07/10 12:23
00:00:00 Thank you, everybody.
00:00:02 Please be seated.
00:00:03 All right, folks, we're back on record in the Kroenke and Treasure chest matter 3 and 20-0622Civil parties and council are present.
00:00:15 Jury is out.
00:00:17 Just before we broke, one of the jurors handed us a note.
00:00:21 Let me read you what the note says.
00:00:22 It says, what was the price of gold per ounce in September 2020?
00:00:29 That seems right to me here.
00:00:34 Okay.
00:00:57 It may be a fair question, but now you know what's on their mind.
00:01:03 So I will simply say that we have the question given where we are in the trial.
00:01:09 We'll consider whether or not that specifically needs to be asked at some point along the way.
00:01:14 We'll let the evidence continue.
00:01:15 Perfect.
00:01:15 Thank you very much, sir.
00:01:20 Q&A is after
00:02:01 No, definitely not
00:02:26 Well, you see, there's two accounting formats, first in, first out.
00:02:29 We're going to bring in Mr. Hanrahan, who's going to lecture you.
00:02:32 Yeah, I mean, this doesn't work either.
00:02:34 I view it like a divorce case, when you're valuing property to divide.
00:02:39 You don't value it until when they bought it 10 years ago.
00:02:41 You look at it every day.
00:02:47 Yeah.
00:02:56 Okay, shut the ground.
00:02:59 I'm just joking.
00:03:25 I learned this word.
00:03:25 I want to use it.
00:03:26 I've seen it on TV.
00:03:28 Turn this thing up and say that all the time.
00:03:30 Sometimes.
00:03:30 I'm just not very good at speaking in person.
00:03:33 I'm sorry.
00:03:35 I just don't want to speak.
00:03:42 I'm making my career choice.
00:03:46 No, that's not what she said.
00:03:48 I'm making my career choice.
00:04:27 Please rise for the jury.
00:04:53 Thank you, everyone.
00:04:54 Please be seated.
00:04:54 Welcome back.
00:05:02 All right, ladies and gentlemen, welcome back.
00:05:04 In a moment we're going to turn to cross-examination by Mr. Campion, but before we do that, one of your members had provided a note, which I told you in advance.
00:05:14 You can ask questions.
00:05:16 I've got your question.
00:05:17 I've gone over it with the lawyers, given where we are in the case.
00:05:20 The question may be premature for this witness, but likely we may get an answer as we progress.
00:05:26 So I'm not going to ask it right now, but thank you for the note.
00:05:30 Mr. Campion, when you're ready for cross.
00:05:32 Thank you.
00:05:32 Mr. Kroenke, good afternoon.
00:05:33 Hi there.
00:05:34 We've met before, haven't we?
00:05:35 We have.
00:05:36 Okay.
00:05:36 If anything I'm saying isn't – if any question I ask isn't clear, just let me know.
00:05:39 I don't want to put words in your mouth, and this will take whatever time it needs to.
00:05:45 I anticipated spending some time talking to you about your company and your expertise.
00:05:49 I think you covered that adequately, but is there anything that you weren't asked regarding the companies that you own or that you established that you think the jury should know?
00:06:02 only that I think you know the the companies I own what we I've started and and so nothing was handed down to me I mean I'm a farm-raised boy and and believe in the American dream and I've been trying to exercise that okay I mean I think it's fair for the jury to conclude that you
00:06:28 If you're not the top, you're one of the very few companies that can perform the type of civil construction that your company's demonstrated can prove in Alaska.
00:06:38 I mean, I think we're a very capable company.
00:06:40 I think there's other very capable companies besides us too.
00:06:46 Before you met Randy Elliott, can you tell the jury a little bit about what sort of what had you done to sort of become familiar with gold mining and maybe some of the opportunities that might present themselves to you prior to April 2020?
00:06:59 So Frank had one season, I don't remember what, he had used a bunch of my equipment out at his mine and I went out there a few times with him.
00:07:11 I've had a lot of conversations with different folks who are pretty knowledgeable.
00:07:15 Ron Higgins, I have a strong relationship with him.
00:07:18 He owns a gold mine.
00:07:20 Stuart Smith is kind of one of the leading brokers in gold mines.
00:07:24 I've had numerous conversations with him about different opportunities around the state and how you might go about evaluating a mine and what information to look for.
00:07:35 Okay.
00:07:35 Through that research or through that self-education, what did you think you needed to have for information to be able to actually buy a mine?
00:07:44 What is the information that you needed?
00:07:47 The best information is drilling logs.
00:07:52 Drilling logs cost millions of dollars.
00:07:56 When you get to an opportunity to buy a mine that has drilling logs, you're talking tens of millions of dollars probably to move up the resource.
00:08:03 and that's going to fetch those kind of prices.
00:08:06 What was at the time your understanding of who pays for that drilling and those logs?
00:08:11 Generally speaking the logs are done by the owner and if they're looking to sell they're going to have all the supporting documentation to provide to the prospective buyer.
00:08:26 When you met Mr. Elliott and you began discussing the possibility of buying his mine
00:08:33 Did you understand that he didn't have any drilling logs?
00:08:35 Yes.
00:08:36 How did you think you could bridge the gap from the absence of drilling logs to being able to go to investors or go to a bank and say, here's what I got, I'm looking to buy this.
00:08:45 What did you think you needed?
00:08:47 We needed logs and we needed for sure at least a season on the ground.
00:08:54 Not only discovering, it's a big area.
00:08:56 So I mean, you're not going to be able to in one year time sample everything.
00:09:00 So we needed time on the ground, and we needed proof that you could be successful.
00:09:07 Did you have a plan to develop the proof?
00:09:10 What was it that you were going to do to memorialize the efforts that your crew made in terms of proving or evaluating the ground?
00:09:18 Similar to the expense report, if we'd had a similar report with the findings of gold and the daily output in a certain area plus the same kind of report for the different testing locations,
00:09:30 I think that would have sufficed at least entry-level negotiations to purchase the money.
00:09:35 You discussed with the jury that your crew had this app that allowed them to make daily reports back to the home office.
00:09:44 I think the jury will have the opportunity to review those daily logs.
00:09:48 Was it your intent that those daily logs or daily reports would serve as the
00:09:53 maybe the entry level basis to understand what was in the ground at Dan Creek I think that would have been a portion of it yeah was there something else that you intended to prepare or would would have liked to have prepared that would have been able to prove what your testing showed yeah if we would have been allowed to to you know to mine an area we would have had a log of every day of what we found and I think one of the issues we had is Randy was pretty
00:10:23 Just so it's clear for the jury, do you think Mr. Elliott precluded or prevented your crew from preparing logs other than what the daily report showed?
00:10:50 I would say directly I think indirectly he created a situation would be very difficult for my crew to be in the gold room and and to be tasked with the responsibility of figuring out what we found that day did you have you been in the gold room that you've discussed at Mr. Elliott's house I have and it's a gold room but really describe it for the jury what is it I mean it's a portion of his house where he has got all the cleanup equipment
00:11:18 to process the tailings or the clean outs.
00:11:23 So this is the minus one quarter inch stuff that goes through the riffles and what does it look like?
00:11:29 If you've seen Mr. Elliott do it, what does it actually look like when he's got it in that room?
00:11:33 So it comes into the room in five gallon buckets and it can be anything from a quarter inch on down, but it's highly concentrated with your heavy black, anything that the
00:11:45 Riffles, or the sluice boxes, would have captured.
00:11:49 And there's no equipment out at Dan Creek that can process that gold or clean it up, is there?
00:11:54 Yeah, there's little pieces of equipment.
00:11:56 Little machines that help and aid in it.
00:11:59 But primarily, how do you get from that concentrate to the gold product?
