Settlement Reached for Just Energy Shareholders Amid Controversy
Class Action Settlement Overview
Recently, a significant settlement agreement was reached by representatives of former shareholders involved in a class action against Just Energy Group Inc. This move is part of the legal proceedings initiated after the company's restatement of its financial statements in 2019. Shareholders have been keenly watching the developments in this case, as it concerns the financial integrity and accountability of Just Energy.
Details of the Settlement
In a remarkable development, Just Energy's insurers have agreed to compensate the class action with a settlement of US$25,000,000. This amount reflects a substantial step toward addressing the claims presented against Just Energy. Notably, the settlement is poised to dismiss the action entirely; however, it does not implicate Just Energy in any misconduct or legal liability.
Previous Settlement with Ernst & Young LLP
Additionally, Ernst & Young LLP, a key player in the financial oversight of Just Energy, previously settled claims by paying C$1,500,000. This payment was approved by the court, marking a significant moment of closure for some affected parties.
Who Are the Class Members?
The defined Class encompasses all individuals and entities that acquired any Just Energy securities within the specified Class Period, which spans from May 16, 2018, to August 14, 2019. This definition importantly includes those who retained their securities until the trading close on specified dates in July and August 2019.
Understanding Exclusions from the Class
It is crucial to note that certain persons and entities, referred to as Excluded Persons, are not part of this class. This includes defendants, related subsidiaries, affiliates, and immediate family members of individual defendants.
Misrepresentations Alleged by Plaintiffs
The impetus for the class action stems from allegations that Just Energy made serious misrepresentations during the Class Period. The plaintiffs claim that the company materially overstated its accounts receivable and understated its allowance for doubtful accounts, leading to significant investor losses.
Legal Proceedings and Next Steps
The approval of the settlement is pending before the Ontario Superior Court of Justice. Should the court approve this settlement, it will effectively extinguish all related claims against Just Energy, establishing a final resolution of the disputes presented.
Legal Fees and Compensation for Class Representatives
Class Counsel, representing the plaintiffs, is pursuing legal fees not exceeding 30% of the settlement amount, which translates to US$7,500,000 plus additional disbursements. They are also advocating for compensation for the representative plaintiffs involved.
Upcoming Hearing for Settlement Approval
A critical hearing is scheduled to determine the approval of this settlement and associated fees. During this remote video conference, the Court is set to evaluate whether the proposed settlement is fair and reasonable, which is a vital step towards the distribution of the settlement fund to the Class Members.
Objections and Comments
Class Members have the opportunity to raise any objections or comments regarding the settlement design and legal fees until a specified date prior to the hearing. If the settlement receives court approval, it establishes a binding agreement for all involved.
Contact Information for Inquiries
For those with further inquiries regarding the settlement, Class Counsel representatives can be reached. Berger Montague (Canada) PC is led by Albert Pelletier and Vincent DeMarco, while Siskinds LLP provides insights via Michael G. Robb and Tyler Planeta. Contact details should be referenced directly for appointments and communications.
Frequently Asked Questions
What is the primary focus of the settlement?
The settlement focuses on addressing claims made by shareholders who acquired Just Energy's securities during the defined Class Period.
What does the $25 million settlement entail?
This settlement amount will resolve the class action against Just Energy without admitting any wrongdoing.
Who is included in the defined Class?
The Class consists of individuals and entities that acquired Just Energy securities during the Class Period and retained them during specified trading closings.
What are Excluded Persons?
Excluded Persons are those such as defendants, affiliates, and immediate family members who are not part of the Class.
How can Class Members provide feedback on the settlement?
Class Members can submit comments or objections until the established deadline before the hearing for approval of the settlement.
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