Ron Barlas, accused by the Łútsël K’é Dene First Nation of taking millions of dollars through “blatant self-dealing,” is entering mediation with his accusers.
This month, an independent mediator jointly selected by the parties involved will help them to reach some form of conclusion – rather than proceeding with an NWT Supreme Court civil case.
If mediation fails, the Supreme Court case is expected to continue in March.
In April last year, the First Nation and Chief James Marlowe accused Barlas of misappropriating up to $14 million while he was president and chief executive of Denesoline Corporation, the First Nation’s business wing.
An NWT Supreme Court judge subsequently stripped Barlas of control over Denesoline.
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Barlas maintains he did not illegally enhance his position by moving some revenue intended for Denesoline into companies only he and his wife controlled, as is alleged. He denies an allegation that he manipulated some corporations’ governance to protect his position and prevent independent oversight of what was happening.
Late last year, the First Nation took steps to prepare a related action against a law firm, Reynolds Mirth Richards & Farmer, seeking up to $22.5 million in compensation and punitive damages for what LKDFN says was a years-long pattern of the firm “aiding and abetting” Barlas in actions that harmed the First Nation’s members.
Reynolds Mirth Richards & Farmer formerly represented Denesoline. The CBC first reported the claim against the firm, which has said through counsel of its own that the allegations against it are “devoid of merit and are designed to discredit and embarrass.”
Court documents from December show that lawyers representing Reynolds Mirth Richards & Farmer requested a postponement of proceedings “pending a mediation which is scheduled for January 2024.”
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Larry Innes, a lawyer representing the Łútsël K’é Dene First Nation, confirmed to Cabin Radio on Tuesday that mediation is scheduled to go ahead this month.
“All of this happens out of court between the parties,” said Innes, “and we have [court] dates set for March if mediation, of course, doesn’t reach a settlement. But that’s about all I can say on the matter at this point.”
Łútsël K’é, a fly-in community east of Yellowknife on the East Arm of Great Slave Lake, has a population of around 350 people. The case is extraordinary for the sum of money allegedly involved, given the community’s size.
Counsel for Barlas could not be reached by phone on Tuesday. Counsel for Reynolds Mirth Richards & Farmer has been approached for comment.
