Major shareholder sues Baja Mining over ballooning costs, management

A press release issued by Baja Mining today (TSE:BAJ) announced that Louis Dreyfus, one of the mining company's largest share holders, is suing due to expenditures at Baja's Boleo project in Mexico.

Louis Dreyfus is seeking an independent investigation to the "cost overruns" of the Boleo project and has also demanded for the removal of "officers and directors which share responsibility for Baja's alleged failure to make timely disclosure of cost overruns."

Baja says it "intends to defend this action vigorously."

Louis Dreyfus holds roughly 10% of Baja Mining and has sought arbitration through the London court system.

While shares of Baja climbed 20% to settle at $0.18, the stock is still far away from its mid-April holding point of $0.97.

The downward spiraling stock price came after Baja admitted that the Boleo project, originally projected at $897 million, would exceed $1.1 billion.

In late May, as a last ditch attempt to save the Boleo project, Baja under went massive job cuts.

Read more on Baja's move that cut 40% of its staff >>