Faruqi & Faruqi, LLP’s national practice focuses on complex civil litigation. The firm practices in the areas of Securities, Merger & Transactional, Shareholder Derivative, Antitrust, Consumer Class Action, and Wage & Hour litigation.
The lawsuit has been filed in the U.S. District Court for the Central District of California on behalf of all those who purchased Primero securities between October 5, 2012 and February 3, 2016 (the “Class Period”). The case, Loftus v. Pimero Mining Corp. et al, No. 2:16-cv-01034 was filed on February 15, 2015.
The lawsuit focuses on whether the Company and its executives violated federal securities laws by failing to disclose the issues of tax compliance of Primero’s Mexican subsidiary, Primero Empresa Minera, S.A. de C.V.
Specifically, on February 3, 2016, Primero disclosed that Servicio de Administración Tributaria (“SAT”), Mexico’s tax authority, filed a legal claim against the Company’s Mexican subsidiary in order to nullify the Advance Pricing Agreement (“APA”) filed by Primero in October 2011 and issued by the SAT in 2012; the APA was submitted to the SAT to confirm that the Company was properly recording revenue and taxes from sales under Primero’s silver purchase agreement with Silver Wheaton Corp.
After the announcement, Primero’s share price fell from $2.63 per share on February 3, 2016 to a closing price of $1.89 per share on February 4, 2016—a $0.74 or 28.1% drop.
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