By Marianna Parraga
HOUSTON (Reuters) -Toronto-listed miner Gold Reserve said on Monday it filed a complaint in a Delaware court against Rusoro Mining for alleged breach of its contractual obligations under
a consortium agreement to submit a bid for the parent of U.S. refiner Citgo Petroleum in a court-organized auction.
A $5.9 billion bid by an affiliate of Elliott Investment Management was recommended as the auction's winner in August, beating Gold Reserve's $7.9 billion bid. The process aims to auction Venezuela-owned PDV Holding to compensate up to 15 creditors for expropriations and debt defaults in Venezuela.
Both offers included an agreement with Rusoro to use its $1.5 billion claim related to expropriated assets in Venezuela as part of the bids. Delaware Judge Leonard Stark has not made a decision on the auction's winner amid objections and challenges to the bidding process.
"Gold Reserve is seeking preliminary injunctive relief to enjoin Rusoro from participating in the sale process during the pendency of the action, among other forms of relief," the miner said in a release.
Gold Reserve's complaint was filed under seal in the Court of Chancery of Delaware. The company and parties representing Venezuela last month filed motions to disqualify the judge and court advisors over alleged conflict of interest, which remain pending.
Lawyers representing Rusoro did not immediately reply to a request for comment, but they informed the Delaware court over the weekend about Gold Reserve's complaint and said the company was reviewing the documents while reserving its rights to take any actions.
Gold Reserve is seeking "to prevent Rusoro Mining from taking steps to close on impending purchase of the shares of PDV Holding," Rusoro told the court.
(Reporting by Marianna Parraga; Editing by Nathan Crooks, Alexandra Hudson)
