Major Coin Mint Files for Bankruptcy After Being Found Guilty of Defamation
In news that has sent shockwaves through the coin collecting world, one of the largest custom coin mints – Washington-based Northwest Territorial Mint – has filed for Chapter 11 bankruptcy protection after being found guilty of defamation and invasion of privacy.
Northwest Territorial Mint is a Federal Way company that sells precious metals and produces medals and medallions, including custom challenge coins. In April, Northwest Territorial Mint filed for bankruptcy protection – following multimillion-dollar jury verdicts against the company.
The defamation and invasion of privacy lawsuits were brought in Nevada by a Los Angeles businessman against Northwest Territorial Mint and its owner, Ross B. Hansen. The suit resulted in a $38.3 million judgment a placed against Northwest Territorial Mint and Hansen. Both Hansen and his company were found guilty of five counts of defamation and two counts of invasion of privacy for their involvement in a “coordinated series of online attacks” against California-based real estate management firm Cohen Asset Management, Inc. and its owner Bradley S. Cohen.
The Seattle Times reported that Northwest Territorial Mint filed bankruptcy in April – a calculated move to avoid paying the millions in judgements and fines. According to the company’s filing, it has more than 200 unsecured creditors, and its assets and liabilities both exceed $10 million. The biggest debts listed are a $7 million judgment in favor of Cohen and a $5.5 million judgment in favor of Cohen Asset Management. Northwest Territorial Mint is disputing both judgments.
The defamation suit claimed Northwest Territorial Mint and Hansen created anonymous websites that compared Cohen to infamous Wall Street scam artist Bernie Madoff and alleged that Cohen was involved in a “massive Ponzi scheme”. Those claims were proven to be unfounded. According to the lawsuit, the false claims were made due to Cohen’s anger over litigation by an affiliate of Cohen’s firm, which had been the mint’s landlord at their Auburn, WA warehouse.
A federal judge has ordered that Northwest Territorial Mint and Cohen pay $37 million in damages.
For those “in the know” in the coin world, this is far from the first time that Hansen has made a name for himself – and not in a good way. According to CoinWeek, Hansen has faced numerous allegations of impropriety over the years. These allegations include: laundering drug money, sexual harassment, illegal possession and selling of firearms and noncompliance with federal tax law. Hansen served three years in federal prison for the last two charges and also is currently facing a lawsuit relating to charges that he groped and harassed female employees.
The bankruptcy filing and multiple lawsuits are bad news for customers. There is no guarantee that any of the $20-$30 million dollars owed for outstanding orders can be recovered as bankruptcy proceedings are in the early phase.
“You have to be extremely careful about who you are doing business with,” said Eric Richards, founder of the custom challenge coin company, Phoenix Challenge Coins. “Unfortunately there are some dishonest people in this industry and they give us good, honest coin companies a bad name.”
Richards said it is important to always check the background of a coin company when doing business, especially since so many of custom coin ordering is done online.
“Check out their track record. Read reviews. Do the research. If a coin company has bad press, it is probably for a reason,” said Richards. “The good news is – there are a lot of good guys out here in the coin world, who value you as a client and won’t run off with your investment.”