February 4, 2011
It may be a long time before a nuclear reactor rises in Idaho, but Alternate Energy Holdings took one small step back to undertaking the task yesterday when a federal judge unfroze assets locked-up in December by the Securities Exchange Commission.
U.S. District Judge Edward Lodge released the $7 million into AEHI’s treasury after considering SEC testimony that AEHI CEO Don Gillespie and vice president Jennifer Ransom had used the company assets as a personal piggy bank.
“SEC lawyer Mark Fickes . . . said they have looted the company of millions to finance a luxurious lifestyle, including jewelry purchases, a Maserati sports car and lavish trips to Asia, Colorado and Las Vegas,” reported Bloomberg News.
AEHI lawyer Richard Roth did not seem to dispute the raiding charges but concentrated on the point that AEHI has not violated securities law by promoting the idea that the small company can begin the process of building a nuclear reactor.
Part of the SEC case rested on the contention that AEHI had bamboozled the local populace and “pumped up” the stock by convincing them that the small start-up could build a reactor in the remote corner of Idaho. The judge accepted AEHI’s arguments.
The case against AEHI was originally incubated by the Snake River Alliance and other opposition groups that don’t want a reactor under any circumstances. Snake River openly bragged that it had drawn the SEC into the case when the federal crackdown occurred in December.
Newspaper stories highlighted the opposition groups’ arguments that it was absurd to think a small company such as AEHI could build a nuclear reactor. Gillespie countered, however, that his company would not be financing the reactor but would only do the preliminary regulatory and environmental work to the point where it applied to the Nuclear Regulatory Commission for a license. At that juncture, he argued, a major nuclear builder such as Toshiba/Westinghouse or Korea Electric Power could jump into the project. Since getting regulatory approval constitutes a huge portion of building a new reactor, AEHI would have something to offer. Judge Lodge accepted this point.
"We’re very, very pleased with the result [of the decision]," AEHI attorney Roth told The Associated Press. "We have a company that can continue. Banks and brokerages can be notified that the company is back in business.
Read more about it at Bloomberg