Walter Energy defeats union bid to save contracts and benefits

CHICAGO (Reuters) - Walter Energy Inc defeated an attempt by union workers to salvage job contracts and keep retiree benefits after a judge upheld a lower court ruling allowing the bankrupt coal producer to reject labor agreements.

In an opinion published on Wednesday, U.S. District Judge David Proctor rejected an appeal by an affiliate of the United Mine Workers of America, saying that a U.S. bankruptcy judge’s decision in December to allow Walter Energy to end its labor agreements was “valid.”

Alabama-based Walter Energy, which filed for bankruptcy protection in July, had said that it needed to end its collective bargaining agreements and retiree benefits in order to sell its core operations, given the industry’s dire straits.

The sale to Warrior Met Coal, an entity formed by Walter Energy’s lenders, was approved by the U.S. Bankruptcy Court in January.

Scores of coal jobs have been lost as companies struggle with falling coal demand both domestically and abroad, pushing some of the largest U.S. coal producers into bankruptcy over the past year.

Job losses in the coal industry have become a contentious election issue for Democratic presidential candidates Hilary Clinton and Bernie Sanders.

The United Mine Workers and Walter Energy did not immediately respond to a request for comment. A spokesman for Warrior Met Coal declined to comment.

Reporting by Tracy Rucinski; Editing by Cynthia Osterman