<\/p>\n
A Tanzanian court has struck Pula Group\u2019s $195 million damages claim against companies associated with Patrice Motsepe from the court roll \u2013 but stopped short of deciding whether confidential information was misused to support a competing graphite project, as Pula alleges.<\/p>\n
The High Court of Tanzania found that Pula failed to join to the proceedings two companies central to its case: Australian-listed Evolution Energy Minerals and its Tanzanian subsidiary Ngwena Tanzania, which operates the Chilalo graphite project in the Ruangwa district, not far from Pula\u2019s own graphite project.<\/p>\n
Pula cited Patrice Motsepe and three of his companies as respondents: African Rainbow Minerals (ARM), African Rainbow Capital (ARC), and ARCH Sustainable Resource.<\/p>\n
Read: Pula in a rush to court before African Rainbow Capital delists<\/p>\n
The dispute dates back to 2019 when ARM signed a 24-month confidentiality agreement with US-based Pula Group while considering an investment in Pula\u2019s Ruangwa graphite project in southern Tanzania.<\/p>\n
Pula says it provided ARM with confidential geological, commercial and strategic information. ARM undertook not to use that information for a competitive purpose or in any way detrimental to Pula.<\/p>\n
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Pula later discovered that an associated company, ARCH Sustainable Resources Fund, had invested in Evolution Energy Minerals, the Australian company developing the nearby Chilalo graphite project through Ngwena Tanzania.<\/p>\n
ARCH was sufficiently close to Motsepe and ARM to have received confidential information in breach of the agreement and then act on it, according to Pula\u2019s court filings.<\/p>\n
ARC denies receiving or using Pula\u2019s information and says it was not a party to the confidentiality agreement. The two companies not present in the court \u2013 Evolution and Ngwena \u2013 will have to be joined to the proceedings for the case to continue.<\/p>\n
Read:
ARM market cap drops R3.5bn on news of Tanzanian court challenge
SA court backs Motsepe firm in R3.2bn dispute
Motsepe companies \u2018seek protection\u2019 in SA from Tanzanian court<\/p>\n
Ruling not entirely in Motsepe\u2019s favour<\/p>\n
The Tanzanian court ruling didn\u2019t go entirely in Motsepe\u2019s favour, with the finding that Tanzania had jurisdiction in the matter \u2013 despite an earlier South African court ruling that the confidentiality agreement was concluded between ARM (not ARC) and Pula Group, and that its subsidiary company Pula Graphite has no contractual rights in terms of this agreement, nor can it suffer damages as a result of the alleged breach.<\/p>\n
The Tanzania court took a different view, ruling that the SA judgment was \u201cinconclusive and immaterial\u201d for purposes of the Tanzanian proceeding, but did not make a decision as to whether the confidentiality agreement had been breached.<\/p>\n
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Ambassador Charles Stith, chairman of Pula Group, said: \u201cThis is an important judgment because the court has affirmed central elements of the case Pula has advanced from the outset.<\/p>\n
\u201cIt rejected the challenge to Tanzania\u2019s jurisdiction, rejected the attempt to use the subsequent South African proceedings to terminate our case, and made important findings concerning Mr Motsepe\u2019s controlling interest and capacity to influence ARC.\u201d<\/p>\n
Read: Motsepe company appeals to SA courts over R3.4bn claim in Tanzania<\/p>\n
Pula says three key elements of its claim were established by the Tanzania court: the relationship and common control between ARM, ARC and ARCH; the investment links through the Evolution and Ngwena entities; and the operation of the competing Chilalo graphite project during the relevant period.<\/p>\n
The ruling delays its search for justice, says Pula, but does not derail it. Among its options are to appeal the ruling, apply for a review, or start fresh proceedings citing Evolution and Ngwena as respondents. The company says it is taking advice on the best way forward.<\/p>\n
#Pulas #195m #Motsepe #claim #thrown #Tanzanian #court #technicality<\/p>\n","protected":false},"excerpt":{"rendered":"
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