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On February 9, 2022, Siskinds LLP, Eighty-One West Law PC, and CFM Lawyers LLP initiated a class action against Gatos Silver, Inc. (TSX: GATO) and other defendants.

Gatos is a US-based precious metals production and exploration company focused primarily on silver. Its key operating project is the Cerro Los Gatos (“CLG”) mine in Chihuahua, Mexico. The action alleges, among other things, that the defendants misrepresented the reliability of the mineral reserve estimate for CLG.

The plaintiff alleges that the misrepresentations were corrected on January 25, 2022, when Gatos announced that there were errors in the technical report for CLG. When this news was revealed to the market, the value of Gatos’s shares declined by almost 70%.

There are proposed settlements of the action. For important details regarding the settlements, please consult the “Developments” and “Documents” sections below, and check this page regularly for updates.

Need more information?

Contact Tyler Planeta by email at [email protected] or phone 416.594.4588 or toll-free at 1.800.461.6166

Developments

Discontinuance Against Underwriter Defendants

On January 4, 2024, the Ontario Superior Court of Justice granted permission to the Plaintiff to discontinue the action as against BMO Nesbitt Burns Inc., Goldman Sachs Canada Inc., RBC Dominion Securities Inc., Canaccord Genuity Corp., and CIBC World Markets Inc. (“Underwriter Defendants”), without costs.

Proposed Settlement with Tetra Tech Defendants

The Plaintiff and Tetra Tech, Inc., Guillermo Dante Ramirez-Rodriguez and Kira Lyn Johnson (collectively, “Tetra Tech Defendants”) have reached a proposed settlement of this class action for C$1 million to resolve the claims asserted against them on behalf of all persons and entities (other than certain “excluded persons”), wherever they may reside or be domiciled, who:

  1. purchased Gatos Silver securities under Gatos Silver’s Canadian prospectuses filed in October 2020 and July 2021 and in the distributions to which they related; and
  2. acquired Gatos Silver securities during the period from October 28, 2020 until January 25, 2022 at 6:52 p.m. Eastern Standard Time (“Class Period”) on any Canadian exchange (including, without limitation, the Toronto Stock Exchange) or any Canadian alternative trading system.

The settlement with the Tetra Tech Defendants is subject to approval by the Ontario Superior Court of Justice. A settlement approval hearing has been set for April 10, 2024.

If you do not wish to be bound by the settlement or receive any benefits from it (or any other settlements in the action), you must opt out by no later than April 9, 2024.

If you wish to object to the settlement, you must do so by no later than March 20, 2024.

For complete details regarding the proposed settlement with the Tetra Tech Defendants, including how to opt out or object/comment, please consult the long-form notice available in the “Documents” section below.

Settlement in Principle with Gatos Silver and the Other Defendants

The Plaintiff has separately reached a settlement-in-principle with the remaining Defendants, Gatos Silver, Stephen Orr, Roger Johnson, Philip Pyle, The Electrum Group LLC, Electrum Silver US LLC, and Electrum Silver US II LLC. The settlement is subject to the negotiation of a definitive agreement. If a final settlement agreement is reached, further notice will be provided to class members regarding that settlement, as ordered by the Court.

FAQs

What is a class action?

A class action is a lawsuit that is brought by one or more persons on behalf of a larger group of people whose claims share common legal and/or factual issues. Class actions provide a cost-effective way for groups of people with common interests to pursue a legal claim.

What does “certification” mean?

Certification is the motion where the court determines whether the action can properly be pursued as a class action. The court will consider factors such as whether the claims of the class members raise common legal and/or factual issues and whether a class action is the preferable method of pursuing the claims (as opposed to other methods, such as individual actions).

Do I have to pay anything to participate in the class action?

Class action lawyers are usually paid on a contingency basis. This means that class counsel are only paid if successful. Class counsel are paid a percentage of any settlement or court award. Class counsel fees are subject to court approval.

Can I join the class action?

There are no steps required to “join” the class action. Assuming you fall within the scope of the class definition, you are automatically included in the class action unless you “opt-out” (exclude yourself from the class action).

Can I opt-out of the class action?

Yes. Once the class action has been authorized or certified, you will have the opportunity to opt-out of the class action within a period of time to be determined by the Court. If you exclude yourself, you will not be entitled to any compensation awarded under a settlement agreement or court order. You may however pursue your own action on an individual basis.

