As I have detailed in prior post on this site (most recently here), in recent months plaintiffs’ lawyers have filed a number of securities class action lawsuits against companies in cannabis-related businesses. According to an April 22, 20202 report from the Goodwin Procter law firm entitled “Update on Securities Litigation Against Cannabis Companies” (here), the number of securities suits against cannabis companies jumped significantly in 2019 compared to 2018. As discussed further below, these litigation trends have continued in 2020.
Continue Reading A Closer Look at Securities Suits Against Cannabis Companies

Samantha Wu

In prior posts, I have noted the series of U.S. securities class action lawsuits that have been filed recently against publicly traded companies in the cannabis business, including several Canadian companies. In the following guest post, Samantha Wu of the Bersenas Jacobsen Chouest Thomson Blackburn law firm in Toronto provides an overview of the unique exposures that directors and officers of Canadian cannabis companies face. A version of this article previously was published on the law firm’s website (here). I would like to thank Sam for allowing me to publish her article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Sam’s article.
Continue Reading Guest Post: Canadian Cannabis Companies’ Directors and Officers Face Unique Exposures

One of the things that happened both in the lead up to and in the wake of the October 2018 legalization of cannabis-based products in Canada is that a number of Canada-based cannabis companies listed their shares on U.S. securities exchanges. From the outset, D&O insurers have regarded the cannabis companies as a distinct risk and as a tough class of business. Earlier on, there were relatively few claims to substantiate these concerns. However, there have now been a number of securities class action lawsuits filed against U.S.-listed Canadian companies, with the latest lawsuit filed just this week.
Continue Reading Ontario-Based Firm is Latest Canadian Cannabis Company Hit with U.S. Securities Suit

In the following guest post, Deepshikha Dutt, Douglas B.B. Stewart,of and Frank E.P. Bowman of the Dentons law firm review and analyze a recent decision of the Ontario Superior Court of Justice relating to the liabilities of directors and officers under Ontario statutory law for misrepresentations in offering statements. This article is republished here with permission from Dentons. I would like to thank Deepshikha, Douglas, and Frank for allowing me to publish their article here. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit an article. Here is Deepshikha,  Douglas, and Frank’s article.
Continue Reading Guest Post: Court Dismisses Statutory Misrepresentation Claim against Credit Union Board in Landmark Decision

For those of us involved in day to day D&O insurance transactions, it is a recognized fact that cannabis-related companies represent a tough class of insurance business. Different insurers take different approaches to the business, but at best it is a risk class that most carriers approach warily. There are reasons for the caution, mostly having to do with questions relating to legality across and between jurisdictions. The question of potential claims is a little less certain, as there arguably are relatively few claims examples. However, a recent securities class action lawsuit involving a Canadian-based cannabis business may provide some insight into the kinds of claims in which these kinds of companies may become involved – at least those that are publicly traded.
Continue Reading Plaintiffs Files Cannabis-Related Securities Class Action Lawsuits

Flag of Ontario

There was a time only a few short years ago when the U.S. courts were the preferred forum for the litigation of securities class actions claims, arguably even claims whose relationship to the U.S. and to U.S. laws was slight. The U.S. courts role as preferred forum for securities suits was undermined by the U.S. Supreme Court’s 2010 decision in Morrison v. National Australia Bank, which underscored the fact that the U.S. securities laws apply only to domestic U.S. securities transactions. Since Morrison, a free-ranging inquiry has emerged to determine whether another country’s courts might emerge as the preferred forum for cross-border securities suits.

Among other countries, Canada has emerged as a candidate. However, a recent decision by Court of Appeal of Ontario examining the jurisdictional reach of Ontario’s securities laws expressly rejects the possibility that Ontario (where the bulk of Canadian securities suits are filed) “would become the default jurisdiction for issuers around the world.”  The Court of Appeal’s July 11, 2018 decision in Yip v. HSBC Holdings can be found here. An August 9, 2018 memo from the Toronto-based Blake, Cassels & Graydon law firm can be found here.
Continue Reading Ontario Court Rejects “Jurisdictional Overreach” for Canadian Securities Suits

Readers undoubtedly are familiar with ISS Securities Class Action Services’ annual report on the Top 100 Securities Class Action Settlements, focusing on the largest U.S. securities lawsuit settlements. The most recent Top 100 report is discussed here. ISS Securities Class Action Services has now published a list of the largest Canadian securities class action lawsuit settlements. The Canadian report, which is entitled “The Top 25 Canadian Class Action Settlements of All-Time,” reflects a number of interesting findings, and can be found here.
Continue Reading ISS Releases List of Top 25 Canadian Securities Class Action Settlements

James R. Lane

As I have noted in prior posts, securities class action litigation represents a significant part of the corporate liability landscape in Canada. In the following guest post, James R. Lane, a founding partner of the Toronto law firm of Bersenas Jacobsen Chouest Thomson Blackburn LLP, takes a look at a recent important decision by the Ontario Court of Appeal addressing director and officer liability issues under the Ontario Securities Act. A version of this article previously was published as an alert to the law firm’s clients. I would like to thank Jim for his willingness to allow me to publish his article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is Jim’s guest post.
Continue Reading Guest Post: Directors and Officers Must Defend Secondary Market Misrepresentation Claim

canadian flagAs I have previously detailed (here), 2016 was a record year for securities class action litigation in the U.S. The number of class action lawsuits filed in Canada more than doubled in 2016 compared to the year before, but the filing pace during the year was still below the pace during the period from 2010 to 2014, according to a new report from NERA Economic Consulting. The February 22, 2017 report, entitled “Trends in Canadian Securities Class Actions: 2016 Update,” which sets out a comprehensive overview of Canadian securities class action filing and case resolution trends, can be found here. NERA’s February 22, 2017 press release about the report can be found here.
Continue Reading Canadian Securities Class Action Litigation: On the Rebound?