This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Hearing Begins Patriot's Bid To Cut Benefits

By JIM SUHR

ST. LOUIS (AP) â¿¿ A long-awaited bankruptcy hearing began Monday in which a St. Louis-based coal company insists it must significantly cut thousands of retirees' health care and pension benefits or risk liquidation â¿¿ a claim that its miners union strongly rejects.

Patriot Coal Corp.'s proposed benefits cuts have been the most contentious aspect of its bankruptcy case since it filed for Chapter 11 protection last summer, when it estimated it would have to spend $1.6 billion to cover retirees' health care costs.

The United Mine Workers of America union, after weeks of protests in states where Patriot and its former corporate parent Peabody Energy Corp. have operations, has labeled the proposed benefits cuts immoral, drastic and unfair. Miners, along with consumers and local religious leaders, picketed again Monday near Peabody's downtown St. Louis headquarters, and police said more than a dozen of them were arrested.

Peabody accused the union of grandstanding "when it knows that this matter will be decided in the courts" and is between the union and Patriot, not Peabody. Peabody added it "has lived up to its obligations and continues to do so."

The hearing could last through Friday, although U.S. Bankruptcy Judge Kathy Surratt-States may not issue a ruling immediately.

Looking to cease pension contributions, Patriot last month gave the union a proposal that would create a trust with a maximum of $300 million from future profit-sharing to fund some level of health benefits. Patriot, seeking to modify its collective bargaining agreements, also would give the union a 35 percent equity stake in the company once it emerges from bankruptcy.

Patriot CEO Bennett Hatfield has called the moves necessary for Patriot's survival and the preservation of more than 4,000 jobs.

Union leaders have said that when it jettisoned Patriot in 2007 as a separate company, Peabody saddled it with pension and long-term health care obligations that invariably would prove too burdensome and have to be shed. On Monday, Peabody called that version "a desperate attempt to rewrite history," noting that "Patriot was highly successful following its launch more than five years ago with significant assets, low debt levels and a market value that more than quadrupled in less than a year."

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,083.80 -2.83 -0.02%
S&P 500 1,987.98 +0.97 0.05%
NASDAQ 4,472.1080 -1.5890 -0.04%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs