Silvercorp Metals says it is cooperating with U.S. SEC subpoena

Wed Apr 3, 2013 10:12am EDT
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April 3 (Reuters) - Silvercorp Metals Inc said on Wednesday it is cooperating with the U.S. Securities and Exchange Commission, which has subpoenaed documents related to the silver miner's battle with short sellers.

A report about the subpoena published by Canada's Globe and Mail newspaper sent the Vancouver-based company's shares down more than 10 percent on Tuesday. The stock rose 3.1 percent to C$3.65 in early trading on Wednesday.

Shares of Silvercorp, which operates several mines in China, fell briefly in the autumn of 2011 after it said it had received an anonymous letter accusing it of fraud, and two then-anonymous blogs published similar allegations.

In August, a New York court dismissed Silvercorp's defamation complaint against hedge fund Anthion Management, which was behind the original short report, investing blog and other defendants.

New York State Supreme Court Justice Carol Edmead ruled that the reports were expressions of opinion, and protected by the U.S. Constitution's provisions for freedom of expression. Silvercorp abandoned its appeal last month.

According to an excerpt from the subpoena released by Silvercorp, the SEC is seeking all documents related to the short sellers' allegations, and the defamation case. (Reporting by Allison Martell; Editing by Janet Guttsman and Maureen Bavdek)