00:12:04 You have to segregate.
00:12:06 And how do you do that?
00:12:07 By using screens, and then you pan each screen.
00:12:11 So you're hand panning each screen to get to the final product?
00:12:13 That's how Randy was doing it.
00:12:15 Did you do any of that when you were out at Dan Creek?
00:12:18 I observed.
00:12:19 Have you ever done that in your life?
00:12:21 Not to that degree.
00:12:23 Would you agree it takes some skill and dexterity to be able to pan the gold and separate it the way that Mr. Elliott does?
00:12:28 Absolutely, yes.
00:12:31 Do you think anyone on your crew, including Frank, was able to separate gold as efficiently and cleanly as Mr. Elliott did?
00:12:38 Probably not as efficient.
00:12:40 Randy said 40 years of
00:12:43 of doing this at that mine.
00:12:45 I think Frank is very capable, and I think even my son spent some time with him and was capable of learning.
00:12:53 Okay.
00:12:53 I don't want to be distracted from my outline, but so your son received some benefit from instruction from Mr. Elliott?
00:13:03 Knowledge.
00:13:03 Knowledge.
00:13:04 Okay.
00:13:06 From the times that you were out at Dan Creek in the summer of 2020, was Mr. Elliott generous with
00:13:12 the information and knowledge that he had gained over 40 years?
00:13:15 Yeah.
00:13:19 So, you know, Mr. Brzezinski asked you whether you rushed into this, and ultimately that's probably not that important to the jury.
00:13:26 It's semantics.
00:13:26 But I want to talk about the timeline that led you to mining in 2020.
00:13:34 In my opening, you know, and in the evidence, would you agree that you met Mr. Elliott in the early part of April 2020?
00:13:42 I think it might have been the late part of March, actually.
00:13:44 Okay.
00:13:45 And do you have a recollection of the date that you invited him to your hangar or your office or home to buy gold from him?
00:13:51 I don't.
00:13:52 I never had any conversations with him at that point.
00:13:56 All right.
00:13:56 I had no contact information.
00:13:58 Oh, but you don't recall what date it was either?
00:14:00 I don't.
00:14:01 It was sometime, I think it was late March.
00:14:04 So when you're first talking to Mr. Elliott, are you thinking, man, I might buy his mine?
00:14:09 Was that even anywhere in your head when he started?
00:14:12 You mentioned exit strategy in your direct testimony.
00:14:14 What does that mean?
00:14:41 In your mind, what does an exit strategy for Mr. Elliott mean?
00:14:44 A succession plan for somebody to step in and either buy him out or manage his exit.
00:14:51 Do you have any doubt in your mind whether or not that was and remained Mr. Elliott's intent in the 2020 season?
00:14:59 I believe that that was his intent and probably still is.
00:15:07 Did you view
00:15:10 your new relationship with Mr. Elliott as an opportunity?
00:15:15 An opportunity to potentially get into gold mining?
00:15:18 An opportunity to do a lot of things.
00:15:21 An opportunity to help a man with a succession plan.
00:15:25 An opportunity to spend some time in Wrangell, St.
00:15:27 Elias.
00:15:27 An opportunity to potentially purchase a gold mine.
00:15:30 An opportunity to operate in a gold mine for a season.
00:15:36 You just spent the end of your testimony with Mr. Brzezinski talking about how you
00:15:40 allocated expenses and basically charged Mr. Elliott for that opportunity.
00:15:45 And I want to ask you, what you just said to us suggests that the opportunity to mine in 2020 at Dan Creek was not just a business opportunity for you, was it?
00:15:57 No.
00:15:59 You understand my question?
00:16:00 Not really.
00:16:01 Okay.
00:16:01 Would you agree with me that it provided a potential business opportunity for you?
00:16:09 Okay.
00:16:09 I mean, to explore and potentially buy a mine.
00:16:11 That's a potential business opportunity, right?
00:16:14 Yeah.
00:16:14 And it provided a recreational opportunity for you and your family to be in Wrangell-St.
00:16:18 Elias National Park and gold mine, correct?
00:16:20 I think if once we purchased it, it would provide that.
00:16:25 Right.
00:16:25 I mean, I don't think it provided that to any large extent during the 2020 season.
00:16:31 You said you were out there at least 12 times?
00:16:33 Yeah.
00:16:35 How many of your family members did you bring with you out to the mine?
00:16:38 Only my two boys, one time each.
00:16:40 Okay.
00:16:41 So you didn't view that there was any recreational benefit for you that summer?
00:16:45 Very little.
00:16:46 I mean, I think there was an opportunity to spend a little bit of time with each of my boys and to get them excited.
00:16:52 My oldest son specifically got excited about it.
00:16:55 My youngest son was probably still too young.
00:16:58 Okay.
00:17:00 And you said Mr. Elliott was generous with your son and sharing knowledge with him.
00:17:03 Yes.
00:17:03 Yeah.
00:17:04 Was there anything that Mr. Elliott did or said to you that suggested that your family wasn't welcome at his mine on the 2020 season?
00:17:11 No.
00:17:12 Okay.
00:17:12 So you just decided you had other priorities, business and otherwise, that prevented you from spending more time out there?
00:17:19 I don't know if that was ever my intent to spend a bunch of family time out there that year.
00:17:23 You could have, though.
00:17:25 I suppose, sure.
00:17:26 I mean, these jurors can't go out to Dan Creek without Mr. Elliott's permission.
00:17:29 They can't just go out there and spend time in Goldmine, can they?
00:17:34 Actually, I think they can if they own a piece of property out there.
00:17:38 But they can't mine or spend time on Mr. Elliott's property unless he agreed to it.
00:17:43 I think there's actually a section of the CC&Rs for anybody who owns land out there that can go onto that property and recreationally mine.
00:17:57 Okay.
00:17:59 I may be mistaken on that, but that's my understanding.
00:18:04 You mentioned in your direct testimony that you acted quickly but you don't feel like you rushed into this project.
00:18:12 You mentioned that you've done 20 to 25 projects roughly in the bush through the companies that you've formed and operate.
00:18:19 Is that still accurate in your mind?
00:18:21 And I think you testified that generally you've got a 12 to 15 month window sort of in advance before you start the work.
00:18:28 Is that accurate?
00:18:30 Not necessarily before we start the work, but it's probably more than that if you include the work and the time it takes to do the work and the design and whatever negotiation there is up front.
00:18:45 In that early phase when you're planning and designing a project, are you considering the budget that you may need to establish to be successful in a project like that?
00:18:55 Is that part of your planning?
00:18:57 It can be.
00:19:00 involved in the design, then we're usually involved in the budget planning.
00:19:03 If we're not involved in the design, then no.
00:19:06 If you're not involved in the design, then you're just basically charging the day rate that you described earlier.
00:19:11 It's a piece of equipment and its operator is going to cost you this amount.
00:19:15 This is our rate sheet.
00:19:17 Is that right?
00:19:17 It can be that way.
00:19:18 It can be what you're describing as like a T&M contract.
00:19:23 Can you define that for them, T&M?
00:19:24 Time of matures.
00:19:25 Okay.
00:19:25 Or a cost plus.
00:19:29 Okay, so if you're involved in designing a project, then you would prepare a budget or be involved in that, correct?
00:19:35 Generally speaking, yes.
00:19:36 And if you're not involved in the design, then you wouldn't have a budget?
00:19:40 Generally.
00:19:41 Okay.
00:19:43 And that's because you know that if you're going to do a T&M time and material contract, you've already figured out a rate that's going to provide you a profit and it's going to be something that is going to keep you in the black, right?
00:19:52 Yeah, it's a rate that we've established that is fair to all parties and keeps us in business.
00:19:59 And the day rate that you've developed for your company, was that something that you had available in 2020?
