As I had posted earlier, this short position is irrelavent... it's only 0.3% of the total shares outstanding. This is just noise.
Also, if you read Jim Sinclair, he has been saying that recently the hedge funds have been going long gold/silver and are shorting the miners. This could be because they are betting on the tax loss selling when people sell stuff blindly. However, this is dangerous in AUN's case, as people will sell other junk and get into quality miners like AUN.