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Evening trading sees oil at $50
5:20p ET Monday, September 27, 2004
Dear Friend of GATA and Gold:
GATA today distributed throughout the United States
via Business Wire a press release about Blanchard
& Co.'s new class-action lawsuit against Barrick
Gold and J.P. Morgan Chase. At this hour the
release has been posted on the home pages of
Kitco.com and TheBullionDesk.com. It is appended
and you can find its Internet link here:
http://home.businesswire.com/portal/site/google/index.jsp?
ndmViewId=news_view&newsId=20040927005749&newsLang=en
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
* * *
Class-Action Suit Seeks Damages For Gold Investors
from Barrick and J.P. Morgan Chase, GATA Says
From Business Wire
Monday, September 27, 2004
DALLAS -- Everyone in the United States who lost
money trading gold since 1998 could recover
damages from Barrick Gold and J.P. Morgan
Chase if a federal class-action anti-trust lawsuit
brought last week in New Orleans prevails, the Gold
Anti-Trust Action Committee says.
The suit is being underwritten by Blanchard & Co.,
the New Orleans coin and bullion dealer, and builds
on Blanchard's own anti-trust suit against Barrick and
Morgan Chase in U.S. District Court in New Orleans.
The first suit, which is in the "discovery" or evidence-
collecting phase, charges Barrick and Morgan Chase
with manipulation of the gold market. That suit seeks
injunctive relief -- a court order to stop Barrick and
Morgan Chase from manipulating the gold market --
and is expected to go to trial in April 2005.
The class-action lawsuit, in which gold investors Greg
McKenzie and A.J. Miller are the lead plaintiffs, will
attempt to quantify the financial harm done by Barrick
and Morgan Chase to gold investors and devise a
remedy for their restitution.
"We expect to obtain compensation for all gold owners,
not only for their losses from their gold investments but
also for the profits they should have realized," Blanchard
CEO Donald W. Doyle Jr. said in an interview with the
Gold Anti-Trust Action Committee.
GATA consultant Reginald H. Howe brought a similar
federal lawsuit in Boston in 2000. It was dismissed on
jurisdictional grounds in 2002. Since then GATA has
documented and publicized evidence of manipulation
of the gold market by Barrick, Morgan Chase, other
bullion banks, and the U.S. government.
"The exact number of gold owners who are members
of the class is unknown at this time and can be
determined only through appropriate discovery and
expert testimony," Doyle told GATA. "But we allege,
on information and belief, that the members of the
class owned, during the period at issue, about 96.5
million ounces of gold having a market value of
$38.58 billion at $400 per ounce. Once a judgment
is obtained and the amount of damages suffered by
the class members is determined, those damages
will automatically be tripled under the mandatory
provisions of the federal anti-trust laws.
"In 1983 Barrick Gold Corp. was a start-up company
with a single mine in Canada and a founder with no
experience in the gold business," Doyle said. "By
2001 Barrick had amassed off-balance-sheet
assets that were worth more than the market
capitalization of the next five biggest gold-mining
companies in the world combined. Barrick made
$2.3 billion on its short sales of gold and made a
profit on those short sales for 62 consecutive
quarters. A short sale is inherently a high-risk
speculation. How many true speculations have
ever been profitable for 62 consecutive quarters?"
Blanchard's original lawsuit charges essentially
that Morgan Chase provided Barrick with so much
borrowed gold -- presumably obtained from central
banks -- on such favorable terms that Barrick could
overwhelm the market and move prices up or down
at will and not have to repay the borrowed gold for
many years if at all. In some years, Blanchard
maintains, Barrick was able to supply to the
market more gold than was supplied by all the
bullion banks combined.
In an attempt to have Blanchard's lawsuit
dismissed, Barrick, according to GATA, seemed
to acknowledge the plaintiff's premises. Barrick
submitted a motion arguing that in borrowing gold
and selling it into the market, the company was
acting as the agent of central banks and carrying
out their policies in the gold market and thus
should share their immunity from lawsuits.
U.S. District Judge Helen Berrigan rejected
Barrick's motion and sent the case on for discovery
and trial.
"While the price of gold fell by more than 25
percent," Doyle said, "Barrick was able to increase
its annual operating cash flow by more than 400
percent. Barrick became the dominant gold mining
company in the world through acquisitions made
with the profits from its short sales of gold. By
suppressing and depressing gold prices, Barrick
forced its competitors to sell gold assets and
companies at fire-sale prices.
"The measures that Blanchard has taken have
already been good for the gold industry and our
clients. Since we began discussions with Barrick
in this lawsuit, the company has reduced its
hedging position by 10 million ounces, adding
gold demand and subtracting gold supply. On
December 2, 2003, Barrick's president and chief
operating officer announced that Barrick had given
up hedging for good. By consenting to the
termination of its short sales of gold -- assuming
that Barrick honors its commitment -- the company
took a major remedial step sought by Blanchard's
original complaint.