00:20:05 Like, had you guys already developed one at that point?
00:20:07 Yeah.
00:20:07 Did you ever show that to Mr. Elliott?
00:20:10 I don't recall.
00:20:11 There's probably a really good chance that we did in some of those meetings.
00:20:15 You don't know if you did or not?
00:20:17 I don't know with certainty.
00:20:19 Do you know if you produced that in discovery at all?
00:20:21 Do you know if that's been produced?
00:20:23 I don't know if we did or not.
00:20:25 We may have.
00:20:28 When you entered into the first agreement with Mr. Elliott on May 5, 2020, there's no mention of a day rate or a time and material contract in that first agreement, is there?
00:20:39 No, we decided not to build the job that way because of the business opportunity.
00:20:45 When you say we, are you talking about you and Kevin Clark, or are you talking about yourselves and Mr. Elliott?
00:20:50 All three of us.
00:20:51 So you made a decision not to make this a time and material contract?
00:20:54 Correct.
00:20:55 Okay.
00:20:59 So you didn't have a budget for the project.
00:21:01 That is, you did not develop a budget for the 2020 mining season at Dancrete, did you?
00:21:06 No.
00:21:07 Did you have a rough idea what it might cost you?
00:21:12 I mean, a rough range of magnitude, probably.
00:21:15 Okay, so when you signed that agreement on May 5, 2020, what did you think it might cost you to do what you had just committed to do?
00:21:22 Probably no less than $350,000 and probably not over $750,000.
00:21:28 So between $350 to $750.
00:21:30 And when you signed that agreement, how did you think you were, I mean, did you have a reasonable expectation that you were going to cover your expenses through mining?
00:21:41 Yeah, and I clearly articulated that.
00:21:44 You clearly articulated that to whom and when?
00:21:46 To Randy and to Kevin multiple times.
00:21:49 Why didn't you put it in the agreement?
00:21:50 Put what in the agreement?
00:21:51 That you expected that your expenses would be covered.
00:21:54 It is in the agreement.
00:21:56 What the agreement says is that the expenses will be split evenly, as will the gold.
00:22:01 Well, in the second agreement, it states that the intent is for the gold to cover the expenses.
00:22:06 Okay, we'll get to that.
00:22:09 And I want to talk a little bit about your attorney, Mr. Brzezinski, referred to Mr. Elliott's equipment as junk, and you testified that you were disappointed at how ill-prepared
00:22:24 Mr. Elliott and his equipment were when you actually started the testing in May 2020, right?
00:22:30 You recall that?
00:22:31 I do.
00:22:32 All right.
00:22:34 Did you have an opportunity to inspect Mr. Elliott's equipment at Dan Creek before you signed the agreement on May 5th?
00:22:40 Not really, no.
00:22:41 Why not?
00:22:43 Nothing was started.
00:22:44 We were out there to look at the land, not equipment.
00:22:47 Did Mr. Elliott say that you couldn't try to start the equipment?
00:22:52 No.
00:22:53 Did you ask to see if the equipment actually operated?
00:22:56 No.
00:22:59 At that point it was communicated to us that the equipment was in running order, verbally.
00:23:06 Otherwise, why would you pledge it on a contract?
00:23:13 Was that in the agreement?
00:23:15 That they would provide equipment, yes.
00:23:18 Was it in the agreement that the equipment would be operating when you got there?
00:23:22 Why would you pledge equipment that isn't running?
00:23:25 Did Mr. Elliott tell you that my equipment's not in the best shape and we're going to have to spend some time getting it running?
00:23:31 Did he communicate that to you at all?
00:23:33 He communicated that his equipment is older, but he never communicated that it was not running.
00:23:38 You testified that one of the reasons your company's successful is that you spend the winter preparing your equipment so that when the season starts, you're ready to rock and roll.
00:23:47 That's right, isn't it?
00:23:48 Yes.
00:23:48 And you knew Mr. Elliott doesn't do that, does he?
00:23:52 Well, no, he had talked numerous times about how much effort he was putting into his marukas all winter long and shipping.
00:23:58 I think he even shipped a new one in that spring.
00:24:00 So there was a lot of conversation from him about him putting effort into his equipment.
00:24:05 Okay.
00:24:06 Okay.
00:24:08 But I guess the point I want to establish with you is that you had the opportunity to inspect Mr. Elliott's equipment, didn't you?
00:24:16 I would say indirectly, yes.
00:24:18 Okay.
00:24:18 And you did not inspect his equipment before you signed the agreement on May 5th, did you?
00:24:22 No, we took him at his work.
00:24:24 That wasn't my question.
00:24:24 I'm sorry, Mr. Kroenke.
00:24:26 You didn't inspect his equipment, did you?
00:24:28 We did not.
00:24:35 We've talked a little bit about the opportunity that the agreement provided to you.
00:24:39 I want to talk about another aspect of that, which is, did you view the opportunity to be around Mr. Elliott, whether you or your crew,
00:24:50 in the Dan Creek area.
00:24:51 Did you view that as an opportunity to learn how to mine in that area?
00:24:56 I think, I guess I need you to rephrase that question.
00:25:01 Did you think there was value in having you and your crew having access to Mr. Elliott out at Dan Creek with regard to mining and learning how to mine out there?
00:25:09 Did you view that as valuable or as an opportunity?
00:25:13 I viewed that as valuable, yes.
00:25:15 Okay.
00:25:17 There's probably no way to quantify it, but what
00:25:20 What would it be worth to have access to a guy that's been mining out there for 40 years and have unfettered access to his knowledge and understanding of what he's learned?
00:25:27 What's that worth?
00:25:30 In hindsight, I think I would have rather him not be there, to be honest with you.
00:25:35 And we would have figured it out.
00:25:36 If we were doing that, then we wouldn't be here in the first place, right?
00:25:39 We can't go back to 2020 and wish we had done things differently.
00:25:42 What I want to ask you about was, is there value
00:25:47 If you say no, that's fine.
00:25:48 But do you see any value in having access to Mr. Elliott's knowledge about how to mine at Dan Creek?
00:25:53 If that knowledge would have been communicated in a non-manipulative way, I think there would have been value there.
00:25:58 And I think there was some value there.
00:26:00 But I think it was largely clouded by the other ancillary issues.
00:26:11 I asked you what your intentions were.
00:26:13 with regard to entering into the agreement and starting this testing period.
00:26:19 You've told the jury that you believe Mr. Elliott was motivated to find an exit strategy.
00:26:27 Do you believe he was motivated to manipulate or interfere with what your crew was trying to do?
00:26:37 No, I don't think he was motivated.
00:26:41 I don't think he went into the agreement with that motive, but I think that is his nature.
00:26:47 In learning more about, while I was out there, Randy Elliott's history, I think his nature.
00:26:52 Okay.
00:26:53 You have an opinion about him.
00:26:54 That's fine.
00:26:55 And when do you think you learned this information?
00:26:58 Throughout the season.
00:26:59 Okay.
00:27:03 All right.
00:27:03 Let me move on.
00:27:08 Mr. Burzynski asked you what you got out of the deal, right?
00:27:13 What did you get for all the expenses you paid?
00:27:15 Do you remember that question?
00:27:17 Yeah, I do.
00:27:18 And you basically said, I didn't get anything out of this, right?
00:27:21 I don't think I said that.
00:27:22 What do you think you got out of it?
00:27:23 What did you benefit or how did you benefit from the 2020 mining season?
00:27:27 I got a gold nugget and 43 ounces of gold.
00:27:31 What happened to the gold that Travis and Frank recovered during the course of the summer?
00:27:35 They went to Randy.
00:27:36 You know that because?
00:27:38 Okay.
