditors may not agree to that.
Thomas Link, 59, who owns a small drilling business, was hired in 2021 to do some work on the business owned by the judge. People told him he would regret doing business with the judge, but he said he was approached by the governor himself. . A few months later, Mr. Link was penniless.
“‘I told you so,’ that’s all I heard,” he said.
On April 24, after a year and a half of litigation, Justice reached a settlement with Mr. Link, agreeing to pay a portion of the hundreds of thousands of dollars that Mr. Link says he is owed. The company failed to pay the initial settlement.
