Thursday, April 18, 2024

Legal wrangle for soul of Okavango Delta rages

The battle for the soul of the Okavango Delta has intensified.

The Canadian oil and gas company that is exploring oil in the delta has revealed it would defend a class action filed in the United States of American Court against it.

The company stands accused of, among others, falsifying its findings to inflate stock prices.

In an emailed response to Sunday Standard queries, ReconAfrica said it “will undertake vigorous action to defend itself against any such claims” adding that, “The Company has not yet been served with the complaint.”

While ReconAfrica also indicated that it has not yet been served with the complaint, it confirmed that  on October 25, 2021, Eric Muller, on his behalf and on behalf of all persons and entities (other than the defendants) who purchased or otherwise acquired shares of the Company between February 28, 2019 and September 7, 2021, filed a class action complaint against the Company and related persons (the “Defendants”), in the United States District Court, Eastern District of New York, alleging various violations of the Federal securities laws.

ReconAfrica purports to engage in the identification, exploration, and development of oil and/or gas assets in Namibia and Botswana, including in the Kalahari Desert and other fragile areas.

The ReconAfrica class action lawsuit alleges that, throughout the Class Period, defendants made false and misleading statements and failed to disclose: (i) ReconAfrica’s plan for using unconventional means for energy extraction (including fracking) in the fragile Kavango area; (ii) that ReconAfrica would begin unlicensed drilling tests; (iii) that ReconAfrica would illegally use water for well testing; (iv) that ReconAfrica would illegally store used water in unlined pools; (v) that ReconAfrica would skirt Namibian law and hire an inadequate and inappropriate consultant; (vi) that, as a result, ReconAfrica risked future well, drilling, and water-related licenses in Namibia and Botswana; (vii) that, contrary to its representations.

The class action also states that ReconAfrica did not reach out nor provide adequate information (including in relevant local languages) through accessible means to those to be impacted by its testing and potential energy extraction; (viii) that ReconAfrica’s interests are in the Owambo Basin, not the so-called Kavango Basin; (ix) that ReconAfrica has continuously engaged in stock pumping; and (x) as a result of the foregoing, defendants’ public statements were materially false and/or misleading at all relevant times.

The Law firm of Robbins Geller Rudman & Dow LPP which announced the class action recently explained that the Private Securities Litigation Reform Act of 1995 permits any investor who purchased ReconAfrica securities during the Class Period to seek appointment as lead plaintiff in the ReconAfrica class action lawsuit. A lead plaintiff is generally the movant with the greatest financial interest in the relief sought by the putative class who is also typical and adequate of the putative class. The law firm also explained that, “A lead plaintiff acts on behalf of all other class members in directing the ReconAfrica class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the ReconAfrica class action lawsuit. An investor’s ability to share in any potential future recovery of the ReconAfrica class action lawsuit is not dependent upon serving as lead plaintiff.”


Read this week's paper