Attorneys' fees related to a Sunshine Mine lawsuit were denied by a judge recently.

During a court hearing on Nov. 19, Shoshone County District Court Judge Fred Gibler rejected a request for more than $1 million in attorney's fees and costs by Stonehill Capital Management LLC. related to two cases dating back two years.

Attorneys for Stonehill Capital Management had requested attorney's fees from Sunshine Precious Metals Inc. and Silver Opportunity Partners for some 2,175 hours of work on the matter dating back to September 2010.

In his ruling on Nov. 19, Gibler said that Stonehill Capital Management has prevailed on some issues, but not all, and thus was not a prevailing party and did not grant their request for attorneys' fees.

During the Nov. 19 hearing, attorney Richard B. Harper of Baker Botts LLP of New York City said that parties should be ready for the court to proceed with a final judgment after the sale of property takes place. It is unclear what property that is, however a scheduled deposition for Oct. 26 of attorney Douglas Phelps of Spokane listed a number of properties that were transferred from Sunshine Precious Metals Inc. to Diversified Machine Technology (DMT) of Fallon, Nev. in 2004. The properties include: the Sunshine Mine, Sunshine office building, Sunshine tracts, Consolidated Mine site, Yankee Mill site, and portions of the Ore Grande Tract and the following lodes: Prudential, Norcross, Oslo and Stevie Corcoran, Chief, Mayday, Crane, and Cleveland.

A Nov. 7 trial scheduled before Judge Gibler was vacated in lieu of a settlement.

On Nov. 19, Harper said that the lenders settled for $2.725 million, which was a stipulation entered into prior to the vacated trial.

During the Nov. 19 hearing, Marc Rosen an attorney from Kleinberg, Kaplan, Wolff and Cohen PC of New York City and a representative of Stonehill Capital Management stated that Stonehill was owed $2.725 million under the 2003 stock purchase agreement and could consequently foreclose on the Sunshine Mine if that amount wasn't paid.

On April 17, Gibler ruled in a summary judgment that the Sunshine Mine's mortgage from Sept. 11, 2000, remained in effect. The total amount of indebtedness from the 2000 mortgage was approximately $71.2 million, according to Gibler.

Gibler also ruled that a 2003 stock purchase agreement remains in effect which limits claims by Stonehill Capital Management and Highwood Partners against American Reclamation Inc. to one-half of the net proceeds from the sale of Sunshine Precious Metals Inc.

Gibler also denied a quiet title to the Sunshine Mine to Silver Opportunity Partners.

In addition, a summary judgment issued by Gibler included an order that the lenders - Stonehill Capital Management LLC and Highwood Partners LP - release the 2000 mortgage when American Reclamation Inc. pays $2.725 million.

William F. Boyd, an attorney from Ramsden and Lyons LLP of Coeur d'Alene, described the case in a court document on Oct. 4: "This matter involves mortgage and security agreements, bankruptcy reorganization plans, credit agreements, stock purchase agreements and sophisticated corporate transactions providing for the purchase and sale of substantial assets between many parties over many years."

Boyd's statement was made as part of a request for attorneys' fees.

An exhibit in the court file showed a $5 million credit agreement for Sunshine Argentina Inc., an entity that includes Sunshine companies in Argentina, Mexico and Peru, among others.

Adding to the international flavor of the issues, Bob Mori of American Reclamation Inc. was listed as a resident of Mazatlan, Mexico.

"We will know very shortly if sales happen," Rosen said on Nov. 19.

The Sunshine Mine, located up Big Creek south of Interstate 90 between Osburn and Kellogg, has been closed for a number of years.