00:27:40 So your testimony is all you got out of this was the gold, the copper nugget, and nothing else?
00:27:51 Yes.
00:27:51 Okay.
00:27:53 Let me go back to what was the purpose of the original agreement you signed on May 5, 2020?
00:27:58 It was to evaluate.
00:27:59 What does that mean in your mind?
00:28:01 To try to quantify the resource.
00:28:03 Okay.
00:28:05 Do you think there's gold at Dan Creek?
00:28:07 I do.
00:28:08 Did you know that before May 5th, 2020?
00:28:11 I did.
00:28:13 You did?
00:28:14 You hadn't done any testing before May 5th, had you?
00:28:17 I bought gold from him.
00:28:18 Okay.
00:28:19 He claimed it came from the mine.
00:28:20 Okay.
00:28:20 But after May 5th, you and your guys actually found gold at Dancrate, didn't you?
00:28:25 We did.
00:28:26 Okay.
00:28:26 And whether you choose to buy it or not, you had information that would have been, in your words, an entry-level way to start to figure out whether or not you could find investors to invest in the mine, correct?
00:28:38 Can you repeat that?
00:28:39 Sure.
00:28:39 Frank and Travis are logging in the gold that they're recovering in these daily reports, aren't they?
00:28:45 To a certain degree.
00:28:47 Again, that was, I don't feel like they had clear and unrestricted access to the gold.
00:28:53 That's fair.
00:28:53 My question is, Frank and Travis, they were sending you daily reports and they were reporting to you what they understood they were finding, weren't they?
00:29:01 Some of the reports were, hey, we think we had a good day but we're waiting.
00:29:05 RANDY TO TELL US.
00:29:06 AND THAT'S CLEARLY ARTICULATED IN THE DAILY REPORTS.
00:29:09 HAVE YOU REVIEWED THOSE REPORTS PRIOR TO YOUR TESTIMONY TODAY?
00:29:11 YEAH.
00:29:12 OKAY.
00:29:13 THE JURY WILL GET TO SEE THEM AND THEY CAN DECIDE WHAT FRANK AND TRAVIS WROTE.
00:29:22 SO DO YOU BELIEVE THAT DURING THE 2020 MINING SEASON YOU LEARNED WHETHER OR NOT THE DAN CREEK MINE CLAIMS THAT RANDY OWNED, ELLIOTT OWNED, DID YOU LEARN WHETHER OR NOT THEY'RE VALUABLE?
00:29:34 Not to the extent that I needed to, no.
00:29:36 Then why did you offer to buy it from him?
00:29:40 The offer that I made I think was supported mostly by his other contractors and what we were able to witness of his other crew out there.
00:29:53 So do you recall making an offer to Mr. Elliott to buy the mine from him in July 2020?
00:29:57 I do.
00:29:58 What do you recall about that offer?
00:30:02 If memory serves me correctly, it was $1.5 million down and a payout of a certain percentage over five years of whatever we were able to recover.
00:30:13 Do you have a rough idea of what you think that might have been?
00:30:16 10% maybe or 15%?
00:30:18 So say 10%.
00:30:19 I can represent to you, I think that's what the offer was.
00:30:21 Would you agree 10% sounds reasonable?
00:30:24 And if it's 10% and you think that you could have gotten $1,500
00:30:27 No, we could have gotten more than that.
00:30:31 Okay, use whatever number you want, but let's say, what is the number you'd like to use for what you think the actual payout would have been over five years?
00:30:37 I think when I was formulating that offer, we felt like it would be conservative, 2,500 ounces a year.
00:30:48 2,500 ounces a year?
00:30:49 If we were allowed to plan and logistically prepare for the season,
00:30:56 I think that would be the minimum.
00:30:58 Okay.
00:30:58 Based on what I saw the other contractor doing.
00:31:02 I've got a calculator right here.
00:31:04 So 2,500 ounces a year, you're saying your offer to Mr. Elliott was 1.5 million and then 10% of 2,500 ounces a year.
00:31:12 Is that right?
00:31:12 250 ounces.
00:31:13 250 ounces.
00:31:13 And the price of gold in 2020 was about 1,600 an ounce?
00:31:18 I don't recall.
00:31:19 Okay.
00:31:20 I think it was more than that.
00:31:22 Okay.
00:31:22 You want to say 1,700?
00:31:23 I think it was more than that, too.
00:31:24 I think it was $1,800 or $1,900.
00:31:25 Okay.
00:31:27 Well, I'll use your number.
00:31:31 So if it's $1,800 an ounce, it's about $450,000 a year you'd have been paying Mr. Elliott.
00:31:38 Does that sound about right?
00:31:39 Yeah.
00:31:40 And then over five years, that'd be $2.2 million.
00:31:42 Yeah.
00:31:42 So essentially your offer was, at least at the time, was about $3.75 million?
00:31:46 Yeah.
00:31:46 Okay.
00:31:49 When you made that offer to Mr. Elliott, do you recall telling him that it was conditioned on you finding investors?
00:31:55 I do.
00:31:56 Did you have investors lined up that would have been able to make that happen in the summer of 2020?
00:32:01 I had two investors lined up.
00:32:03 Okay.
00:32:04 Why did you write to him that you said, assuming I can find investors, this is my offer?
00:32:09 Because I wanted to clearly communicate.
00:32:11 So I mean, there was a contingency.
00:32:14 I mean, they have to say yes.
00:32:15 They have to see the, I mean, they're not just going to write checks based on what I tell them.
00:32:19 Fair enough.
00:32:19 And you didn't have $1.5 million to put down, did you?
00:32:22 I don't recall exactly what our cash flow looked like at that time.
00:32:25 Okay.
00:32:26 Do you recall that at the very same time that you were asking Mr. Elliott, or making that offer to Mr. Elliott, that you asked him for additional gold?
00:32:34 Probably.
00:32:35 And you'd already received 43.6 ounces or thereabouts.
00:32:38 Is that right?
00:32:40 I don't know if the...
00:32:43 calendars lining up with that.
00:32:45 I don't know when exactly I received the 43 ounces as it pertains to the offer.
00:32:49 Okay.
00:32:50 Do you recall receiving 43.6 ounces?
00:32:53 I do.
00:32:53 All right.
00:32:54 And do you recall after receiving it asking him for more gold?
00:32:58 I do.
00:32:59 How much more gold did you ask him for?
00:33:00 I think I asked him to bring the balance to 100 ounces.
00:33:02 Okay.
00:33:03 So 100 ounces.
00:33:04 And if we're talking 1,800 an ounce, we're talking about $180,000.
00:33:07 I think that was net.
00:33:07 Net, right.
00:33:14 Why did you think it was appropriate to have Mr. Elliott fronting expenses for you in June or July based upon the agreement you had signed with him?
00:33:23 Well, that wouldn't have been.
00:33:24 I'd already fronted the expenses, so that's indicative of him coming alongside on the expenses like the agreement stipulated.
00:33:29 I'm sorry, it's indicative of what?
00:33:31 Him coming alongside and sharing in the expenses as they're accrued.
00:33:36 But that's not what you wrote in the agreement, is it?
00:33:40 I don't know.
00:33:40 Did you write in the agreement that we would
00:33:42 share expenses as they're accrued?
00:33:44 Did you use that language?
00:33:45 I don't know.
00:33:46 Didn't the agreement say that at the end of the year you'd split, you'd figure out the expenses in gold and then you'd even up at that point?
00:33:52 Wasn't that the agreement?
00:33:53 It seems like it.
00:33:54 Okay.
00:33:54 But you wanted him to pay you in June or July?
00:33:56 I was starting to lose trust.
00:33:58 Okay.
00:34:01 Do you believe that Mr. Elliott had any expenses associated with your mining operations in the summer of 2020?
