Scott Kugler

Representative Work

Securities:

• Bridgemark Class Action and Regulatory – Defended Bridgemark and others against claims by shareholders and the B.C. Securities Commission that they participated in a $50 million “cheque swap” scheme involving contemporaneous private placement financings and the retainer of consultants funded by the financings.
• Crypto Coin Regulatory – Defending a payment processing company and its founder and CEO against allegations by the B.C. Securities Commission that they made misrepresentations and illegally distributed securities when it issued a crypto coin and then operated an exchange for that coin.
• Real Estate Developer Regulatory – Defending a real estate developer and its founder in an investigation by the B.C. Securities Commission that moneys raised in private placements for one development were unlawfully loaned by the developer in furtherance of a second development.
• Xebec Class Action – Defended a former officer and director of Xebec against a securities class action. Investors sued the company, its officers, directors, auditors and underwriters for misrepresentation in connection with a $143 million prospectus offering of Xebec securities.
• Shareholder Activism – Defended Aberdeen International Inc. against an application to the OSC by an activist shareholder intent on forcing our client to register with the OSC in a different category, change its processes, and report differently to shareholders. Our client was completely successful in having the activist's application dismissed.
• Shareholder Activism – Represented Land & Buildings Investment Management LLC, a high profile activist investor, in an urgent proceeding at the OSC to contest a decision of the TSX that would have permitted Hudson's Bay Company to complete a complex and dilutive share issuance within the context of a multi-billion dollar transaction. Our client was entirely successful in the only contested motion argued at the OSC and subsequently negotiated a settlement.
• SNC-Lavalin Class Actions – Defended the former CEO of SNC-Lavalin in class actions in Ontario and Quebec. Investors sued the company and its officers and directors for approximately $1 billion for misrepresentation. The action was certified as a class action, but with a much narrower scope than the plaintiffs sought in the Claim. We defeated a motion by plaintiffs to amend the Claim and defeated a motion for leave to appeal from that decision. The claim has been settled.
• Penn West Class Actions – Defended Penn West Petroleum and a number of current and former directors and officers of the company against multiple shareholder class actions in Canada. A parallel class action was commenced in the United States. Shareholders claimed to have suffered damages as a result of a drop in the stock price that occurred after the company announced, among other things, that it would be restating some of its financial statements. The claim has been settled.
• Poseidon Class Actions – Defended Poseidon and its directors and officers against class actions and multiple other actions in which shareholders assert both primary and secondary market claims arising from the company's announcement that approximately $100 million in revenue was improperly recognized. Class actions were commenced in Alberta, Ontario, Quebec and New York. The Poseidon litigation also involved CCAA proceedings and regulatory proceedings. The claim has been settled.
• Colt Resources Class Action – Defended Colt Resources and two of its directors against a shareholder class action alleging that the company failed to make timely disclosure of a material change and subsequently made misrepresentations in its disclosure documents. The plaintiffs were granted leave to proceed with claims under s. 138.3 of the Securities Act, but with a much narrower scope than the plaintiffs sought in the Statement of Claim.The claim has been settled.
• Convertible Debenture Pricing – Represented a hedge fund in a dispute with the issuer of convertible debentures concerning the conversion price of the debentures. Our client was entirely successful in obtaining a court order requiring the issuer to pay the conversion price that our client had sought.
• Disclosure / Insider Trading – Represented a publicly traded company in a regulatory investigation in which the OSC alleged that the company's disclosure was deficient and that some of its key executives traded while in possession of material undisclosed information. Ultimately, proceedings were not commenced.
• Insider Trading – Represented the President of a public company in proceedings commenced by the OSC in which it was alleged that he had traded while in possession of material undisclosed information. A settlement was approved by the OSC in a decision that is widely cited as setting out the applicable principles for a settlement approval hearing.
• Investment Advisors – Represented multiple investment advisors and portfolio managers at a leading Canadian financial institution in a regulatory matter involving IIROC. Our clients were entirely successful in concluding the matter without formal proceedings being commenced any of them.
• Investment Advisors – Represented an investment advisor at an established securities dealer in regulatory proceedings relating to allegations that the broker had failed to properly advise certain clients and had entered into private dealings with those clients. The proceedings were settled.
• Investment Dealers – Represented a securities dealer in multiple civil proceedings by investors who lost considerable sums of money as a result of investing in an unapproved product that was brought to their attention by some of the dealer's representatives. These actions were settled.
• Greenstar Class Action – Defended four former officers and directors of Greenstar against a class action in Ontario alleging misrepresentation in its offering documents relating to its operations in China. The claim has been settled.
• Barkerville Class Action – Defended Barkerville and two of its former directors and officers against a securities class action relating to alleged misrepresentations concerning geological reports issues in regard to the company's mining properties. The claim has been settled.
• Armtec Class Actions – Defended a publicly traded infrastructure company and its directors and officers in class actions commenced in Ontario and Quebec by primary and secondary market investors for approximately $100 million. The plaintiffs alleged that the prospectus and certain public statements contained misrepresentations about the sustainability of the company's dividend. The claim has been settled.
• Atlas Cold Storage Class Action – Defended the CFO of a publicly traded income trust in a class action commenced in Ontario by primary and secondary market investors for approximately $343 million. The plaintiffs alleged that the prospectus, as well as various financial statements and press releases, contained misrepresentations about the finances of the income trust. The claim has been settled.
• Portus Class Action – Defended four investment dealers in class actions commenced by investors for an unspecified amount that was expected to be close to $100 million. The plaintiffs alleged that the Portus hedge fund was a sham and that the investment dealers were complicit in the furtherance of the sham. The defendants were successful in striking out most of the claim on a preliminary motion, following which a settlement was reached.
• YBM Magnex Class Action – Defended the former auditor of YBM Magnex in two class actions commenced by primary and secondary market investors for approximately $360 million. The plaintiffs alleged that YBM Magnex was used to carry out a multi‑layered conspiracy and fraud for several purposes including obtaining improper gains by financial statement misrepresentation and manipulation. The actions were settled by all defendants prior to certification.

