The Perils Of Evidentiary ‘Jenga Towers' In Securities Class Actions

In a series of securities class action decisions issued in 2022, Ontario courts provided useful guidance on elements of the statutory cause of action for secondary market misrepresentation. In Lundin Mining, the Ontario Superior Court of Justice clarified the "change" aspect of a "material change" under the Ontario Securities Act and, in Pretium, the Ontario Court of Appeal confirmed that the reliability of information is a relevant consideration when determining whether information is "material."

In addition, courts have continued to show an increasing willingness to engage, at the preliminary leave stage, in detailed examinations of both the fact and opinion evidence adduced by the parties. In 2022, leave motion judges diligently performed what the Supreme Court of Canada has called their "important gatekeeping role," repeatedly cautioning against attempts to "reason backwards" from a decrease in share price to argue that a claim has a reasonable possibility of