Gold miners accused of defaulting on a $25 million loan will get their day in a Montezuma County courtroom next year. A counterclaim has also been filed.
New York hedge fund Maximilian Investors initially filed civil action on April 12, 2013, against Red Arrow Gold and its partner American Patriot Gold after they defaulted on a $25 million loan. The investors claim they are still owed nearly $11 million.
Red Arrow Gold owner Craig Luikko of Mancos filed a breach of contract counterclaim on Sept. 15, 2014. Included in the 10-page rebuttal, Luikko’s attorney Robert Korn argues, in part, that American Patriot Gold skimmed millions from the initial loan, and his client should not be individually liable to claims made by William Sanders, owner of property leased to and subsequently polluted by Red Arrow Gold.
At a hearing before District Court Judge Todd Plewe last week, multiple attorneys involved with the complex case rejected court-suggested trial dates in January and February of next year. Their concerns included having enough time to obtain depositions from witnesses.
“This is a 2013 case,” Plewe advised. “I’m trying to bring resolution to all parties.”
An April 27, 2015, trial date was finally agreed upon. The trial is expected to last seven days.
Appearing via telephone, none of the attorneys involved were present in the courtroom on Thursday, Sept. 25. Sanders and his wife did attend, and he was obviously frustrated that his property rights linger in peril as he exited the building.
“We’ll see you next year,” he told a bailiff.
According to court documents, Luikko maintains Jaeger Kottmeier Associates, a court-appointed custodian, was solely responsible for the pollution that resulted from the operation of an illegal, unpermitted mining operation outside of Mancos. He also claims Maximilian Investors and Jaeger Kottmeier Associates have defamed and slandered his Red Arrow Gold business.
Luikko was ordered by state regulators to shut down the gold mill on the border of Mancos last summer. He was also fined $250,000 for multiple environmental violations.
The Environmental Protection Agency completed efforts to remove heavy-metal contamination from the Mancos mill site in July. Some 240 pounds of liquid mercury waste were recovered.
Last fall, Plewe discharged Jaeger Kottmeier Associates of any liability, minus any willful misconduct or gross negligence. The order, however, didn’t clear the receiver of all potential civil claims from Sanders.
Sanders said he has regained control of his property, but mining equipment remains on site.
