The Canadian mining services business was sold for $190 to Castle Harlan in July 2011 only to be re-sold to its Australian-based competitor Bradken for $217m seven hours later.
Pala said the deal was “misleading and deceptive” as Bradken would have had to pay more than financial firm like Castle Harlan had it bought the business directly.
The firm has added new fraud allegations and claims of unjust enrichment, tortious interference and negligent misrepresentation, said Reuters.
“Castle Harlan merely was a puppet and Bradken its puppeteer. (Pala’s subdiriary Norcast S.A.R.L.) would have insisted on a higher price and more favorable terms of sale had it known (that the business was being sold to Bradken),” said the amended complaint filed with Manhattan federal court on May 7, according to the report.
The firm is seeking at least $26m in compensatory damages and restitution as well as punitive damages, which were not included in the initial complaint, said the report.
Earlier this year an Australian court ordered Bradken to pay $22.4m in damages to Pala, which claimed the sale violated Australia’s competition law.
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