June 08, 2020 - Vancouver, British Columbia – NOVAGOLD RESOURCES INC. (“NOVAGOLD” or the “Company”) (NYSE American, TSX: NG) today released a comprehensive response addressing the multiple misleading statements and patent falsehoods made by J Capital Research (JCAP) in its report on the Company issued on May 28, 2020. NOVAGOLD believes that JCAP, masquerading as a research firm, is perpetrating what is known as a short-and-distort scheme.
“The NOVAGOLD team has been thoroughly reviewing the error-ridden report by JCAP since it was published on May 28, 2020,” said Greg Lang, President and CEO of NOVAGOLD. “Our response, while of necessity lengthy, clearly highlights the numerous false and misleading statements contained in the report. I encourage everyone to review this material in detail in order to fully understand the magnitude of the distortions and deceptions put forth by JCAP, and why NOVAGOLD is so determinedly assessing all of the legal options available to it in various jurisdictions.”
The full response, which contains a line-by-line factual analysis of the inaccurate report, can be viewed in this matrix: https://www.novagold.com/investors/news/index.php?content_id=2355.
Among other points, NOVAGOLD’s response demonstrates:
? Donlin Gold (or the “project”), 50%-owned by NOVAGOLD, is clearly feasible as well as one of the world’s largest and highest-grade known open-pit gold deposits, as supported by extensive environmental, technical, and social studies conducted by numerous reputable firms;
? NOVAGOLD and its partner Barrick Gold are advancing Donlin Gold toward development in a fiscally and socially responsible manner with a strong focus on technical excellence, safety, and environmental stewardship;
? The Company’s highly experienced and well-regarded management team is steadfast in its strategy toward successful execution of the project when the gold price, market conditions, and project optimization render it ready for development;
? JCAP exhibited a fundamental lack of knowledge of geology, engineering, topography, technology, accounting and financial assessment methodology as it attempted to denigrate NOVAGOLD and its assets; and
? JCAP’s misrepresentations, convenient omissions, and intentional muddling of chronology, events and data, as well as inappropriate comparisons and consistent reliance on unidentified, questionably credentialed “experts”, exposed its deep lack of legitimacy.
Additionally, Dr. Thomas S. Kaplan, Chairman of the Board of Directors of the Company, released a separate statement in which he comprehensively addressed for the investing public his take on JCAP. It can be viewed here: https://www.novagold.com/investors/news/index.php?content_id=2353.
NOVAGOLD is vigorously assessing with counsel all of the legal options available to it in various jurisdictions against JCAP and any other parties who may be complicit in any effort to manipulate NOVAGOLD’s share price through the dissemination of these and any other falsehoods and distortions.
The Company’s Board of Directors and management are sincerely thankful for NOVAGOLD’s shareholders’ warm engagement and support, as the Company continues to advance Donlin Gold, a truly unique gold development project, perfectly positioned for the next generation of mines.


AND
NOVAGOLD Chairman Thomas S. Kaplan Addresses Misleading
Short-and-Distort Report by Short Seller
June 08, 2020 - Vancouver, British Columbia – NOVAGOLD RESOURCES INC. (“NOVAGOLD” or the “Company”) (NYSE American, TSX: NG) today released a statement issued by Dr. Thomas S. Kaplan, Chairman of NOVAGOLD, who also represents the largest shareholder of the Company. Dr. Kaplan addresses a blatantly misleading report issued on the Company by short seller J Capital Research (JCAP) on May 28, 2020. In that report, the Company believes that JCAP, masquerading as a research firm, is perpetrating, what is known as a short-and-distort scheme designed to nefariously inject the market with misleading and false negative information about the Company to drive the price of its security down in order to allow those with short positions to quickly cover them at an artificially low price and, in doing so, derive a quick profit on the backs of unsuspecting shareholders.
The Company provided a separate detailed response to this attack. This response highlighted, line-by-line, a myriad of JCAP’s falsehoods and outright lies and scrupulously juxtaposed them against corresponding facts in a multipage document, linked to a separate press release which can be viewed here: https://www.novagold.com/investors/news/index.php?content_id=2354.
“With lies you may get ahead in the world – but you can never go back.”
On Thursday morning 10 days ago, I was enjoying a particularly sweet moment, savoring a fine cup of Nespresso’s (now discontinued) Ethiopian Yirgacheffe-origin coffee – my favorite. For myself, as for many of you, the coffee drinking ritual is an important one, especially these days, when home and office are now more than ever one and the same. It was another day under lockdown in our New York City apartment, yet I felt blessed to have a family and loved ones mostly safe from our common foe, and in as reasonable spirits as one can be when profoundly aware that tragedy and trauma surround us all. The mood was actually upbeat as my older son had narrowly avoided a ruptured appendix a couple of mornings before and, benefitting from the combination of his precocious self-diagnosis of appendicitis, the laser-like focus of our family’s physician, and the surgical staff at New York-Presbyterian/Columbia Hospital, he was operated on and back at home in his own bed the very same day. This constituted the first “outing” either of us had in quite some time and was thus memorable in more ways than one. Witnessing my boy up and about after one day of bed rest only was astonishing, and as gratifying a moment as one could ask for as a parent.
My tranquility was suddenly broken by a flurry of e-mails from friends and colleagues. Had I seen the “hit piece” on NOVAGOLD? I had not. When I read JCAP’s report, my first reaction was to chuckle because the piece was clearly so fallacious that I initially assumed it had been written by a child – cooped up kids have far too much time on their hands these days – or, more likely, a disgruntled short seller. The long winter that had witnessed the cratering of the gold industry over the past decade had in fact decimated many actors in the space. Some had simply gone by the wayside, much like the proverbial hare in Aesop’s fable, the victims of fatal flaws that can best be described in broad strokes as follows: self-inflicted wounds, jurisdictional reckoning, or plain bad luck. Other than a hiccup of collateral damage when our partner Barrick went through one of its periodic praetorian blood lettings back in 2013, NOVAGOLD had suffered from none of these afflictions and, tortoise-like, had marched steadily up the value chain and was now trading at multi-year highs.
