Calgary-based Infinito Gold Fails to Strong-arm Costa Rican Judiciary As Final Appeal Rejected by Supreme Court

Common Frontiers-Canada – MiningWatch Canada – Council of Canadians – United Steelworkers

(Ottawa) On June 19, 2013, the Constitutional Chamber (Sala IV) of Costa Rica’s Supreme Court unanimously rejected Infinito Gold’s appeal of the November, 2011 decision of the Court’s Civil and Administrative Law Chamber (Sala I) annulling the concession for the company’s proposed Crucitas open-pit gold mine.

This marks the third and final time that a Chamber of Costa Rica’s Supreme Court has shut down Infinito’s efforts to develop the controversial Crucitas site near the San Juan River, which forms the country’s northern border with Nicaragua. According to MiningWatch Canada spokesperson Jamie Kneen, “This is a victory for the people of Costa Rica over a Canadian mining bully that has sought to bend the country to its will, and silence opposition to its mine – this court decision will also help to preserve Costa Rica’s reputation as an ecologically-minded and democratic country.”

Infinito Gold’s multiple lawsuits should be more than enough to qualify the Canadian company as a vexatious litigant. Not only has Infinito attempted to intimidate the Costa Rican government, but it has also sought to silence opposition voices by initiating five lower court actions against two university professors, a lawyer for an environmental group, and two Congressional Deputies. It has lost the first three court cases, but intends to appeal. Comments Kneen, “Infinito has been a vexatious litigant in Costa Rica for years and should now pack up and leave – but not before it pays all court costs and for the environmental damage it has already caused.”

For years, Infinito has confronted street protest, backed by periodic opinion polls showing that 77% of the population oppose the development of the Crucitas mine. Costa Ricans are now celebrating this most recent Supreme Court decision and hoping that the much-reviled Canadian firm will take the hint and leave. As Stuart Trew of the Council of Canadians says, “Unfortunately a gracious exit would appear to be the last thing on the company’s mind.”

Infinito Gold produces no gold and is operating in the red. In its most recent financial statement, management admits that, “there is considerable doubt regarding the Company’s ability to operate as a going concern.” In fact, Infinito Gold is being kept afloat by its major shareholder, Ron Mannix, who, as the Statement goes on to point out, could exercise his rights for payment (but hasn’t) with regard to roughly $25 million owing him, given that the Company is currently in violation of default provisions included in the loans in question.

There is also the outstanding matter of an alleged 2008 donation of $200,000 to then-President Oscar Arias’ Peace Foundation, reportedly arranged by Infinito’s largest shareholder shortly before Arias issued an Executive Decree declaring that proceeding with Crucitas was in “the National Interest”, bypassing legislation prohibiting open-pit mining. The Costa Rican Attorney General has being trying to get to the bottom of this allegation and late last year requested information from the Canadian government.

Trew says, “Canada’s Department of Justice should come clean regarding the content of the documents it recently sent to Costa Rican authorities with respect to the alleged $200,000 ‘donation’.”

Ottawa has thus far refused to confirm or deny whether such a document existed, even after Costa Rica had acknowledged receiving it in February of this year. Former Common Frontiers coordinator Rick Arnold says, “Under Access to Information rules, the Canadian government has refused to release any of the relevant documents. This matter of possible influence peddling – at the highest levels – is of utmost importance to both countries and should be immediately shared with the public.”

Although, this ruling is a victory for Costa Ricans the legal nightmare may continue if Infinito makes good on its threat to take the case to international arbitration seeking $1.092 billion in compensation for its claimed investment and the loss of future profits.

We call on Infinito Gold to immediately cease and desist in its long running role as a ‘vexatious litigant’ in Costa Rica and announce that it will:

  • drop the threat to sue Costa Rica for $1.092 billion for alleged breach of the Costa Rica-Canada Bilateral Investment Treaty;
  • put an end to all lawsuits still in process against Costa Rican citizens;
  • pay all outstanding court costs and the damages assessed following the illegal clear-cutting of the Crucitas site;
  • leave Costa Rica.

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