Law Offices of Howard G. Smith Announces Investigation of Gold Resource Corporation
Law Offices of Howard G. Smith announces that it is investigating potential claims against Gold Resource Corporation (“Gold Resource Corp.” or the “Company”) (NYSE MKT:GORO) concerning possible violations of federal securities laws. The investigation is related to allegations that certain statements issued by the Company between January 30, 2012 and October 17, 2012 were false and misleading concerning Gold Resource Corp.'s operations and financial prospects.
Gold Resource Corp. engages in the exploration and production of gold and silver in Mexico. The investigation is related to allegations that the Company misrepresented or failed to disclose that: (1) overly aggressive expansion of Gold Resource's underground mining operations in the first quarter of 2012 had created operational difficulties and lower production at the Company's mines in Mexico's southern state of Oaxaca; (2) the Company was mining in lower grade zones of the deposit; (3) significant operational efficiency improvements were required at the mine, including electric power upgrades, expanded ventilation and the ability to handle increased ground water at deeper levels, which limited the Company's ability to mine higher grade stopes; (4) decreases in long-hole stoping were forcing the Company to mine from lower-grade areas of the deposit and process more-diluted development ore; (5) as a result of the foregoing, tonnes from stoping had decreased in 2012 -- from an estimated 55% of milled ore during the first quarter to an estimated low of 15% during the second quarter; and (6) during the third quarter of 2012, a dispute had arisen between the Company and the buyer of its metal concentrates, with the buyer claiming net adjustments (reductions) to the Company's provisional third quarter 2012 invoices.
On October 17, 2012 Gold Resource Corp. announced preliminary production results for the third quarter 2012, and reported additional reasons for the Company's lower than expected third quarter 2012 results, including a dispute with the buyer of the Company's metal concentrates resulting in the buyer claiming net adjustments (reductions) to Gold Resource Corp.'s invoices. Following this news, the Company's common stock fell from $20.15 per share to a closing price of $18.01 per share on October 18, 2012.
If you purchased Gold Resource Corp. common stock between January 30, 2012 and October 17, 2012, if you have information or would like to learn more about these claims, or if you wish to discuss these matters or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Howard G. Smith, Esquire, of Law Offices of Howard G. Smith, 3070 Bristol Pike, Suite 112, Bensalem, Pennsylvania 19020 by telephone at 215-638-4847, Toll-Free at 888-638-4847, or by email to firstname.lastname@example.org, or visit our website at http://www.howardsmithlaw.com.