46 Pages Posted: 27 May 2009 Last revised: 6 Oct 2009
Date Written: August 10, 2009
A number of Canadian provinces recently have adopted legislation providing shareholders with a claim for secondary market fraud. Although the legislation has some similarities to the “fraud on the market” class action found in the United States, the laws have some important differences. This article compares securities class actions in Canada and the United States, highlighting the differences between the two regimes that are likely to have important strategic consequences for class action attorneys and issuers. The article also collects and analyzes data on the securities class actions that have been filed to date against Canadian issuers in both Canada and the US, sometimes simultaneously. Finally, the article analyzes the effect of the new legislation on premia for directors’ and officers’ insurance. We find that the relative price of D&O insurance went up substantially for issuers listed only in Canada after the legislation went into effect.
Keywords: Ontario Securities Act, Supreme Court of Canada, director and officer insurance
JEL Classification: K22
Suggested Citation: Suggested Citation
Pritchard, Adam C. and Sarra, Janis P., Securities Class Actions Move North: A Doctrinal and Empirical Analysis of Securities Class Actions in Canada (August 10, 2009). U of Michigan Law & Economics, Olin Working Paper No. 09-009; Alberta Law Review, Forthcoming. Available at SSRN: https://ssrn.com/abstract=1410724 or http://dx.doi.org/10.2139/ssrn.1410724