In November 2005, a $15 million class action was filed against Miller Bernstein LLP (“Miller Bernstein”), the former auditor of the defunct securities dealer Buckingham Securities Corporation (“Buckingham”). The class action arises out of the alleged failure of Buckingham to properly segregate client funds and the losses this caused when the firm collapsed. The statement of claim alleges that Miller Bernstein failed to properly discharge its duties as Buckingham’s auditors and that such failure caused losses to class members.
The action against Miller Bernstein has been dismissed as a result of the plaintiff’s unsuccessful summary judgment motion on behalf of the class. For more details, please see the “Developments” section below.
Who is affected by the class action against Miller Bernstein LLP?
The class action is brought on behalf of all persons, wherever resident, except the Excluded Persons,* who created or maintained an investment account with Buckingham at any time after March 17, 1997 through July 6, 2001 (the “Class Period”) and who maintained such an investment account on July 6, 2001, including, without limiting the foregoing, those persons who filed claims in the receivership of Buckingham (the “Class”).
*Excluded Persons means: (i) Miller Bernstein (the “Defendant”); (ii) any partner or employee of the Defendant, and any member of the immediate family of any such partner or employee; (iii) any person who served as an officer or director of Buckingham at any time, and any member of the immediate family of any such officer or director; (iv) Buckinghamshire Holdings Inc., GS Investments, Inc., HSS Investments Inc., Deekay Investments Inc., Scriblerus Holding Corporation, George Seidel, Harold Seidel, Norman Frydrych, Lloyd Bruce, Deborah Krofchick, David Sidel, 1195154 Ontario ltd., David Lieberman, 7928 Investments Ltd., David Bromberg, AKH Investments Ltd. and Rose Brinder (collectively, the “Insiders”), together with any other beneficial shareholders of Buckingham, and members of their immediate families; (v) any entity in respect of which any of the persons identified in (i) to (iv) above has a direct or indirect controlling interest; (vi) the legal representatives, heirs, successors and assignees of any Excluded Person.
Developments
Certification as Class Action:
This action was certified as a class action on July 20, 2010. This means that the action may proceed as a class action, but does not indicate that the action will likely be resolved in favour of the Class. Discoveries have been completed and the action is proceeding towards trial.
Motion for Summary Judgment:
From June 27-29, the Court heard a summary judgment motion brought on behalf of the Class Members against the defendant Miller Bernstein. A motion for summary judgment is essentially a streamlined form of trial. The Class sought judgment on the common issues relating to whether Miller Bernstein is liable to the Class Members (i.e. whether it is legally responsible for Class Member's losses), as well as issues relating to methodology and quantum of damages (i.e. the amount the defendant must pay to the Class).
On July 12,2017, the Court released its decision finding for the Class, a copy of which can be read here. The Defendant has delivered a notice of appeal.
Defendant's Appeal of Summary Judgment to the Ontario Court of Appeal:
The appeal was heard before the Ontario Court of Appeal on March 5, 2018. The Court of Appeal overturned the lower court’s finding that Miller Bernstein was liable to Class Members. In so doing, the Court of Appeal dismissed the Class Members’ claims against Miller Bernstein.
A copy of the Ontario Court of Appeal’s decision can be read here.
Appeal to the Supreme Court of Canada:
On November 5, 2018, the Class sought leave to appeal the decision of the Ontario Court of Appeal to the Supreme Court of Canada. The Supreme Court refused leave to appeal on May 2, 2019 resulting in the action being dismissed against the defendant.
FAQs
What is a Class Action?
A class action is a lawsuit that is brought by one or more person on behalf of a larger group of people whose claims share common legal and/or factual issues. Class actions provide a cost-effective way for groups of people with common interests to pursue a legal claim.
What does “certification” mean?
Certification is the motion where the court determines whether the action can properly be pursued as a class action. The court will consider factors such as whether the claims of the class members raise common legal and/or factual issues and whether a class action is the preferable method of pursuing the claims (as opposed to other methods, such as individual actions).
Do I have to pay anything to participate in the class action?
Class action lawyers are usually paid on a contingency basis. This means that class counsel are only paid if successful. Class counsel are paid a percentage of any settlement or court award. Class counsel fees are subject to court approval.
Can I join the class action?
There are no steps required to “join” the class action. Unless you opted-out (excluded yourself from the class action), assuming you fall within the scope of the class definition, you are automatically included in the class action.
What should I do to protect my rights?
To protect your rights, you should:
- Maintain any records or transactions related to your Buckingham account.
- Contact us by filling out the form below.
I still have a question. Who should I contact?
If you have further questions, please complete the form on this page.