Canadian Underwriter

$75-million shareholders’ lawsuit proposed against SNC Lavalin

February 26, 2019   by THE CANADIAN PRESS

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SNC-Lavalin Group Inc. faces new legal troubles as a shareholder aims to launch a class action lawsuit in connection with the criminal charges against the embattled engineering firm.

Law firm Strosberg Sasso Sutts LLP has filed a proposed class action lawsuit in Ontario Superior Court that alleges the company failed to disclose soon enough that federal prosecutors declined to invite it to negotiate a remediation agreement.

The allegations have not been tested in court.

The Montreal-based company is at the centre of a scandal enveloping Ottawa after the Globe and Mail reported the Prime Minister’s Office pressured former attorney general Jody Wilson-Raybould to steer prosecutors to hammer out a remediation agreement that would have averted a criminal trial.

The legal action says the head of the federal prosecution service told SNC-Lavalin on Sept. 4 that she would proceed with fraud and corruption charges stemming from the company’s business in Libya. The court filing says the company did not inform investors until Oct. 10, when the share price dropped nearly 14 per cent.

The lawsuit seeks $75 million in damages for shareholders who acquired SNC-Lavalin securities between Sept. 4 and Oct. 10. SNC-Lavalin did not respond immediately to requests for comment.

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