TORONTO – Opponents of a proposed class-action settlement involving the former auditor of Sino Forest have until Jan. 18 to file objections with the Ontario Superior Court ahead of a hearing scheduled for early February.
Auditing firm Ernst & Young has agreed to pay $117 million to a fund to compensate shareholders of the troubled Chinese-Canadian company, which has been accused of fraudulently overstating its assets.
However, a group of fund managers has objected to the settlement, which includes a provision that will prevent them from opting out of the class-action to pursue their own suits against Ernst & Young.
On Friday, the firms representing Sino Forest’s shareholders released a schedule of proceedings leading to a Feb. 4 hearing before the Ontario Superior Court of Justice, which will be asked to approve the class settlement.
Legal motions in favour of the settlement are to be submitted to the court by Jan. 11. Opponents will have a week to file their notices of objection and further pre-hearing proceedings will occur in the following weeks.
The law firms Koskie Minsky LLP of Toronto, Siskinds LLP of London, Ont., and Siskinds Desmeules of Quebec City are representing investors who bought Sino Forest shares between March 31, 2006 and Aug. 26, 2011.
A group of investment firms said on Dec. 7 they would oppose a restructuring plan at Sino-Forest Corp. because it includes the settlement with Ernst & Young.
Comite Syndical National de Retraite Batirente, Northwest and Ethical Investments and Trimark Investments object to the settlement because it would deprive them of the right to sue their audit firm individually.