Rikin Morzaria

The Ontario Securities Commission sought approval of a settlement agreement with Edward Gong, who admitted to unregistered trading and securities fraud in connection with a pyramid scheme that raised hundreds of millions of dollars.

Gong's company had previously pled guilty to criminal charges and was fined approximately $1 million.

The Capital Markets Tribunal approved the settlement, permanently banning Gong from trading in securities, acting as a director or officer of most issuers, and acting as a registrant or promoter, finding the terms reasonable and in the public interest.

Staff of the Ontario Securities Commission alleged that the respondents engaged in unregistered trading, illegal distribution of securities, and made false or misleading statements in connection with raising funds for a hotel redevelopment project.

The Capital Markets Tribunal found that the respondents distributed securities without a prospectus and breached a temporary cease trade order.

However, the Tribunal dismissed the allegations of unregistered trading, finding that the capital raising was ancillary to the underlying hotel business, and dismissed the allegations of false statements because no trading relationship existed.

The Tribunal also found the respondents engaged its public interest jurisdiction by failing to segregate funds and maintain accurate records.

Staff of the Ontario Securities Commission alleged that Steer Technologies Inc. published misleading news releases regarding its COVID-19 contact-tracing platform and failed to correct forward-looking information.

The individual respondents admitted to failing to ensure the accuracy of the releases and authorizing a relationship with a company publishing biased promotional articles.

The Capital Markets Tribunal approved the settlement agreement, finding the agreed sanctions, including financial payments, governance reviews, and director bans, achieved specific and general deterrence and were in the public interest.

Staff of the Ontario Securities Commission and respondent Stephen Kelley sought approval of a settlement agreement regarding allegations of unregistered trading, breaching a temporary cease trade order, and making misleading representations to investors in the Buffalo Grand Hotel project.

The Capital Markets Tribunal approved the settlement, finding it in the public interest.

Kelley agreed to a $15,000 administrative penalty, a two-year market participation ban, and to cooperate with Staff in ongoing proceedings against the remaining respondents.

The respondents raised $10 million from investors through secured debentures, representing that the funds would be used exclusively to finance a specific real estate project (Bayview Creek).

Instead, the respondents diverted approximately $3.39 million of the proceeds back to the corporate respondent and to other real estate projects controlled by the individual respondent.

The Capital Markets Tribunal found that the respondents engaged in a course of conduct that they knew perpetrated a fraud on investors, contrary to s. 126.1(1)(b) of the Securities Act.

Staff of the Ontario Securities Commission alleged that Plateau Energy Metals Inc. made misleading statements in news releases and filings regarding the status of its mining concessions in Peru, and that its CEO and CFO authorized or acquiesced in these contraventions.

Staff also alleged the CEO made selective disclosure to certain shareholders.

The parties entered into a settlement agreement wherein the respondents agreed to pay administrative penalties totaling $750,000 and investigation costs totaling $300,000.

The Capital Markets Tribunal approved the settlement, finding it fell within a range of reasonable outcomes and was in the public interest.

Staff of the Ontario Securities Commission alleged that Cronos Group Inc. improperly recognized revenue and overstated its U.S. goodwill and intangible assets, and that its former Chief Financial Officer failed to take appropriate steps to address revenue recognition issues.

The respondents admitted to the misconduct and entered into settlement agreements with Staff.

The Capital Markets Tribunal approved the settlements, finding that the agreed sanctions, including administrative penalties, costs, and an independent review of internal controls, were in the public interest and achieved specific and general deterrence.

Following a merits decision finding that the respondents engaged in unregistered trading and illegal distribution of binary options, the Capital Markets Tribunal held a sanctions and costs hearing.

The respondents operated an interconnected global business that raised over $1.4 million from Ontario investors using deceptive practices.

The Tribunal ordered significant market participation bans, administrative penalties of $1,000,000 and $500,000, joint and several disgorgement of $1,407,278.63, and costs of $400,000.

Staff of the Ontario Securities Commission alleged that the respondents operated an interconnected business operation to promote, sell, and process binary options transactions from headquarters in Israel to Ontario residents.

The Commission found that the respondents engaged in the business of trading securities without registration and distributed securities without a prospectus, contrary to sections 25(1) and 53(1) of the Securities Act.

The Commission also found that one respondent engaged in deceptive practices, including using aliases and concealing the true location of operations, which was contrary to the public interest.

The respondents raised approximately $170,600 from 90 investors through a fraudulent scheme involving a purported cryptocurrency mining company.

The Ontario Securities Commission found that the investments were 'securities' and that the respondents engaged in unregistered trading and illegal distribution.

The respondents made false representations about the business, use of funds, and expected returns, and misappropriated the funds for personal use.

The individual respondent also misled Staff and breached confidentiality during the investigation.

The Commission ordered permanent market bans, disgorgement of $170,600, an administrative penalty of $500,000, and costs of $100,000.

Staff of the Ontario Securities Commission and the respondent entered into a settlement agreement regarding allegations that the respondent engaged in the business of trading and advising in securities and acted as an investment fund manager without registration.