Competition / Anti-Trust:

• Real Estate “Sales Commission” Class Action – Defending an international real estate brokerage in a class action in which plaintiffs allege a price fixing conspiracy to maintain sales commissions for real estate brokers.
• "Condo Refurbishment" Class Action – Defending a condominium refurbishment company in a class action commenced by condominium corporations in the Greater Toronto Area in which plaintiffs allege that multiple leading refurbishment companies engaged in illegal bid rigging in order to charge higher prices to condominium corporations for refurbishment services.
• Airline "Capacity" Class Actions – Defending a U.S. airline in class actions commenced in multiple jurisdictions in Canada in which plaintiffs allege that the defendant airlines conspired to limit the increase in capacity in the airline industry in order to drive higher prices and higher margins.
• Airline "Fuel Surcharge" Class Actions – Defending a U.S. airline in class actions commenced in Ontario on behalf of all persons who purchased a ticket for trans-Atlantic or trans-Pacific air travel. The plaintiffs allege that the defendants participated in a worldwide price-fixing conspiracy in relation to fuel surcharges that were applied to airline tickets. The plaintiffs have claimed approximately $200 million in damages.
• "Prescription Drug" Class Action – Defending a drug company in a class action in Federal Court commenced by consumers in Canada who purchased prescription drugs that they allege were priced at higher than competitive levels due to an alleged price-fixing conspiracy between drug companies.
• "Farmed Salmon" Class Action – Defending a Norwegian based salmon producer in a class action in Federal Court commenced by consumers in Canada who purchased farm-raised salmon that they allege was priced at higher than competitive levels due to an alleged price-fixing conspiracy between salmon producers.
• "Drywall" Class Actions – Defended a leading US drywall manufacturer against class actions in Ontario and Quebec relating to an alleged conspiracy to increase the price of drywall throughout North America. The claim has been settled.
• "Resistors" Class Actions – Defended a Japanese based resistor manufacturer against a class action in Ontario relating to an alleged conspiracy to increase the price of resistors throughout the world. The claim has been settled.
• "LCD" Class Actions – Represented a Taiwanese manufacturer of LCDs in class actions commenced in Ontario and B.C. on behalf of direct and indirect purchasers of LCDs. The plaintiffs alleged that the defendants participated in a worldwide price-fixing conspiracy in relation to LCDs. The plaintiffs claimed approximately $150 million in damages. The claim has been settled.
• "SRAM" Class Actions – Represented a U.S. manufacturer of SRAM in class actions commenced in Ontario, Quebec and B.C. on behalf of direct and indirect purchasers of SRAM. Plaintiffs alleged that the defendants participated in a worldwide price-fixing conspiracy in relation to SRAM and claimed approximately $400 million in damages. In advance of the certification motion, the plaintiffs brought a motion for production by the defendants of unredacted materials in their possession from the parallel U.S. proceeding. The defendants successfully resisted this motion, as well as a similar motion in the U.S. The claim has been settled.
• "Consumer Product Engines" Class Actions – Represented an international manufacturer and distributor of consumer product engines in class actions commenced in Ontario and Quebec on behalf of all persons who purchased engines or products containing the engines. The plaintiffs allege that the manufacturer falsely advertised the attributes of the engines. The claim has been settled.
• "Automotive Cross Border Pricing Disparity" Class Actions – Represented a leading automobile manufacturer in a class action commenced in Ontario on behalf of all persons who purchased automobiles in Canada at prices higher than were available in the US. We were entirely successful in negotiating a dismissal of the action against our client.

