NEW YORK, March 28, 2019 (GLOBE NEWSWIRE) -- Pomerantz LLP announces that a class action lawsuit has been filed against Vale S.A. (“Vale” or the “Company”) (VALE) and certain of its officers and directors. The class action, filed in United States District Court, Southern District of New York, and indexed under 19-cv-01610, is on behalf of a class consisting of all behalf of persons and/or entities who purchased or otherwise acquired Vale shares between April 11, 2017 and January 28, 2019, both dates inclusive (the “Class Period”), seeking remedies under the Securities Exchange Act of 1934 (the “Exchange Act”). Plaintiff’s claims are asserted against the Company and certain of its executive officers.
If you are a shareholder who purchased Vale securities between April 11, 2017, and January 28, 2019, you have until March 29, 2019, to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at firstname.lastname@example.org or 888.476.6529 (or 888.4-POMLAW), toll-free, Ext. 9980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and the number of shares purchased.
Vale together with its subsidiaries, produces and sells iron ore and iron ore pellets for use as raw materials in steelmaking in Brazil and internationally. It operates through Ferrous Minerals, Coal, and Base Metals segments. The Company was formerly known as Companhia Vale do Rio Doce and changed its name to Vale S.A. in May 2009. Vale was founded in 1942 and is headquartered in Rio de Janeiro, Brazil.
Vale has a history involving dam failure in connection with its mining activities. On November 5, 2015, Brazilian authorities reported that an iron-ore mine operated by Samarco Mineração SA (“Samarco”) (jointly owned by Vale and BHP, another mining entity) burst, killing dozens of people and devastating the local community. The cause of the collapse was the failure of a tailings dam, used to hold water and discarded minerals from the nearby iron-ore mine.
The complaint alleges that Throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Vale had failed to adequately assess the risk and damage potential of a dam breach at its Feijão iron ore mine especially in light of its experience in 2015; (ii) Vale’s programs to mitigate health and safety incidents were inadequate; (iii) Defendants failed to disclose that Vale’s auditor was not independent, as required under Brazilian mining law; (iv) Defendants failed to disclose that an internal report commissioned by Vale in 2018 to assess the stability of the tailings dam raised concerns over its drainage and monitoring systems; (v) Defendants failed to disclose the existence of information that the dam was at risk of “liquefaction,” the same issue that led to the 2015 collapse of the Samarco dam; and (vi) as a result, Vale’s public statements were materially false and misleading at all relevant times.
On January 25, 2019, Reuters reported that Vale’s tailings dam had burst at its Feijão iron ore mine. A “torrent of sludge tore through the mine’s offices, including a cafeteria during lunchtime.”
On this news, shares of Vale fell $1.20 per share or over 8% to close at $13.66 per share on January 25, 2019.
Then, on January 26, 2019, BBC News reported that hundreds of people affected by the dam’s breach remained missing, in part because the dam’s alarm system failed at the time of the accident. A report by a Folha de S. Paulo newspaper stated “the risk of collapse of the dam had been mentioned in a ‘tense meeting’ that approved its license last month[.]”
That same day, Reuters reported that Brazil’s National Mining Agency ordered Vale to suspend operations at its Corrego de Feijão iron ore mining facility as a result of the dam burst. The article also stated that “State prosecutors . . . [seek] $1.3 billion  in Vale’s accounts for handling damages . . . adding that [prosecutors] expect more funds to be frozen in the future.”
On January 28, 2019, Reuters reported “Brazil’s top prosecutor said on Monday she will pursue criminal prosecutions after the collapse of a tailings dam operated by mining giant Vale SA killed at least 58 people and left hundreds missing, and that executives may be punished.”
That same day, Reuters reported that “Brazilian securities industry regulator CVM has opened a probe into miner Vale SA’s filings related to a burst tailings dam in the town of Brumadinho[.]”
On this news, shares of Vale plunged by $2.46 per share, or approximately 18%, to close at $11.20 per share on January 28, 2019.
On February 6, 2019, the Wall Street Journal reported report that the Company was in possession of a detailed report written months before the disaster indicating that the dam was not certifiable. Then on February 7, 2019, the Wall Street Journal reported that “[a] safety auditor who inspected a Vale SA mine-tailings dam that collapsed in January killing at least 150 people told police he felt pressured to attest to its stability, despite indications it was unsafe, because he feared losing business with the company”.
The Pomerantz Firm, with offices in New York, Chicago, Los Angeles, and Paris, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com
Robert S. Willoughby
888-476-6529 ext. 9980