News & Features

Jurors Award $2.575 Million to Mining Claimants in Montanore Suit

Former Montana Gov. Schweitzer among investors to share in damages; defendant dies in logging accident

In a tragic turn of events following 11 years of litigation in a Libby mining claim dispute, a 70-year-old defendant in the case against Mines Management Inc. and Montanore Minerals Corp. was killed in a logging accident just two days after jurors delivered a $2.575 million judgment in his favor.

The defendant, Arnold Bakie, fought for more than a decade to maintain his mining claim beneath the Cabinet Mountains Wilderness area extending north of Libby, and on Oct. 17 jurors issued their verdict awarding Bakie $2.575 million for plaintiff Montanore’s trespass onto the man’s unpatented mining claims.

Montanore is a subsidiary of Coeur d’Alene-based Hecla Mining Company, which owns Revett Mining Company, including the shuttered Troy Mine and the proposed Rock Creek Mine near Noxon. Hecla again expanded its Montana operations with the acquisition of Mines Management Inc., which had proposed the Montanore Mine project near Libby.

Jurors awarded an additional $750,000 to a group of five investors that includes former Montana Gov. Brian Schweitzer, who in 2013 joined others to form Optima, Inc., a business that controls mining rights, known as claims, on underground parcels needed by Mines Management Inc. to access the proposed Montanore Mine.

Specifically, a tunnel for the mine passes through the claims held by Schweitzer’s group.

A federal judge in 2014 gave Montanore a preliminary condemnation order on Bakie’s claim, giving the company rights to access the reserves through tunnels passing through Optima’s claims.

Schweitzer also serves as chairman of Stillwater Mining Company, Montana’s largest mining company, which is not involved with Optima or the Montanore mine.

In 2007, Montanore initiated a legal action in Lincoln County District Court in which the company sought a declaration that the claims were invalid. After District Judge James Wheelis ruled in 2013 that the claims were valid, Montanore brought an action in federal district court, seeking to condemn for public use easements and rights of way through the claims.

U.S. District Court Judge Dana Christensen ordered the easements and rights of way condemned for Montanore’s public use and determined that the defendants were not entitled to any compensation.

On appeal, the Ninth Circuit Court of Appeals ruled that Christensen abused his discretion by not staying the federal case until the pending state court case was resolved, remanded it back to state court and set the stage for trial.

After the five-day trial, jurors deliberated for approximately two hours before delivering the verdict in favor of the claimants and awarding damages.

Lincoln County District Judge Matthew Cuffe presided over the case.

Stephen Brown, an attorney representing Optima in the case, said the federal appellate court was clear in its finding that the state court case should have been allowed to run its course.

Still, Montanore is expected to appeal the jury’s judgment to the Montana Supreme Court.

Accusing Hecla of “claim jumping,” or the practice of seizing another person’s claim of land for mineral rights, Schweitzer said the case involved a “nest of scoundrels” who concocted a “typical mining industry scam.”

According to Bakie’s obituary, he passed away Oct. 19 while “doing what he loved best in the place he was most comfortable — the great outdoors.”

“Due to certain circumstances, his love of logging began at the age of nine,” the obituary continues. “With a little red wagon, a chainsaw, a jug of gas and bar oil, he headed for the log deck to cut firewood. Thus began his love of logging and a lifelong career.”

Bakie’s lengthy and costly fight to maintain his mining claims forced him to join forces with partners, including Schweitzer and another developer behind Optima, the mining industry veteran Frank Duval.

Although significantly less than the $2.575 million awarded to Bakie, the $750,000 awarded to Optima was better than what an expert commission appointed by Judge Christensen proposed three years ago — $0.

The three-member commission determined Optima did not show that its mining claims, or rights, had been worth anything prior to their condemnation, and sided with Mines Management, Inc. The findings were accepted by Christensen.

Following the condemnation order, Schweitzer and the other investors sought up to $10 million in compensation.

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