Securities Law - SCJ

The plaintiffs moved without notice for a Norwich Order and Mareva Injunction against Benjamin Allan Ward, the former CEO of Wayland Group Corp., in connection with a proposed investors' class action under the Ontario Securities Act.

Ward had been noted in default and evaded service.

The court found evidence of Ward's history of securities fraud, improper conduct, evasion of service, and removal of assets to multiple jurisdictions.

The court granted the Mareva Injunction to prevent asset dissipation pending a default judgment motion scheduled for March 10, 2026, where damages exceeding $49 million are sought on behalf of the proposed class.

The court approved a proposed settlement and certified the action for settlement purposes under the Class Proceedings Act, 1992.

The class consists of approximately 100 investors in a failed real estate limited partnership project.

The settlement restores the class members’ proportionate interest in the property, now with greater development density and less debt, and is considered generous.

The court found the settlement fair, reasonable, and in the best interests of the class, and approved class counsel’s fees.

The action will continue only as between the defendants for unresolved crossclaims.

This decision concerns three related matters: the appointment of a receiver over the assets of Sussman Mortgage Funding Inc. and related companies, the granting of a Mareva injunction against Sanford Sussman, and the scheduling of a motion to appoint representative counsel for investors.

The court finds the appointment of B. Riley Farber Inc. as receiver to be in the public interest and grants the Mareva injunction on consent.

The decision addresses the statutory and common law bases for receivership, the public interest in protecting investors, and the coordination of proceedings involving multiple stakeholders.

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 court approved a Notice Plan for a proposed settlement in a certified class action between Vecchio Longo Consulting Services Inc. and Aphria Inc. et al.

The Notice Plan, developed by class counsel and to be administered by RicePoint Administration Inc., was found to be fair, reasonable, and effective in providing adequate notice to class members regarding the settlement approval hearing and related matters.

The court confirmed that the plan met the requirements of the Class Proceedings Act, 1992, and ordered that the Notice Plan proceed as proposed.

Terra Firma Capital Corporation sought court approval for a plan of arrangement under section 182 of the Business Corporations Act (Ontario), which would result in GM Capital Corp. acquiring all outstanding common shares of Terra Firma it did not already own.

The arrangement was overwhelmingly approved by both shareholders and minority shareholders.

The court applied the three-part test for approving arrangements, confirming that statutory procedures were met, the application was made in good faith, and the arrangement was fair and reasonable, supported by strong shareholder approval, board recommendations, and fairness opinions.

The final approval order was granted.

The Ontario Securities Commission (OSC) brought a motion seeking an order for the issuance of Letters of Request in Commissions under section 152 of the Securities Act.

The OSC required evidence from two individuals, one residing in British Columbia and one in Massachusetts, USA, for a proceeding before the Capital Markets Tribunal concerning Bridging Finance Inc. and its respondents.

The respondents did not oppose the motion.

The court granted the order, finding that the proposed witnesses had relevant evidence and that the Letters of Request and Commissions accorded with Rule 34.07(2) of the Rules of Civil Procedure.

This decision concerns a carriage motion between two proposed securities class actions, Kennedy v. Akumin Inc. and Longair v. Akumin Inc., brought under the amended Class Proceedings Act, 1992.

The court applied the new s. 13.1 of the CPA, which mandates a focus on efficiency and likelihood of success in advancing class members' claims.

The Longair action proposed a broader class period, alleged more categories of misrepresentation, and named additional defendants, including the company's auditor.

The court found that the Longair action better advanced the goals of access to justice and behaviour modification by encompassing more viable claims and defendants, despite some reservations about the claim against the auditor.

Carriage was granted to the Longair action, and the Kennedy action was stayed.

The case involved a claim by Scotia Capital Inc. against Aphria Inc. for an "Independence Fee" under an engagement letter for financial advisory services in defending a hostile takeover bid, and a counterclaim by Aphria for defamation related to Scotia's discontinuation of analyst coverage.

The court found that Scotia successfully defended Aphria against the takeover bid, entitling it to the Independence Fee.

The court dismissed Aphria's defense arguments of lack of causality and repudiation.

The court also dismissed Aphria's counterclaim for defamation, finding no evidence that the discontinuation of coverage lowered Aphria's reputation or caused economic loss.

The plaintiff in a proposed securities class action sought an "exclusivity order" to prevent other actions on the same subject matter from being commenced in Ontario without leave of the court.

The defendants did not object.

The court denied the request, emphasizing that Ontario's established procedure for managing competing class actions involves a "carriage motion" once rival claims emerge, rather than a pre-emptive exclusivity order.

The court distinguished the Federal Court's "inclusivity order" in Heyder v. Canada (Attorney General) as not overriding Ontario's endorsed approach.

This continued case conference endorsement addresses the plaintiff's request to adjourn a multi-day leave motion in a proposed class action until an in-person hearing is possible, due to concerns about conducting a complex hearing virtually during the COVID-19 pandemic.

The defendant was prepared to proceed virtually.

The court, acknowledging the evolving confidence in virtual hearings and the need for courts to operate, ordered the motion to proceed by videoconference on the previously scheduled dates of June 23 and 24, 2020, finding that remote procedures are not inherently unfair and practical issues can be addressed through cooperation.

This trial decision addresses a complex dispute arising from the sale of a business, involving a promissory note default, failure to assume a lease, and subsequent seizure of assets.

The vendor (plaintiffs) sought to recover a deficit, while the purchaser (defendants) counterclaimed for unlawful seizure and damages.

The court found the purchaser in default of the promissory note and the lease assumption.

It determined that notice prior to seizure was not required under the Personal Property Security Act's exception for collateral customarily sold on a recognized market, and that the vendor's actions, while dishonourable, did not breach the duty of honest performance.

