You are here
Silver class-action suits against Morgan, HSBC consolidated in New York
By Evan Weinberger
Law360.com, New York
Tuesday, February 8, 2011
http://www.law360.com/securities/articles/224556
A judicial panel on Tuesday consolidated class-action litigation alleging that JPMorgan Chase & Co. and HSBC Holdings PLC violated antitrust laws by manipulating the silver market and potentially reaped billions of dollars while keeping the price of silver artificially low.
The U.S. Judicial Panel on Multidistrict Litigation on Tuesday consolidated the seven class-action lawsuits pending against the two banks in the U.S. District Court for the Southern District of New York.
"A majority of the domestic defendants are located in that district, and thus many witnesses and discoverable documents are likely to be found there," the panel ruled. "In addition, a substantial majority of the constituent and potential tag-along actions are pending in that district (including the first-filed action)."
The MDL has been assigned to Judge Robert P. Patterson Jr.
... Dispatch continues below ...
Prophecy Resource Spins Off Platinum/Palladium Venture:
World-Class PGM Deposit in Yukon
Company Press Release, January 18, 2011
VANCOUVER, British Columbia -- Prophecy Resource Corp. (TSX-V:PCY)and Pacific Coast Nickel Corp. announce that they have agreed that PCNC will acquire Prophecy's Nickel PGM projects by issuing common shares to Prophecy.
PCNC will acquire the Wellgreen PGM Ni-Cu and Lynn Lake nickel projects in the Yukon Territory and Manitoba respectively by issuing up to 550 million common shares of PCNC to Prophecy. PCNC has 55.7 million shares outstanding.
Following the transaction:
-- Prophecy will own approximately 90 percent of PCNC.
-- PCNC will consolidate its share capital on a 10 old for one new basis.
-- Prophecy will change its name to Prophecy Coal Corp. and PCNC will be renamed Prophecy Platinum Corp.
-- Prophecy intends to distribute half of its PCNC shares to shareholders pro-rata in accordance with their holdings.
Based on the closing price of the common shares of PCNC on January 17, $0.195 per share, the gross value of the transaction is $107,250,000.
For the complete announcement, please visit:
http://prophecyresource.com/news_2011_jan18.php
According to the order, six of the seven cases pending against JPMorgan and HSBC were filed in the Southern District of New York, while the seventh is pending in the U.S. District Court for the Eastern District of New York. The panel found that consolidating the litigation would "eliminate duplicative discovery; prevent inconsistent pretrial rulings on class certification, discovery, and other pretrial issues; and conserve the resources of the parties, their counsel and the judiciary."
The suits were spurred in part by a statement in October by Commissioner Bart Chilton of the U.S. Commodities Futures Trading Commission saying there had been "repeated attempts to influence prices in the silver markets."
The CFTC has been investigating the silver market for two years, and Chilton said the "fraudulent efforts to persuade and deviously control" silver prices should be prosecuted.
The suits, which specifically allege violations of the Commodity Exchange Act and the Sherman Act, claim that the banks collaborated to suppress the price of silver futures and options contracts by amassing "enormous" short positions in Commodity Exchange Inc., or Comex, beginning June 1, 2008.
Many of the allegations in the suits come from information provided by a whistleblower who used to work in the London office of Goldman Sachs Group Inc., the suits say.
The whistleblower is not named in the complaints, but in testimony before the CFTC in March, Bill Murphy, chairman of the advocacy group the Gold Anti-trust Action Committee, said it was a metals trader in London named Andrew Maguire.
After Maguire went public in March, the defendants began to unwind their positions in Comex, the suits claim.
Since then, the net short position of silver futures that are held by commercial banks -- the vast majority of which are made up of JPMorgan and HSBC -- has dwindled by more than 30 percent, the suits say.
As that happened, the price of silver skyrocketed, reaching $24.95 an ounce in October, its highest level in 30 years, the suits contend.
JPMorgan and HSBC declined to comment on the suits.
Cleary Gottlieb Steen & Hamilton LLP is representing HSBC.
Counsel for JPMorgan was not immediately available.
The MDL is In re: Commodity Exchange Inc., Silver Futures and Options Trading Litigation, MDL number 2213, in the U.S. District Court for the Southern District of New York.
* * *
Join GATA here:
Phoenix Investment Conference and Silver Summit
Renaissance Glendale Hotel and Spa
Friday-Saturday, February 18-19, 2011
Glendale, Arizona
http://cambridgehouse3.com/conference-details/phoenix-investment-confere...
Support GATA by purchasing a colorful GATA T-shirt:
Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:
http://gata.org/node/wallstreetjournal
Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon:
Help keep GATA going
GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:
To contribute to GATA, please visit:
Sona Drills 85.4g Gold/Ton Over 4 Metres at Elizabeth Gold Deposit, Extending the Mineralization of the Southwest Vein on the Property
Company Press Release, October 27, 2010
VANCOUVER, British Columbia -- Sona Resources Corp. reports on five drillling holes in the third round of assay results from the recently completed drill program at its 100 percent-owned Elizabeth Gold Deposit Property in the Lillooet Mining District of southern British Columbia. Highlights from the diamond drilling include:
-- Hole E10-66 intersected 17.4g gold/ton over 1.54 metres.
-- Hole E10-67 intersected 96.4g gold/ton over 2.5 metres, including one assay interval of 383g of gold/ton over 0.5 metres.
-- Hole E10-69 intersected 85.4g gold/ton over 4.03 metres, including one assay interval of 230g gold/ton over 1 metre.
Four drill holes, E10-66 to E10-69, targeted the southwestern end of the Southwest Vein, and three of the holes have expanded the mineralized zone in that direction. The Southwest Vein gold mineralization has now been intersected over a strike length of 325 metres, with the deepest hole drilled less than 200 metres from surface.
"The assay results from the Southwest Zone quartz vein continue to be extremely positive," says John P. Thompson, Sona's president and CEO. "We are expanding the Southwest Vein, and this high-grade gold mineralization remains wide open down dip and along strike to the southwest."
For the company's full press release, please visit:
http://sonaresources.com/_resources/news/SONA_NR19_2010.pdf
