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by Mike Caswell

Silvercorp Metals Inc. has lost its attempt to have the Supreme Court of British Columbia reject an unlawful detention lawsuit on jurisdictional grounds. The company had sought to have the case heard in China, where the detention occurred. The judge, however, has ruled against that request, finding that Vancouver is a more convenient venue.

The ruling comes as part of a case filed last year by Kun Huang, a man who had done some of the research for the Alfred Little report that targeted Silvercorp in 2011. The well-publicized report, which questioned the output from the company's Ying mine, placed Silvercorp under considerable scrutiny and led to a substantial drop in its share price. Mr. Huang complained that after the report, the company enlisted the police in China to imprison him with no charges. He said that he spent three years being unlawfully detained as a result.

For its part, Silvercorp said that the courts in B.C. were not the appropriate venue for the matter. In a motion filed Oct. 22, 2014, the company argued that the case should be heard in a Chinese court. Almost all of the material evidence is in that country, all of the potential witnesses live there and the applicable law will be Chinese law. Silvercorp also said that the potential witnesses would include Chinese police who would be unlikely to come to Canada to testify.

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