Pula Graphite Partners drops $195 million suit against African Rainbow Minerals

 

Pula Chairman Ambassador Charles Stith

By The Citizen Reporter

Media/news company Mwananchi Communication Limited

Dar es Salaam. A $195 million lawsuit filed on Tuesday by Pula Graphite Partners and the Pula Group LLC against African Rainbow Minerals (ARM) and its six affiliates was

abruptly dropped on Thursday.

On October 28, 2022, Pula filed an application in a lawsuit claiming a breach of a non-disclosure and non-compete agreement at the Commercial Division of the High Court of Tanzania. This action marked the beginning of the legal dispute between the two mining companies.

The plaintiffs have filed a lawsuit against South Africa-based ARM, claiming $195 million in damages for an alleged breach of their non-disclosure and non-compete agreements.

But in a surprise move, when the case came up for hearing on Tuesday, Pula withdrew it with the intention of refiling it within ten days, within which the company will have to sort out some technical issues that could have affected the case.

The issue in question was whether or not a resolution from Pula directors authorising the suit needed to be attached as a part of the original complaint.

In line with this, it came to Pula’s knowledge that on February 24, 2022, the Court in Tanzania issued a decision in the case involving Sharaf Shipping Agency (T) Limited Vs Barclays Bank Tanzania Limited, whereby it emphasised that the suit was incompetent for failure to plead and annex board (the) resolution sanctioning the institution of the suit.”

“It was based on such an argument that Pula Graphite Partners and the Pula Group, on advice of counsel, were withdrawing their current complaints against African Rainbow Minerals et al….They will refile their law suit with the board resolution, which is consistent with the prior decision by the court in the aforementioned case,” Pula said in a statement yesterday.

The statement said that the decision was intended to ensure that minority shareholders of a board were not overlooked in decisions to bring legal action. Pula is a 50-50 joint venture, with Tanzanian shareholders having equal representation.

Pula President Mary Stith said: “Withdrawing and refiling are based on a technicality. We are comfortable with the course of action recommended by our lawyers. We do intend to refile our suit because we believe our case is strong, and we believe that taking this action will ensure that Tanzanian companies will have a fair chance to defend their interests against foreign competitors”.