The Cash Store Financial Services Inc. operated a payday loan business from 2002 until it sought CCAA protection in April 2014.
The company's estate sued its auditor KPMG LLP and counsel Cassels Brock & Blackwell LLP, alleging negligence and breach of fiduciary duty.
The plaintiff claimed that the defendants knew or ought to have known that Cash Store was misrepresenting its business as a broker when it was actually a direct lender bearing credit risk, and that this misrepresentation caused a deepening of insolvency from late 2011 until the CCAA filing in 2014.
The plaintiff sought damages ranging from $119 million to $177 million, plus disgorgement of legal fees.
The court dismissed all claims against both defendants, finding that Cash Store was properly characterized as a broker during the relevant period, that the defendants met applicable professional standards, and that the plaintiff failed to prove causation and damages.
The court also found the claims were statute-barred.
