Friedland shakes off asset freeze

An Ontario judge has removed the freeze on certain assets belonging to mining executive Robert Friedland — assets that the U.S. Environmental Protection Agency (EPA) had hoped to obtain.

The assets in question, the $152 million in Inco (N-T) shares coming to Friedland as a result of Inco’s acquisition of Diamond Fields Resources, would have covered all the cleanup costs at the Summitville mine site in southwestern Colorado. Friedland was the co-founder of Galactic Resources, which owned Summitville. He held various top positions in that company but resigned before the mine closed in 1992. The EPA took over the site late that year and found it to be discharging acidic, copper- and silver-rich drainage into the local river system.

In May of this year, a federal district court judge in Colorado signed a court order requiring Friedland to pay for the EPA’s cleanup of Summitville.

U.S. Department of Justice officials then went to the Supreme Court of British Columbia, pleading their case that Friedland was likely to avoid paying restitution by pulling his assets out of North America completely unless his Inco shares were frozen. The court complied.

On Nov. 6, Mr. Justice Robert Sharpe of Ontario Court (General Division) ruled that the U.S. had misrepresented and omitted vital information at the earlier court hearings, which were conducted without Friedland’s knowledge.

He criticized the U.S. for “a pervasive failure” to disclose all relevant material facts to the courts in Canada.

Justice Sharpe also ruled that the U.S. had failed to prove that Friedland was liable under U.S. environmental law for the costs of the cleanup.

“It’s a powerful judgement that speaks for itself,” Friedland said through his Vancouver holding company, Ivanhoe Capital. “The court orders and injunctions, which amounted to an entirely unwarranted restraint of my property and civil rights, have now been decisively thrown out.” At presstime, the U.S. government had not appealed the decision.