Robert Gain

The respondent Silvio Serrano brought a motion and application seeking disclosure of a Confidential Order and related reasons that authorized redactions to transcripts of a co-respondent's compelled interview.

Prior to the hearing on the merits, the term of the Commissioner who had presided over preliminary procedural matters expired, and a new panel was assigned.

Serrano brought a motion challenging the new panel's jurisdiction, arguing the original Commissioner's term should be extended under s. 4.3 of the SPPA or the matter heard de novo.

The Commission dismissed the panel composition motion, finding the original Commissioner only made procedural rulings and did not participate in the merits, so s. 4.3 did not apply and procedural fairness was not breached.

On the disclosure motion, the Commission ordered that the respondents be provided with redacted versions of the Confidential Order and Reasons, as well as information regarding the legal basis for the redactions, balancing the need for procedural fairness with the interests protected by the confidentiality.

The applicant sought to revoke a section 11 investigation order after the Ontario Securities Commission publicly disclosed his compelled testimony in a receivership application without first obtaining a section 17 disclosure order.

The Tribunal held that the Commission is bound by the confidentiality provisions of section 16 and cannot publicly disclose compelled evidence without a section 17 order.

However, the Tribunal concluded that revoking the section 11 investigation order was not an appropriate remedy for the improper disclosure, as the disclosure occurred after the order was issued and revocation would be purely punitive.

In an enforcement proceeding, the respondent Serrano brought a motion seeking disclosure of a Confidential Order and related reasons that redacted portions of a co-respondent's compelled interview transcripts.

Staff argued they were legally prohibited from identifying information relating to the Confidential Order and proposed an ex parte, in camera hearing to make submissions.

The Commission held that it had the inherent authority to control its own procedure and ordered a confidential phase of the hearing.

To address the inherent fairness concerns of excluding the respondents, the Commission appointed an amicus curiae to represent the interests of justice during the confidential phase.

Epix Resource Finance Corporation applied for an order under section 127 of the Securities Act against Aberdeen International Inc., alleging Aberdeen failed to comply with obligations applicable to non-redeemable investment funds.

The Commission considered whether Epix should be granted standing to proceed as a private party.

The Commission dismissed the application, finding that Epix failed to demonstrate it was in the public interest to bypass Commission Staff's usual gatekeeper processes and policy-based filtering.

Staff of the Ontario Securities Commission and the respondent audit firm jointly submitted a settlement agreement for approval regarding the respondent's audits of two investment funds.

The respondent admitted to failing to conduct its audits in accordance with generally accepted auditing standards, including failing to obtain sufficient audit evidence, lacking professional skepticism, and failing to complete required engagement quality control reviews.

The Commission approved the settlement, finding it in the public interest, and ordered the respondent to be reprimanded, pay an administrative penalty of $3.5 million, and pay costs of $500,000.

Staff of the Ontario Securities Commission brought a motion seeking an order requiring BDO Canada LLP to deliver further and better witness summaries prior to a merits hearing.

Staff argued the summaries failed to disclose the substance of the anticipated evidence and did not properly identify the documents to which the witnesses would refer.

The Commission dismissed the motion, finding that at the pre-hearing stage, the summaries could not be deemed deficient on their face, particularly given BDO's concession that certain broad language in the summaries was nominal and of no real value.

In an enforcement proceeding against BDO Canada LLP for alleged failures to comply with generally accepted auditing standards (GAAS) during its audits of Crystal Wealth Management Systems Limited, BDO brought a motion seeking further disclosure from Staff of the Ontario Securities Commission.

BDO sought disclosure of files relating to compliance reviews of Crystal Wealth conducted by OSC and BCSC Staff, as well as documents pre-dating January 1, 2012.

The Commission dismissed the motion, finding that the compliance reviews were not relevant to the allegations against BDO, as they served a different purpose and were not connected to BDO's compliance with GAAS.

The Commission also found no basis to require disclosure of documents older than three years before the impugned audits.

A minority shareholder of the respondent company brought an application under s. 127 of the Securities Act seeking to block a going-private transaction structured as a plan of arrangement.

