A. Dimitri Lascaris

The Ontario Plaintiffs brought a motion for approval of a $117 million settlement and release of claims against Ernst & Young LLP within the CCAA restructuring of Sino-Forest Corporation.

Several institutional investors objected, arguing that the settlement improperly extinguished their opt-out rights under the Class Proceedings Act and that the third-party release was not justified under the CCAA.

The court approved the settlement and release, finding them fair, reasonable, and rationally related to the restructuring plan.

The court held that claims compromised within a CCAA proceeding do not afford opt-out rights, and the settlement provided a substantial benefit to stakeholders.

In a proposed securities class action arising from the takeover of a mining company through a joint bid on the Toronto Stock Exchange, multiple defendant groups moved to transfer the proceeding from London, Ontario to Toronto under Rule 13.1.02 of the Rules of Civil Procedure.

The plaintiffs opposed the transfer, asserting that the dispute had multinational elements and that no venue factor strongly favoured Toronto.

The court held that the defendants failed to establish that a transfer was desirable in the interests of justice and dismissed the transfer motions.

The plaintiffs also moved to stay a related statutory valuation proceeding involving dissenting shareholders under the Business Corporations Act.

The court granted a temporary stay, finding substantial overlap in factual and expert valuation issues and concluding that a stay would avoid duplication of proceedings and promote access to justice.

The appellants, auditors and underwriters of Sino-Forest Corporation, appealed an order declaring that their claims for contribution and indemnity against Sino-Forest were 'equity claims' under the Companies' Creditors Arrangement Act (CCAA).

The claims arose from proposed shareholder class actions alleging misrepresentation.

The Court of Appeal dismissed the appeal, holding that the definition of 'equity claim' in s. 2(1) of the CCAA focuses on the nature of the claim rather than the identity of the claimant.

The court found that the appellants' claims for contribution and indemnity were clearly connected to the shareholders' equity claims and thus fell within the expansive statutory definition.

The plaintiffs sought leave under Part XXIII.1 of the Securities Act and certification of a proposed class proceeding alleging secondary market misrepresentation by a public issuer and its directors and officers in continuous disclosure documents.

They also requested approval to discontinue common law negligent misrepresentation and oppression remedy claims in favour of the statutory cause of action.

The court held that the plaintiffs met the statutory leave test by demonstrating good faith and a reasonable possibility of success at trial.

It further concluded that discontinuance of the common law and oppression claims would not prejudice class members because the statutory claim avoided reliance issues and certification difficulties.

The action was certified as a class proceeding, with identifiable class members, common issues, and a preferable procedure established.

In a proposed securities class action alleging secondary market misrepresentation by a publicly traded company and several of its officers and directors, the plaintiff brought a motion for substituted service of pleadings on two individual defendants who had not been personally served.

One defendant’s whereabouts were uncertain in Québec and the other, a Canadian citizen ordinarily resident in Québec, was incarcerated in Switzerland while criminal proceedings were ongoing.

The court considered Rules 16.04 and 17.05 of the Rules of Civil Procedure and the interaction with the Hague Convention on service abroad.

It held that the rule prohibiting substituted service where Hague Convention service is required did not apply because the defendant’s ordinary residence and connection to Canada justified service under the general rule.

The court concluded that the proposed methods of service through counsel were reasonably likely to bring the proceedings to the defendants’ attention.

The defendants and proposed defendants sought leave to appeal a motion judge's ruling on a Rule 21 motion, an order certifying the proceeding as a class proceeding, and an order granting the plaintiffs leave to commence an action under the Securities Act.

The court granted leave to appeal the Rule 21 motion in relation to the pleadings of negligence and negligent misrepresentation, noting that two recent Supreme Court of Canada decisions created a correctness and conflict issue.

Consequently, leave to appeal the certification order was also granted.

Furthermore, the court granted the proposed defendants leave to appeal the order allowing proceedings against them under the Securities Act, finding good reason to doubt the correctness of the motion judge's determination that they were de facto officers of the Income Fund.

The court issued an endorsement to settle the terms of a certification order in a securities class action, following the certification of conspiracy claims.

The defendants sought to exclude 'early sellers' from the class definition and challenged the class period dates.

The court declined to exclude early sellers, finding it premature as the scope of those entitled to relief for conspiracy was uncertain.

The court also approved the class period dates as they aligned with the plaintiff's theory of the case.

Finally, the court approved the plaintiff as a suitable representative for both primary and secondary market purchasers regarding the conspiracy claim.