- Novagold (NG) has filed a lawsuit against J Capital Research following the publication of a purported short and distort report
- The report, published on May 28, alleged that Novagold’s management consistently misled investors regarding its Donlin gold project in Alaska
- Novagold then responded to what it called clearly disingenuous statements in an extensive release on June 8
- The company has now launched a civil action lawsuit for defamation in the United States District Court for the Eastern District of New York
- Novagold (NG) is currently up 3.21 per cent and is trading at C$12.86 per share
Novagold (NG) has filed a lawsuit against J Capital Research following the publication of a purported short and distort report.
The report, published on May 28, alleged that the company’s management had consistently misled investors regarding its Donlin gold project in Alaska.
Novagold’s proposed natural gas pipeline, which would power the project, was also scrutinised, citing the inhospitable terrain.
J Capital Research claimed to have spoken with an engineer who worked on costing the project that didn’t know of any engineering company with the experience to build such a complex pipeline.
The focus of the report then shifted to the company’s management, referring to Novagold’s silver-tongued CEO who it claimed was already preparing the ground for the inevitable pipeline failure.
On June 8, Novagold’s Chairman, Thomas Kaplan, published a lengthy rebuttal saying the hit piece was clearly so fallacious that he initially assumed it had been written by a child.
“With little experience in dealing with nefarious actors, we chose the path familiar to us: we would ignore the defamatory aspects of the piece and tackle the challenge as if it were a traditional shareholder enquiry,” he said.
Now, however, the situation has escalated with the filing of a civil action lawsuit for defamation in the United States District Court for the Eastern District of New York.
The decision to take legal action reportedly follows a unanimous vote by Novagold’s Board of Directors to aggressively pursue redress for the company and its stakeholders.
These proceedings will be overseen by a special committee in consultation with Baker Botts LLP, an international law firm based in Texas.
Novagold (NG) is currently up 3.21 per cent and is trading at C$12.86 per share at 10:55am EDT.