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Judge's Ruling Mixed in the Suit Former CEO of The Greenbrier Resort,
Paul Ratchford, Brought Against Owner CSX
By Christian Giggenbach, The Register-Herald, Beckley, W.Va.McClatchy-Tribune Regional News

Jun. 26, 2008 - LEWISBURG -- A Greenbrier County judge Wednesday ruled against Paul Ratchford, the former president and CEO of The Greenbrier who filed a motion for partial summary judgment in his ongoing $50 million lawsuit against CSX Corp.

However, Circuit Judge Joseph P. Pomponio Jr. clearly stated there was no West Virginia case law backing either side, and Ratchford's lawyer said an appeal to the state Supreme Court was imminent.

The central issue in Wednesday's ruling revolved around Ratchford's claim that his $700,000 severance package, paid to him by Jacksonville-based CSX Corp. -- sole owner of the resort -- was not issued within a 72-hour period as defined by law under the state's Wage Payment and Collection Act.

In March, Ratchford sued CSX and three other individuals, including CSX CEO Michael Ward, after Ward fired him last Sept. 18. Court documents indicate CSX lawyers acknowledge Ratchford was fired "without cause."

At the time, Ratchford's salary was $350,000 per year and he was owed $2,916.67 by CSX. The state wage payment law states all employees must receive any unpaid "wages" within a 72-hour period and employees are due triple the amount of wages if the law is violated.

According to court documents, Ratchford was paid $2,916.67 on Sept. 28, 2007, but several months later, CSX also sent him a check for $8,750.01 to cover "any potential ... damages on those wages."

In October, as part of a severance package with CSX, Ratchford was paid $700,000 and 1,200 shares of CSX stock.

Ratchford's Lewisburg lawyer, Barry Bruce, filed a motion claiming CSX owed his client $2.1 million and 3,600 shares of stock because his former employees violated the wage payment act.

CSX lawyers argued that Ratchford's severance pay and stocks were not defined as "wages" under the state's act and asked Pomponio to dismiss the motion.

"Both parties agree that this is an issue of first impression since there is no West Virginia case law directly on point," Pomponio wrote in his 18-page decision. "The court finds that this dispute presents a pure legal question that is appropriate for a resolution on a motion to dismiss.

Calling state law "silent" on the question of defining severance pay as part of one's wages, Pomponio looked to other states for guidance and also cited a Cambridge dictionary definition of the word "severance" in his decision to grant CSX's motion to dismiss Ratchford's motion for partial summary judgment. Summarily, Ratchford's motion for partial summary judgment was denied.

Pomponio cited cases from Massachusetts, Connecticut and Colorado in his decision, but also said "the court recognizes that there is a split of authority on this issue among courts across the country."

- -- -

On Wednesday, Bruce and CSX issued dueling news releases to The Register-Herald concerning Pomponio's decision.

"On behalf of Paul Ratchford and his family, we strongly disagree with Judge Pomponio's interpretation of the Wage Payment and Collection Act and will immediately appeal his decision to the West Virginia Supreme Court of Appeals," Bruce said. "Unfortunately, Judge Pomponio has chosen to construe the act narrowly when the West Virginia Supreme Court of Appeals has ruled the act should be construed broadly and liberally to effectuate its purpose."

CSX spokesman Gary Sease issued this news release to The Register-Herald Wednesday afternoon.

"We are pleased with the court's decision on the wage payment act claims, and the judge's decision speaks for itself. We will continue to vigorously litigate the remaining claims," Sease said.

- -- -

Pomponio did rule against CSX in another matter which could have some bearing on Ratchford's larger claim that he was fired for uncovering financial unethical acts of retired and active CSX executives.

Pomponio denied a CSX motion to dismiss Ratchford's claims that Greenbrier executive Bruce Rosenberger and Greenbrier consultant Howard Shapiro conspired behind his back and reported falsehoods to CSX executives which allegedly helped Ratchford get fired.

Rosenberger is the vice president of human resources at the resort and it is unclear if Shapiro continues to consult for The Greenbrier. Both have been named as co-defendants in the case.


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Copyright (c) 2008, The Register-Herald, Beckley, W.Va.

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