ELKO - Queenstake Resources USA is asking the U.S. District Court in Reno for a status conference in a push for settlement of the class action lawsuit filed against the company by laid-off Jerritt Canyon Mine employees.
Queenstake and parent Yukon-Nevada Gold Corp. claim the only hang-up to a settlement is agreement over attorney fees and costs and their offer is for all back severance pay and medical bills.
The ex-employees disagree and filed a motion this week to strike Queenstake's request for the conference, claiming the motion broke the confidentiality agreement imposed for negotiations.
"They have not offered to pay full severance or medical," lawyer Travis Gerber of Elko said Thursday.
He said he couldn't cite figures because of the confidentiality agreement, but he said Queenstake is trying to discount any attorney fees.
Gerber alleged Queenstake filed the conference motion that became public to make it "appear they are doing the right thing. We're disappointed they broke the confidentiality promise."
Yukon-Nevada President and Chief Executive Officer Robert Baldock said Thursday he can't comment because of the confidentiality agreement.
"We agreed not to put out any news," he said.
Queenstake laid off 400 workers at Jerritt Canyon north of Elko in August 2008 when the company ran into financial trouble. At that time, Queenstake paid the workers 30 days of severance pay but not the remaining 30 days of pay required under the Worker Adjustment and Retraining Notification Act.
According to Queenstake's request for the conference, the former employees accepted all of Queenstake's offer "except the terms related to attorney's fees and costs."
The plaintiffs offered to settle for $800,000 in lawyer fees and costs, but Queenstake offered $650,000. The plaintiffs then countered at $780,000 "and have been unwilling to move from this number," Queenstake contends in the documents.
Queenstake's offer as outlined in the conference request also is for what it says is the full amount of medical claims, $1.6 million, and for 30 days of back severance for the laid-off workers, totaling $1,210,431.
The offer also is for $75,000 to cover any 401k contribution claims and $100,000 in enhancements for the five named plaintiffs, according to court documents.
The five former Queenstake employees who filed the lawsuit on behalf of all the laid-off workers - Kurt Knudsen, Donald Capp, Larry Moon, Steve Volkert and Paul Dyer - initially asked for a $5 million lien against Queenstake over the pay issue.
The ex-employees stated in their Sept. 28 motion the court should strike Queenstake's conference request because it breaks the confidentiality agreement. The plaintiffs point to a letter Queenstake attached that plainly states it is confidential and for settlement purposes only.
"Plaintiffs participated in settlement negotiations with the expectation that this information would be kept confidential. Plaintiffs would like all settlement negotiations between the parties to remain confidential," the motion from the laid-off employees states.
Queenstake earlier asked that attorney fees and costs be left up to the court, and specified those fees and costs would be above the amount paid to laid-off employees so they would receive the full amount owed them, the conference request states.
Queenstake contends the plaintiffs rebuffed the $650,000 offer to cover attorney fees and costs and opposed allowing the court to set the fees.
"Plaintiffs' reluctance to leave the fees and costs issue to the court is understandable because they will likely have difficulty justifying their fees and costs request in light of the fact that, to date, no discovery has been conducted in this case," the Queenstake request for a conference states.
Queenstake also writes that it's "not in the best interest of the class to hold up settlement over the issue of how much plaintiffs' counsel should be compensated."
Attorneys for Queenstake include Gary DiGrazia of Elko and Anthony Hall and Dora Lane of Reno. Attorneys for the former mine employees are Gerber and Mark Thierman of Reno.
Vancouver-based Yukon-Nevada restarted the Jerritt Canyon mill last year and resumed mining at the underground Smith Mine early this year.