Hansen Wong

The Ontario Securities Commission brought an enforcement proceeding against the respondent, alleging he perpetrated a fraud and made misleading statements contrary to the Securities Act by drafting press releases for a public company that contained false information.

The Capital Markets Tribunal dismissed the application, finding that while the press releases were misleading, they were issued by the corporation, not the respondent.

The Tribunal held that drafting corporate communications does not constitute making a statement to the investing public under s. 126.2(1), nor does it constitute perpetrating a fraud on the public under s. 126.1(1)(b), absent evidence that the respondent caused or duped the corporation into issuing them.

The Ontario Securities Commission appealed an order appointing a receiver over Cacoeli Asset Management and related entities pursuant to section 129(1) of the Securities Act.

The appellants argued that the appointment of a receiver requires a strong prima facie case of breaches of the Act.

The Court of Appeal upheld the lower court's decision, holding that the correct evidentiary standard is a serious concern that there have been possible breaches of the Act.

The court found that the OSC had met this standard based on evidence that funds raised from investors for specific projects were diverted to other purposes without investor disclosure or consent.

The Ontario Securities Commission sought the appointment of a receiver over the assets of Traders Global Group Inc. and related entities based on allegations of fraud and unregistered securities trading.

The receiver was appointed in January 2024.

More than nineteen months later, the respondents brought a motion to discharge the receiver, and the receiver sought directions regarding disclosure of data to the Commission.

The court found that significant changes in circumstances had occurred since the appointment, including the dismissal of related U.S. proceedings due to misconduct by CFTC staff whose evidence had supported the receivership appointment, the discovery of a Nova Scotia decision that undermined the novelty of the Commission's legal theory, and substantial delay in the investigation without issuance of an Application for Enforcement Proceeding.

The court granted the respondents' alternative request to vary the appointment order, reducing the frozen assets from tens of millions to $10 million in escrow, while retaining the receiver to administer the escrow and act as intermediary for data disclosure.

The court also confirmed the receiver's authority to share non-privileged data with the Commission under the appointment order.

The applicant, the Ontario Securities Commission, sought an order under section 129 of the Securities Act to appoint a receiver and manager over all assets and properties of the respondents, a group of interconnected real estate investment entities.

The Commission alleged that the respondents diverted investor equity from specific limited partnership projects to unrelated properties, contrary to the limited partnership agreements and marketing materials.

The court rejected the respondents' argument that a strong prima facie case was required, holding that the Commission only needed to show serious concerns of a breach.

Although the court ruled that investor interview transcripts were hearsay and inadmissible for the truth of their contents, it found sufficient evidence of improper fund diversion to justify the receivership.

The court appointed the receiver over all properties, declining to exempt specific properties held by secured creditors, to ensure coordinated oversight.

The Ontario Securities Commission (OSC) applied for the appointment of a receiver over the respondents under section 129 of the Securities Act.

The parties sought directions from the court regarding non-disclosure obligations under sections 16 and 17 of the Act, particularly concerning the production and use of investigation materials.

The court endorsed a protocol allowing redacted and unredacted affidavits to be filed, balancing the need for confidentiality with the respondents’ right to make full answer and defence.

The court also addressed scheduling and adjournment of the application, confirming the interim monitorship and setting a new hearing date.

The Ontario Securities Commission sought sanctions against Manticore Labs OÜ and Manticore Labs Inc. (operating as CoinField) following a merits decision finding they breached the Securities Act through unregistered trading, illegal distribution of securities, and making false and misleading statements to investors.

The respondents operated a crypto asset trading platform that went offline, leaving investors unable to withdraw their funds.

The Capital Markets Tribunal found the misconduct to be serious and ordered permanent market participation bans, an administrative penalty of $2.4 million, disgorgement of $537,034.46, and costs of $89,538.30.

The Ontario Securities Commission brought allegations against Manticore Labs OÜ and Manticore Labs Inc., operators of the CoinField crypto asset trading platform, for violations of the Securities Act.

The Capital Markets Tribunal found that the crypto contracts offered by CoinField were 'investment contracts' and therefore securities.

The Tribunal concluded that the respondents engaged in the business of trading securities without registration, distributed securities without a prospectus, and made false or misleading statements to investors regarding the safety of their funds and withdrawal delays.

The Tribunal also found that the respondents' failure to maintain proper custody of investors' assets and honour withdrawal requests justified a public interest order under s. 127(1) of the Act.

A subsequent hearing was ordered to determine sanctions and costs.

Wessuc Inc. sued Todd Brothers Contracting Limited and The Guarantee Company of North America (GCNA) for breach of contract, unjust enrichment, and breach of trust related to a sludge removal contract.

Todd counterclaimed for Wessuc's failure to complete the contract.

The court found that the contract was a lump sum agreement for 6100 m³ of sludge removal, not a per-unit price for total volume including water.

Wessuc abandoned the project by ceasing work and failing to provide a plan for completion, entitling Todd to terminate the contract.

Wessuc's claim for damages and quantum meruit was dismissed as it did not substantially complete the work.

