Baja Mining Corp. (TSX: T.BAJ, Stock Forum) said Monday that Louis Dreyfus Commodities Metals Suisse, S.A. has commenced litigation against the company in the Supreme Court of British Columbia.
Baja said Dreyfus is seeking an independent investigation of the cost overruns to the Boleo project in Mexico and Baja's disclosure thereof, as well as the removal of officers and directors which it says share responsibility for Baja's alleged failure to make timely disclosure of the cost overruns.
None of these allegations have been tested in a court of law and Baja said it intends to defend this action vigorously.
Dreyfus is a family-owned Swiss company that is involved in agricultural processing and commodities trading.
Baja has been under pressure since it announced in April that costs associated with the development of its Boleo project would be 21% above a 2010 estimate of $1.143 billion. It attributed the increase to a variety of factors, including a change of scope, design improvements and price increases in key consumables such as steel and fuel.
Reacting to pressure from Baja’s biggest shareholder, Mount Kellett Capital Management LP, former Baja chief executive officer John Greenslade stepped down last month, leaving the Vancouver junior to begin the search for a successor.
Trading at 18 cents on Monday, Baja has seen its stock price plunge from over $1.20 last October. The company currently has a market cap of $61.2 million, based on 340.2 million shares outstanding.