Kirkland Lake Gold Ltd. Class Action Lawsuit
- Company Name
- Kirkland Lake Gold Ltd.
- Stock Symbol
- Class Period
- January 8, 2019 to November 25, 2019
- Southern District of New York
The Kirkland Lake Gold Ltd. class action lawsuit charges Kirkland Lake Gold and its Chief Executive Officer with violations of the Securities Exchange Act of 1934 and seeks to represent purchasers of Kirkland Lake Gold common shares between January 8, 2019 and November 25, 2019, inclusive (the “Class Period”). The Kirkland Lake Gold class action lawsuit was commenced on June 29, 2020 in the Southern District of New York and is captioned Brahms v. Kirkland Lake Gold Ltd., No. 20-cv-04953.
Kirkland Lake Gold owns and operates gold mines in Canada and Australia. According to the Kirkland Lake Gold class action lawsuit, leading up to November 25, 2019 and unbeknownst to investors, Kirkland Lake Gold was considering acquiring Detour Gold Corporation (“Detour”), an underperforming Canadian exploration and mining company.
The Kirkland Lake Gold class action lawsuit alleges that defendants made materially false and/or misleading statements, as well as failed to disclose that: (i) Kirkland Lake Gold lacked adequate internal controls over financial reporting, especially with regard to its projections of risks, reserve grade, and all-in sustaining costs; (ii) as a result of the known, but undisclosed, impending acquisition of Detour, Kirkland Lake Gold’s projections relating to its risks, reserve grade, and all-in sustaining costs were false and misleading; (iii) Kirkland Lake Gold’s financial statements and projections were not fairly presented in conformity with International Financial Reporting Standards; and (iv) based on the foregoing, defendants’ positive statements about Kirkland Lake Gold’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
On November 25, 2019 – following a months-long campaign of rosy projections relating to Kirkland Lake Gold’s key metrics – Kirkland Lake Gold announced that it had entered into a definitive agreement to acquire all of the outstanding securities of Detour for $3.68 billion. Kirkland Lake Gold’s announcement received a chilly reception from analysts and investors alike who were baffled by the deal’s economics. On this news, the price of Kirkland Lake Gold shares declined more than 17%.
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