Todd's counterclaim for costs incurred to complete Wessuc's work, including cattail removal, equipment, fuel spill cleanup, and sand/sawdust for drying sludge, was allowed for $53,000.

GCNA was found to have no obligations under the bond due to Wessuc's failure to provide timely and adequate notice.

The Ontario Securities Commission applied to appoint a receiver over the property of the respondents, who allegedly engaged in a fraudulent foreign exchange trading scheme.

The respondents had collected over USD $310 million in registration fees from customers who believed they were trading in a live market, when in fact they were trading in a simulated environment controlled by the respondents.

The court found a prima facie case of fraud and determined that appointing a receiver was appropriate for the due administration of Ontario securities law to manage and preserve approximately USD $90 million in frozen assets.

Following a merits decision finding that the respondents illegally distributed securities and breached a temporary cease trade order in relation to a hotel development project, the Capital Markets Tribunal held a sanctions and costs hearing.

The Tribunal ordered permanent market bans against the respondents, with a limited carve-out allowing the individual respondent to remain a director and officer of his registered real estate brokerage.

The Tribunal also ordered the respondents to jointly and severally pay an administrative penalty of $600,000, disgorge $13.177 million and US$364,000, and pay $166,000 in costs.

Staff of the Ontario Securities Commission sought an inter-jurisdictional enforcement order against the respondent following his criminal conviction for defrauding investors of over $23 million through a mortgage investment corporation and a limited partnership.

The Capital Markets Tribunal found that the criminal convictions arose from a course of conduct related to securities, as the arrangements constituted investment contracts.

Given the egregious nature of the fraud, the duration of the misconduct, and the need to protect investors, the Tribunal concluded it was in the public interest to permanently prohibit the respondent from participating in Ontario's capital markets.

In the receivership of the Bridging Funds, the Receiver brought a motion to determine whether unitholders with Potential Statutory Rescission Claims (based on misrepresentations in offering memoranda) or Potential Redemption Claims (based on unfulfilled redemption requests) were entitled to priority over General Unitholder Claims.

The court held that Potential Redemption Claims were not entitled to priority because the redemption requests had not been completed prior to the receivership.

However, the court held that Potential Statutory Rescission Claims were entitled to priority, finding that the statutory right of rescission under s. 130.1(1) of the Securities Act creates a de facto priority and justifies the imposition of a constructive trust over the invested funds.

The appellant appealed a decision of the Ontario Land Tribunal regarding compensation for the expropriation of contaminated land.

The Tribunal had determined the property's market value to be $290,000 based on a speculative value, rejecting the appellant's higher valuation due to prohibitive environmental remediation costs.

The Tribunal also awarded $51,683 for wasted costs.

On appeal, the Divisional Court found no palpable and overriding error in the Tribunal's factual findings regarding market value and wasted costs.

The Court also rejected the appellant's argument that it was denied procedural fairness when the Tribunal refused an interlocutory motion for third-party document production.

The appeal was dismissed.

Hiawatha First Nation applied for a permanent injunction to restrain three of its members from constructing a gas station on the reserve.

The band argued the construction violated the Indian Act, a band by-law requiring building permits, a band resolution imposing a moratorium on new businesses, and environmental legislation.

The court found that the building permit by-law and environmental legislation did not apply, and that the proposed business structure did not violate the Indian Act.

However, the court held that the band resolution imposing a moratorium was an enforceable by-law.

The court granted an injunction restraining construction while the moratorium remains in effect and until the proponents comply with all applicable laws.

The defendant, Visiting Angels Inc., moved for summary judgment to dismiss the plaintiff's claim alleging conversion, negligence, vicarious liability, and intentional infliction of emotional distress.

The claims arose from alleged theft and damage of items during a home cleaning service.

The plaintiff opposed the motion and sought to transfer the matter to Small Claims Court.

The court granted the defendant's motion for summary judgment, finding no genuine issue for trial as the plaintiff failed to provide reliable evidence to substantiate her claims of ownership, loss, or damage, or to link the alleged torts to the defendant.

ESW Capital, LLC applied for exemptive relief from the minimum tender requirement under the Securities Act in connection with its proposed take-over bid for Optiva Inc. The proposed bid was opposed by two other control block shareholders, Maple Rock and EdgePoint, who announced they would not tender their shares.

ESW sought to exclude their shares from the minimum tender calculation.

The Ontario Securities Commission dismissed the application, finding no exceptional circumstances or abusive conduct by the target, bidder, or control block shareholders that would warrant altering the recalibrated bid regime and undermining minority shareholder choice.

The proposed intervenor, representing Ontario school boards, brought a motion to intervene in an appeal concerning the allocation of tax savings between a utility's shareholders and ratepayers.

The utility opposed the intervention, arguing the proposed intervenor would merely duplicate the regulator's arguments.

The court granted the motion, finding that the proposed intervenor had a direct interest in the outcome and would provide a useful and distinct perspective on behalf of ratepayers without causing undue delay.