00:34:07 Probably fuel.
00:34:09 Fuel.
00:34:09 Okay.
00:34:09 How much...
00:34:10 How much fuel do you think your equipment used to operate during the summer of 2020?
00:34:18 To accomplish my tasks or to accomplish his tasks?
00:34:22 I don't want to quibble with you.
00:34:23 To run the equipment that you brought out there, how much fuel do you think your equipment used?
00:34:28 I think the majority of the fuel went towards capital projects.
00:34:31 But my question is how much fuel do you think that was used?
00:34:35 I don't know that.
00:34:36 I'm not a fuel guy.
00:34:37 I'm not a logistics guy.
00:34:38 I'll admit it.
00:34:38 I have no idea.
00:34:39 The jury may not either.
00:34:40 How much fuel are we talking about these pieces of equipment using every day?
00:34:45 I mean, the Sany probably uses 40 gallons a day.
00:34:49 Okay.
00:34:50 I mean, so just rough math, I mean, do you think there's a significant cost that Mr. Elliott incurred for fuel?
00:34:56 Yeah, I do.
00:34:56 Okay.
00:34:57 But I understand your testimony, which is it only benefited him and it didn't benefit you.
00:35:00 Not only, but majorly.
00:35:03 I want to talk to you about that, okay?
00:35:04 So...
00:35:06 You obviously understand the value of civil construction and building roads and Dykes, right?
00:35:09 You clearly get that, right?
00:35:10 I do.
00:35:12 So if you're going to buy the mine and you'd offer to pay him, in your testimony, $3.75 million for a mine, wouldn't you have received the benefit of the work that your crew is doing that summer?
00:35:22 If he accepted the offer.
00:35:24 Right.
00:35:25 So it would have been a benefit to you had you been able to purchase the property.
00:35:31 Sure.
00:35:31 Okay.
00:35:34 You spent time in your testimony talking about the things that Mr. Elliott failed to do.
00:35:38 And I think one thing I really want to focus on with you is you agreed in the agreement that you wrote that you would provide other qualified persons to conduct the testing and exploration in 2020.
00:35:51 You agreed to that, didn't you?
00:35:52 Could I see the agreement?
00:35:54 Yeah, you've got it right there in your binder.
00:35:58 Exhibit 2, page 1 of 1.
00:36:00 It should be the second page in there, Mr. Kroenke.
00:36:08 Okay, so you've got that open.
00:36:13 Fifth paragraph?
00:36:15 Yeah, I'm just reading it.
00:36:16 Okay.
00:36:21 Okay.
00:36:22 So would you agree with me that you agree that you would provide other qualified persons needed for the testing that will be expensed to the common expenses?
00:36:29 I agree.
00:36:30 That's what it says, yes.
00:36:31 What was your intent when you wrote that?
00:36:33 To supply Travis and Frank and other qualified operators.
00:36:37 okay but who are the other qualified operators?
00:36:39 Nate Patterson, brandon devore both of them were qualified operators how much time did they spend at dan creek?
00:36:45 i don't recall exactly were they there all summer?
00:36:48 no okay your payroll records will reflect when they were out there right?
00:36:52 yup okay would you agree with me that they weren't out there more than a few weeks?
00:36:57 i would agree with you that why is it that you didn't have them out there longer?
00:37:00 because we weren't allowed to mine okay how much time did frank
00:37:06 actually spent out there?
00:37:07 In other words, did Frank leave Dan Creek for periods of time for R&R or for other projects or for whatever reason?
00:37:13 Mostly for R&R.
00:37:14 He had a family, a wife, and I mean you couldn't just expect him to stay out there the entire time.
00:37:18 So how much time, like how much R&R time did you give him that summer?
00:37:22 I don't recall exactly how much R&R time.
00:37:24 When he requested it, if he had something that he needed to be at, I let him do it.
00:37:28 Okay.
00:37:29 And did Travis get to take R&R time?
00:37:30 He did.
00:37:32 Do you recall Travis bringing his son out to Dan Creek that summer?
00:37:35 How old was his son at the time?
00:37:38 16 or 17, I think.
00:37:39 Okay.
00:37:40 And do you know whether or not his son was operating equipment out there?
00:37:45 I think he, more on the four-wheelers and stuff, I think.
00:37:48 I don't know.
00:37:50 I mean, if he was operating anything, it would have been a dump truck.
00:37:52 Okay.
00:37:54 I want to talk about that.
00:37:55 So you, I want to talk about how much time you actually spent out at Dan Creek.
00:37:59 I think you said you invested 249.5 hours into the mining season.
00:38:02 Is that right?
00:38:03 Mm-hmm.
00:38:06 I'm sorry, yes or no?
00:38:07 Yes.
00:38:07 Okay.
00:38:08 Of that 249.5 hours, how much time did you actually spend with your boots on the ground at Dan Creek?
00:38:15 We could get into the time log.
00:38:16 I would show it.
00:38:17 I'm just asking if you have a recollection.
00:38:19 I mean, I was probably out there a total of six or seven days, maybe eight days.
00:38:26 In those six to eight days, how much time do you think you spent operating any equipment?
00:38:31 I didn't operate equipment.
00:38:32 How much time did you spend repairing any equipment?
00:38:34 I didn't spend any time repairing equipment.
00:38:36 When you were out at Dan Creek, what were you doing?
00:38:38 I was trying to formulate plans, trying to look at the overall picture, get my crew back on track after they've been directed by Randy, trying to negotiate with Randy.
00:38:51 So the information that you shared with the jury about how Mr. Elliott manipulated, redirected, or interfered with your crew, is that information that you personally observed or is that information you received from your crew?
00:39:06 No, it would have been information I received from the crew.
00:39:08 All right.
00:39:09 And do you believe that the daily reports that they were sending you would reflect or should have reflected the interference, the distraction, the manipulation, the redirection that you've described to the jury?
00:39:18 I think they do reflect that to a certain degree.
00:39:21 To what degree do they not reflect that, in your opinion?
00:39:23 I mean, I think it's a portion of what actually happened.
00:39:26 Okay.
00:39:26 So, I mean, the nature of data reports isn't to –
00:39:31 Seth Kroenke v Treasure chest LLC
00:39:56 about this interference and manipulation and redirection from Mr. Elliott.
00:40:00 How can they know that it happened if you weren't there and you don't have reports that reflect it?
00:40:03 Ask them.
00:40:04 Ask them, Frank and Travis.
00:40:05 Yeah.
00:40:06 Okay.
00:40:09 And if Frank and Travis were to tell the jury that they don't recall interference, redirection, manipulation by Mr. Elliott, what should the jury conclude?
00:40:17 I think they need to believe them.
00:40:20 Okay.
00:40:22 I want to talk to you about that second agreement.
00:40:26 The that's exhibit to it just so you have it right reference and I know you were asked about this I don't want to spend a lot of time on it But your testimony before the jury is that you signed that agreement and then handed it to mr. Elliott, correct?
00:40:37 That's my recollection.
00:40:38 Yes, and then he wrote an anecdotal, correct?
00:40:41 Correct, and then he signed it.
00:40:42 Correct.
00:40:43 Are you testifying that you didn't agree to the insertion of the term anecdotal under your agreement?
00:40:49 I didn't understand the this say the meaning of it.
00:40:52 So I
00:40:54 I think once it was explained in the way that it was explained, I was fine with it.
00:40:59 And what you explained to the jury, your understanding was that there'd be a lower burden of proof for Mr. Elliott's receipts because of the nature of his business operation?
00:41:08 A lower burden of proof, not that they didn't exist.
00:41:10 Okay.
00:41:17 You may recall during your deposition, we talked a little bit, and I'm going to ask you the same question now.
