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News >  Idaho

Investor sues company chief over mine deals

An investor is suing the president of the company trying to reopen Idaho’s Sunshine Mine, claiming that Ray De Motte bilked him out of nearly $3.4 million through fraudulent business practices.

James D. Christianson of Vancouver, Wash., invested in Sterling Mining Co. and other companies that De Motte and his associates controlled or had a financial interest in, according to the suit filed this week in federal court in Tacoma.

Christianson bought his first Sterling stock in 2003, the suit said. Several months later, he met De Motte, who painted a favorable picture of prospects at the defunct Sunshine Mine and indicated it could be producing silver in as little as 18 months, when he knew that reopening the mine was realistically eight years away, the suit alleges. De Motte persuaded Christianson to invest heavily in Sterling Mining and other questionable ventures, including a charter plane service out of Wallace and dilapidated Silver Valley real estate, according to the suit.

“I obviously disagree with the allegations,” De Motte said Friday afternoon. “I plan to vigorously defend my reputation.”

The mine near Kellogg was one of the Silver Valley’s largest private employers when it shut down in 2001. Sterling’s nine employees in Kellogg are working to rehabilitate it, De Motte said.

According to the suit, Christianson seeks to recover more than $3.2 million in financial losses, plus interest and other compensation. In addition to De Motte, the suit names Sterling director Carol Stephan and Melanie Farrand, a business partner of De Motte’s.

Christianson bought 75,000 Sterling shares in spring 2003, based on a broker’s advice, according to the suit.

A year later, Christianson could have realized $525,000 by selling his stock, but De Motte demanded that they not be sold, the suit says. As a result, Christianson did not sell, though unbeknownst to him, De Motte and other insiders were selling their stock, according to the suit.

The suit also alleges that De Motte engaged in securities fraud. De Motte was a director and investor in several other penny mining stocks, and purportedly told Christianson that he planned to reactivate the largely dormant companies. De Motte encouraged Christianson to buy up stock in several of the firms, the suit said. After reassuring Christianson that he was keeping his shares, De Motte sold his stock when the price was high, and Christianson was stuck with devalued stock, the suit said.

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