Canada Lithium to Vigorously Defend Lawsuit
TORONTO, April 11 /CNW/ --
TORONTO, April 11 /CNW/ - Canada Lithium Corp. (TSX: CLQ) (OTCQX: CLQMF)
(the 'Company') today announced that it will vigorously defend a
proposed class action lawsuit that has been commenced in the Ontario
Superior Court of Justice against the Company, its directors and
certain officers relating to a mineral resource estimate for the Quebec
Lithium Project (the 'Project') that was announced by the Company on
October 28, 2010 and incorporated into various disclosure documents
from October 28, 2010 to February 28, 2011. The Notice of Action also
names Ms. Michelle Stone, the geologist that prepared the mineral
resource estimate that is at issue in the action.
'We believe that this case is without merit and that it will ultimately
be dismissed,' said Company President and CEO Peter Secker. 'The
Company took immediate action when we learned that there was a
potential issue with the previously announced mineral resource estimate
and we are working to resolve this matter as quickly as possible and
anticipate receiving an independent resource estimate on or before May
13, 2011.'
The Notice of Action alleges that the Company, its directors, certain
officers, and Ms. Stone made misrepresentations in violation of
Canadian securities regulatory requirements relating to the mineral
resource estimate that was announced by the Company on October 28, 2010
and incorporated into various disclosure documents, including but not
limited to, a National Instrument 43-101 compliant technical report
filed on November 22, 2010 and a prospectus issued by the Company on
January 24, 2011.
The Notice of Action was filed by Siskinds LLP in London, Ontario on
Friday, April 8, 2011 and came to the attention of the Company this
morning. The representative plaintiff has requested a variety of
orders and declarations in the Notice of Action, including $50,000,000
in general and special damages, and, in the alternative, rescission in
relation to the shares issued pursuant to the prospectus mentioned
above. The Company has not been served by Siskinds LLP with the Notice
of Action or a Statement of Claim. McCarthy Tétrault LLP has been
retained by the Company in respect to this proposed class action.
On February 28, 2011, the Company announced that it was appointing
Roscoe, Postle & Associates ('RPA') to undertake a preliminary
independent review of the mineral resource estimate for the Project
that was announced by the Company on October 28, 2010 after an internal
review indicated a material reduction in the measured, indicated and
inferred mineral resource.
On March 16, 2011, the Company announced that RPA had confirmed that
there were significant issues with the geological modelling that had
produced the mineral resource estimate announced on October 28, 2010.
The Company also confirmed that it had appointed AMC Mining Consultants
(Canada) Ltd. ('AMC') to independently conduct a resource estimate of
the Project and expeditiously prepare a new NI 43-101 compliant
report. The Company anticipates that AMC will complete the independent
resource estimate on or before May 13, 2011 and then prepare a new
National Instrument 43-101 compliant technical report.
The Company believes that there will be a material reduction in the
measured, indicated and inferred mineral resource announced on October
28, 2010. It is not possible to accurately quantify the magnitude of
the reduction in the mineral resource at this time and the Company
therefore determined that an independent mineral resource estimate was
required and has appointed AMC to conduct this estimate.
The Quebec Lithium Mine originally operated from 1955 to 1965 as an
underground mine and processing plant that produced spodumene, lithium
carbonate and lithium hydroxide monohydrate. In 1974, Surveyer,
Nenninger et Chenevert Inc. ('SNC') was contracted by Sullivan Mining
Group to write a feasibility report on the rehabilitation of the former
Quebec Lithium Mine. SNC calculated a historical reserve estimate of
15,736,938 tonnes grading 1.14% Li(2)O. This estimate is not compliant with NI 43-101 standards.
The Company believes that the historical estimates are relevant;
however, the estimates should not be relied upon. The historical
estimates have not been verified by a qualified person. The historical
estimates were prepared under CIM standards in 1974; however, they do
not meet the current CIM Definition Standards on Mineral Resources and
Mineral Reserves adopted in 2005. The Company is not treating the
historical estimates as a current mineral resource estimate under
National Instrument 43-101.
About Canada Lithium Corp.
The Company holds a 100% interest in the Quebec Lithium Project near Val
d'Or, the geographical heart of the Quebec mining industry. The
project, as noted above, is currently the subject of an independent
resource audit. Metallurgical tests have produced battery-grade
lithium carbonate from project samples.
Cautionary Statement Regarding Forward-Looking Information
This press release contains 'forward-looking information' within the
meaning of applicable Canadian securities legislation. Generally,
forward-looking information can be identified by the use of
forward-looking terminology such as 'plans', 'expects' or 'does not
expect', 'is expected', 'budget', 'scheduled', 'estimates',
'forecasts', 'intends', 'anticipates' or 'does not anticipate', or
'believes', or variations of such words and phrases or statements that
certain actions, events or results 'may', 'could', 'would', 'might' or
'will be taken', 'occur' or 'be achieved'.
Forward-looking information is based on reasonable assumptions that have
been made by the Corporation as at the date of such information and is
subject to known and unknown risks, uncertainties and other factors
that may cause the actual results, level of activity, performance or
achievements of the Corporation to be materially different from those
expressed or implied by such forward-looking information, including the
fact that an independent review is being conducted by a third party
that will work independently of the Company and, for reasons outside
the control of the Company, may cause the expected completion time
identified herein by management to be materially different.
Forward-looking information in this press release includes, among other
things, disclosure regarding the anticipated timing for completion of
the independent resource estimate of the Project.
Although the Company has attempted to identify important factors that
could cause actual results to differ materially from those contained in
forward-looking information, there may be other factors that cause
results not to be as anticipated, estimated or intended. There can be
no assurance that such information will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such information. Accordingly, readers should not place
undue reliance on forward-looking information. The Corporation does not
undertake to update any forward-looking information referenced herein,
except in accordance with applicable securities laws.
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Peter Secker, President and CEO (416) 361-2821
Olav Svela, Director, Investor Relations (416) 361-2821 or (416) 479-4355 or email osvela@canadalithium.com
Christine Stewart, Renmark Financial Communications Inc. (416) 644-2020 or email cstewart@renmarkfinancial.com
Please visit the Canada Lithium website at www.canadalithium.com.
Corporate Office: 401 Bay Street, Suite 2010, P.O. Box 118, Toronto, ON, M5H 2Y4