A suit filed against Pacific Lumber by a local activist has put potential investors on notice that the company may be unable to repay loans.
Redway resident and Country Activist publisher Bob Martel's class-action suit to undo the 1985 Maxxam buyout of PL includes a lis pendens action that puts stockholders and other investors on notice that the suit could leave Maxxam without control of its property.
PL's stock price dropped by three points after the news hit Wall Street. The company said it would appeal last month's ruling by Humboldt County Superior Court Judge William Ferroggiaro Jr. that allowed the notice.
Martel's suit alleges that the buy-out was accomplished through fraud, deceit, misrepresentations and violations of California corporate law, and asks that the timber firm be returned to its previous owners.
It is one of three stockholder actions that contend the takeover was the result of a secret scheme by Maxxam chief Charles Hurwitz and indicted junk-bond dealer Michael Milken and the Drexel Burnham Lambert investment firm that successfully avoided the anti-takeover provisions in PL's corporate bylaws.
Milken pleaded guilty in April to six felonies and agreed to pay $600 million in penalties in a plea bargain on a 98-count indictment for fraud and racketeering, seven of which involved the PL deal. It has been called the largest securities fraud case in history.
Mendocino County's Forest Advisory Committee last month called for a five-year slowdown on industrial logging to make sure there is timber left for the future.
One of five emergency recommendations being prepared for the Board of Supervisors, the slowdown proposal would slow harvests on industrial timberland by 20% per year over five years until they equal forest growth.
It came in response to reports of "full throttle" logging in the countyÑtrees being cut so fast that state regulators don't have the time to adequately review logging plans.
Other emergency proposals included a special 20% "resource depletion fee" on the value of timber logged beyond the emergency limits; using the fees to create a fund to ease economic dislocation; prohibiting conversion of timber-zoned lands; and requiring industrial landowners like Georgia-Pacific and Louisiana-Pacific to provide timber inventory and growth figures.
The five-point proposal split the committee, but loggers and small timber landowners fell on both sides. UC-Extension forest advisor Peter Passof admitted that industrial forest companies are severely over-harvesting, but opposed the measure as too hasty. Forest activist and reforestation contractor Meca Wawona called it a compromise that would continue to allow over-harvesting for the next five years.
"If we don't act now, the economic impact on people's lives in this county 10 years from now will be much more severe, and we will have fewer resources to make a transition to a more diversified timber economy," she said.
The committee, set up a year ago to advise the Board of Supervisors on forestry issues, expects to send a formal version of the proposal to the board in July.
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WASHINGTON (AP) June 26 President Bush on Tuesday [June 22] blocked new oil drilling off the coasts of much of California, Florida, Washington, Oregon and New England until at least the year 2000. California includes Northern California, 1.1 million acres off Mendocino and Humboldt counties; Southern California, 6.7 million acres south of the Santa Barbara Channel to the Mexican border.
In addition, he permanently blocked any drilling in a proposed marine sanctuary in California's Monterey Bay, and ordered a moratorium on new leases until 1996 for one section off southern California where drilling already is under way. "My desire is to achieve a balance between the need to provide energy for the American people and the need to protect unique and sensitive coastal and marine environments," Bush said in a written statement announcing his long-pending decision. The President called for more environmental studies to settle the question of whether leases might be offered after 2000.
...The California and Florida areas probably contain 1.3 billion barrels to 2.8 billion barrels of oil, equivalent to 75 to 160 days of consumption, and 2.2 trillion cubic feet of gas, about a 42-supply, according to a White House fact sheet. Figures were not given for the other areas.
...Bush said he believes "there are significant offshore areas where we can and must go forward with resource development." He did not say what areas he was referring to, but his administration has indicated it will go forward in Alaska and the long-productive Gulf of Mexico, where Bush himself pioneered offshore drilling many years ago.
...Bush also said he is implementing an overhaul of the leasing system, to include "rigorous scrutiny" of potential oil yields before any leasing occurs, assurance that drilling and exploration practices will not pose a risk to "unique natural resources," priority for development in the regions with the highest potential yield and a study of national security needs.
