Pease & Curren started our blog, “Karat Chat”, to provide our perspective on issues of concern to the industries we serve, with a focus on precious metals. In our 102 years of operating a refinery, we have learned a few things about the world of precious metals that we think our friends in jewelry, dental, manufacturing and pawn could benefit from knowing. Recently we have discussed running a jewelry store in the era of e-commerce , new changes to interstate taxation of retail transactions , and mergers in the mining industry . So when one of the largest refiners in the United States, Republic Metals, filed bankruptcy, we analyzed the petition and posted the basic facts in a way that our busy readers could easily understand. We followed up with another post explaining the bankruptcy process and giving hints about what a reader could and could not do if Republic owes them money, among other issues.
One of the most interesting things we found in the bankruptcy paperwork was that many other refiners were listed as creditors of Republic, and several were owed millions of dollars. We speculated as to the risks posed by these losses and wondered aloud if Republic’s bankruptcy would create a “ripple effect” causing other refiners who had lost access to so much money to also go bankrupt. As it turns out, not everyone enjoyed this discussion.
Last week, we received a phone call from Sam Trencher, principal of New York state refiner So Accurate, which was listed in the bankruptcy petition as being owed approximately 2.1 million dollars by Republic. Our blog had also shared something we had learned from the Jewelers Board of Trade: “In October 2018, [So Accurate] closed the main location and relocated to the former branch location at … Woodside, NY.” Mr. Trencher demanded that the information about his company be taken off the blog, threatening to sue Pease & Curren. When asked if any of the information was inaccurate, Mr. Trencher agreed that every statement in the blog was accurate, but argued that it was not “hunky-dory” because it gives readers the wrong impression. He said that So Accurate has made lots of money, so much that the loss of 2.1 million is no big deal. He told me that he ships material he receives from his customers to various large true refiners like Metalor, Heraeus, and others, and that any loss to Republic was just one part of a larger picture. As for the closing of the main location in Long Island City, he said that that facility had been rented and his lease was up. He offered to provide proof that the relocation was unrelated to finances. For our part, we told him that factually accurate information would not be removed from the blog, but that we would review whatever additional information he provided and would pass along anything we deemed useful to our readers.
Initially, no “proof” was forthcoming. Instead we received a demand letter from So Accurate’s lawyer calling or blog “libelous” and threatening to sue. After we pointed out that “libel” requires a false statement, and that everything we said was true, So Accurate changed tack. It has now provided a few pages of what it represents to be its Long Island City lease with an end date of August 31, 2018, in an effort to show that its closing of that location had nothing to do with Republic. The pages they provided are available here so that readers can form their own conclusions.
Of course, Pease & Curren has no special, insider knowledge of any other company’s finances. All we have is our experience in the industry and access to publicly available information. As the Republic bankruptcy and other precious metals stories unfold, we will continue to provide whatever information we can find that we think will benefit our readers. In an industry that has had more than its share of scandal, we believe that transparency is a value to be encouraged rather than a problem to be litigated at. Our view on this, it turns out, is not unanimous.
