Silver-gold producer Hecla Mining Co. and its President and CEO Phillips Baker has been found in violation of the "bad actor" law by the state of Montana, after his previous employer, Pegasus Gold Corp., left the state with a huge bill for pollution cleanups, The Associated Press reported March 20.

Montana's department of environmental quality director, Tom Livers, said the Idaho-based company will need to return over US$30 million to resolve the situation.

If Hecla, which is developing two mines in the state, fails to resolve the violations, its could have its mining permits and licenses suspended.

The "bad actor" law bars companies and individuals from starting new mines if they don't clean up the old ones. However, Hecla Vice President Luke Russell said that the company had no relation to Pegasus, and the state is not understanding the law correctly.

Pegasus operated three mines in Montana that polluted waterways and went bankrupt in 1998. The company plans to challenge the charges in court.

Hecla recently entered a deal to acquire all of the outstanding shares of junior gold-silver miner Klondex Mines Ltd. for US$462 million in cash and shares.