Damages were assessed, adjusting the plaintiffs' claim by reducing excessive storage fees and crediting the defendant for an undervalued asset sale.

The plaintiff moved to certify a proposed class action against TD Asset Management Inc. (TDAM) alleging that TDAM improperly paid "trailing commissions" to discount brokers for "service and advice" that was not provided, thereby wasting Mutual Fund assets and causing investor losses.

The court granted certification for claims of breach of trust, breach of fiduciary duty, disallowance of improper expenses under s. 23.1 of the Trustee Act, and prospectus misrepresentation.

However, claims for knowing assistance, knowing receipt, and unjust enrichment were struck as analytically unworkable or lacking a proper basis in fact.

The court affirmed the plaintiff's standing as a unitholder to sue the trustee and manager, and found the class definition and common issues suitable for certification, reiterating that certification is a low hurdle not concerned with the merits.

The plaintiff sought leave to proceed with a class action for secondary market misrepresentation against a company and its officers.

The claims arose from an unauthorized investment made by the CEO, which was not fully disclosed in subsequent financial statements and press releases.

The court granted leave, finding a reasonable possibility that the CFO knew or deliberately avoided knowing about the unauthorized investment, and that a press release announcing the CEO's departure constituted a public correction, signaling concerns about the CEO's conduct related to the investment.

The plaintiff, George Leon, brought a proposed class action in Ontario against Volkswagen AG for fraudulent misrepresentation related to the purchase of VWAG American Depositary Receipts (ADRs) and common shares on foreign exchanges.

Volkswagen AG moved to dismiss the action for lack of jurisdiction or, alternatively, to stay it on the grounds of forum non conveniens.

The court dismissed the action, finding no real and substantial connection to Ontario, as VWAG did not carry on business in Ontario and the tort of fraudulent misrepresentation was not committed there.

The court also found that the U.S. (for ADRs) and Germany (for common shares) were clearly more appropriate forums, emphasizing the principle of international comity in cross-border securities litigation and giving little weight to the plaintiff's asserted juridical advantages in Ontario.

The plaintiff sought leave under s. 138.8 of the Ontario Securities Act to commence an action for secondary market misrepresentation against Pretium Resources Inc. and Robert A. Quartermain.

The plaintiff alleged that the defendants failed to disclose material facts regarding conflicting expert opinions on the validity of a mineral resource estimate for the Brucejack Project, leading to a significant drop in share price.

The court granted leave, finding that the plaintiff established a reasonable possibility of success at trial.

The court determined that the concerns raised by Strathcona Mineral Services, a respected mining consultant, were material facts that a reasonable investor would consider important, despite Pretium's belief that the data was unreliable.

Furthermore, the court found a reasonable possibility that the defendants would not be able to establish the "no reasonable grounds to believe" branch of their reasonable investigation defense under s. 138.4(6) of the OSA.

Martin Gerard, as plaintiff in a class action against Detour Gold Corporation and Gerald Panneton, moved for court approval of a settlement agreement, a distribution plan, class counsel fees of $1,620,000 plus disbursements and taxes, and honoraria for the representative plaintiffs.

The court, having previously certified the class action for settlement purposes, found the $6 million settlement and distribution plan to be fair, reasonable, and in the best interests of the class, considering factors such as the likelihood of success, the arm's-length negotiations, and the absence of objections.

The court also approved the requested class counsel fees and honoraria for the representative plaintiffs, Martin Gerard and Terry Wright, acknowledging their significant efforts.

The Superior Court of Justice approved a $69 million settlement in a securities class action against Manulife Financial Corporation, along with the plan of allocation, honoraria for representative plaintiffs, class counsel's contingency fees, and a preliminary commission for a third-party litigation funder.

The court found the late-stage settlement to be fair and reasonable, considering the extensive litigation and identified risks, including compelling evidence of market understanding of Manulife's hedging practices, a reasonable investigation defense, arguments against corrective disclosure, the impact of the economic crisis, and the dismissal of a parallel U.S. action.

The Trustee in Bankruptcy appealed a Registrar's decision that allowed a secured claim by Snap Auto Finance Corp. The Trustee had initially disallowed Snap's claim, arguing that Snap failed to perfect its security interest in a vehicle within the timeframes required by Ontario's Personal Property Security Act (PPSA) after the vehicle was brought into Ontario.

The Registrar found the vehicle had not been "brought in" to Ontario.

The Superior Court found the Registrar erred by not considering the debtor's assignment in bankruptcy in Ontario and his sworn Statement of Affairs, which indicated Ontario residency.

The Court concluded the vehicle was "brought in" to Ontario in November 2015, and Snap failed to perfect its security interest within the statutory 60 days or 15 days of notice.

The Trustee's appeal was allowed, restoring the disallowance of Snap's secured claim, making Snap's interest subordinate to the Trustee's.

This decision addresses eight motions in a billion-dollar secondary market securities class action.

The court granted motions by SNC-Lavalin and its Outside Directors to strike paragraphs from the Plaintiffs' Amended Reply and dismissed the Plaintiffs' motion to deliver a Fresh as Amended Reply, finding that the Plaintiffs were attempting to plead a new, uncapped liability claim without leave and reintroduce previously rejected allegations of bribery in Libya.

The court also granted motions by the Outside Directors and Michael Novak to strike paragraphs from Riadh Ben Aïssa's Statement of Defence, which similarly attempted to introduce allegations of bribery in Libya and knowledge against co-defendants beyond the scope of the granted leave.

Additionally, the court granted protective orders for the examinations for discovery of Messrs.

Ben Aïssa, Duhaime, and Roy, who faced criminal charges, to protect their Charter rights and the integrity of criminal proceedings, but denied requests to stay or postpone discoveries.