The world of rare earth metals is getting stranger… A law firm called Robbins Geller Rudman & Dowd LLP has filed a class action suit against Molycorp, Inc. (NYSE: MCP). Allegations are over “false and misleading statements about the capability of the Company’s “Mountain Pass” mining operation and the Company’s earnings caused Molycorp common stock to trade at artificially inflated prices throughout the Class Period.”
More specifically, it was noted that development and expansion was not progressing on schedule and would not allow the Company to reach rare earth oxide production rates at the end of calendar 2012 and 2013. Another charge is that end users had been reducing demand for the Company’s products as prices for rare earth elements increased. The suit is for those who purchased shares between March 9, 2011 and November 10, 2011.
Molycorp shares are down 1.4% at $29.27 on low volume. The Market Vectors Rare Earth/Strategic Metals (NYSE: REMX) is down 0.7% at $18.48 on low volume so far.
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