A securities class action settlement proposed for a lawsuit involving Silvercorp Metals, Inc., recently obtained preliminary approval.
Silvercorp Metals is a Canada-based mining firm. The company is a low-cost producer with several mines in China. It focuses on enhancing shareholder value by purchasing projects that could possibly enjoy organic growth. SilverCorp Metals has been paying a cash dividend since 2007.
Class action settlement hearing
On Dec. 3, 2014, lead counsel for plaintiffs Matthew Tuccillo, Esq, of Pomerantz LLP, provided notification about an upcoming hearing for the proposed settlement.
Tucillo is taking lead for Pomerantz on several securities fraud class action lawsuits in the U.S., including the one brought forth against Silvercorp Metals, Inc., which has the docket number 1:12-cv-09456 in the U.S. District Court for the Southern District of New York.
He announced pursuant to Rule 23 of the Federal Rules of Civil Procedure and an Order of the U.S. District Court for the Southern District of New York that a hearing would be held on Feb. 9, 2015, before the Honorable Jed Rakoff, U.S. District Judge.
The lead counsel notified potential investors that their rights could be impacted if they either bought or came to own the company’s common stock between May 20, 2009, and Sept. 13, 2011, on the New York Stock Exchange. These dates are inclusive, and represent the settlement class period.
The announcement revealed that all current officers and directors, as well as those who held this role during the settlement class period, are not contained within the class. In addition, defendants, as well as any company, family member, entity, trust of affiliate owned or controlled by any of the aforementioned, are also excluded.
The lead counsel for plaintiffs indicated that the hearing would determine, among other things, whether the court should approve the proposed settlement amount of $14 million as reasonable, fair and adequate, and whether it should approve the plan of allocation as fair and reasonable.
Key court determinations
The court also planned to review whether the securities class action should be dismissed with prejudice, as specified in the stipulation filed with the court. In addition, the hearing planned to determine if the legal entity should approve the lead counsel’s application for attorney’s fees and expenses, request to be remunerated for expenses and application for an incentive award.
Members of the settlement class interested in obtaining a share of any proceeds stemming from the settlement have until Feb. 4, 2015, to send in a proof of claim to establish that they are entitled to recovery. In addition, eligible investors have until Jan. 19, 2015, to supply any objection they have to the proposed settlement, attorney’s fees and plan of allocation. Any such objection must be filed and served before the aforementioned date.
In addition, members that do not want to be bound by whatever judgment comes from the securities class action have until Jan. 19, 2015, to exclude themselves by following the steps outlined in the notice.
Finally, individuals who bought the company’s common shares during the settlement class period but lack the key documents including the Proof of Claim and Release Form and the Notice of Proposed Settlement of Class Action can contact the Settlement Administrator to obtain them.