CNOOC, China's largest offshore oil company by output, has refuted accusations of making misleading statements that arose in a class action made by its US investors, according to a company statement posted on the Hong Kong bourse late Monday.
CNOOC said that the company received notice on October 11 of the lawsuit filed by its US investor Sam Sinay, individually and on behalf of all others similarly situated, to the US District Court in the Southern District of New York.
Sam Sinay accuses CNOOC of releasing false and misleading statements about its business performance during the period from January 27 to September 16, 2011, as well as failing to disclose June 2011's Bohai Bay oil spills in a timely manner.
But CNOOC refuted in the statement that "the accusations have no legal basis, and the company will do its utmost to defend itself and safeguard its rights and interests."
CNOOC also warned the company's shareholders and potential investors to trade its shares cautiously.
The plaintiff said CNOOC's business misrepresentations have caused economic losses to investors, according to a document on the website of US law firm Robbins Geller Rudman & Dowd LLP, one of the attorneys for the plaintiff.
CNOOC was not available for comment Tuesday.
The class action could mean legal fees for CNOOC because as a US-listed company it must respond to the lawsuit, Lin Boqiang, director of the China Center for Energy Economics Research at Xiamen University, told the Global Times Tuesday.
The lawsuit may impact other Chinese enterprises, he noted, and companies listed overseas must be careful especially in disclosing information, because they may face more frequent accusations abroad by law firms which specialize in such actions.
However, Jia Fangyi, a lawyer at Beijing-based Great Wall Law Firm, said actions that correct Chinese enterprises' problematic behaviors such as pollution should be supported, no matter which country's law is applied.
Jia said CNOOC may deserve the lawsuit for serious ocean pollution.
Jia has sued the State Oceanic Administration in 2011 for late disclosure of the Bohai Bay oil spill and called on CNOOC and ConocoPhillips to set up a 10 billion yuan compensation fund.
"There is no law in China regarding economic compensation liability for enterprises which fail to disclose information about important events such as pollution, and the relevant US law could be a good reference point for China," Jia noted.
CNOOC holds a 51 percent stake in the Bohai Bay oilfield where the oil spill occurred, with ConocoPhillips China Inc holding the rest and acting as operator. After the oil spill, CNOOC paid 730 million yuan ($116.8 million) compensation and ConocoPhillips paid 2.3 billion yuan based on a Chinese State decision.
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