00:41:21 I mean, knowing what you know now,
00:41:23 Do you think it was a smart move for you to write the contract in the way that you did?
00:41:29 No, I think it would have been better to probably get you folks involved.
00:41:33 Meaning attorneys?
00:41:33 Yeah.
00:41:34 And have it more arm's length maybe?
00:41:37 I don't know if I, no I wouldn't describe it as that.
00:41:39 Okay.
00:41:40 I mean it's a pretty significant investment.
00:41:44 You testified that
00:41:45 in May 2020, you thought it might cost you between $350,000 to $750,000, and you've reduced the whole agreement to one page.
00:41:53 I mean, there's some risk associated with that, isn't there?
00:41:57 Sure.
00:41:57 Yeah.
00:41:58 And is it fair to say that at least initially you trusted Mr. Elliott?
00:42:04 Yes.
00:42:05 Okay.
00:42:05 Why did you record the meetings?
00:42:07 That came later.
00:42:09 Didn't you record the meeting on May 5th?
00:42:11 I don't know for sure.
00:42:12 I don't think I did.
00:42:15 You don't think he did?
00:42:16 I don't think I did record it.
00:42:17 If there's a recording of a meeting with you and Mr. Elliott on May 5th, who would have recorded it?
00:42:21 Probably Kevin.
00:42:23 At your direction?
00:42:24 No.
00:42:24 He was surreptitiously recording Mr. Elliott and you meeting without your knowledge or consent?
00:42:29 He was part of the meeting too.
00:42:30 It was a three-way meeting.
00:42:32 Okay.
00:42:32 He works at your direction, doesn't he?
00:42:36 Yeah.
00:42:37 He's your right-hand man?
00:42:38 Yeah.
00:42:38 Okay.
00:42:39 So your testimony is if there was a recording from May 5th, it was Kevin Clark that recorded it, not you?
00:42:43 I think so, yes.
00:42:44 And you didn't know about it?
00:42:46 I don't recall if I knew about it.
00:42:47 I mean, at some point I knew about it.
00:42:49 Okay.
00:42:49 Did you tell Mr. Elliott you were recording his meeting secretly?
00:42:53 I did at some point let him know that the meetings had been recorded.
00:42:56 You did that in July when you threatened to sue him, didn't you?
00:42:59 I don't think I threatened to sue him in July.
00:43:01 We'll look at the text.
00:43:03 But you didn't tell him until July, did you?
00:43:05 That seems right.
00:43:16 I want to get to your expenses, but I want to talk just broadly about your expenses.
00:43:20 It looks like in the Seth time that is in the exhibit, I think it's Exhibit 9, but it looks like you charge for your time flying in and out of Dan Creek as part of the 249.5 hours.
00:43:35 Does that sound right?
00:43:37 Probably.
00:43:38 Okay.
00:43:39 And then you also testified that it's under market, but you charge about $2,000 a flight.
00:43:43 Yep.
00:43:46 How should, can't the jury understand or shouldn't the jury understand that you're essentially double charging Mr. Elliott for flights by charging for your time and then charging for the flight again?
00:43:56 Well, no, not really because the time associated with the, I'm not allowed to charge for my flight time if I'm just charging for a flight.
00:44:04 I'm allowed to charge on the airplane side for fuel, insurance, hangar, maintenance, stuff like that.
00:44:11 Overhead and fuel, right?
00:44:14 What?
00:44:14 Overhead.
00:44:15 Some of it's overhead insurance.
00:44:16 I wouldn't call it overhead.
00:44:17 Okay, just operating expenses.
00:44:19 Directly attributed to their plan.
00:44:20 Okay.
00:44:21 And so do you agree that your billing rate for the time that you spent was $200 an hour?
00:44:29 I agree.
00:44:30 Okay.
00:44:33 How did Mr. Elliott get in?
00:44:34 Well, did Mr. Elliott fly in and out of Dan Creek during the 2020 mining season?
00:44:39 I think he did.
00:44:40 Okay.
00:44:41 Do you have any idea why he flew in and out?
00:44:44 No.
00:44:44 Do you think he went and got parts, materials, equipment?
00:44:48 He may have.
00:44:49 Do you think he flew any of your guys in and out at all?
00:44:53 He might have flown one of my guys to and from McCarthy, but if I was honest, I quickly learned that none of his airplanes were an annual.
00:45:04 I didn't ask you that.
00:45:05 I'm just asking whether or not he flew in and out.
00:45:07 I'm trying to answer.
00:45:09 Okay.
00:45:09 My question is, did he fly in and out?
00:45:12 I don't know.
00:45:13 I think he did, yes.
00:45:14 Okay.
00:45:16 You said once you've mobilized, you can't cross a river once the water comes up, right?
00:45:20 It's very dangerous to do so.
00:45:22 So the only way, really the only reasonable way to get in and out of there would be to fly?
00:45:25 Correct.
00:45:25 All right.
00:45:28 You used a term in the agreement, which is Exhibit 2, that says expenses that are in direct relation to the development.
00:45:36 Do you recall using that language in the agreement on Exhibit 2?
00:45:42 I do.
00:45:43 What did you mean when you wrote that?
00:45:45 In direct relation to the agreement.
00:45:47 What does it mean?
00:45:49 It means the expenses that are directly related to the agreement that him and I are operating under.
00:45:53 And that's the agreement to explore and mine?
00:45:56 Yes.
00:45:56 Okay.
00:45:57 So do you view the demobilization costs as a cost in direct relation to the development?
00:46:03 Yes.
00:46:04 Okay.
00:46:06 Why didn't you include
00:46:08 You submitted a list of expenses to Mr. Elliott.
00:46:11 You said at some point in the summer or in the fall.
00:46:13 Why didn't you list those expenses out more clearly in the agreement itself?
00:46:16 Which expenses?
00:46:18 Demobilization costs, for example.
00:46:20 Because we didn't have them all.
00:46:22 But why didn't you put the categories of expenses?
00:46:24 You put other expenses in there, but why didn't you put that in the agreement so that Mr. Elliott knew what he was signing up for?
00:46:29 Because we didn't have all the expenses captured, and so we tried to estimate a number that was conservative.
00:46:36 I'm saying why didn't you put the categories of expenses, meaning Seth Time was going to... All the categories.
00:46:41 You knew what Seth Time was worth, though, didn't you?
00:46:43 Yeah, but I didn't know necessarily which bucket to drop it in.
00:46:47 So if your time's worth $200 an hour, what's Mr. Elliott's time worth?
00:46:52 Whatever he feels like it's worth.
00:46:54 And you'd accept that?
00:46:55 If he said, my time's worth the same amount as yours, Mr. Kroenke, would you accept that?
00:47:01 As it relates to this dispute?
00:47:03 The direct relationship to the development.
00:47:05 Not about
00:47:07 concrete construction or civil construction about mining at Dan Creek do you think his time is worth the same amount as yours if he can produce an itemized list yeah of what his time if he can't his time he didn't work on them he didn't work at all if he if he doesn't have a list are you suggesting he just creates a list now no I'm not I'm saying if he testifies that he spent a certain amount of time during the course of the year supporting the development that was part of your agreement is that time worth something I don't know what that time is
00:47:37 I'm just asking whether you think there's value to his time or not.
00:47:41 I think there's value to everybody's time.
00:47:44 Time is the biggest resource we have.
00:47:47 Do you have a sense of how much time he might have actually worked in support of the agreement?
00:47:51 I don't think it was much.
00:47:52 But you were only there six or eight days, so you wouldn't know for sure, would you?
00:47:55 Well, no, I do.
00:47:56 I've talked to my crew at length, and most of the time he spent was counterproductive to what we were trying to do.
00:48:09 You went through Exhibit 5, which is your summary of expenses, and you've explained to the jury how you arrived at those numbers.
