More than 200 employees of a Perry County coal mine have been laid off because of a contract dispute, a federal lawsuit alleges.
Trinity Coal Corporation charged in the lawsuit that the South Carolina Public Service Authority, known as Santee Cooper, has reneged on a deal for Trinity to sell coal to the utility.
Trinity said nearly all the coal it produced at its Perry County mine was shipped by rail to Santee Cooper.
The utility has refused this year to take the coal or pay for it, so Trinity was forced to idle the mine and lay off 260 of the 300 employees, according to the lawsuit, filed Monday in federal court.
Trinity is seeking an injunction ordering Santee Cooper to begin taking coal again. If the South Carolina utility doesn't do so, Trinity could be forced into bankruptcy, the lawsuit says.
Santee Cooper has not responded to the lawsuit in court.
However, the coal company's complaint says the utility began refusing to take Trinity's coal because the coal allegedly did not meet the quality specified in the contract. Trinity said that was not justified.
The coal company had shipped 7 million tons of coal to Santee Cooper without a complaint before the controversy arose, the lawsuit said.
Trinity Coal and Trinity Coal Marketing signed a deal in 2007 to provide 14 million tons of coal to Santee Cooper from 2008 through the end of 2013, according to the lawsuit.
Santee Cooper moved to cancel the contract after a sharp drop in coal prices in early 2012, Trinity claimed.