The Piedmont Lithium Inc (ASX: PLL) share price is plunging on Wednesday after its mining permit woes escalated into a securities class action lawsuit.
At the time of writing, shares in the emerging lithium producer are down 5.7% to 74.5 cents.
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Why is the Piedmont Lithium share price sinking?
Securities litigation firm, Wolf Haldenstein Adler Freeman & Herz LLP, announced that it had filed a federal securities class action lawsuit in the United States on behalf of persons and entities that have purchased Piedmont Lithium shares.
Wolf Haldenstein's complaint advised any investors to contact the firm immediately, saying:
If you have incurred losses in the shares of Piedmont Lithium Inc., you may, no later than September 21, 2021, request that the Court appoint you lead plaintiff of the proposed class. Please contact Wolf Haldenstein to learn more about your rights as an investor in Piedmont Lithium Inc.
What's the class action for?
Wolf Haldenstein pointed to the company's recent mining permit issues, citing:
On July 20, 2021, before market hours, Reuters reported that Piedmont "has not applied for a state mining permit or a necessary zoning variance in Gaston County, just west of Charlotte, NC, despite telling investors since 2018 that it was on the verge of doing so." According to the article, a majority of the Board of Commissioners said, "they may block or delay the project because Piedmont has not told them what levels of dust, noise and vibrations will occur, nor how water and air quality would be affected."
According to Piedmont Lithium's prior announcements, permits for lithium production and its chemical plant were expected to be complete by mid-2021.
The Piedmont Lithium share price dived 21.3% to a 5-month low of 68.5 cents on the day of Reuters' report.
It wasn't until Thursday, 2 September that the company announced applications for a mining permit with the North Carolina Department of Environmental Quality.
