In February 2013 and July 2014, proceedings were commenced against National Bank of Canada and National Bank Financial Inc., respectively. These proceedings have been brought in the Ontario Superior Court of Justice and the Quebec Superior Court, alleging that National Bank of Canada and National Bank Financial Inc. influenced the release of certain of Poseidon’s documents containing material misrepresentations. These proceedings have been brought on behalf of all persons and entities that acquired Poseidon’s common shares or other securities on or prior to February 14, 2013, other than certain persons and entities affiliated with the defendants.
Proceedings against KPMG LLP In July 2014, proceedings were commenced in the Ontario Superior Court of Justice, the Court of Queen’s Bench of Alberta and the Quebec Superior Court against Poseidon’s auditors, KPMG LLP. Among other claims, the plaintiffs in these actions allege that KPMG LLP failed to comply with applicable auditing and other professional standards in its audits and reviews of Poseidon’s financial statements, as a result of which the company’s assets, accounts receivable and revenues were materially overstated. The plaintiffs seek to represent all persons and entities that acquired Poseidon’s common shares or other securities on or prior to February 14, 2013, other than certain persons and entities affiliated with the defendants.
The Class Actions against Poseidon, Its Directors and Officers and Other Defendant
As a result of the CCAA proceedings of Poseidon, the class actions against Poseidon and its directors and officers have been stayed by Order of the Alberta Court of Queen’s Bench. The class actions against other defendants, including the underwriters, National Bank, KPMG and Peyto, have not been affected by the CCAA stay of proceedings. The plaintiffs have brought a motion to consolidate the class proceedings pending in the Ontario Superior Court of Justice against these defendants, which has been adjourned due to the CCAA proceedings. In April 2015, the plaintiffs argued a motion before the Ontario Superior Court of Justice that sought the Court’s permission to proceed with the claims against National Bank of Canada. On May 20, 2015, the Court released its decision and dismissed the motion. The plaintiffs intend to appeal from the motion judge’s order to the Court of Appeal for Ontario