The applicant alleged the controlling shareholders improperly relied on the 90 percent exemption from minority approval requirements by engaging in a multi-step strategy to dilute minority interests.

The Commission dismissed the application for standing, finding that the applicant delayed in bringing the application, failed to establish a prima facie case of abusive conduct, and had adequate alternative remedies under the CBCA to address concerns regarding price and fairness.

This motion concerned the approval of an Administration Protocol and a Distribution Protocol for the net proceeds of court-approved settlements in an ongoing class action alleging a conspiracy among financial institutions to fix prices in the foreign exchange (FX) market.

The court reviewed the proposed protocols, which differentiated between direct and indirect claimants, allocated funds (80% direct, 20% indirect), and incorporated expert analysis for damage calculation, conversion ratios, and liquidity factors.

The court found the protocols to be fair, reasonable, and in the best interests of the class, approving them without objection.

This is a counsel fee approval motion in an ongoing competition law class action.

Class counsel sought approval for an additional $13.7 million in fees, bringing the total to approximately $19.7 million, representing an 18.5% contingency fee or a 3.8 multiplier on docketed time, based on $107 million in settlements achieved to date.

The court considered factors such as risk, complexity, skill, and results, and assessed the degree of success as 19% of the estimated damages.

The court found the requested fee to be unreasonable and reduced the additional fee to $7 million, resulting in a total fee of $13 million, representing a 12% contingency fee or a 2.5 multiplier.

The court emphasized the need to balance incentives for class counsel with the access to justice principles of the Class Proceedings Act, 1992, and to avoid overcompensating counsel, which could disincentivize further robust litigation against non-settling defendants.

The representative plaintiff brought a motion for approval of a $15 million settlement in a class action against Ontario regarding systemic negligence and breach of fiduciary duty at provincially-run schools for the deaf.

The court found the settlement to be poor for the majority of the class, as 90% of the student class and 100% of the family class would receive no compensation.

However, given the significant litigation risks and the lack of aggregate damages available, the court approved the settlement as falling within the zone of reasonableness.

The court also approved class counsel's fee request of $3.75 million, but on the condition that counsel donate $1.5 million to a charity for the deaf to introduce a cy-près element and provide some benefit to the uncompensated class members.

The appellants, plaintiffs in a proposed class action alleging price-fixing in the foreign exchange market, obtained an ex parte subpoena in the United States under 28 U.S.C. 1782 against a non-party, Bloomberg.

The respondents successfully moved before the case management judge for an order requiring the appellants to obtain authorization under the Ontario Rules of Civil Procedure before taking any steps to enforce the subpoena.

The Divisional Court dismissed the appellants' appeal, finding that the motion judge correctly held that the appellants could not use the U.S. process to circumvent Ontario's strict rules on pre-certification discovery of non-parties, and that the appellants had failed to make full and fair disclosure to the U.S. court.

The plaintiff moved to certify a proposed class action arising from allegedly unreliable Motherisk hair-strand drug and alcohol testing used in child protection, family, and criminal proceedings.

The court held that while the pleading disclosed a cause of action and there was evidence of a broad group of potentially affected persons, the proposed proceeding failed on common issues, preferable procedure, and representative plaintiff criteria.

The court found the alleged systemic negligence did not materially advance the class members' real claims because compensable harm depended on highly individualized proof that a particular test result was false and adversely influenced a particular proceeding.

The litigation plan for individual hearings was found unworkable and procedurally unfair.

Certification was refused.

This motion concerned the certification of a class proceeding against the provincial Crown for alleged physical, emotional, and sexual abuse perpetrated against students at three residential schools for the deaf.

The action pleaded claims in negligence and breach of fiduciary duty, as well as Family Law Act derivative claims.

The motion for certification was brought on consent and was granted, as all criteria under the Class Proceedings Act, 1992 were satisfied.

The defendant brought a motion to set aside two default judgments arising from a breach of contract action involving a technology services agreement.

The court applied the established test for setting aside default judgments, considering delay, explanation for the default, and the existence of a triable defence.

