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After mechanical failures at Barrick Gold’s Veladero Mine resulting in the release of toxic cyanide solution, the Defendant released statements alleging that it rectified the mechanical problems and affirmed its quarterly and annual guidance production and cost numbers. This securities class action pertains to those documents released by the Defendant, which are alleged to contain misrepresentations because:
(i) they omitted to disclose the material fact that the Defendant did not complete all the Court-ordered remedial work on its leaching operating systems at the Veladero Mine, thereby exposing investors to additional avoidable risks including that the mine could suffer another cyanide spill or that operations at the mine would be suspended for non-compliance with the Court’s orders; and
(ii) after the March 2017 cyanide solution accident, its previously released guidance in respect of gold production, which was reaffirmed on April 6, 2017 despite the mine being restricted from using cyanide at that time, was not reasonably attainable.
On April 24, 2017, the Defendant commenced a process of releasing corrective disclosures that:
(i) revealed those previously ordered corrective measures were, in fact, not completed prior to the Class Period; and
(ii) reduced its guidance on its previously released gold production numbers while raising forecasted costs of production, despite previously confirming it as recently as April 6, 2017.
Immediately after the release of the corrective disclosures, the price of the Defendant’s equity securities on the TSX dropped by approximately 11%.
On August 19, 2019, The Honourable Justice Perell of the Ontario Superior Court of Justice approved a dismissal of this action pursuant to section 29 of the Ontario Securities Act. A copy of Justice Perell’s Order dismissing the action can be found here, and a copy of the Court-approved Notice outlining the facts relating to the dismissal can be found here.
Class or Motion for Authorization issued: July 24, 2018
Class Period: February 15, 2017 to April 24, 2017, inclusive
Leave to Proceed Record Served: On or before March 1, 2019
Shareholders’ Counsel: Andrew Morganti, Morganti & Co.
Corporate Defendants’ Counsel: Davies Ward Phillips & Vineberg LLP