Finally An Update !Bandera Gold files lawsuit against Minera San Jorge
2008-04-01 21:59 ET - News Release
Mr. Kelvin Williams reports
THE STATE COURT OF JALISCO, MEXICO, COMMERCIAL DIVISION GRANTS PREVENTIVE MEASURES IN FAVOR OF BANDERA GOLD LTD. RELATING TO THEIR DISPUTE WITH MSJ & GEORGE S. BARNETT
On Jan. 4, 2008, and Jan. 7, 2008, Bandera Gold Ltd. (BGL) issued news releases in Stockwatch concerning the property dispute that is continuing with its joint venture partner, Minera San Jorge SA de CV (MSJ). Bandera indicated at that time that its legal counsel had reviewed all of the documentation regarding its signed option agreement, considered the circumstances of the situation that had arisen, and concluded that the issues at hand represented a deliberate breach of contract by MSJ and George S. Barnett.
Since that time, representatives of the company's legal team in Guadalajara, Caracas and Calgary have been working diligently to quantify and enforce the company's position regarding the legally binding agreement that is in place between BGL and MSJ.
There has been little communication between representatives of BGL and MSJ since the company's January announcements. BGL is aware that the 60-tonne-per-day test production mill has been operating throughout the dispute and that a substantial amount of silver/gold dore has been produced. There has not been any documentation forwarded to BGL by MSJ or its sister companies regarding this dore production.
On Feb. 26, 2008, the company's legal counsel in Guadalajara filed a lawsuit, with preventive measures that were applied for and granted on March 7, 2008, by a judge in the State Court of Jalisco, Mexico (commercial division, Guadalajara, Mexico), naming the following as defendants:
- Minera San Jorge;
- Campania Minera Cinco Minas SA de CV;
- Mr. Barnett;
- Minera Amajac SA de CV;
- The Public Mining Register.
On March 7, 2008, the court issued preventive measures in favour of the company consisting of the following:
- The encumbrance of assets of the defendants for an amount of $6-million;
- The registration of the lawsuit on the files of each of the mining concessions subject to the option agreement before the Public Mining Register in Mexico City;
- A prohibition for Mr. Barnett to leave the court's jurisdiction (the Mexican state of Jalisco) until this case is settled, unless having appointed an attorney to act on his behalf while he is away.
On March 28, 2008, Mr. Barnett and the company offices of MSJ and Amajac were served with the lawsuit. The defendants have nine business days to reply to the suit in defence of the action or be considered to be in default. In order to guarantee any damages to the defendants in case the lawsuit is dismissed, BGL was required by the court to post a bond of six million pesos (approximately $600,000).
In order for these preventive measures to be put in place and stay applicable, BGL was required to place a $600,000 warranty bond in order to respond to any damages and injury that the defendants may suffer as a result of the said preventive measures being put in place. In order for the co-defendants to have the preventive measures noted above removed, they will have to provide a warranty bond (or cash in lieu of) ranging from $600,000 to $1.2-million (the exact amount will be determined by the judge in due course).
The management of Bandera Gold and its legal team will continue to vigorously protect its shareholders' interest in the Cinco Minas and Gran Cabrera properties and its rights under the option agreement. Additional information regarding the suit will be released in the near future.
We seek Safe Harbor.