Poseidon Concepts Corp.
Siskinds LLP represents plaintiffs in proposed class actions filed in the Ontario Superior Court of Justice, Alberta Court of Queen’s Bench and Quebec Superior Court against Poseidon Concepts Corp. (“Poseidon Concepts”; TSX: PSN) and certain of its current or former officers and directors. In Alberta, Siskinds LLP is co-counsel with the Calgary-based law firm of Jensen Shawa Solomon Duguid Hawkes LLP. The Quebec proceeding is brought by Siskinds Desmeules, Siskinds LLP’s Quebec affiliate law firm.
The proceedings are brought on behalf of all persons who acquired securities of Poseidon Concepts on or prior to February 14, 2013, whether in a prospectus offering or in the secondary market, other than certain excluded persons associated with the defendants.
The class action plaintiffs allege that, among other things, the defendants made statements that were materially false and misleading regarding Poseidon Concepts’ financial position, financial performance and cash flows, overstated the company’s revenue and income and reported inflated assets.
On February 14, 2013, Poseidon Concepts disclosed that an investigation conducted by a Special Committee of its Board of Directors into the matters arising out of its accounts receivable situation had resulted in a preliminary determination that, among other things, certain of the company’s purported $148 million revenue booked during the first nine months of 2012 should not have been recognized and should not have been recorded as accounts receivable and that, as a result, the company would restate its financial statements relating to that period.
Also on February 14, 2013, the Alberta Securities Commission issued a cease trade order prohibiting all trading in Poseidon Concepts’ securities until such time that the order is revoked or varied.
Proceedings against the Underwriters
In late-January 2012, Poseidon Concepts distributed to the public 6,347,000 common shares at a price of $13.00 per share. Certain financial institutions, lead by National Bank Financial Inc., acted as the underwriters in that offering.
On February 20, 2013, Siskinds LLP commenced a proposed class action in the Ontario Superior Court of Justice against the underwriters that acted in connection with Poseidon Concepts’ January 2012 share offering on behalf of all persons and entities that bought Poseidon Concepts’ shares in that offering. In this action, among other claims, the plaintiff alleges that the prospectus that was issued in connection with that offering did not disclose all material facts relating to Poseidon Concepts, and that it contained other material misrepresentations.
Proceedings against National Bank of Canada
On February 19 and 22, 2013, Siskinds LLP and its Quebec-based affiliate, Siskinds Desmeules commenced proceedings in the Ontario Superior Court of Justice and the Quebec Superior Court against National Bank of Canada. In those proceedings, the claimants allege that National Bank of Canada influenced the release of certain of Poseidon Concepts’ documents containing material misrepresentations, and seek to represent all persons and entities that acquired Poseidon Concepts’ securities on or prior to February 14, 2013.
Proceedings against Peyto Exploration & Development Corp. (successor to Open Range Energy Corp.)
On October 1, 2013, Siskinds LLP and Jensen Shawa Solomon Duguid Hawkes LLP filed a proceeding under the Alberta Securities Act in the Court of Queen’s Bench of Alberta, seeking leave of court to commence an action against Peyto Exploration & Development Corp. (as successor to Open Range Energy Corp.). In this proceeding, the claimants allege that Open Range Energy Corp. influenced the release of certain of Poseidon Concepts’ documents containing material misrepresentations, and seek to represent all persons and entities that acquired Poseidon Concepts’ securities on or prior to February 14, 2013.
Open Range Energy Corp. (also known as New Open Range) was a successor to Poseidon Concepts’ oil and gas exploration and production business pursuant to the implementation of a plan of arrangement in November 2011. Open Range Energy Corp. was acquired by Peyto Exploration & Development Corp. in August 2012.
Proceedings against KPMG LLP
In July 2014, Siskinds LLP, Jensen Shawa Solomon Duguid Hawkes LLP and Siskinds Desmeules commenced proceedings in the Ontario Superior Court of Justice, the Court of Queen’s Bench of Alberta and the Quebec Superior Court against Poseidon Concepts’ auditors, KPMG LLP. Among other claims, the plaintiffs in these actions allege that KPMG LLP failed to comply with applicable auditing standards in its audits of Poseidon Concepts, as a result of which the company’s assets, accounts receivable and revenues were materially overstated. The plaintiffs seek to represent all persons and entities that acquired Poseidon Concepts’ securities on or prior to February 14, 2013.
On April 9, 2013, Poseidon Concepts Corp. and certain of its affiliates (collectively, "Poseidon") obtained creditor protection under the Companies' Creditors Arrangement Act ("CCAA").
On May 31, 2013, the Alberta Court of Queen's Bench (the "Court") made an order appointing Franz Auer, Joanna Goldsmith and Marian Lewis (the "Representatives") to represent the investors in Poseidon Concepts’ CCAA proceedings (the "Representation Order"). The Representation Order also appoints Jensen Shawa Solomon Duguid Hawkes LLP, Siskinds LLP, Siskinds, Demeules, S.E.N.C.R.L and Paliare Roland Rosenberg Rothstein LLP ("Representative Counsel") as counsel to the Representatives. A copy of the Representation Order is available on Poseidon Concepts' Court-appointed Monitor's website at: http://www.pwc.com/en_CA/CA/car/poseidon/assets/poseidon-110_060413.pdf
Copies of the Notices to Poseidon Concepts’ investors in regard to the Representation Order can be found here: [English] [French].
Court-Ordered Mediation within the Insolvency Proceedings
On October 11, 2013, the Court of Queen’s Bench of Alberta presiding over the CCAA proceedings rendered an order requiring certain stakeholders of Poseidon Concepts to participate in a global mediation with a view to resolve their pending claims. Among other persons and entities, the plaintiffs in the Alberta, Ontario and Quebec proceedings against Poseidon Concepts and its directors and officers were parties to the mediation. The mediation was held in late-April 2014 in Calgary, Alberta. The mediation was not successful.
A copy of the Mediation Order can be found [here].
Persons who acquired securities of Poseidon Concepts on or prior to February 14, 2013, are encouraged to complete the online information form. Your information will be held in strict confidence. By completing this form, you are not retaining Siskinds LLP, nor do you incur any obligations in connection with this lawsuit.
Any inquiries regarding these proceedings may be directed to Nicole Young of Siskinds LLP. Ms. Young can be contacted by telephone (toll free) at (800) 461-6166 (ext. 2380) or by email by clicking on the Contact Us link below.