Generally, class members will wish to exclude themselves from a class action if they intend to bring their own individual action. In the majority of cases, it will be more economical to participate in the class action because the legal costs will be shared among a very large number of people.

I still have a question. Who should I contact?

If you have any other questions, please complete the contact form below or call 1-800-461-6166.

Discontinuance Against Underwriter Defendants

On January 4, 2024, the Ontario Superior Court of Justice granted permission to the Plaintiff to discontinue the action as against BMO Nesbitt Burns Inc., Goldman Sachs Canada Inc., RBC Dominion Securities Inc., Canaccord Genuity Corp., and CIBC World Markets Inc. (“Underwriter Defendants”), without costs.

Proposed Settlement with Tetra Tech Defendants

The Plaintiff and Tetra Tech, Inc., Guillermo Dante Ramirez-Rodriguez and Kira Lyn Johnson (collectively, “Tetra Tech Defendants”) have reached a proposed settlement of this class action for C$1 million to resolve the claims asserted against them on behalf of all persons and entities (other than certain “excluded persons”), wherever they may reside or be domiciled, who:

  1. purchased Gatos Silver securities under Gatos Silver’s Canadian prospectuses filed in October 2020 and July 2021 and in the distributions to which they related; and
  2. acquired Gatos Silver securities during the period from October 28, 2020 until January 25, 2022 at 6:52 p.m. Eastern Standard Time (“Class Period”) on any Canadian exchange (including, without limitation, the Toronto Stock Exchange) or any Canadian alternative trading system.

The settlement with the Tetra Tech Defendants is subject to approval by the Ontario Superior Court of Justice. A settlement approval hearing has been set for April 10, 2024.

If you do not wish to be bound by the settlement or receive any benefits from it (or any other settlements in the action), you must opt out by no later than April 9, 2024.

If you wish to object to the settlement, you must do so by no later than March 20, 2024.

For complete details regarding the proposed settlement with the Tetra Tech Defendants, including how to opt out or object/comment, please consult the long-form notice available in the “Documents” section below.

Settlement in Principle with Gatos Silver and the Other Defendants

The Plaintiff has separately reached a settlement-in-principle with the remaining Defendants, Gatos Silver, Stephen Orr, Roger Johnson, Philip Pyle, The Electrum Group LLC, Electrum Silver US LLC, and Electrum Silver US II LLC. The settlement is subject to the negotiation of a definitive agreement. If a final settlement agreement is reached, further notice will be provided to class members regarding that settlement, as ordered by the Court.

What is a class action?

A class action is a lawsuit that is brought by one or more persons on behalf of a larger group of people whose claims share common legal and/or factual issues. Class actions provide a cost-effective way for groups of people with common interests to pursue a legal claim.

What does “certification” mean?

Certification is the motion where the court determines whether the action can properly be pursued as a class action. The court will consider factors such as whether the claims of the class members raise common legal and/or factual issues and whether a class action is the preferable method of pursuing the claims (as opposed to other methods, such as individual actions).

Do I have to pay anything to participate in the class action?

Class action lawyers are usually paid on a contingency basis. This means that class counsel are only paid if successful. Class counsel are paid a percentage of any settlement or court award. Class counsel fees are subject to court approval.

Can I join the class action?

There are no steps required to “join” the class action. Assuming you fall within the scope of the class definition, you are automatically included in the class action unless you “opt-out” (exclude yourself from the class action).

Can I opt-out of the class action?

Yes. Once the class action has been authorized or certified, you will have the opportunity to opt-out of the class action within a period of time to be determined by the Court. If you exclude yourself, you will not be entitled to any compensation awarded under a settlement agreement or court order. You may however pursue your own action on an individual basis.

Generally, class members will wish to exclude themselves from a class action if they intend to bring their own individual action. In the majority of cases, it will be more economical to participate in the class action because the legal costs will be shared among a very large number of people.

I still have a question. Who should I contact?

If you have any other questions, please complete the contact form below or call 1-800-461-6166.

Contact Us

Join to stay informed about the progress of this class action.

Your information will be held in strict confidence. Completing this form does not create a lawyer-client relationship with Siskinds LLP or Siskinds Desmeules s.e.n.c.r.l. or any of their personnel, nor does it impose any obligations related to the class action or otherwise.

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