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US shareholders file lawsuit over Quebec health products plant explosion

02 January 2013

New York law firm Robbins Geller has filed a class-action lawsuit on behalf of shareholders against Neptune Technologies et Bioressources Inc, whose Sherbrooke plant suffered an explosion on November 8 killing three and injuring 18. A tank of acetone, a highly flammable solvent, is believed to have been the source of the explosion.

The lawsuit claims the Neptune factory in Sherbrooke was storing dangerously high levels of acetone
The lawsuit claims the Neptune factory in Sherbrooke was storing dangerously high levels of acetone

The suit claims that the factory was storing "dangerously high levels of acetone."

In November, Radio Canada reported that the quantity of acetone being stored inside the factory was higher than the maximum level authorised by the Quebec Environment Ministry.

The suit alleges that Neptune, along with some of its officers and directors, violated US law, and that the company failed to disclose key information about its Sherbrooke facility, in violation of the Securities Exchange Act of 1934.

A statement released by Robbins Geller alleges that Neptune "issued materially false and misleading statements regarding the company's operational status and financial projections."

The claim goes on to say that officials failed to disclose that they had installed larger acetone storage tanks at the plant, which stored "dangerously high levels of acetone," exceeding those permitted by the environment ministry.

"There is absolutely no foundation for what this legal class action refers to," said André Godin, Neptune's chief financial officer. He said the company is in the process of hiring legal counsel in the US to defend the company and its directors against the claims, which he called "completely false."

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