Industrial Metals

SouthGobi Resources (TSX:SGQ) provided an update on class action proceedings in Ontario, reporting the interim decision of the Ontario Superior Court of Justice deciding two preliminary motions in the proceedings.

SouthGobi Resources (TSX:SGQ) provided an update on class action proceedings in Ontario, reporting the interim decision of the Ontario Superior Court of Justice deciding two preliminary motions in the proceedings.
As quoted in the press release:

On or about January 6, 2014, Siskinds LLP, a Canadian law firm, filed the Action against the Company, certain of its former senior officers and former and current directors, and its former auditors, Deloitte LLP, in the Court in relation to the Restatement.
To commence and proceed with the Action, the plaintiff was required to bring preliminary motions to seek leave to commence the Action under the Securities Act (the “Leave Motion”) and to certify the Action as a class proceeding (the “Certification Motion”). The Court rendered its decision on the Leave Motion on November 5, 2015.
The Court dismissed the plaintiff’s Leave Motion as against each of the former senior officers and former and current directors of SouthGobi named in the Action on the basis that the “large volume of compelling evidence” proved the defence of reasonable investigation on the balance of probabilities and provided the basis for dismissing the Leave Motion as against them.
The Court granted the preliminary Leave Motion against SouthGobi on the basis that, at this stage, the plaintiff met the low legal standard of “reasonable possibility of success.” In granting leave, however, the Court acknowledged the “… compelling evidence of the defendant company … that may prevail at trial …” The Court refused an award of costs for both the Leave and Certification Motions to the plaintiff.
The Company firmly believes that it has a strong defence on the merits and will continue to vigorously defend itself against the Action through independent Canadian litigation counsel retained by the Company for this purpose.

Click here for the full press release.

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