A Canadian mining company backing the proposed Pebble mine project in southwest Alaska has reached a $6.4 million settlement with disgruntled investors who claimed in federal court in New York that they were misled by the company regarding the size and scope of the mine project.
Plaintiffs in the case, including Neil Darish, an owner of the McCarthy Lodge in the Copper River census area, contend that the company made false and misleading statements about the size, scope and duration of the project.
The original complaint was filed in the U.S. District Court for the Eastern District of New York.
The lawsuit named as defendants Northern Dynasty Minerals president and chief executive officer Ron Thiessen; former Northern Dynasty CEO Tom Collier; chief financial officer Mark Peters; and former chief financial officer Marchand Synman.
This past January the court denied a defense motion to dismiss the lawsuit. Then on June 7, a settlement was reached and approved by the court, which noted that the settlement provided a guaranteed, immediate recovery for Northern Dynasty investors.
Adam Chodos, executive vice president of corporate development for Northern Dynasty, said in a statement on behalf of investor relations vice president Mike Westerlund that Northern Dynasty firmly believes that the notion of a “secret mine plan” is baseless and that the company denies any wrongdoing alleged by plaintiffs.
Chodos said the company is confident that it would have prevailed at trial on the merits, once the full context and facts underlying the permitting process would show the allegations to be without merit.
“Nonetheless,” said Chodos, “This settlement brings to an end what would have been a costly and protracted legal process, with the settlement amount representing a fraction of the expected costs of litigation to bring this case to verdict.”
He added that the settlement amount is entirely within Northern Dynasty’s insurance policy limits and that the company does not anticipate corporate funds will be used for the settlement.
The legal fight over construction of the copper, gold and molybdenum mine near the headwaters of Bristol Bay in Southwest Alaska has been going on for over two decades, with proponents hailing the potential economic boost to the region and the state, including jobs during the construction phase, as well as once the project was up and running.
Opponents, including commercial and sport fishing groups and several major environmental entities, contend that development and operation of the mine would cause significant environmental damage to the watershed, home of the world’s largest run of millions of wild sockeye salmon.
The commercial and sport fisheries have for years contributed millions of dollars to the regional and state economy. Wildlife in the area also depend on these fish for sustenance.
The Environmental Protection Agency (EPA) announced its decision in January to issue 404(c) Clean Water Act protections that vetoed the Pebble mine, due to adverse risks the project posed to the watershed and surrounding ecosystem.
Commercial fishermen, tribes and conservation groups said they were looking forward to the first Bristol Bay fishing season in two decades without the threat of the Pebble mine, according to the Bristol Bay Defense Fund (BBDF).
The EPA order itself was celebrated in a spring event at the White House with President Biden and other members of his administration in attendance. Biden himself said that “The amazing thing about resources like this: if you take care of it, it can go on forever…. Once a resource like this is harmed or destroyed, it may be impossible to bring it back.”
The BBDF, upon learning of Northern Dynasty Minerals’ settlement with investors, said the settlement strongly indicated that the Vancouver, British Columbia-based mining firm was not telling the truth about the size and duration of the proposed project in its permitting mine plan. That had resulted, the BBDF said, in the U.S. Army Corps of Engineers conducting an environmental review of a mine one-tenth the size of the project the company actually intended to build and operate.
In a statement issued on Monday the BBDF said: “This settlement demonstrates yet again how untrustworthy Northern Dynasty Minerals is and always will be. Not only did they mislead investors, they lied to the people of Bristol Bay, and since they aren’t using any corporate funds for this settlement, the Biden administration should order them to remediate the parts of the watershed they damaged and left behind polluted for the community to clean up.”
The BBDF contends that Northern Dynasty acted without regard for tribes, commercial and sport fish harvesters or members of the Bristol Bay community, who would be the most impacted by “their reckless and devious mining proposal.”
