The defendants, Nortel Networks Corporation and John Roth, appealed an interlocutory order that struck only portions of the plaintiff's statement of claim.
The Divisional Court allowed the appeal and struck the entire statement of claim against the appellants, finding it disclosed no reasonable cause of action.
The court held that the plaintiff failed to plead the essential elements of negligent misrepresentation, failed to plead material facts to overcome the business judgment rule regarding alleged mismanagement, and lacked standing as an individual shareholder to bring claims for conversion of company property.