00:48:15 Do you stand behind all those expenses today?
00:48:18 I do.
00:48:20 I've got to tell you, it's a little surprising that you charged Mr. Elliott profit and overhead.
00:48:26 Is that something that you anticipated charging him when you started these agreements in May and then in June 2020?
00:48:33 No.
00:48:34 Why did you decide to add that?
00:48:36 Because at that point we felt swindled.
00:48:38 And you turned the agreement, which was an agreement to explore and mine at Dan Creek, you turned it into a construction contract, didn't you?
00:48:45 I did not.
00:48:45 He did.
00:48:47 He did?
00:48:48 He did.
00:48:48 And how did he do that?
00:48:50 By talking us into giving him the blue plant so his contractors could pay the bill.
00:49:01 Was the blue plant operating throughout the summer?
00:49:05 Once we got it built, I don't know, we left.
00:49:09 But to my knowledge, I believe it operated the rest of the year.
00:49:12 Okay.
00:49:14 If Travis had issues with it and couldn't keep it running, do you know if that's true or not?
00:49:22 I've never seen a piece of equipment that Travis can't keep running.
00:49:26 Okay.
00:49:30 You testified that
00:49:33 Frank and Travis may have left for R&R leave.
00:49:36 Did they leave for any other projects for any of your companies during the course of the summer?
00:49:40 Not that I'm aware of.
00:49:42 Did you have a job in Valdez in the latter part of July and early August?
00:49:46 Yeah, we might have had a small epoxy job, like a one or two day job.
00:49:50 Okay.
00:49:50 Do you know if Frank or Travis left to work on that?
00:49:52 I think Frank did that.
00:49:53 Okay.
00:49:54 So Frank actually left and went to Valdez to work on a project during the mining season?
00:49:57 Yep.
00:49:58 And then who did you leave behind, if you know?
00:50:00 Probably Travis.
00:50:01 Okay.
00:50:02 And Travis was focused on getting the blue plant operating, wasn't he?
00:50:05 Well, and running the crew.
00:50:06 And who was the crew?
00:50:07 When Frank left, who was the crew at the end of July?
00:50:10 I don't know exactly who was the crew at that time.
00:50:12 Was there anybody there besides Travis and his son?
00:50:15 I think there's periods where it was just Travis and his son.
00:50:18 Was that one of those periods?
00:50:19 It might have been.
00:50:20 How can you mine if you just got Travis and his underage son?
00:50:23 How can they successfully mine?
00:50:26 I mean, two people can mine if you stage materials.
00:50:30 and you have a week's worth of stage materials of pay dirt, you can mine that with two people.
00:50:34 You've never mined though, have you?
00:50:37 I've been, was part of the process and yes, I have been part of Frank's mining.
00:50:41 Okay.
00:50:48 You testified at great length about how Mr. Elliott gave you an ultimatum, gave your crew an ultimatum and said,
00:50:54 That they could not go back and mine in the location that they had mined before, right?
00:50:58 That's your testimony?
00:50:58 Yes.
00:50:59 Do you know what date that was?
00:51:01 I believe that was, that ultimatum was the end of August.
00:51:04 Did he give you that ultimatum?
00:51:07 That ultimatum was given to Travis and Frank, and they called us asking what to do.
00:51:11 And when you say ultimatum, what is it that you were told, Mr. Elliott said, about the ability of your crew to go back and mine at the lower part of the creek?
00:51:20 That they're not allowed.
00:51:21 They were not allowed.
00:51:22 And how was it explained to you?
00:51:24 that they either the 336 and our crew needs to stay up the mine and continue to evaluate or we need to leave.
00:51:33 And we're not allowed to go to the lower section of the area that we stripped.
00:51:37 You weren't present for that conversation?
00:51:39 Not that conversation, but I was present with conversations and had conversations with Randy specifically where he said the same thing.
00:51:46 And he said that your crew was not allowed to go back down the river?
00:51:48 Yes.
00:51:49 All right.
00:51:50 Is that in writing anywhere?
00:51:52 Did Mr. Elliott ever tell you
00:51:54 Your crew cannot return to the lower part of the creek and resume mining.
00:51:57 I think that was a phone conversation or an in-person conversation.
00:52:06 Do you believe Frank went up the canyon on his own volition?
00:52:10 No.
00:52:11 You believe he was directed to do so?
00:52:12 Yes.
00:52:15 There was some discussion of a trommel that Frank had.
00:52:17 Do you recall that?
00:52:18 I do.
00:52:19 Just to remind the jury, what is a trommel?
00:52:23 Tubular gravel screen that rotates and the gravel goes in it and the fines drop through it.
00:52:30 Based on your understanding of that piece of equipment, is that a piece of equipment that could have produced a lot of gold for your crew?
00:52:38 No, it was more of a testing piece of equipment.
00:52:40 Okay.
00:52:40 And was that Frank's piece of equipment?
00:52:42 It was.
00:52:43 Do you know whether or not he sold it to Mr. Elliott?
00:52:45 He sold it to Randy.
00:52:46 Do you know when he sold it to Mr. Elliott?
00:52:48 I don't recall.
00:52:49 Was it before or after you pulled Frank out of Dan Creek?
00:52:52 I don't recall when that happened.
00:52:55 That was an arrangement that Frank and Randy made while Frank was on site.
00:52:58 Okay.
00:52:59 So do you believe that Frank operated that piece of equipment after Mr. Elliott had purchased it from him?
00:53:05 I have no idea.
00:53:06 Okay.
00:53:06 Frank might know though.
00:53:07 He might.
00:53:08 Okay.
00:53:14 If things had gone the way you wanted them to go, you testified that you wanted
00:53:18 to be operating in the lower part of the creek so that you could recover gold, correct?
00:53:22 Correct.
00:53:22 And then did you still want Frank to be testing other portions of the property to see if it produced gold?
00:53:28 I did.
00:53:28 Okay.
00:53:29 And it's your testimony that Mr. Elliott interfered with both pieces of that or just the part of mining at the lower part of the river?
00:53:36 Oh, he interfered with both.
00:53:38 So he prevented Mr. Martin from going and exploring other pieces of property?
00:53:43 I didn't say prevented, I said interfered.
00:53:44 How did he interfere?
00:53:45 He would direct.
00:53:46 He would say the places we could go.
00:53:49 There was one particular instance up the mine when we found an area that we would have liked to stay at for a while and he wouldn't allow it.
00:53:56 Because that's what Mr. Martin or Mr. Turnbull told you?
00:53:58 Yeah, and the next day there was a different contractor on it.
00:54:19 The remaining time I have today, I just want to talk a little bit about the decision to pull out of Dan Creek Your testimony is that you felt you had no choice essentially, is that right?
00:54:33 No, there's always a choice But you chose you chose to pull your equipment off of mr. Elliott's mining claims and pull your crew out in August That was the logical choice with the ultimatum that we had been given.
00:54:46 Okay, so
00:54:52 Do you think that if there wasn't an ultimatum, and obviously we dispute that there was, if there wasn't an ultimatum, could your crew have recovered gold?
00:55:04 Yes.
00:55:05 Okay.
00:55:05 So the jury has to decide whether or not Mr. Elliott gave your crew and you an ultimatum regarding where they could mine.
00:55:13 I think that's one issue that they'll have to... And if there wasn't an ultimatum, then Mr. Elliott didn't prevent you from mining at Dan Creek in 2020, did he?
00:55:20 I wouldn't agree with that statement.
00:55:22 If he didn't give an ultimatum?
00:55:23 Correct.
00:55:24 Because you think he interfered or directed or otherwise manipulated?
00:55:27 He interfered the entire time.
