Investors keep gold lawsuit alive in federal court
Friday, July 22, 2005 9:27 AM CDT
By LISA BOSE McDERMOTT
Texarkana Gazette
texarkanagazette.com
An old gold lawsuit is still alive although it's sputtering through federal court here.
Lawyers for investors of Bre-X are still hoping to recoup money they lost after investing in a company that boasted finding the largest gold mine in the world.
Bre-X stock dropped 83 percent and was eventually pulled from American and Canadian financial markets. This action followed an announcement by New Orleans-based Freeport-McMoRan Copper & Gold Inc., revealing that there were insignificant amounts of gold found in the Busang area of Indonesia where Bre-X executives claimed to be mining the largest gold reserve ever.
In Texarkana, Texas, federal court, Bre-X shareholders struck back at the Canadian gold company and a dozen others when they realized their stock, once worth $4 billion on four Canadian and American stock markets, was now worthless.
On Monday, the stockholders' lawyers told U.S. District Judge David Folsom they could be prepared for a 2006 trial date, according to the minutes of the hearing.
The lawsuit was filed in such a manner that it could be presented as a class action lawsuit. However, Folsom denied class certification on March 21, 2003. There was a problem with one of the fraud claims. It was drafted so that Folsom was not sure if it could meet legal scrutiny.
But at Monday's hearing, Paul Yetter and Damon Young, who represent the stock owners with Paul Miller, told Folsom that they would amend the lawsuit within 30 days. The lawyers defending the company and its executives did not object to the filing of a new court date.
The lawsuit is on behalf of people who held Bre-X stock on the NASDAQ exchange from Aug. 19, 1996, to March, 27, 1997.
"Plaintiffs allege that they and other members of the class purchased Bre-X common stock on the NASDAQ at artificially inflated prices during the period when defendants were disseminating false and misleading statements. The artificial price inflation affected all class members," according to court papers.
Bre-X and the other companies named in the lawsuit are now bound to respond to the shareholders' request for class certification.
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The legal team
brexclass.com
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COURT SETS SEPTEMBER 29 HEARING
brexclass.com
On September 29, a hearing will be held for the purpose of considering Plaintiffs’ Trial and Case Management Plan. At the time of the hearing, both plaintiffs and defendants will be allowed twenty minutes to present their arguments.
Plaintiffs filed their trial plan to provide a detailed plan for managing the conduct of the litigation and to show that all requirements of class certification are satisfied. In particular, the trial plan provides a road map for bringing the claims of both classes in this case to trial as soon as practicable, including both the NASDAQ class, which consists of U.S. purchasers of Bre-X Minerals Ltd. common stock who acquired their shares on the NASDAQ exchange during the period August 19, 1996 through March 26, 1997; and the Canadian Exchange class, which consists of U.S. purchasers of Bre-X and/or Bresea Resources Ltd. common stock who acquired their shares on a Canadian exchange during the period January 17, 1994 through March 26, 1997.
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