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Quebec Innu file $900-million lawsuit against Iron Ore Company of Canada

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MONTREAL - Two Quebec Innu communities have filed a $900-million lawsuit against the Iron Ore Co. of Canada, claiming the miner has violated its rights for nearly 60 years.

The Innu First Nations of Uashat Mak Mani-Utenam (Uashaunnuat) and Matimekush-Lac John (MLJ) said the IOC, which is majority owned by Rio Tinto (NYSE:RIO), caused harm by operating a large mining complex and railway on traditional territory (Nitassinan) in northeastern Quebec and Labrador since the 1950s without their prior consent.

The mining complex and activities are located in the communities of Schefferville, Labrador City and Sept-Iles.

"IOC and now Rio Tinto are the companies that have inflicted the most harm on the Uashaunnuat and MLJ and caused the most damage to our Nitassinan," vice-chief Mike McKenzie of Uashat Mak Mani-Utenam said in a statement on Wednesday.

The lawsuit and a motion seeking an injunction to stop all mining activity were filed Monday in Quebec Superior Court. They claim that IOC's mines and other facilities have ruined the environment, displaced members from their territory and prevented them from practising their traditional way of life.

They also said the 578-kilometre railway between Schefferville and Sept-Iles has opened up their territory to "numerous other destructive development project."

The allegations have not been proven in court.

IOC and Rio Tinto didn't immediately respond to requests for comment.

The $900 million being sought represents IOC's profits at the facilities since 1954, according to Innu calculations.

Innu leaders said they aren't opposed to mining development, but have failed in their attempts over two years at "reconciliation" with the mining company and its large owner.

"A balance must be achieved, but regrettably, IOC's practices are of a bygone era. This must stop," added Chief Real McKenzie of Matimekush-Lac John.

IOC's operations were recently expanded at a cost of $732 million. Rio Tinto is reportedly trying to sell its 58.7 per cent stake in the company. Mitsubishi holds a 26.2 per cent stake and Labrador Iron Ore Royalty Corporation (TSX:LIF) holds the remaining 15.1 per cent stake and receives a seven per cent gross royalty on all IOC iron ore sales.

The Innu communities have reached agreements with miners ArcelorMittal, Cliffs Natural Resources, Tata Steel, New Millennium Iron and Labrador Iron Mines (TSX:LIM) that provide financial compensation for the mining activities.

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