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by Mike Caswell
Silvercorp Metals Inc. has filed a lawsuit in the Supreme Court of the State of New York against Alfredlittle.com and others, claiming that they pushed the stock down with false information and then profited by as much as $100-million through short sales. (All figures are in U.S. dollars.) The company seeks damages for defamation and disgorgement of gains from the scheme.
The suit comes after a series of letters that Alfredlittle.com and others wrote in August and September, 2011, which accused the company of carrying out a potential $1.3-billion accounting fraud. The letters stated that Silvercorp was reporting a profit in Canada while in China it was recording a loss. Silvercorp complains that the letters were untrue and that they allowed the short-sellers to profit.
The allegations are contained in a complaint that Silvercorp filed on Thursday, Sept. 22, against Alfredlittle.com and Chinastockwatch.com. Also named are the sites' operators, New York residents Jerry Katz, Alfred Little and Simon Moore. The suit complains of a scheme that the defendants launched in August, 2011, in which they planned to artificially drive down Silvercorp's price.
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