Three Letcher County men have been ordered to appear in U.S. District Court in Pikeville next month to answer allegations they conspired to steal valuable coal shipments meant for plants in Florida, Georgia, and South Carolina.
On Monday, U.S. Magistrate Judge Edward B. Atkins ordered defendants Billy Joe Smith, Allen Rocky Madden Jr., and James M. Combs to appear in U.S. District Court in Pikeville at 11 a.m. on January 4. The three will be asked to answer charges contained in a 10- page criminal indictment returned by federal grand jury in Pikeville on December 15.
Smith, Madden, and Combs are charged with committing the crime of “theft from interstate shipment of goods” by “systematically” stealing “loads of coal” from Nally & Hamilton Enterprises Inc.’s Doty Creek mine in Knott County, which is located near Hollybush in Letcher County.
According to the indictment, Smith was a foreman/ superintendent at the Doty Creek mine when the thefts began in May 2012 and continued through December 2012. Madden was a loader/ operator at the Doty mine, and Combs was an independent truck driver hired by Nally & Hamilton to haul coal from the Doty mine.
Following is what the indictment, which is broken into segments “Background,” “ Manner and Means of the Conspiracy,” and “Overt Acts,” says about the alleged crime: BACKGROUND
1. At all times relevant to the Indictment, Nally & Hamilton Enterprises, Inc. mined and processed coal at various locations in the Eastern District of Kentucky.
2. All coal production from mines operated by Nally & Hamilton Enterprises, Inc. was shipped via truck to a central processing facility located in Bell County, Ky. Following processing, the coal was stockpiled and then loaded onto trains. All coal shipments leaving the central processing facility were transported in interstate commerce to locations in Florida, Georgia, South Carolina, or Tennessee.
3. The transportation of coal from the various mine sites operated by Nally & Hamilton Enterprises to the central processing facility for ultimate shipment in interstate commerce was provided by independent contract trucking firms or individuals. These contract haulers were paid on a per ton basis for coal that was delivered to the central processing facility. Each active mine had a group of contract trucks that provided transportation services exclusively for that particular mine.
4. Upon entering the mine, trucks would enter the active pit of coal, where the trailer is loaded by a front-end loader. The frontend loader was operated by an employee of Nally & Hamilton.
5. After the trailer was loaded, the loader/operator issues a pit ticket to the coal truck driver. Pit tickets were sequentially numbered and contained the following information: load number for the day, time, seam of coal, date, truck owner, driver’s name, tipple location, coal mineral owner, surface owner, and wheelage. Other information may have appeared, such as the unit number of the trucking company.
6. After completing the pit ticket information, the loader/operator issues copies of the pit ticket to the driver. Two copies of the pit ticket were retained for company use. Those copies were collected at the end of the day by the foreman and sent to the central processing facility the following day.
7. After being loaded and issued a pit ticket, the truck would depart the mine for the central processing facility.
Upon arrival, the driver would pull the truck onto an automated scale. Each truck had a card that contained the truck owner’s name and the Nally & Hamilton Enterprise’s ID assigned to the truck. The truck driver’s information and the gross weight of the truck was recorded onto a computer. The driver would then enter the pit ticket number into the system and empty the load of coal. The truck would then be rescaled for weight.
8. This information was used to prepare payments to the various trucking firms for tonnage delivered. The information entered into the computer system was subsequently reconciled with the pit tickets issued to ensure all trucks loaded at the mine ultimately unloaded at the central processing facility.
The coal delivered from Nally & Hamilton Enterprise mines to the central processing facility was ultimately loaded in rail cars and shipped in interstate commerce to purchasers in Florida, Georgia, South Carolina, or Tennessee. MANNER AND MEANS OF THE CONSPIRACY
10. In or about 2012, Billy Joe Smith, Allen Rocky Madden Jr., and James M. Combs engaged in a conspiracy to systematically steal loads of coal from Nally & Hamilton.
11. As part of the conspiracy, James M. Combs, an independent truck driver hired by Nally & Hamilton to haul coal from the Doty Creek Mine in Knott County, would enter the mine and receive a load of coal.
12. Allen Rocky Madden Jr., a loader/operator employed by Nally & Hamilton at the Doty Creek Mine, would load or allow coal to be loaded into the truck driven by Combs, but would not issue a pit ticket to Combs.
13. Smith was a foreman/ superintendent employed by Nally & Hamilton at the Doty Creek mine at the time period relevant to this indictment. As a supervisor, Smith knowingly allowed Combs’s truck to be loaded without a pit ticket. Smith was paid per load by Combs for allowing him to receive coal without a pit ticket.
14. After receiving the coal, Combs would take the coal and sell it to an individual in Letcher County, who would pay Combs for the coal and then ship the coal in interstate commerce to a purchaser in Virginia. OVERT ACTS
15. In furtherance of the conspiracy and to effect the objects of the conspiracy, the following overt acts, among others, were committed in the Eastern District of Kentucky and elsewhere:
(a) On or about May 31, 2012, in the Eastern District of Kentucky, the defendant, James M. Combs, received a load of coal without getting a pit ticket.
(b) On or about May 31, 2012, in the Eastern District of Kentucky, the defendant, Allen Rocky Madden Jr., loaded or allowed coal to be loaded into the truck driven by Combs, but did not issue a pit ticket to Combs.
(c) On or about May 31, 2012, Billy Joe Smith was a foreman/superintendent employed by Nally & Hamilton
Enterprises at the Doty Creek mine. As a supervisor, Smith allowed Combs’s truck to be loaded without a pit ticket.
The indictment lists six other identical instances of “overt acts,” charging that other loads of coal were stolen on June 4, June, 6, June 8, June 11, October 15, and December 13, all during the year 2012.
The indictment charges that Smith, Madden, and Combs, “aided and abetted by each other, unlawfully, willfully and knowingly, and with intent to convert to his own use, did embezzle, steal, and take and carry away, and by fraud and deception did obtain, from a station, motor truck, trailer or other vehicle, goods and chattels of a value in excess of $1000, that is coal, which were moving as, were a part of, and constituted an interstate shipment of freight and express and other property from Nally & Hamilton Enterprises, Inc., at the Doty Branch Mine in the State of Kentucky to one of the following: Santee Cooper in South Carolina; Cedar Bay Generating Company in Florida; Kapstone Paper and Packaging in Florida; Georgia Power in Georgia; or Tennessee Valley Authority in Tennessee in violation” of federal law.
If convicted, the defendants could face imprisonment of not more than 10 years, a fine of up to $250,000, and supervised release for a period of three years. The prosecution may also seek restitution.