00:55:30 The ultimatum was the last interference.
00:55:42 Just a moment, please.
00:55:44 No problem.
00:55:48 I guess I want to ask you, you testified that you think Mr. Elliott's a dreamer.
00:55:54 I don't know if I said that specifically, but something to that degree.
00:56:00 You said I'm a dreamer as well, didn't you?
00:56:01 I'm a positive person, an entrepreneur, yeah.
00:56:03 Okay.
00:56:04 What should the jury take away from the term dream?
00:56:07 What are you trying to convey to them that you and maybe Mr. Elliott are dreamers?
00:56:10 What should they understand about that?
00:56:13 I can't speculate about how that would apply to Mr. Elliott, but I can say that how it would apply to me is I'm always trying to look for the good in anything and trying to
00:56:24 facilitate an environment where that could be realized.
00:56:29 I want to touch on the qualified persons that you sent out there.
00:56:33 Do you recall talking to Mr. Elliott about the need for you to send out a mechanic?
00:56:41 Right.
00:56:42 Let me ask it this way.
00:56:44 Do you believe that a mechanic was necessary for your crew to be successful in the 2020 mining season?
00:56:50 No.
00:56:51 Why not?
00:56:52 Because our equipment was in good shape.
00:56:54 and Frank and Travis have mechanic abilities to the degree that would be needed okay and so if the blue plant wasn't running it was it was if it wasn't running you say that you think Mr. Turnbull could get anything running but if it wasn't running why wasn't it running well that I mean at what point well at the point that at any point if it wasn't running once Travis had gotten it fabricated why wasn't it running I mean there was multiple steps where it would he would get it running and then it would break
00:57:25 and you'd have to re-engineer or refabricate something.
00:57:27 I mean, that happened 10 times probably.
00:57:28 Okay.
00:57:29 And is that Mr. Elliott's fault?
00:57:32 No.
00:57:32 Okay.
00:57:33 Is that just the nature of operations out in the bush?
00:57:37 That would be the nature of taking piece and parts from Randy's plants that aren't no longer operating and trying to patch them together to an operating plant.
00:57:47 Yeah, that would be the nature of it.
00:57:48 Okay.
00:57:49 And I think the agreement spells out, but wasn't it your understanding that that's how Mr. Turnbull was going to
00:57:54 was he was going to take bits and pieces from other parts and cannibalize them?
00:57:59 Sure.
00:57:59 Okay.
00:58:11 You testified about crossing and mobilizing across the Nizaina River.
00:58:16 Do you recall that testimony?
00:58:18 Nizaina?
00:58:18 Nizaina, I'm sorry.
00:58:21 Excuse me.
00:58:22 The Nizaina River.
00:58:24 The photos that you showed the jury and explained how that went, were you, did you take those photos?
00:58:29 I took some of those photos.
00:58:31 Were you actually involved in crossing the river and getting your equipment across?
00:58:35 I don't think, I think I was involved from an air logistics standpoint.
00:58:41 So trying to air recon the safest pass.
00:58:45 At one point
00:58:47 one of Randy's crew drowned one of the vehicles and a bunch of our equipment floated out and so I had to land on gravel bars to try to retrieve that those pieces of equipment so I was involved okay um you said one of randy's employees or was it one of the contractors or do you recall I don't know how how he his relationship with the people that were he that worked for him right who actually got the equipment that you brought how did that actually get to the nice across the nizana into the
00:59:18 How did it get there?
00:59:21 Through people driving it or it being loaded on equipment.
00:59:26 And the people who drove it included whom?
00:59:29 Some of his crew and some of my crew.
00:59:31 Okay.
00:59:32 So some of his crew helped mobilize equipment that you were responsible to bring out to Dan Creek?
00:59:37 No, they were responsible to do the mobilization.
00:59:38 That's what was part of the agreement.
00:59:41 Right.
00:59:41 And those are expenses that Mr. Elliott could have
00:59:44 would have split evenly with you at the end of the season, right?
00:59:47 Sure.
00:59:47 Okay.
00:59:51 We put forth quite a bit of effort into helping him with those mobilizations, at least on the way in.
01:00:08 Just review my notes just one moment.
01:00:17 Just a moment, please.
01:00:34 Those are my questions, Your Honor.
01:00:36 All right.
01:00:36 Thank you, Mr. Campion.
01:00:37 Mr. Brzezinski, I'm looking at the clock and ending at 1.30.
01:00:41 Do you want to pick up with a redirect in the morning, or are you going to be brief?
01:00:45 Please.
01:00:45 I think that would be fantastic.
01:00:47 All right.
01:00:48 So, ladies and gentlemen, we're going to conclude things here for the day.
01:00:52 If you could plan to be back at 8.30 tomorrow morning, please leave your notepads on your chairs.
01:00:57 We're going to mark them with a number on them so that you get your own notepad back.
01:01:02 Just a reminder, please, no Googling Dan Creek.
01:01:06 Please stay off of social media about the trial.
01:01:09 Thank you for your attention to this matter, and enjoy the rest of your day.
01:01:12 We'll see you all in the morning.
01:02:22 And we have a question.
01:02:23 Thank you very much
01:02:46 So I'll read the question again.
01:02:48 I'm not sure this is one to answer now, but I'll let you sort it out.
01:02:52 The question is, Mr. Randy Elliott, what was the profit split with the other crew?
01:02:58 50-50, 10-90, 20-80.
01:02:59 Was this why Randy's first priority was this other crew?
01:03:08 I think all those questions will be answered in detail.
01:03:12 I guarantee that.
01:03:15 I think you have an interested juror who She got right to the nitty gritty there.
01:03:20 So folks I'm going to leave it there.
01:03:23 Again I know I've got your motions in limine.
01:03:25 I'm going to get through those this afternoon and try to get that all sorted out so that we're ready to go.
01:03:34 Can I get a preview in terms of what you're planning for tomorrow you're going to finish up with you can you can have sleep I'm going to say less than 10 minutes and then I'm going to call Kevin Clark Kevin Clark followed by Frank Martin followed by Travis Turnbull.
01:03:56 I expect to get all of them done tomorrow
01:04:01 I told you I would set up a Zoom link.
01:04:02 Are they all out or are they going to be here?
01:04:04 They're all here.
01:04:04 They're all our witnesses.
01:04:05 They'll all be present.
01:04:06 Okay.
01:04:07 Fair enough.
01:04:09 And then I'll confer with Mr. Elliott about Zoom witnesses.
01:04:12 I just want to represent to the court.
01:04:13 I think I told them, I don't know if I told you, Your Honor, I did a Zoom test last night with one of our potential witnesses at Dan Creek, and it was as clear as you and I talking right now.
01:04:22 Perfect.
01:04:22 So if we need to go there, we can.
01:04:24 We've done lots of Zoom over the last four years, so we could certainly make it available.
01:04:28 I'll get that link set up and get that sent to both counsel this afternoon.
01:04:32 Your Honor, if I could, I was reviewing the written objections that we did to the exhibits, but there's not one that's pending.
01:04:40 And the written objections, we do object to that exhibit on hearsay grounds.
01:04:46 So to the extent I didn't raise that yesterday, it is in the written one.
01:04:49 I just didn't want the court to think I was trying to surprise anybody.
01:04:52 The nature of trial is objections get made, get remade, get revised along the way.
01:04:59 I wasn't taking any – no surprise from it.
01:05:01 It was just not an issue that I had addressed as part of your objection.
01:05:06 So I appreciate the clarification.
01:05:09 No offense taken.
01:05:10 Thank you.
01:05:10 All right.
01:05:10 Thank you, sir.
01:05:11 Thank you, gentlemen.
01:05:12 Have a good evening.
01:05:18 Seth kroenke v Treasure chest LLC