A Not So Happy Valentine’s Day for the Pebble Mine
Published by the Natural Resources Defense Fund
What’s worse than being dumped on Valentine’s Day? Being sued by your ex the day after.
That’s exactly what happened to Northern Dynasty Minerals—the company behind the proposed Pebble Mine in Bristol Bay, Alaska. One day after an investment report called the company “worthless,” they’ve now been sued based on alleged false and misleading statements in violation of federal securities laws.
Photo credit: Robert Glenn Ketchum
Northern Dynasty Minerals’ executives awoke Valentine’s Day morning to the worst possible gift: a scathing report issued by a private New York-based investment firm. “We believe Northern Dynasty is worthless,” Kerrisdale Capital Management said in its report.
“The Pebble deposit is not commercially viable,” the Kerrisdale report said. “Mining it would require so much upfront investment that it would actually destroy value.”
The report also accused the company of concealing information from the investing public that the Pebble project has a negative present value. “In the past decade, Northern Dynasty has hired at least two major engineering firms to prepare preliminary feasibility studies of Pebble laying out its economics in detail, yet it has failed to publish their findings—because they were damning,” the report said.
Investors immediately began dumping Northern Dynasty stock, which plunged up to 40 percent on Valentine’s Day.
Citing the Kerrisdale report, three securities law firms—Levi & Korsinski, The Rosen Law Firm, and Bronstein, Gewirttz & Grossman—announced plans to initiate investigations in anticipation of possible class action litigation against Northern Dynasty on behalf of its shareholders.
The next day, the Rosen Law Firm filed a securities class action lawsuit against Northern Dynasty. Bronstein, Gewirttz & Grossman, The Pawar Law Group, and Kirby McInerney LLP have also announced class action litigation.
The complaint, filed in in the United States District Court for the Central District of California, alleges that Northern Dynasty made false and/or misleading statements and/or failed to disclose that: (1) Northern Dynasty’s Pebble project is commercially unviable; (2) Northern Dynasty’s Pebble project had a negative present value; and (3) consequently, Defendants’ statements about Northern Dynasty’s business, operations and prospects were materially false and misleading and/or lacked a reasonable bases at all relevant times.
Photo credit: Robert Glenn Ketchum
The Pebble Mine has long been opposed by Alaska Natives, commercial fishermen, sportsmen, environmentalists, chefs, jewelers, and faith based groups because of its threat to Bristol Bay’s greatest treasure: salmon. Because of its size and location, the 10 billion (yes, billion) tons of contaminated waste generated by the Pebble Mine would threaten Bristol Bay’s famed salmon runs—and the $1.5 billion annual commercial fishery, 14,000 jobs, and subsistence-based indigenous cultures that depend on the salmon.
Ultimately, though, it may be Northern Dynasty’s own disgruntled investors—and their lawyers—who will break Pebble. Or at least who broke Pebble’s heart on Valentine’s Day.
Read the full article at: https://www.nrdc.org/experts/taryn-kiekow-heimer/not-happy-valentines-day-pebble-mine
