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Mr. Gibson testified that you called him up on the telephone and instructed him not to mention the claims staking in Utah. Did you do that, and if you did, why did you do it?

Mr. SCHAUSS. That is not true. I will explain that—the investigators were talking to me and they were asking me about Mr. Gibson, and if I knew what town he lived in. I did not know. I told them I didn't know what town he lived in and they implied that they were going to try and get in touch with him.

Mr. Gibson is very, very leary of anything connected with government in any way, shape, or form, and rightfully he should be.

Mr. GORE. Did you call him up?

Mr. SCHAUSS. Yes, I called him, and I told him that he would probably be expecting some people who had been seeing me, and that they would come and talk to him about the properties out there and what work had been done.

My final admonishment to him was this. “Gib, it has been 6 or 7 years.” He was asking me some things he said he could not remember.

Mr. GORE. How many calls did you make?
Mr. SCHAUSS. I made several calls to him.

He asked me about some things that he could not remember. I said “Well, Gib, if you cannot remember, then you cannot remember.

But I said “Whatever you do, do not lie to them and do not mislead them.”

I said that because first of all, I could not supervise him and he could not and did not supervise all of the yahoos working for him. I said

For you to say that each and every post was put in, and each and every hole was drilled—it would be wrong to testify to that. I said You cannot say that definitely.

Mr. GORE. You said “You could do it, but it would be wrong"? Mr. SCHAUSS. I told him not to tell them that he did.

If you will call Mr. Gibson back, I think he will also bring that point out—that I told him to tell the truth.

Mr. GORE. I think his earlier testimony reflected that fact. I agree with that statement. Did you tell him not to mention the claims in Utah?

Mr. SCHAUSS. No. That is a misunderstanding. We were talking about Utah, and I said “Well, they apparently didn't seem to be interested in our work and activities down in Utah, and they did not get into that area.

I said “I don't know what it is all about, and I said they wouldn't tell me.”

But I did not tell him not to specifically mention the thing in Utah because that is a different staking area. It only requires four posts and no validation. He staked that for me also under contract down there and signed on the back of one of the checks that they had been staked and located properly.

Since that time—and there were a number of claims staked down there, I have dropped nearly all of the claims because the drilling that I did did not prove the geologic concept that I had, and I dropped the whole bunch.

Mr. GORE. In your dealings with Mr. Gibson, have you known him to be a truthful person?

Mr. GORE. He appears to be truthful to me.
Mr. SCHAUSS. He is misleading.
Mr. LUKEN. When did you decide he was not a truthful person?

Mr. SCHAUSS. When did I decide that he was not a truthful person?

Mr. LUKEN. Yes. When did you decide that he was not a truthful person?

Mr. SCHAUSS. I don't think it was at any particular moment. It was a feeling that I would get over a period of time. How do you define a truthful person?

Mr. LUKEN. When was he last in your employ?

Mr. SCHAUSS. Mr. Gibson and I got involved in a lawsuit. There was a lot of bitter words between us. He sued me.

Mr. LUKEN. Did you understand the question? When was he last in your employ?

Mr. SCHAUSS. Probably about 1975.

Mr. LUKEN. Did you know before he left your employ that he was not a truthful person?

Mr. SCHAUSS. When it finally dawned on me was when I had to go back to the town he was working in-in Utah-and I had to pay many thousand of dollars worth of bills that he was supposed to have paid and had not paid.

Mr. LUKEN. When was that?

Mr. SCHAUSS. That would have been in 1975. That is when I was really upset.

Mr. LUKEN. Before or after he had left your employ?
Mr. SCHAUSS. It would have been afterward, I would say.
Mr. LUKEN. Did he leave voluntarily?

Mr. SCHAUSS. I told him that the project was finished. All the drilling had been done down there, and it had not looked very fruitful and it didn't look like there would be very much work or areas to stake. In fact, I was going to drop large areas of ground. We just kind of terminated it that way.

Then, later on, I found that there were a lot of bills left unpaid.

I am sure he has an explanation, but I sent expense checks down to him to pay them. In fact, I kept him down there quite a long time after the job was done.

Another thing was the Bureau of Land Management. The last time I was down there was this spring. I was down there with the Bureau of Land Management. They were very interested in looking for water. I took them out and showed them several hundred holes that had water in them. We logged the holes and made notes of them, and I showed them where they were. That was because of the drought situation. They were planning on maybe putting windmills on them.

In his reports over the phone to me he told me that he had plugged the holes. Here was the Bureau of Land Management jumping on me because the holes were not plugged,

I said, “Look, I was told that the man was down here for a month or so and he told me that he plugged the holes. In fact, he sent me a bill for materials to plug the holes.” But I said, "They are not plugged. I can see it. It is obvious.”

Mr. LUKEN. Mr. Wunder?

Mr. WUNDER. Thank you, Mr. Chairman.

Mr. Schauss, let me ask you about the Mexicans. Did you know that Mr. Gibson had employed illegal Mexican aliens to work on his crew?

Mr. SCHAUSS. Yes, at one time I became aware of that.
Mr. WUNDER. When did you become aware of this?

Mr. SCHAUSS. A fellow showed up there with the crews. He showed up with two Indian squaws and a couple of cases of beer, and they went on a drunk for 2 days. Nothing was getting done and I got mad, and I told Gib that I was upset so he said he was going to try and get some other guys to do it. Several weeks later I came out there and I lived in the trailer house with him. There were these Mexicans. I asked him about them. I started talking with them. They didn't talk my language.

I could not understand them and none of them would talk American. I asked Gib where he got them and he said "Well, I picked them up around Casper through some other Mexicans." He said "I think some of them are 'wetbacks'", or something like that. I asked how they were, and he said “They work hard and they get the job done, and they do what they are told. For the most part, a lot of things they do not understand about what you're doing so you have to tell them a lot. I have an interpreter here who helps me”.

That's the way I found out.
Mr. WUNDER. Wasn't Mr. Gibson an employee of yours?

Mr. SCHAUSS. He was working under a contract. In fact, we had a hassle with the Unemployment Commission over this.

Mr. WUNDER. Was he an independent contractor?

Mr. SCHAUSS. They determined he was an independent contractor.

Mr. WUNDER. Who made the determination?
Mr. SCHAUSS. The unemployment division.
Mr. WUNDER. For which State?
Mr. SCHAUSS. Wyoming.

Mr. WUNDER. There was a dispute as to whether he was an independent contractor?

Mr. SCHAUSS. He had put in for unemployment compensation. Mr. WUNDER. And claimed that he was one of the employees?

Mr. SCHAUSS. He claimed that he was part employee, and I went back and showed them and gave them the facts on the thing. They determined that he was not.

Mr. WUNDER. Did you have a written contract with Mr. Gibson? Mr. SCHAUSS. Yes.

Mr. WUNDER. Did this written contract specify what precisely Mr. Gibson was required to do to fulfill that contract?

Mr. SCHAUSS. Yes. The best I can recall on the thing is this. I have not seen the contract for a long time. It was a handwritten contract. In fact, he had all the members of the crew sign the thing because they were at one time to get paid so much per post for putting them in, and so much for drilling the validation holes and stuff like that.

Mr. WUNDER. Do you still have that contract?
Mr. SCHAUSS. I do not know.

Mr. WUNDER. Mr. Chairman, could we hold the record open at this juncture for the purpose of asking Mr. Schauss to submit to us the contract that he entered into with Mr. Gibson for the record?

Mr. LUKEN. Without objection, the record will be open at this point for that purpose.

[The following document was received for the record:]

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