NEW YORK, Feb. 22 12, 2022 (GLOBE NEWSWIRE) — Pomerantz LLP announces that a class action lawsuit has been filed against MP Materials Corp. f/k/a Fortress Value Acquisition Corp. (“MP Materials” or the “Company”) (NYSE: MP; FVAC; FVAC WS; FVAC.U) and certain of its officers. The class action, filed in the United States District Court for the District of Nevada and registered as 22-cv-00315, is on behalf of a class consisting of all persons and entities other than defendants who have purchased or otherwise acquired MP Materials securities between May 1, 2020 and February 2, 2022, both dates inclusive (the “Class Period”), seeking to recover damages caused by the Defendants’ violations of federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated thereunder, against the Company and some of its senior leaders.
If you are a shareholder who purchased or otherwise acquired securities of MP Materials during the class period, you have until April 25, 2022 to ask the court to appoint you as the lead plaintiff in the class. A copy of the complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at [email protected] or 888.476.6529 (or 888.4-POMLAW), toll-free, Ext. 7980. Those making inquiries by e-mail are encouraged to include their mailing address, phone number and number of shares purchased.
[Click here for information about joining the class action]
MP Materials engages in the ownership and operation of integrated rare earth mining and processing facilities. The company was previously known as “Fortress Value Acquisition Corp.” (“FVAC”) and operated as a special purpose acquisition company (“SPAC”).
In November 2020, FVAC completed a merger with MP Mine Operations LLC (“MPMO”) and Secure Natural Resources LLC (“SNR” and, collectively with MPMO, “Legacy MP Materials”), whereby, among others, Legacy MP Materials became an indirect wholly-owned subsidiary of FVAC, and FVAC changed its name to “Fortress Value Acquisition Corp.” to “MP Materials Corp.” (the “Business Combination”). Following the business combination, the Company began to own and operate the Mountain Pass rare earth mine and processing facility (“Mountain Pass”) in California.
The Complaint alleges that, throughout the Class Period, the Defendants made materially false and misleading statements regarding the company’s business, operations and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) FVAC overstated its due diligence efforts and expertise in identifying target companies to acquire; (ii) FVAC performed inadequate due diligence on Legacy MP Materials prior to the business combination, or ignored important red flags regarding, among others, management of Legacy MP Materials, compliance policies and profitability of Mountain Pass; (iii) as a result, the future business and financial prospects of the Company after the Business Combination have been overestimated; (iv) MP Materials engaged in an abusive transfer pricing scheme with a related party in the People’s Republic of China (“China”) to artificially inflate the Company’s profits; (v) the MP Materials ore at Mountain Pass was not economically viable to harvest for rare earth metals; and (vi) as a result, the Company’s public statements were materially false and misleading at all material times.
On February 3, 2022, Bonitas Research released a report (the “Bonitas Report”) accusing MP Materials of executing an “abusive transfer pricing manipulation scheme” with a related party in China, Shenghe Resources Holding Co., Ltd. . (“Shenghe”), which owned 7.7% of the company as of March 22, 2021. Specifically, the Bonitas report alleged that, since the second quarter of 2021, MP Materials and Shenghe “executed an abusive price manipulation scheme of transfer by which Shenghe had overpaid MP [Materials] concentrates for artificially swelling MP [Materials’] profits, [which] conveniently coincided with the expiry of the SPAC insider lockout so that MP [Materials] insiders could sell MP [Materials] stock at artificially inflated prices. Additionally, the Bonitas report cited a German academic study from September 2019 concluding that MP [Materials’] Mountain Pass ore is “not economically viable to mine for rare earth metals, while 12 of 13 other well-known rare earth mines outside of China are economically feasible” at current market prices.
On this news, MP Materials’ stock price fell $5.61 per share, or 14.25%, to close at $33.75 per share on February 3, 2022, on unusually high trading volume of 12,371,789 shares.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, Paris and Tel Aviv, is recognized as one of the leading firms in the areas of corporate litigation, securities and antitrust. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues the tradition he established, fighting for the rights of victims of securities fraud, breaches of fiduciary duty and corporate misconduct. The firm recovered numerous multimillion-dollar damages on behalf of class members. To see www.pomlaw.com
Robert S. Willoughby
888-476-6529 ext. 7980