SAN DIEGO and RENO, Nev., April 10, 2014 /PRNewswire/ -- Shareholder rights law firm Robbins Arroyo LLP announces that an investor of Allied Nevada Gold Corp. (NYSE: ANV) has filed a federal securities fraud class action complaint in the U.S. District Court for the District of Nevada. The complaint alleges that the company and certain of its officers and directors violated the Securities and Exchange Act of 1934 between January 18, 2013 and August 5, 2013 (the "Class Period"). Allied Nevada is engaged in the mining, development, and exploration of properties in Nevada for the production of unrefined gold and silver bars.
Allied Nevada Accused of Failing to Disclose Operating Defects and Production Deficiencies
According to the complaint, in a two-day period, shares of Allied Nevada fell $2.17 or more than 40%, to close at $3.73 per share on August 7, 2013. The dramatic drop in value followed an announcement by the company that its production costs would increase substantially because of systemic operating defects at its Lewis leach pad. According to the complaint, Allied Nevada's adjusted cash costs per ounce of gold increased 27% from the first quarter to the second quarter of 2013. Further, production deficiencies at the Lewis leach pad impacted the company's operating cash flow, which resulted in the company deciding to defer construction of its Hycroft Mine. The decision to defer construction of the Hycroft Mine came just weeks after the company sold $150.5 million shares in a secondary public offering, intended in part to fund capital expenditures at the mine.
The complaint further alleges that Allied Nevada failed to disclose to investors that the costs to remedy the Lewis leach pad production deficiencies were reasonably likely to adversely impact the company's future production, production costs, and cash flows. As a result, Allied Nevada's statements regarding financial performance were materially false and misleading throughout the Class Period.
Allied Nevada Investors Are Encouraged to Contact Shareholder Rights Law Firm Robbins Arroyo
If you invested in Allied Nevada and would like to discuss your shareholder rights, please contact attorney Darnell R. Donahue at (800) 350-6003, DDonahue@robbinsarroyo.com, or via the information form on the firm's shareholder rights blog: www.robbinsarroyo.com/shareholders-rights-blog/allied-nevada-gold-corp/
Robbins Arroyo LLP is a nationally recognized leader in securities litigation and shareholder rights law. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits, and has helped its clients realize more than $1 billion of value for themselves and the companies in which they have invested.
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SOURCE Robbins Arroyo LLP