"I believe that the class action will be successful in
recovering damages and putting a stop to practices
that have suppressed and depressed the price of
gold and all tangible assets," Doyle concluded.
Blanchard's Internet site with information about its
litigation is:
----------------------------------------------------
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----------------------------------------------------
RECOMMENDED INTERNET SITES
FOR DAILY MONITORING OF GOLD
AND PRECIOUS METALS
NEWS AND ANALYSIS
Free sites:
http://www.cbs.marketwatch.com
http://www.capitalupdates.com/
http://www.silver-investor.com
http://www.thebulliondesk.com/
http://www.goldismoney.info/index.html
http://www.minersmanual.com/minernews.html
http://www.a1-guide-to-gold-investments.com/euro-vs-dollar.html
http://www.investmentrarities.com
http://www.kuik.com/KH/KH.html
(Korelin Business Report -- audio)
http://www.plata.com.mx/plata/home.htm
(In Spanish)
http://www.plata.com.mx/plata/plata/english.htm
(In English)
Subscription site:
http://www.lemetropolecafe.com/
Eagle Ranch discussion site:
http://os2eagle.net/checksum.htm
Ted Butler silver commentary archive:
http://www.investmentrarities.com/
----------------------------------------------------
COIN AND PRECIOUS METALS DEALERS
WHO HAVE SUPPORTED GATA
AND BEEN RECOMMENDED
BY OUR MEMBERS
Blanchard & Co. Inc.
909 Poydras St., Suite 1900
New Orleans, Louisiana 70112
888-413-4653
http://www.blanchardonline.com
Centennial Precious Metals
3033 East 1st Ave., Suite 403
Denver, Colorado 80206
www.USAGold.com
Michael Kosares, Proprietor
US (800) 869-5115
Canada 1-800-294-9462
European Union 00-800-2760-2760
Australia 0011-800-2760-2760
cpm@usagold.com
Colorado Gold
222 South 5th St.
Montrose, Colorado 81401
www.ColoradoGold.com
Don Stott, Proprietor
1-888-786-8822
Gold@gwe.net
El Dorado Discount Gold
Box 11296
Glendale, Arizona 85316
http://www.eldoradogold.net
Harvey Gordin, President
Office: 623-434-3322
Mobile: 602-228-8203
harvey@eldoradogold.net
Investment Rarities Inc.
7850 Metro Parkway
Minneapolis, Minnesota 55425
http://www.gloomdoom.com
Greg Westgaard, Sales Manager
1-800-328-1860, Ext. 8889
gwestgaard@investmentrarities.com
Kitco
178 West Service Road
Champlain, N.Y. 12919
Toll Free:1-877-775-4826
Fax: 518-298-3457
and
620 Cathcart, Suite 900
Montreal, Quebec H3B 1M1
Canada
Toll-free:1-800-363-7053
Fax: 514-875-6484
http://www.kitco.com
Lee Certified Coins
P.O. Box 1045
454 Daniel Webster Highway
Merrimack, New Hampshire 03054
www.certifiedcoins.com
Ed Lee, Proprietor
1-800-835-6000
leecoins@aol.com
Miles Franklin Ltd.
3015 Ottawa Ave. South
St. Louis Park, Minn. 55416
1-800-822-8080 / 952-929-1129
fax: 952-925-0143
http://www.milesfranklin.com
Contacts: David Schectman,
Andy Schectman, and Bob Sichel
Missouri Coin Co.
11742 Manchester Road
St. Louis, MO 63131-4614
info@mocoin.com
314-965-9797
1-800-280-9797
http://www.mocoin.com
Resource Consultants Inc.
6139 South Rural Road
Suite 103
Tempe, Arizona 85283-2929
Pat Gorman, Proprietor
1-800-494-4149, 480-820-5877
Metalguys@aol.com
Swiss America Trading Corp.
15018 North Tatum Blvd.
Phoenix, Arizona 85032
http://www.swissamerica.com
Dr. Fred I. Goldstein, Senior Broker
1-800-BUY-COIN
FiGoldstein@swissamerica.com
----------------------------------------------------
HOW TO HELP GATA
If you benefit from GATA's dispatches, please
consider making a financial contribution to
GATA. We welcome contributions as follows.
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Gold Anti-Trust Action Committee Inc.
c/o Chris Powell, Secretary/Treasurer
7 Villa Louisa Road
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USA
By credit card (MasterCard, Visa, and
Discover) over the Internet:
http://www.gata.org/creditcard.html
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http://www.GoldMoney.com
Gold Anti-Trust Action Committee Inc.
Holding number 50-08-58-L
Donors of $750 or more will, upon request,
be sent a print of Alain Despert's colorful
painting symbolizing our cause, titled "GATA."
GATA is a civil rights and educational
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Code and contributions to it are tax-deductible
in the United States.