Shareholder / Partnership Disputes:

• Real Estate Company – Represented a group of third generation shareholders of a billion dollar family development business to obtain liquidity for their minority shareholdings.
• Real Estate Company – Represented a group of second generation shareholders of a half-billion dollar real estate company to instill transparency and proper governance, leading to a successful partial liquidation of the business to provide liquidity to all interested shareholders.
• Oppression / Buyout claim – Defended a major shareholder of a family business against claims by a minority shareholder and former employee alleging off-book transactions, misuse of IP, and fraudulent bookkeeping.
• Real Estate Company – Represented a 50% shareholder of a half-billion dollar real estate company to negotiate a restructuring of the business to provide for a separation of the owners' interests without resort to litigation.
• Real Estate Company – Defending multiple shareholders of a leading real estate and development company in a one billion dollar shareholder dispute involving the oppression remedy.
• Oppression on Business Shut Down – Defended the majority shareholder, and the directors and officers, of a national automobile repair business against claims of oppression by minority shareholders who allege that the business was shut down without their approval and contrary to statutory requirements.
• Share Valuation Dispute – Defended a public company in a valuation dispute with a former C-Suite shareholder regarding the price at which the shareholder was required to sell its shares to the company. Achieved complete success on a court application dealing the valuation process.
• Dispute re Issuance of Convertible Debt to Related Parties – Defended a leading water purification company and its directors and officers against a claim commenced by minority shareholders claiming that a convertible debt issuance was oppressive and breached statutory requirements applicable to non-arms' length transactions. The claim was settled on the eve of trial.
• Renewable Energy – Defended a renewable energy company and its directors against a claim by a minority shareholder claiming oppression by the majority shareholder and by the directors and breach of an unsigned "agreement".
• M&A Dispute re Earnout Payments – Represented the vendors in a dispute with the purchaser of a large consumer products business involving a dispute over the interpretation of the transaction documents relating to Earnout calculations.
• M&A Dispute re Obligation to Close – Represented the vendor in a dispute with the purchaser about whether the conditions for closing had occurred. Through effective negotiation, the purchaser backed off insisting on closing saving our client millions of dollars.
• M&A Dispute re Misrepresentations – Defended a company and its principals against a claim brought by the purchasers of the defendant company's pharmacy business. The purchasers claimed that certain representations were false and that certain covenants were not fulfilled. The claim has been settled.
• M&A Dispute re Reps and Warranties Insurance – Assisting an insurer to investigate and defend multiple claims against its R&W insurance policy dealing with alleged breach of representations in purchase agreements.
• M&A Advisory - Advisory work for a leading underwriter with respect to its domestic obligations to clients and third parties for the purposes of an international arbitration.
• Tier 1 Automotive Supplier – Represented a shareholder of a Tier 1 automotive supplier in an action involving claims of wrongful dismissal and oppression. The claim has been settled.
• Private Health Care Company – Represented a key shareholder of a private health care company in a dispute with its other key shareholder over the management and control of the company. The dispute was resolved prior to court proceedings being commenced.
• Private Health Care Company – Represented shareholders of a closely-held private health care company in a dispute with other shareholders who had joined the company as a result of a merger. The unanimous shareholders' agreement did not contain a buy-sell provision or other contractual mechanism that would allow for the resolution of the shareholder dispute, but we obtained a court order forcing the other shareholders to sell their shares to our clients. The terms of sale were resolved out of court.
• Building Supply Company – Defended one of the partners of a partnership in a dispute with its former partner regarding the validity of a buy-sell offer and the conduct of the partners in relation to the buy-sell offer. The former partner applied to the court for an injunction to block the buy-sell offer from closing but we successfully resisted that motion and the transaction was completed

