Last update of 2009 - Happy Holidays...

Please see the following update from the counsel of the Shire Class Action Group.  I am taking a break and will not be responding to phone calls or emails until after January 4th.

Happy Holidays!

On Monday I attended in court before Madam Justice Kent with other counsel for a variety of matters.  The major point was for Justice Kent to clarify her December 7 decision, in particular a couple of paragraphs which were not clear as to how debtor in possession funds were to be paid as a result of her decision not to continue the CCAA stay of proceedings.  This included a review of what she intended in her decision concerning the payment of professional fees.  She said her intention was that the debtor in possession financing was to be paid out of the equity in the properties first before any secured creditors' security would be impacted.  She found the professional fees of the monitor, monitor's counsel and debtor counsel (as usual in CCAA matters) were to be paid out of the DIP.  Unfortunately she also decided to revisit the October 7 order of Justice LoVecchio who directed that up to $100,000 of the DIP be paid for the investors' legal costs.  She found that procedurally this request had not been formally put before the court and she believed she could revisit previous decisions in CCAA proceedings where circumstances changed.

There was also an application by the DIP financier to appoint E&Y as a full blown receiver instead of the modified receivership powers that it holds currently.  She adjourned this application until January 8 at 9:00 am.as it was filed on late notice.

More updates...

On December 7, Madam Justice Kent rendered a decision in which she has declined to extend the stay and thus ended the CCAA proceedings on the basis that continuing CCAA proceedings would not add value over and above what the properties would be worth through a foreclosure process. Kent did say that there should be payment for the professionals to date under the dip, the receiver's charge and the administration fee from the equity in the companies.  It is likely that another receiver would be put in place to coordinate the various foreclosures and to deal with the properties against which there are not any conventional mortgages.  We have asked the existing receiver what happens next and they have advised that they are reviewing the matter.  In effect, the judge is saying that the properties should all be sold but it should not be under the umbrella of the CCAA because of the potential risk that secured creditors will lose some priority to the debtor in possession financing in place in CCAA proceedings.

It is important to note that the investors benefitted to a large extent from the investigation analysis and detailed report compiled by the Monitor.  This kind of detailed report would not have been provided in a non-CCAA receivership.

One of the applicants from the last hearing, Investit, has sent a letter to the Court asking for clarification of certain points in the decision.  The Court has set Monday, December 21 at 10:00 am to hear from them.

CCAA goes up in smoke...

Please see the this link for information on the decision today by Justice Kent who has declined the CCAA stay extention.  As for what this means, I don't have answers right now. Stay tuned.

A decision coming Monday...

The applications finished late in the day. The judge decided to take some time on the weekend and will provide her decision on Monday.
I'll provide an update when I get the news.

Next CCAA Court Date - December 4th...

The next hearing in the CCAA is Friday, December 4th.  I don't have the exact time, but it is expected to be at 8:30am.  Unfortunately, I won't be able to be there.  If you are there, could you kindly send an update my way after?