Coverage of the latest Canadian insolvency filings, court cases, news and more
an early stage cannabis cultivation company that is in the process of building a facility in Chatham, Ontario, was placed in receivership on September 19 on application by Auxly Cannabis Group, owed approximately $16.2 million. The company’s facility is approximately 90% complete and it has submitted its application for a cultivation license. The company’s loan from Auxly, which was used to finance the acquisition of the Chatham land and the construction of the facility, matured in August 2019 and the company has been unable to refinance the loan or otherwise put forward a proposal acceptable to Auxly. Farber was appointed receiver. Counsel is Bennett Jones for the applicant and Siskinds for the company.
Purdue Pharma LP, a Stamford, Connecticut-based pharmaceutical company, obtained a Canadian recognition order of its US Chapter 11 proceedings on September 19. The company’s most prominent product is its opioid pain medication, OxyContin. The company has been named in more than 2,600 lawsuits filed throughout the US state and federal court systems. The lawsuits allege that the company acted improperly in the marketing and sale of OxyContin and is responsible for fueling an opioid addiction crisis in the United States. In Canada, Purdue is also subject to over 10 class-action lawsuits. The company has sought bankruptcy protection in an attempt to find a global resolution of the existing claims against it. The company is proposing a settlement that involves, among other things, a $3.0 billion contribution from the company’s shareholders and the transfer of the company’s business and assets into a trust for the benefit of claimants and the US public. EY was appointed information officer. Canadian counsel is Stikeman Elliott for Purdue, Torys for the information officer, BLG for certain affiliated Purdue Canadian entities and Paliare Roland for the Sackler families.
a Vancouver, British Columbia-based company that owns the Wolverine Mine in the Yukon Territory, was placed in receivership on September 13 on application by the Government of Yukon, which has grown increasingly concerned about the continually deteriorating condition of the mine site, as well as the company’s failure to pay approximately $25.0 million in security outstanding since May 2018. On July 31, a day before the hearing of the Government of Yukon’s petition to appoint a receiver over the company, the company filed an NOI, though a limited lifting of the stay was subsequently ordered to allow the Government of Yukon to proceed with its application to appoint a receiver. On September 5, a material adverse change was reported by the company’s proposal trustee after the company failed to make certain forecast post-filing payments, including $618.0 thousand on account of projected remediation costs. PwC was appointed receiver and will be running a sales process for the company’s assets, including the Wolverine Mine. Alvarez & Marsal is the proposal trustee. Counsel TGF for the applicant, Fasken for the company, Dentons for the receiver and BLG for the proposal trustee.
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“Study the past if you would define the future.” Confucius’ quote is a favourite of Michael Rotsztain, who has been practising insolvency and restructuring law for over 40 years. Beginning his career at the legendary insolvency firm of Harries Houser, where he had the good fortune of being mentored by a bankruptcy law dream team, Michael spent the major part of his career at a leading Bay Street firm and since 2014 has been the chair of GSNH’s five-lawyer Restructuring and Insolvency Group. Michael recounts how insolvencies and restructurings have evolved over his career and shares what he thinks are the next steps in the evolution.
Richard Williams of James Williams & Associates alerts readers to new regulations that bring into question whether existing protections under the BIA and model orders are sufficient to protect trustees from liability associated with the inadvertent release of personal information.