Class Members In Ontario Securities Action Can Be Bound By Settlement Of Parallel U.S. Class Proceeding

An Ontario court has just released a welcome decision for issuers who may find themselves defending parallel securities class actions in multiple jurisdictions. In the decision, the judge held that members of a class certified in Ontario can be bound by a settlement reached in a related class proceeding in the U.S., and then excluded from participating further in the Ontario class proceeding. In rendering her decision, the judge noted, "[i]t is not the function of this court to jealously guard its own jurisdiction over a class proceeding that has been certified here."

In Silver v. IMAX, 2013 ONSC 1667, released on March 19, 2013, van Rensburg J. granted the defendants' motion to amend the Ontario class to exclude those who were part of the class in a parallel, conditionally-settled U.S. action.  The result is that, by settling their action in the U.S., the defendants were able to resolve the overwhelming majority of claims on both sides of the border.