USA Rare Earth rebuts MP Materials lawsuit as rivalry deepens

USA Rare Earth Inc. pushed back against allegations by MP Materials Corp., calling a lawsuit filed by its rival an attempt to hinder the company’s growth.

The company refuted MP’s claim that USA Rare Earth improperly obtained and used confidential information from a former MP employee. USA Rare Earth said in a filing in the 8th District of the Texas Business Court on Monday that it will “deny each and every” allegation made by MP.

A spokesperson for USA Rare Earth said the company believes MP’s lawsuit “is completely without merit and was filed for an improper purpose.”

The defense comes a month after MP Materials filed the lawsuit accusing USA Rare Earth of a corporate “raiding campaign” that saw the company poach several MP employees. The lawsuit also cast doubt on the viability of USA Rare Earth’s projects, which include an undeveloped mineral deposit in Texas and a yet-to-be-completed processing plant in Oklahoma.

USA Rare Earth countered on Monday that MP is trying to impede its rival as both companies pursue efforts to establish rare earth processing and magnet-making capacity in the US.

“We believe this lawsuit amounts to nothing more than an attempt by MP to slow USAR’s bold vision and significant momentum, as we build out US and Allied rare earth value chains,” the spokesperson said. “We are making significant strides in furthering America’s strategic interests and will remain focused on our mission.”

MP declined to comment.

The legal dispute highlights growing tensions within the nascent US rare earth industry, which has attracted billions of dollars in public and private investment amid concerns about China’s dominance of global supply chains for the minerals used in electric vehicles, defense tech and other advanced technologies.

Las Vegas-based MP operates the Mountain Pass mine in California, the only active rare earth mine in the US. USA Rare Earth, meanwhile, is developing the Round Top deposit in Texas and constructing a magnet manufacturing facility in Oklahoma.

The two companies were also subjected to Chinese export controls on Sunday.

(By Jacob Lorinc)