Barrick Gold (T.ABX) slapped with multi-billion dollar class action suit in Ontario

Gaalen Engen Gaalen Engen, Stockhouse.com
4 Comments| April 25, 2014


Barrick Gold (TSX:ABX, Stock Forum), a Toronto-based gold and copper producer engaged in exploration and mine development, was called to the carpet today with the launch of a multi-billion dollar class action suit commenced by Koskie Minsky LLP and Sutts, Strosberg LLP against the corporation and certain of its officers.

 

According to the news release, the claim was made on behalf of purchasers of Barrick securities from May 7, 2009 and November 1, 2013. Allegations state that the company's public disclosure misrepresented the progress and feasibility of its Pascua-Lama project located in Chile and Argentina.

 

A Chilean appeals court ordered Barrick to halt construction at the Pascua-Lama project citing environmental violations on April 10, 2013, after which the company announced an after-tax impairment charge of $4.5 to $5.5 billion and stated it was indefinitely suspending operations at Pascua-Lama. Investors are alleged to have lost billions of dollars as a result of the company's misrepresentation and failures to disclose.

 

Jay Strosberg of Sutts, Strosberg LLP commented, “Full, true and plain disclosure is the lifeblood of our capital markets and this action raises questions about Barrick's disclosure practices regarding its massive Pascua-Lama project.”

 

Kirk Baert of Koskie Minsky LLP added, “the plaintiff, on behalf of Barrick's investors, seeks an explanation and compensation for the significant losses he and other investors suffered as the challenges regarding the Pascua-Lama project have been revealed.”

 

Barrick Gold was in the news recently when the company announced it wanted the Newmont merger talks to resume.

 

Shares were up 1.40% on the news to $19.52 per share.

 

Currently there are 1.2b outstanding shares with a market cap of $22.7 billion.


Tags: GOLD

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Comments

QuitGold
Great news! Though this article misses the fact that 5 confidential witnesses from inside the company have testified in a similar case in the States, stating that they had insider knowledge that Barrick's Pascua Lama project would cost way more than Barrick was projecting, and that the head office knew about it. They also have evidence to show that Barrick was not meeting their environmental requirements. The lawfirm is Labaton Sucharow. Look it up!
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April 25, 2014
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JohnnyLingo
Canne, such a facile accusation ("first thing we do is kill all the lawyers" - Shakespeare). What about the fact that if the claim is legit, none of the investors could possibly afford to bring it themselves, even if several of them banded together (see Erin Brokovich, which is based on a true story). Or the fact that many class actions are not fully or even partially successful (check out recent press re: final conclusion of Bre-X class action where the lawyers had occumulated se...
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April 26, 2014
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canne
If the lawsuit is successful, the lawyers will get 1/3 of the proceeds - ahead of everyone else, then the remaining money will come out of the remaining shareholder's pockets. Who wins here ? guess..
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April 26, 2014
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JohnnyLingo
....where the lawyers had occumulated several million dollars worth of time and collected very little). How about a little criticism for the Walsh's / Felderhofs / Madoffs / etc., before throwing all the lawyers under the bus. One day you, too, might even want to sign up for a class action, if you haven't already....
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April 26, 2014
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