RIO Rio Tinto Limited

By Stephen Dockery 

A U.S. District Court on Friday dismissed a lawsuit by Rio Tinto PLC alleging that Vale SA conspired with an Israeli billionaire to take Rio Tinto's mining concessions in West Africa, with the court finding the events were outside the statute of limitations.

Rio's lawsuit pitted two of the world's largest mining companies against each other in a fight over a vein of iron ore in the Simandou range of Guinea, one of the richest veins ever discovered. Rio Tinto, an Anglo-Australian company, alleged that Brazilian mining company Vale worked with Israeli billionaire Benjamin Steinmetz and his mining company, BSG Resources Ltd., starting in December 2008 to illegally take Rio Tinto's mining rights in Guinea.

Judge Richard Berman in the Southern District of New York decided Rio Tinto's suit came too long after the alleged misconduct occurred to seek damages. In his decision, he wrote that the "claim is outside of the four-year civil RICO statute of limitations and is, therefore, time-barred."

He also decided Rio Tinto had not alleged an lengthy enough scheme to back up its claims of fraud and conspiracy under the Racketeer Influenced and Corrupt Organizations Act.

Vale's lawyer, Jonathan Blackman of Cleary Gottlieb Steen & Hamilton LLP, described the suit as "an effort by a competitor to take advantage of the corruption scandal in Guinea." In a statement, Vale said it was "pleased that the U.S. court saw that Rio Tinto's allegations were baseless."

BSG Resources said the court found "Rio Tinto had failed even to make coherent accusations of racketeering by BSGR and Mr. Steinmetz in connection with the Simandou concession."

Rio Tinto wasn't immediately available for comment.

The case was one aspect of the contentious acquisitions of iron-ore-mining concessions from the government of Guinea under the last years of President Lansana Conté's rule.

Rio Tinto had held the whole block of iron-ore concessions and was exploring them before half of those areas were redistributed to BSG Resources in 2008. BSGR subsequently sold a 51% stake in its Guinean assets to Vale for $2.5 billion.

An investigation carried out by the Guinean government found BSG Resources obtained the rights through corruption, and stripped them from the company while clearing Vale of wrongdoing. BSG Resources denied there was any impropriety in its acquisition of the assets and is trying to win compensation.

There is a continuing criminal corruption investigation into the mining deal by the U.S., The Wall Street Journal reported previously. People familiar with the matter said senior executives of BSG Resources are among those being investigated. The company has said previously there is no evidence linking its employees to corruption in Guinea.

Write to Stephen Dockery at stephen.dockery@wsj.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

(END) Dow Jones Newswires

November 20, 2015 15:23 ET (20:23 GMT)

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