Ecometals Limited Litigation Update
November 23, 2011 at 12:28 PM EST
TORONTO, ONTARIO--(Marketwire - Nov. 23, 2011) - Ecometals Limited (TSX VENTURE:EC)(BERLIN:GDQ)(FRANKFURT:GDQ)
Ecometals Limited (the "Company") is providing information on the status of certain litigation between the Company and Alto Tocantins Mineracao Ltda. ("ATML"), Tocantines Mineracao SA ("TMSA"), and Industria e Comerico de Minerios ("ICOMI") in Brazil.
The Company believes that the actions launched by this group of companies are frivolous and devoid of any merit and the Company is defending them vigorously.
Case Number 0028592-47.2010.8.03.0001
This is a claim by ATML and TMSA, as plaintiffs, against the Company and Ecometals Ferro de Amapa Ltda ("EFAL"), a subsidiary of the Company, as defendants, dated August 12, 2010 pursuant to which the plaintiffs have sought to rescind a joint venture agreement dated December 2007 (the "Matapi JVA") between them relating to the Matapi iron prospects. The plaintiffs seek to be indemnified for alleged losses and damages and moral damages and injunctive relief to prevent the Company and EFAL from exploring the Matapi property. The amount claimed is R$28,080,000 (approximately Cdn$16,227,000), which amount the Company believes to be grossly disproportionate to the value of the Matapi iron prospects. The Matapi JVA calls for disputes to be arbitrated in the United Kingdom and the lower court in the State of Amapa has refused jurisdiction. This decision was confirmed on April 04, 2011 by a unanimous panel of judges upon appeal to the State Court of Appeals of the State of Amapa. Subsequent to this on or about November 03, 2011, the plaintiffs sought an extraordinary appeal which has not yet been admitted by the State Court of Appeals.
Case Number 0028558-72.2010.8.03.0001
This is a claim by ATML and ICOMI, as plaintiffs, against the Company and Ecometals Manganes do Amapa Ltda. ("EMAL"), a subsidiary of the Company, as defendants, dated August 12, 2010, pursuant to which the plaintiffs have sought to rescind a separate joint venture agreement dated December 22, 2007 (the "SdN JVA") between them relating to the Serra do Navio manganese project. The plaintiffs seek to be indemnified for alleged losses and damages and moral damages and injunctive relief to prevent the Company and EMAL from exploring the SdN property. The amount claimed is R$11,446,200 (approximately Cdn$6,615,000). The SdN JVA calls for disputes to be arbitrated in the United Kingdom and the Company has sought to have this arbitration clause enforced. Although the lower court in the State of Amapa initially accepted jurisdiction, the Company successfully appealed this decision to the State Court of Appeals of the State of Amapa which determined on September 01, 2011 that the matter should be arbitrated in the United Kingdom. Subsequent to this on or about October 28, 2011, the plaintiffs sought an extraordinary appeal to the State Court of Appeals but the Company is unaware as to whether or not such appeal has been admitted. In the meantime, on September 01, 2011, the State Court of Appeals stayed the proceedings on the merits until the appeal can be heard.
In the interim, in a separate proceeding, the Company obtained on September 15, 2011 an injunction against ATML and ICOMI to remove them from the Serra do Navio project as illegal trespassers.
Based on the facts of these two cases and its understanding of the state of law in question, including that based on advice from local legal counsel, the Company believes that the outcome of both of these lawsuits will be favourable.
Ecometals Limited is a Canadian TSX Venture Exchange listed mineral exploration and development company focused on mineral resources in Latin America. Apart from its gold exploration in Ecuador, Ecometals also has significant manganese, iron and gold projects in Brazil at grass roots and development planning stages.
Forward Looking Information:
This press release contains certain "forward-looking information". All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements relating to the expected outcome of the legal actions discussed herein) are forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the Company based on information currently available to the Company as well as certain assumptions, including without limitation, the nature and scope of the legal actions discussed herein, the costs and prospects associated with such legal actions and the effects of such litigation on the Company's execution of its business strategy. Forward-looking statements are subject to a number of significant risks and uncertainties and other factors that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on the Company. Factors that could cause actual results or events to differ materially from current expectations include, but are not limited to the failure to conclude the legal actions discussed in a timely manner and in favour of, or on favourable terms for, the Company.
Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guaranteed of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.