May 13, 2020
Jeremy Opolsky has told Canadian Lawyer that a unanimous 7-0 SCC decision permitting third party litigation funding “declines to speak in broad generalities about litigation financing in other contexts, especially the class action context, and implies that lower courts are going to continue to evolve and shape the law on this issue.”
On May 8, the SCC released the reasons for its January 23 decision in 9354-9186 Québec inc. v. Callidus Capital Corp where a Québec gaming company appealed the right to secure funding to sue one of its creditors.
Speaking on the initial case, Jeremy told the publication, “what the supervising judge finds is that the interim financing—called DIP financing—of Bentham’s litigation financing agreement is appropriate and what Callidus is seeking to do by seeking another vote and seeking to be able to vote on the plan is really to act with improper purposes, to double-dip to get another chance at approving its plan and to shield itself from the litigation.”
The Court of Appeal then overturned the decision based on its view that the funder was seeking to cut in line in front of creditors and determined the issue to be “a type of equity investment,” which required a vote said Jeremy.
The case was then brought to the SCC where it was decided that under the Companies' Creditors Arrangement Act (CCAA), litigation funding should qualify as interim financing.
You can read all of Jeremy’s comments in the Canadian Lawyer article.
Read more of Torys’ insights on Litigation and Dispute Resolution on the relevant practice page.