In a civil action filed in the supreme court of British Columbia, Core claims Piggott misappropriated US$64,000 (C$85,300) of corporate funds for his own use and, without board authority, in 2018 borrowed $1.96 million (C$2.61 million) in Ecuador at annual interest rates of between 26.06% and 30.06%, which were far higher than prevailing market rates.
Consequently, Core Gold alleged it had suffered direct financial loss.
The company further accused Piggott of making libellous statements against the board, implying the directors, other than himself, were dishonest, corrupt and acted contrary to the best interests of the company.
Piggott, who owns about 7% of Core Gold, vehemently opposed the recently approved takeover by Australia's Titan Minerals in an all-scrip deal valued at C$72 million.
"Piggott's statements are false. The lawsuit seeks to recover damages, including punitive damages, in an amount to be assessed by the court," the company said.
Piggott was terminated for cause as CEO in March. He had never challenged his termination.
Piggott has not stated whether he intends to defend the lawsuit or not.
Meanwhile, Titan announced on Wednesday that it too had retained Canadian and Australian litigation counsel to consider all legal options available against Piggott regarding his misleading statements.