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30 JUNE 2026 AL CIRCLE

Rare earth rivalry intensifies as MP Materials sues USA Rare Earth over technology dispute

EDITED BY : STAFF EDITOR 2MINS READ

rare

Stock image for referential purposes only

Competition in the US rare earth industry has intensified after MP Materials filed a lawsuit against USA Rare Earth, alleging that the company acquired confidential magnet-making technology through former employees.

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The dispute comes as the United States accelerates efforts to build a domestic rare earth supply chain following China's tightening of export controls on rare earth materials and magnets. China currently accounts for around 90 per cent of global rare earth magnet supplies, making the sector strategically important for industries ranging from electric vehicles and aerospace to defence.

MP Materials claims a former senior engineer transferred confidential information related to grain boundary diffusion, a technology used to improve the heat resistance of rare earth magnets while maintaining magnetic strength. The company alleges that USA Rare Earth recruited several key employees with access to proprietary knowledge and is seeking at least USD 5 million in damages.

Explore: The most comprehensive and forward-looking industry-focused report – Global Bauxite & Alumina Market Forecast to 2036: Supply–Demand, Trade Flows & Price Outlook

USA Rare Earth has denied the allegations, describing the lawsuit as an attempt to slow the company's progress. It argued that the technology can be independently developed or obtained through legitimate means and rejected claims that it had misappropriated trade secrets.

The legal dispute comes as both companies continue expanding their operations with government support. MP Materials operates one of the world's largest rare earth mines in California and recently secured a multibillion-dollar agreement with the US Department of Defense to strengthen domestic rare earth production.

USA Rare Earth has also received significant federal backing, announcing USD 1.6 billion in government support earlier this year. The company is commissioning a magnet manufacturing facility in Oklahoma, while production from its proposed Texas mine is targeted for 2028. It has also expanded through acquisitions, including UK-based Less Common Metals and Brazil's Serra Verde, which operates the Pela Ema rare earth mine.

Industry observers say the case reflects the increasing competition for technology, skilled workers and production capacity as the US seeks to reduce dependence on imported rare earth materials and strengthen its domestic supply chain.

Explore our e-magazine ALuminium LeaderSpeak 2026 for the latest industry insights and trends.


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EDITED BY : STAFF EDITOR 2MINS READ

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