Corporate Commercial Disputes

• Lender Liability – Defending a prominent bank against allegations that it conspired with one of its commercial borrowers in connection with its borrower’s consumer facing business.
• Real Estate Brokerage – Defending a leading real estate brokerage against claims that misrepresentations were made in a confidential information memorandum that led the purchaser to overpay for a $100+ million commercial portfolio.
• Sales Commissions – Defending a prominent rapid test manufacturer against claims by a third party reseller alleging that it made introductions leading to significant purchases that should have triggered sales commissions.
• Leasing Dispute – Defended a industrial property owner against claims by a former tenant that it had the right to purchase the property under the lease. The tenant’s claim was dismissed by the court and the decision was upheld by the Court of Appeal.
• Employment Class Action – Defended a leading technology company in a class action by couriers who claim to be employees rather than independent contractors.
• Condominiums – Defended a condominium corporation and its directors against a claim by multiple large tenants in respect of a dispute over the parking arrangements at the location and over the tenant’s desire to erect a pylon sign.
• Employment – Defended a prominent sports club against a claim brought by a member who was challenging the club’s decision to suspend his membership for breach of the club’s rules.

Privacy:

• Privacy Class Action – Defending a leading technology company in a class action by consumers who claim that mobile phone companies had access to, and accessed, their user information and confidential data under alleged data sharing agreements with Facebook.
• Privacy Class Action – Defending a leading cloud storage and services company in a class action by customers of a financial institution whose data was accessed in a cyberattack on the financial institution. We were entirely successful in having the plaintiffs' claim dismissed at the certification motion. Plaintiffs have commenced an appeal.

Insurance:

• HST Class Action – Defending a leading insurer in a class action by policy holders alleging that their SABS benefits were incorrectly calculated due to alleged inclusion of HST in benefits calculations. We were entirely successful in having the claim struck out on jurisdictional grounds on a preliminary motion. Plaintiff's appeal to the Court of Appeal was dismissed. Plaintiff's application for leave to appeal the Supreme Court of Canada was also dismissed.

Municipal:

• Highway Class Action – Defending a municipality in a class action by persons who were involved in accidents on a highway alleging that the highway was unsafe for vehicular use.
• Environmental Class Action – Defending a municipality in an environmental class action alleging that plaintiffs lost property value resulting from approval of developments that allegedly increased the size of the downstream floodplain.

Franchise Disputes:

• Disclosure – Defended multiple claims against franchisors against the of franchisees and former franchisees relating to alleged misrepresentations and deficiencies in the disclosure documents.
• Disclosure – Represented the first franchisee in a newly established franchise business in a rescission claim against the franchisor relating to alleged deficiencies in the disclosure document. A settlement was achieved.
• Disclosure / Misrepresentations – Defended an individual who is alleged to be a franchisor's associate in a claim by a franchisee relating to alleged deficiencies in the disclosure document as well as alleged misrepresentations made prior to entering into the franchise agreement. A settlement was achieved.
• Real Estate – Represented a franchisor in a dispute with a former franchisee concerning land control over the former franchise location. The court enforced our client's rights under a land control agreement with the former franchisee and awarded our client control over the property. The decision was upheld by the Court of Appeal.

Administrative Law:

• Judicial Review – Represented the manufacturer of Chobani Greek yogurt in a high profile dispute regarding a test marketing permit that had been issued by the Minister of International Trade that allowed limited quantities of Chobani to be imported into Canada duty-free. The applicants contended that the import permit was unreasonable because the imports threatened Canada's supply management system and argued to have the import permit struck down. The court dismissed the applications and ruled that the applicants all lacked standing.