Derek Ricci

In a CCAA restructuring involving a remote iron ore mining operation facing an immediate cash crisis before a narrow seasonal shipping window, the applicants sought approval of interim debtor-in-possession financing and a super-priority charge.

Competing secured creditor groups proposed rival DIP facilities, but the court approved the Crown lender’s DIP for the interim bridge period only, emphasizing the urgent need for operational stability, the monitor’s support, and the limited prejudice given the de novo rehearing scheduled within weeks.

The court added consultation, consent, and information protections to preserve a level playing field for the competing DIP proponents before the full return motion.

The stay of proceedings was extended, authority was granted to pay certain critical pre-filing suppliers with the monitor’s consent, and the sealing request was adjourned.

The Ontario Securities Commission alleged that the respondents engaged in an illegal distribution of Canopy Growth Corporation shares and that Cormark and Kennedy failed to deal fairly, honestly, and in good faith with Canopy, or alternatively, acted contrary to the public interest.

The allegations centered on a series of transactions involving a private placement, a securities loan agreement, and short sales executed when Canopy was added to the TSX composite index.

The Capital Markets Tribunal dismissed all allegations, finding that the transactions did not constitute an illegal distribution under the extended definition, Canopy was not a client of Cormark or Kennedy, and the respondents did not mislead Canopy or otherwise engage the Tribunal's public interest jurisdiction.

The respondent, Marc Judah Bistricer, brought a motion seeking additional disclosure from Staff of the Ontario Securities Commission regarding documents obtained during its investigation.

Staff alleged that the respondents engaged in abusive short selling and other transactions contrary to the animating principles of the Securities Act.

Bistricer sought documents relating to similar transactions by others and all materials obtained under section 11 investigation orders.

The Capital Markets Tribunal dismissed the motion, finding that the disclosure request was too vague and imprecise.

Furthermore, even interpreting the request generously, the Tribunal held that the requested documents were irrelevant, as the standard for the respondents' conduct is not determined by the prevalence of similar conduct by others in the market, and Staff's disclosure obligation does not extend to all materials obtained during an investigation.

Mangrove Partners applied for a joint hearing before the Alberta Securities Commission (ASC) and the Ontario Securities Commission (OSC) regarding a proposed transaction between TransAlta Corporation and Brookfield.

TransAlta brought a motion arguing the OSC should decline to hear the application due to an insufficient nexus with Ontario.

The OSC found that while it had jurisdiction, there were no compelling circumstances to warrant exercising it concurrently with the ASC, which was the principal regulator and had stronger connections to the dispute.

The OSC declined to exercise its jurisdiction to hear the application.

The Ontario Securities Commission held a sanctions hearing for a respondent who admitted to trading without registration and illegal distribution of securities in relation to a Ponzi scheme.

While Staff sought a disgorgement order of $207,641 and an administrative penalty of $50,000, the Commission declined to impose monetary sanctions.

The Commission found that the respondent was unaware the investment was a Ponzi scheme, was genuinely remorseful, and had no ability to pay due to her age and financial circumstances.

Non-monetary sanctions, including a 15-year trading ban, were imposed.

Following a merits decision finding that Coventree Inc. and its senior officers, Geoffrey Cornish and Dean Tai, failed to disclose material changes in breach of the Securities Act, the Ontario Securities Commission held a hearing to determine sanctions and costs.

The Commission emphasized the fundamental importance of timely disclosure to the integrity of capital markets.

While noting mitigating factors such as the respondents' lack of intent to mislead and their cooperation with Staff, the Commission imposed significant administrative penalties to achieve specific and general deterrence.

Coventree was ordered to pay a $1 million penalty and $250,000 in costs, while Cornish and Tai were each ordered to pay a $500,000 penalty and were prohibited from acting as directors or officers of a reporting issuer for one year.