The Applicants, licensed cannabis producers, sought court approval and sanction of their second amended and restated plan of compromise and arrangement under the CCAA.
The Plan aimed to implement a settlement framework for multiple securities class actions arising from the Applicants' illegal cannabis growing operations.
While the court found the Allocation and Distribution Scheme reasonable and rejected KPMG's complaint about being excluded from voting, it refused to sanction the Plan.
The court held that the Plan's provisions regarding the assignment of claims against KPMG and the Judgment Reduction Provision in the Bar Order were not fair and reasonable to the non-settling defendants, as they failed to limit the non-settling defendants' liability to several liability.