The respondent raised approximately $25 million from investors over a 10-year period through a limited partnership.

The respondent had reasonably relied in good faith on legal advice that registration was not required.

The Commission approved the settlement agreement, which included a voluntary payment of $1,600,000, costs of $100,000, and an undertaking not to apply for registration for one year, finding it to be in the public interest.

Staff of the Ontario Securities Commission and David Cartu sought approval of a settlement agreement regarding allegations that Cartu permitted two corporate entities to facilitate the sale of binary options to Ontario investors without registration.

Cartu admitted to the breaches and agreed to pay a $300,000 administrative penalty, $15,000 in costs, and to be subject to a seven-year market ban.

The Commission approved the settlement, finding it fell within a range of reasonable outcomes and was in the public interest.

Staff of the Ontario Securities Commission and the respondents sought approval of a settlement agreement.

The respondents admitted to operating multilateral trading facilities for fixed income securities in Ontario without being recognized as an exchange or exempted, contrary to subsection 21(1) of the Securities Act.

The respondents cooperated with Staff, self-reported the issues, and proactively implemented a remediation program.

The Commission approved the settlement, ordering disgorgement of $663,305.20 and an administrative penalty of $2,506,011.80, finding the terms fell within a range of reasonable outcomes and were in the public interest.

The applicant's employer was investigated by the Ontario Securities Commission.

The applicant was summoned to give evidence but refused to answer questions about their employment, citing a confidentiality clause in their employment agreement.

The applicant applied for directions and a declaration that the information was privileged.

The Commission cross-applied for declarations that the applicant must answer the questions.

The court dismissed the application and allowed the cross-application, finding that the information did not meet the Wigmore criteria for case-by-case privilege and that the applicant was required to attend the examination and answer all relevant questions, subject only to valid claims of privilege.

The applicant received a summons to testify in an ongoing investigation by Staff of the Ontario Securities Commission.

The applicant wished to cooperate but was concerned that testifying would violate a confidentiality clause in their employment contract.

The applicant sought an order from the Commission directing that testifying would not breach the contract, or alternatively, an order under s. 17 of the Securities Act authorizing the disclosure of the investigation to the Superior Court of Justice to seek such a declaration.

The Commission held it lacked jurisdiction to make binding declarations of right regarding the employment contract.

However, the Commission granted the s. 17 order, finding it in the public interest to allow the applicant to seek directions from the court on a confidential basis.

The defendant insurer, Compagnie d'Assurance Traders Generale ("Traders"), brought a motion for summary judgment seeking a declaration that Justin Gough operated Nancy Gough's vehicle with implied consent, thereby making Nancy vicariously liable under the Highway Traffic Act and negating the plaintiff's uninsured automobile claim against Traders.

The court dismissed the motion, holding that "consent" under s. 192(2) of the Highway Traffic Act requires a positive conferral of permission to possess the vehicle, not merely a failure to prevent unauthorized use.

The evidence showed no express or implied consent for Justin to drive the vehicle, as his license was suspended, and he took the keys without permission.

The applicant requested a reconsideration of a Licence Appeal Tribunal decision that dismissed her application for statutory accident benefits as time-barred.

The applicant argued that the two-year limitation period did not start to run until she was deemed catastrophically impaired and that the doctrine of discoverability applied.

The Executive Chair denied the request for reconsideration, finding that the request was filed late without an acceptable excuse.

Furthermore, the applicant failed to establish any significant error of law or fact in the Tribunal's original decision regarding the limitation period, the doctrine of discoverability, or the refusal to allow an expert witness.

The defendants moved to dismiss or stay the plaintiffs' claim under the Fraudulent Conveyances Act, which was added after one defendant transferred property to his wife for no consideration following a personal injury action.

The plaintiffs sought damages exceeding insurance policy limits.

The court dismissed the motion, finding that a fraudulent conveyance claim can be pursued before a judgment is obtained in the main action and that joining the claims avoids multiplicity of proceedings, with the trial judge having discretion to manage the trial process to prevent prejudice.

The applicant, a 14-year-old high school student, sustained a mild traumatic brain injury when she was struck by a car as a pedestrian.

She applied for non-earner benefits, which the insurer terminated after 104 weeks.

The arbitrator found that the applicant's post-accident life was significantly altered by cognitive fatigue, reduced processing speed, and anxiety, requiring extensive accommodations and therapy to complete high school.

Rejecting the insurer's medical assessments, the arbitrator concluded the applicant suffered a complete inability to carry on a normal life and awarded ongoing non-earner benefits and interest.

Following a jury trial for a motor vehicle accident where the plaintiff pedestrian was awarded damages less than the defendant's Rule 49 offer to settle, the court determined the costs payable.

The plaintiff was awarded costs up to the date of the offer, and the defendant was awarded costs thereafter.

The court reduced the defendant's costs due to a late concession on liability and the improper testimony of the defendant's expert witness, resulting in a net costs award payable to the plaintiff.