Carlo Rossi

The Receiver brought a motion to extend the appointment of limited partner advisory committees, approve its activities, and approve a process for appointing Representative Counsel for the Unitholders.

The Ad Hoc Committee of Retail Investors raised concerns about the independence of the proposed appointment process.

The court approved the Receiver's activities and the extension of the committees, but modified the Representative Counsel appointment process to include an independent third party to evaluate proposals and make a recommendation to the court.

In the receivership proceedings of Bridging Finance Inc. and related entities, the Receiver brought a motion seeking approval of a Key Employee Retention Plan (KERP), a tolling order for limitation periods, a sealing order for confidential appendices, and the formation of Limited Partner Advisory Committees (LPACs).

An Ad Hoc Group of Retail Investors brought a cross-motion seeking the appointment of Representative Counsel.

The court granted the Receiver's requests, finding the KERP necessary, the sealing order justified under the Sherman Estate test, and the LPACs appropriate for providing input during the strategic review.

The court time-limited the LPACs to 60 days and dismissed the motion for Representative Counsel with leave to reassess in 60 days, prioritizing the portfolio review before addressing allocation issues.

The appellants, former executives of Sino-Forest Corporation, appealed the Ontario Securities Commission's decisions finding they engaged in a massive securities fraud and imposing significant sanctions, including over $11 million in administrative penalties and $64 million in disgorgement.

The appellants argued the Commission failed to properly consider Chinese business and cultural practices (guanxi) when assessing their intent to commit fraud, alleged a reasonable apprehension of bias by the hearing chair, and challenged the sanctions as excessive.

The Divisional Court dismissed the appeal, finding the Commission reasonably concluded that Ontario securities law overrides cultural explanations for illegal conduct, there was no reasonable apprehension of bias, and the sanctions were proportionate to the enormity of the fraud.