Investigation Counsel P.C. wishes to announce the commencement of a proposed class action against the former CEO of Partners REIT, Ronald McCowan, certain of the REIT’s former and current trustees , and certain other defendants.
The action relates to the circumstances surrounding Partner REIT’s decision to enter a transaction, announced on April 2, 2014 (the “Transaction”), for the purchase of certain Ontario properties from an entity named Holyrood Holdings Limited (“Holyrood”).
The action is brought to recover losses suffered by all persons, subject to certain exclusions, who held units of Partners REIT as of the close of trading on April 1, 2014.
It is alleged, among other things, that Holyrood was under the control of McCowan, either alone or jointly with his business associate Laura Philp (“Philp”), and that he had a material economic interest in the Transaction. As such, the Transaction was in violation of the REIT’s Declaration of Trust and applicable rules of the Toronto Stock Exchange because the trustees did not seek and obtain unitholder approval for the Transaction. McCowan and the trustees allegedly breached their trust and fiduciary duties to the class members by causing Partners REIT to enter the Transaction.
Holyrood, Philp, and the law firms who acted on behalf of Partners REIT and Holyrood for the Transaction are also defendants.
It is alleged that the defendants have liability for damages sustained by the proposed class.
On March 13, 2015, the plaintiff served the defendants with his Motion Record in support of certification of the action as a class proceeding.
This matter is being case managed. At the initial case conference following delivery of the plaintiff’s Motion Record, the Case Management Judge directed that the plaintiff’s certification motion be bifurcated, with a first hearing to deal with the first requirement for certification (whether the Statement of Claim disclosed reasonable causes of action against each of the defendants) and, if necessary, a second hearing to deal with the remaining four certification requirements. The first hearing took place on June 4, 2015. The Case Management Judge held that the plaintiff’s claim disclosed reasonable causes of action against the trustee defendants and McCowan. He dismissed the claims against Philp, Holyrood, and their law firm. A copy of his decision can be found here: https://investigationcounsel.com/locking-v-mccowan-2015-onsc-4435/ The plaintiff successfully appealed the order dismissing the claims against Philp and Holyrood. A copy of the Court of Appeal’s decision can be found here: https://investigationcounsel.com/locking-v-mccowan-2016-onca-88/
The motion hearing to address the remaining four requirements for certification is scheduled for November 8 and 9, 2016. (A description of the requirements for certification of a class proceeding can be found here: https://investigationcounsel.com/post/what-fraud-victims-should-know-about-class-and-group-actions/ )
On November 8, 2016, the action was certified by the Ontario Superior Court of Justice on consent of the parties. A copy of the Certification Order can be found here . A copy of the Notice to Class Members can be found in English here and in French here .
On October 30, 2018, the parties executed Minutes of Settlement. Subject to court approval, the settlement fully and finally resolves the claims advanced on behalf of the Class Members in this case. The defendants have agreed to pay the Class $4.95 million (inclusive of legal fees, administration expenses, applicable taxes, and a levy payable to the Ontario Class Proceedings Fund) in exchange for the Class providing a release to the defendants in respect of the allegations made in the proceeding. The settlement did not involve or constitute an admission of liability by any defendant.
A copy of the French Claim Form can be found here: