March 31, 2020
CannTrust Holdings (TSX:TRST), a cannabis producer in Canada with production and processing facilities in Fenwick and Vaughan, Ontario, along with its subsidiaries CannTrust, CTI Holdings (Osoyoos) and Elmcliffe Investments, obtained protection under the CCAA on March 31. Following regulatory audits of the company's facilities in June and July 2019, Health Canada determined that the company was growing and storing cannabis contrary to applicable laws. Subsequently, Health Canada suspended the company's licences so that it can no longer propagate new batches of cannabis. Multiple putative securities class actions were also commenced in Canada and the US against the company, seeking aggregate damages of at least $500.0 million. Despite efforts to address Health Canada's findings and concerns by implementing a remediation plan, the company has had no revenue since July 2019 and recent global developments - including an oil price shock and the COVID-19 pandemic - have made it even more difficult for the company to attract new financing or strategic partners. EY was appointed monitor. FTI is the Chief Restructuring Officer of the companies. Counsel is McCarthy Tétrault for the companies, Aird & Berlis for the monitor, and Goldman, Spring, Kichler & Sanders for CannTrust Holdings.