MOSCOW, August 26 (RAPSI) - Khan Resources Inc. (Khan) has decided not to appeal to the Supreme Court of Canada a lower-court decision to dismiss its efforts to validate, substitute, or dispense with service of its claim against Russian uranium producer Atomredmetzoloto (ARMZ), according to a statement released by Khan Friday.

According to the lower-court decision, which was rendered by the Court of Appeal for Ontario in April, Khan had sought to initiate proceedings against ARMZ in Canada, claiming that they had endeavored to serve ARMZ with process, but the Russian government had refused service.

Rather than appealing in Russia, Kahn had moved to dispense with or validate service in a Canadian court. Initially the motion was allowed, but the Superior Court then set aside the order allowing it. Kahn then turned to the Court of Appeal, hoping it would set aside the Superior Court's decision. 

The Court of Appeals then agreed that the Superior Court had held correctly. 

In its statement Friday, Khan explained: "On April 2, 2013 the Court of Appeal for Ontario dismissed Khan's appeal to validate, substitute or dispense with service of Khan's Statement of Claim against ARMZ, its Russian partner in Mongolia. ARMZ had avoided service of the Statement of Claim as the Russian Ministry of Justice had invoked Section 13 of the Hague Convention which allowed Russia to refuse to serve ARMZ as a matter of Russian sovereignty or security. Khan has decided not to appeal this decision to the Supreme Court of Canada."

Meanwhile, Khan's arbitration against the Mongolian government remains underway. 

According to that claim, "A submission on the merits and damages arising from the Mongolian Governments expropriatory and unlawful treatment of Khan was filed with an International Arbitration Tribunal by the Company on December 7, 2012."

A formal hearing is set for the case from November 11 through 15.

According to its website, Khan and its prececessors have been active in the development of Mongolia's Dornod uranium property since 1995. The website claims, "in 2010, the Government of Mongolia refused to reissue to Khan the required licenses for the Dornod property which effectively resulted in 100% expropriation of the asset without any compensation. As a result of these actions, Khan has launched a US$326 million international arbitration action against Mongolia for the illegal expropriation of its asset in January, 2011. The international arbitration action is currently in process. Khan is well funded and will continue with this legal action to recover value for its shareholders from this illegal expropriation."