Getty prevails in court battle with Gold Standard

The outcome of a longstanding court battle against Getty Oil is not in favor of Utah-based junior Gold Standard (NASDAQ). The verdict is in, and the company will not receive the US$404 million awarded by a jury in 1993.

The Utah Supreme Court denied an appeal by the company, resulting from a lower court judge’s reversal of the jury’s decision on the original charges.

The litigation stems from a 1973 joint venture between Gold Standard and Getty on the Mercur gold mine in Utah. Getty was taken over by Texaco in 1984 and the Mercur was sold to Toronto-listed Barrick Gold (then American Barrick Resources) in 1985.

Gold Standard’s president, Scott Smith, was disappointed by the ruling. He also expressed displeasure at what he believes is the court’s lack of confidence in the jury system. The original claim was heard by a jury over seven weeks, and resulted in Gold Standard being awarded what was then the highest award in Utah history. Days later, however, the judge overruled the jury and reversed the decision.

Attorneys for Gold Standard will file a motion of reconsideration to the state Supreme Court to the effect that the lower court erred, and will request it examine the presented material more closely.

News of the decision had a negative effect on Gold Standard’s stock, which lost nearly 80% of its value.

The company holds more than 1 million acres of claims in Brazil.

Also, it has released a royalty on 100,000 acres of diamond claims to American Mineral Fields, in exchange for 100,000 shares of its common stock.

The company’s Uruguay holdings comprise 346,000 acres.