It therefore made no sense to me that one would go out of their way to short our stock. And, as Mark Bristow and I shared a laugh with each other last week, who in their right mind would short a great gold story in a growing bull market in gold? Be that as it may, the hunters in this case were cunning in their larceny and caught us unawares, as those who throw a sucker punch (or, as the Aussies call it, a “coward punch”) know in advance that it will. Conspicuously manipulative in their conflation of events and personalities, we could immediately see the obvious intent of the document and assumed everyone else would do too. When our largest shareholders expressed not only solidarity, but also genuine outrage at JCAP’s obvious falsehoods and underhanded ways, we learned that while the experience may well be new to us, it was not to others.
With little experience in dealing with nefarious actors, we chose the path familiar to us: we would ignore the defamatory aspects of the piece, and tackle the challenge as if it were a traditional shareholder enquiry. After all, we pride ourselves on being unusually transparent in our communications and reporting, as evidenced by a previous exercise in which we invited real analysts to submit any questions they wished to ask of management. True, the two
situations were apples and oranges – yet their contrast proves to be rather insightful. The enquiry that followed came from a veteran, industry-leading analyst (John Bridges, who retired last year), who worked at a legitimate firm (J.P. Morgan) and was honest, fair, and well-meaning in all his research coverage – and, I should add, bullish on the NOVAGOLD story. He submitted many questions – we answered them all in writing, and he published them. We translated that success into a regular model of writing in-depth Q&A sections in our Annual Reports that communicate to our shareholders, or prospective shareholders, the most frequently asked questions of us, so they can see for themselves not only the answers to what they want to know, but also answers to questions that others have thought of and that may have escaped them. Believing that an educated consumer is the best and most steadfast customer, we have often been cited – by true experts like John Hathaway and discerning investors like John Paulson and Will Danoff – as being a model of transparency and shareholder alignment in our industry.
I am truly proud of the fact that being held to account is something we welcome – and in fact always will. We just love it. In this instance with JCAP, we knew better than anyone that the contentions at hand did not reflect sincere, constructive examinations or questions. As to their disgraceful endeavor to paint our management team as the same one that had crippled NOVAGOLD – long before we entered the scene and began fixing it in 2009 as a white knight, and turned the Company completely around after taking over management in 2012 – it was downright libelous. In other words, knowing full well that the claims were mendacious, it became clear that this exercise constituted a deliberate, if utterly shameless, attempt to manipulate our share price for financial gain.
To that extent, as I saw the volumes spike and our stock slump, the hatchet job was working. Was this even legal, I wondered? At first, we weren’t sure, but it seemed it shouldn’t be as the misstatements were so blatant as to suggest defamation or worse. I confess that I am not in the business of trading, and certainly not short-selling, so the whole phenomenon was completely alien to me. One can easily imagine the shock to our management team. It was hard for us to even find an analogy. A “sucker punch”? It sure qualified, but these can happen even among friends in a moment of weakness. So that did not seem strong enough. A Clockwork Orange-inspired, financial adaptation of the so-called “knockout game”? Perhaps equal in savagery, but also senseless. A “snatch and grab”? Getting closer. Might it typify a “mugging”? Closer still, as a mugging definitely constitutes a theft, yet can also be both physically and psychologically scarring. In actual fact, as I googled the singular incident I felt we were experiencing, I found the precise definition of what had befallen us: a “short-and-distort” campaign.
We are, unfortunately, not the first to fall victim to such a campaign. Indeed, articles have been written about these schemes, describing some common patterns of how they have been carried out: first, a person or firm purporting to be a financial analyst publishes statements alleging that the company has acted fraudulently or is otherwise in financial trouble; then investors with long positions react to the published statements by selling their long positions; then the company’s share price drops, resulting in a loss of market capitalization, and perhaps worse, a tarnished reputation; finally, those who have taken short positions on the company cash in on this series of events. One such article can be found here:
https://www.dlapiper.com/~/media/files/people/weiner-perrie/weinerweberhsu.pdf
We will not stand idly by as a “short and distort” campaign is waged against NOVAGOLD. The statements made by JCAP about NOVAGOLD are false, misleading, ultimately defamatory, and illegal in many respects. NOVAGOLD intends to pursue the legal action available to it so that these wrongs can be redressed. Understanding the breadth of these “short-and-distort” schemes also helps explain why it has taken NOVAGOLD’s management some time to assemble a comprehensive rebuttal to a succession of perfidies so voluminous and twisted as to require an army of readers and literally a line-by-line response.
“As the vilest writer hath his readers, so the greatest liar hath his believers: and it often happens, that if a lie be believed only for an hour, it hath done its work.”
Suffice to say, I unequivocally believe that anyone reading our Company’s response to this catalogue of errors – of both commission and omission – will conclude that JCAP’s agenda was to manipulate NOVAGOLD’s stock and profit from an unwarranted and unjustified sneak attack on an organization that has been “doing it right” for at least the past 8 years that Greg Lang and I have been in charge. As reflected in Jonathan Swift’s rather apt observation about the utility of falsehood, highlighted above, it is the nature of the beast that the perpetrators make their ill-gotten gains from unsuspecting shareholders who are duped out of their money after such an assault. For their report is not
see & read more on
https://www.novagold.com/_resources/news/2020-06-08b.pdf

and see also
https://www.novagold.com/_resources/news/2020-06-08c.pdf