The court held that the motion to set aside the first partial default judgment for the liquidated portion of the claim was brought with undue delay and lacked a reasonable explanation or evidence of a meritorious defence.

However, the court accepted a limited explanation regarding the second judgment for the unliquidated portion of damages and found that issues relating to quantum and equitable remedies warranted adjudication on the merits.

The second judgment was set aside on conditions, including payment of the first judgment and costs.

In a second appeal arising from insurance class proceedings concerning participating account transactions implemented in a 1997 life insurance acquisition, the appellants challenged the trial judge’s interpretation of the remedial formula previously crafted by the Court of Appeal.

The court held that the objective of the remedy was to unwind the transactions as of the effective date by restoring the participating accounts and shareholder accounts to the positions they would have occupied had the transactions not occurred, without conferring a windfall.

It concluded that amortization charges could not reduce the merger expense savings deduction, that the 6.91 percent return under paragraph 200(e) had to be calculated on an after-tax basis, and that paragraph 200(e) formed part of the deduction rather than an addition to the amount payable.

The appeal was allowed, the effective date remained December 31, 2011, and the amount repayable to the participating accounts was fixed at $51.6 million subject to updating.

The appellant intended to bring a class action for secondary market misrepresentation under the Securities Act against confidential sources quoted in a newspaper article about a leveraged buyout.

The appellant sought a Norwich order to compel the journalist and newspaper to disclose the sources' identities.

The Court of Appeal dismissed the appeal, holding that while the appellant met the threshold for a Norwich order, the respondents satisfied the Wigmore test for journalist-source privilege.

The public interest in protecting the confidential sources outweighed the public interest in the appellant's weak proposed action.

In a proposed national class proceeding alleging a price‑fixing conspiracy in the market for DRAM semiconductor devices, the representative plaintiffs sought approval of four additional settlement agreements with certain defendants and approval of class counsel fees.

The court assessed whether the negotiated settlements were fair, reasonable, and in the best interests of the class under the Class Proceedings Act, 1992.

Although no finalized distribution protocol for settlement funds had yet been developed, the court concluded the settlements—totaling $23.325 million and including cooperation provisions—were reasonable given litigation risk and the benefit of cooperation against non‑settling defendants.

The court also scrutinized class counsel’s request for a 30% contingency fee of approximately $7.13 million.

Finding that percentage excessive at this stage of the proceedings, the court reduced the fee award to 20% of total settlements achieved to date and approved an interim fee of $4,180,345.59.

Following a prior trial and a partial appeal, the court conducted a rehearing to determine the appropriate remedy in a certified class proceeding concerning participating account transactions and an unlawful pre‑paid expense asset used by life insurance companies.

The Court of Appeal had upheld the finding of illegality but directed the trial judge to determine the monetary amounts required to unwind the transactions and restore funds to participating policyholder accounts.

The central disputes concerned the calculation of merger synergy deductions, whether historical amortization charges should be deducted when determining the benefit received by participating accounts, the interpretation of a 6.91% return provision, and the appropriate “effective date” for unwinding the transactions.

The court concluded that amortization expenses since 1997 must be deducted to reflect the “no contribution/no benefit” principle and interpreted the Court of Appeal formula as adding, not subtracting, the 6.91% return to the participating accounts.

The court fixed December 31, 2011 as the effective date and ordered that $284,675,000 be paid to the participating accounts, with cancellation of the pre‑paid expense asset and related amortization charges.

In a certified class proceeding alleging a price-fixing conspiracy in the market for DRAM (dynamic random access memory) devices contrary to Part IV of the Competition Act and related torts, the representative plaintiffs sought court approval of a negotiated settlement with one defendant.

The settlement required the settling defendant to pay $5.75 million for the benefit of class members in Ontario, British Columbia, and Québec and to provide extensive cooperation in the ongoing litigation against non-settling defendants.

The agreement also included a bar order preventing contribution and indemnity claims against the settling defendant while permitting discovery cooperation and proportional liability determinations at trial.

Applying established class action settlement approval principles, the court concluded the settlement was fair, reasonable, and in the best interests of the class.

The settlement approval order was granted.