Vancouver-based precious metals producer Eastern Platinum (TSX:ELR) will fight a proposed class action suit filed against it earlier this week.
On Tuesday, Siskinds LLP, a London, Ontario-based firm, filed a suit in the Superior Court of Ontario that alleges Eastern failed to disclose “material information” about an interruption of operations at its Crocodile River mine in January.
The suit also names three of Eastern’s directors and officers as defendants, though neither the company nor Siskinds has divulged the names of the executives.
Siskinds said the suit has been brought on behalf of all persons who bought shares of the company between January 1 and April 15.
The company said it has yet to be served with any court documents, and is “of the view that the allegations are completely without merit.”
In May, Eastern reported that workers at Crocodile River had unlawfully occupied the mine and sabotaged underground electrical and pumping equipment. (See “Unrest, sabotage plague Eastern Platinum’s South African mine” – BIV Business Today, May 12.) The unrest happened amid wage negotiations.
Crocodile River is the company’s only mine and is in South Africa’s Bushveld Complex, one of the world’s most sought after reserves of platinum group metals.
At press time, the company’s shares were down $0.03 to $0.80.
Eastern stock has lost 58% of its value this year, wiping out $1 billion in market value.
Joel McKay
Twitter:jmckaybiv