AngloGold Ashanti Limited Wins Summary Judgment in Breach of Contract and Fraud Action

On March 18, 2020, the U.S. District Court for the Southern District of New York granted motions for summary judgment in their entirety in favor of Cravath clients AngloGold Ashanti Limited (“AGA”) and related corporate entities, dismissing a breach of contract and fraud action brought by Newmont Mining Corporation, to whom AGA sold a Colorado gold mine and mineral processing facility in 2015.

The purchaser’s allegations included that AGA failed to disclose deficiencies at the mineral processing facility that rendered it unable to achieve certain performance targets set forth in the materials made available to bidders during diligence, and that those deficiencies in turn constituted a material adverse effect (“MAE”) under the relevant purchase agreement. As a result, the purchaser sought up to $175 million in damages. The Court rejected that claim on a number of alternative bases, including that the claimed MAEs were excluded from the MAE definition under the plain language of the purchase agreement, that the claimed MAEs related to circumstances that were foreseeable at the time of purchase and against which the purchaser failed to negotiate protection, and that the extensive factual record did not support the purchaser’s assertion that an MAE occurred.

The Cravath team included partner Lauren A. Moskowitz, practice area attorney Hector J. Valdes and associates Gregg A. Fish, Samuel A. Stuckey, Garrett M. Biedermann and Brendan R. Blake. Zachary W. Jarrett also worked on the matter.

The case is: Newmont Mining Corp. v. AngloGold Ashanti Ltd., No. 17‑CV-8065 (RA) (S.D.N.Y.).