Jury convicts former Kentucky state Rep. Keith Hall of bribing mine inspector

PIKEVILLE — A jury convicted former state Rep. W. Keith Hall, D-Phelps, on Friday of bribing a state coal mine inspector to win favorable treatment for surface mines he owned in Pike County.

Hall, 55, faces up to 10 years in prison and up to $250,000 in fines when he is sentenced Sept. 17. As the jury's verdict was read aloud, following 90 minutes of deliberation, Hall trembled slightly and bowed his head, his eyes reddening. Minutes later, he exited the U.S. District Courthouse with his family, declining to comment.

Hall paid or otherwise arranged for about $46,000 to go to Kelly Shortridge in 2009 and 2010 after the Kentucky Division of Mine Reclamation and Enforcement assigned Shortridge to inspect his mines. Prosecutors said the payments were bribes. In exchange, they said, Shortridge ignored or delayed citing violations and allowed Hall to auger-mine coal outside the permitted area.

Hall, who helped regulate the state's coal industry as vice chairman of the House Natural Resources and Environment Committee, denied the bribery charge on the witness stand Thursday. He said some of the money was charity for Shortridge, a close friend who claimed to be in financial trouble, but most of it was legitimate business fees he paid Shortridge for two coal-related deals they worked on together. None of the money was intended to buy influence on mine inspections, Hall testified.

Assistant U.S. Attorney Ken Taylor attacked that defense Friday during his closing statement to the jury. It's "preposterous" to suggest that Hall, a veteran of the coal industry and the legislature, would think it ethical to give gifts to or do business with the state inspector assigned to his mines, Taylor said.

"Everyone knows it is improper for the inspector to be in bed with the inspected. But Wendell Keith Hall wants you to believe he didn't know that," Taylor said.

Shortridge, who resigned his state job last year, pleaded guilty in February to soliciting a bribe and is scheduled to be sentenced Aug. 6.

After the verdict, one of Hall's lawyers, Brent Caldwell, said that both Shortridge's guilty plea and Hall's explanation might have "looked bad" to the jury.

"It may not be illegal, but it's not a wise choice — even if it is legal — to do business with someone who regulates your business," Caldwell said.

Hall will file a motion asking for a new trial in the next 10 days, Caldwell added.

During the weeklong trial, the jury heard evidence that suggested Hall tried to keep his payments to Shortridge secret. The majority of the money passed through a company, DKJ Consulting, established in the name of Shortridge's wife with the help of Hall's office secretary. Shortridge said creating the company was Hall's idea, to conceal the path of payments. Hall denied it.

Also, after Hall made complaints about Shortridge demanding money from him in late 2012, he refused to answer questions from officials at the state Energy and Environment Cabinet — which oversees the mine agency — or the cabinet's inspector general, who investigated Hall's complaints. State officials testified that they found Hall's silence to be perplexing.

Hall spent 14 years in the Kentucky House until his defeat in last year's Democratic primary. He twice was fined by the Legislative Ethics Commission, once for taking no-bid contracts funded by money he approved in the state budget and another time for failing to properly disclose his personal finances for six consecutive years.

Prior to his election to the House, Hall was forced to resign from the Pike County school board in 1999 during a state investigation into his alleged attempts to improperly influence the awarding of school district jobs.

The Herald-Leader first reported in June 2013 on a history of unresolved safety and environmental violations at Hall's Pike County surface mines and on his relationship with Shortridge.

In late 2012, Hall complained to Billy Ratliff, then the state's director of mine reclamation and enforcement, that he had paid Shortridge an undisclosed sum for a local Little League team, but the inspector was demanding still more money from him. The Energy and Environment Cabinet's Office of the Inspector General opened an investigation. But Hall refused to be interviewed, and Shortridge denied any wrongdoing.

The cabinet let the matter drop with an inspector general's report drawing no conclusions on Hall's complaint. The Herald-Leader obtained the report through the Kentucky Open Records Act and published it.

During this week's trial, prosecutors said the FBI and the U.S. Interior Department's inspector general read about Hall's mines and the state's report in the newspaper. They decided to open a federal investigation. The two men were indicted last October.

This story was originally published June 26, 2015 at 3:19 PM with the headline "Jury convicts former Kentucky state Rep. Keith Hall of bribing mine inspector."