A lawsuit claims the bank should be liable for misrepresentations made during the financial crisis
Rochon Genova LLP has released a statement to remind the investing public of a certified class action against the CIBC.
The statement said that on February 3, 2014, the Court of Appeal for Ontario certified a class action against CIBC relating to the bank’s representations relating to its exposure to the US subprime mortgage market through collateralized debt obligations (CDOs) and credit default swaps (CDS); the bank eventually had to take write-downs on those positions amounting to $9.3 billion.
The plaintiffs were also granted leave to commence an action under the Ontario Securities Act’s secondary market liability provisions. Under the provisions, if someone acquires a security from a company after the company makes false representations in a public disclosure, then the individual is allowed to recover damages without proof or reliance on the misrepresentation, subject to certain defenses that may be asserted.
The Court of Appeal’s certification was upheld by the Supreme Court of Canada in December 2015. The defendants deny any merit to the claims, which have yet to be verified for accuracy by a court.
The statement from Rochon Genova identifies “all persons or entities, excluding U.S. residents, who purchased CIBC common shares between May 31, 2007 and February 28, 2008 on the TSX” as members of the class. Those who wish to opt out of the action are advised to send a signed letter, which should include certain contact information and details of the CIBC shares purchase or purchases made during the period covered by the action, by January 3, 2017.
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The statement said that on February 3, 2014, the Court of Appeal for Ontario certified a class action against CIBC relating to the bank’s representations relating to its exposure to the US subprime mortgage market through collateralized debt obligations (CDOs) and credit default swaps (CDS); the bank eventually had to take write-downs on those positions amounting to $9.3 billion.
The plaintiffs were also granted leave to commence an action under the Ontario Securities Act’s secondary market liability provisions. Under the provisions, if someone acquires a security from a company after the company makes false representations in a public disclosure, then the individual is allowed to recover damages without proof or reliance on the misrepresentation, subject to certain defenses that may be asserted.
The Court of Appeal’s certification was upheld by the Supreme Court of Canada in December 2015. The defendants deny any merit to the claims, which have yet to be verified for accuracy by a court.
The statement from Rochon Genova identifies “all persons or entities, excluding U.S. residents, who purchased CIBC common shares between May 31, 2007 and February 28, 2008 on the TSX” as members of the class. Those who wish to opt out of the action are advised to send a signed letter, which should include certain contact information and details of the CIBC shares purchase or purchases made during the period covered by the action, by January 3, 2017.
Related stories:
CIBC, Scotiabank, RBC implicated in Bahamas offshore exposé
TD and CIBC post third quarter earnings