Greenpeace also accused Bush of political motivation, complaining in a statement that he had not addressed other coastal regions. Sen. Alan Cranston, D-Calif., said that instead of permanent moratorium, "President Bush has given us a decade of delay." But Sen. Pete Wilson, R-Calif., who is running for governor, praised Bush's decision as "the farthest reaching, most comprehensive protection a chief executive has ever given. I predict to you there never will be drilling off the California coast beyond what already is taking place."
Hello EF! from Scotland. Thought you might like to know you got a magic 20 column inch write up in the Guardian newspaper yesterday (p.8 "Redwood camp stops axe from falling, by Martin Walker).
Please convey to your campaigners the following message of support, postdated in history, from our national bard, Robert Burns, who in his poem "The Tree of France" calls on the inspiration of the French Revolution in writing:
"Wi' plenty o' sic trees I trow, The world would live in peace, man; The sword would help to mak' a plough, The din o' war would cease, man."
(sic = such; trow = trust; man = proof that there were old hippies in Scotland long before the venerable movement started in California).
Best wishes, Alastair McIntosh, Co-director, UK Foundation for the Peoples of the S. Pacific; Development Director, Centre for Human Ecology, Edinburgh University.
"Forests Forever" initiative backers last month charged that the timber industry's counter-initiative "is a trickily worded assault on the holdings of small timberland owners."
The industry's "Global Warming and Clearcutting Reduction, Wildlife Protection and Reforestation Act" would create a major competitive advantage for large landowners by exempting them from new regulations, the coalition of environmentalists said.
The industry initiativeÑsponsored by the Timber Association of California, a trade association that represents the biggest logging corporationsÑrequires owners of 5,000 or more acres to file long-term "timber management plans" with limited environmental review, and exempts them from continuing to file timber harvest plans as small owners will.
It adds major new restrictions on clearcutting, but then says the restrictions do not apply when no timber harvest plan is required.
"This puts a huge burden on the small owner relative to the big corporations, creating a dis-incentive for the small owner to stay in business," said Robert Sutherland, one of the authors of Forests Forever's "Forests and Wildlife Protection and Bond Act."
That initiative, in contrast, provides small timberland owners a major exemption for achieving sustained yield and for the first time puts a small timberland owner on the state Board of Forestry.
July 6 - This morning the California Department of Forestry(CDF) denied two controversial timber harvest plans(THPs) in the Headwaters Forest. The two THPs would have allowed cutting of over 600 acres in the middle of the 3000 acre grove. The Headwaters grove is the largest privately owned grove of old-growth redwood in the world. According to CDF, Headwaters is "one of the last three viable murrelet populations known to exist in California." The THPs(89-762HUM, and 89-793HUM) were denied because they did not address potential cumulative effects on the Marbled Murrelet.
"It's more than just Headwaters and the Marbled Murrelet, these ancient forest ecosystems are also habitat for the Spotted Owl, Tailed Frog, Pacific Fisher, Olympic Salamander, and Red Tree Vole, all of which are biologically endangered and are species of special concern. The last of these crucial habitats must remain intact. No more logging in California's ancient forests!" exclaimed Brian Wyatt of Redwood Summer.
CDF was aware of an upcoming lawsuit by the Environmental Protection and Information Center(EPIC) of Redway if the THPs were approved. Chances were high that CDF would lose on the lawsuit because of threats to the Marbled Murrelet. EPIC has won every single completed lawsuit it has brought against the CDF to protect old growth habitat.
...Meanwhile, Pacific Lumber, the current landowners of Headwaters Forest, are still cutting the last remaining old- growth redwood groves. They are currently cutting in four of these groves. One grove definitely has Spotted Owls, Marbled Murrelet, and Tailed Frogs.
...Redwood Summer will be visiting the next Board of Forestry meeting in Santa Cruz on July 11, at 8am, at the Holiday Inn (watch for press release on Board of Forestry demonstration Monday). "We will be demanding that the Board adopt our 'Headwaters Watershed and Wildlife Corridor Plan' that includes no logging of intact ancient forests," asserted Jon Williams, Redwood Summer organizer, and an ecology student.
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Copyright Mendocino Environmental Center 2004
Permission granted to excerpt or use this article if source is cited