December 12, 2013 - 7:18 AM
OTTAWA - The Supreme Court of Canada has agreed to allow a class action suit to go ahead against two mutual fund managers whose practices allegedly cost their investors millions of dollars.
In a 7-0 decision, the court upheld lower court rulings that said a class suit can proceed against AIC Ltd. and CI Mutual Funds Inc.
The firms were among five fund managers found by the Ontario Securities Commission to have allowed market timing practices which hurt their investors.
Although the firms paid millions in a settlement with the securities regulator, some investors filed a class action suit seeking more money.
A motion judge denied the suit, but that was overturned by other courts and now the Supreme Court has agreed the suit can proceed.
Three of the five firms involved have already settled, leaving the suit to go ahead against AIC and CI.
Writing for the court, Justice Thomas Cromwell said the original judge was wrong to have barred the class action suit.
"I agree with the Divisional Court and the Court of Appeal that the motion judge erred in principle in his analysis and that this justified appellate intervention in his exercise of discretion to refuse certification," Cromwell wrote.
"As I see it, the correct legal principles support those courts’ decision to certify the proposed class action."
News from © The Canadian Press, 2013