Stinging Nuns

An order in the courts

Managers who have found themselves embroiled in no-win squabbles with environmental and consumer groups might take some comfort in the problem facing the Blue Diamond Coal Co. of Knoxville, Tenn. It is being taken to court by, of all adversaries, an order of Roman Catholic nuns. Armed with 81 shares of Blue Diamond stock, the 750-member Sisters of Loretto, a teaching order based in Denver, last week joined twelve other parties in bringing a lawsuit against the company. The nuns' eventual aim, as one of them describes it: to urge the company toward greater "corporate responsibility."

The nuns have criticized Blue Diamond, which operates three mines in eastern Kentucky, for a multitude of sins, including assorted environmental abuses, union-busting activities and wrongful denial of responsibility for a 1976 accident at a Kentucky mine that killed 26 men. (Blue Diamond has been cited for violations of Government safety regulations more than 4,500 times in the past nine years.) In March the nuns asked Blue Diamond to register with the Securities and Exchange Commission so that the SEC would have to regulate it. The company refused, stating that the nuns had not been registered as bona fide stockholders. Now the nuns are going to court to force Blue Diamond to register them as the shareholders of record, so that they will be able to get a stockholders' list, which they plan to use to rally inside support for their cause.

The sisters are familiar with such temporal matters, having used positions as stockholders to press for policy changes at J.P. Stevens, Rockwell International and McDonnell Douglas. But this is the first time that the nuns have ever filed a suit.

Explains Sister Eileen Harrington, 27, who is not only a nun but a law student as well: "We didn't want to go to court, but Blue Diamond left us no choice. As Christian women, we don't often put ourselves in an adversary position."

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