FAQS


1. What is this case about?

CannTrust is a publicly traded company and its shares were primarily traded on the Toronto Stock Exchange (“TSX”) and on the New York Stock Exchange (“NYSE”).

Its share price declined following the announcement by CannTrust on July 8, 2019 that it had received a compliance report from Health Canada notifying it that its greenhouse facility in Pelham, Ontario was non-compliant with certain regulations as a result of observations by the regulator regarding the growing of cannabis in five unlicensed rooms and inaccurate information provided to the regulator by CannTrust employees. Class actions in Canada and the United States (the “Actions”) were commenced against, among others, CannTrust, certain of its directors and officers, the underwriters of its May 2019 initial share offering (“Offering Shares”), and its auditors, KPMG LLP.

After extensive negotiations under the auspices of a court-appointed mediator, defendant CannTrust and the majority of the defendants in the Actions have reached a global resolution of the claims asserted against them.

The proposed Settlements will be implemented pursuant to an amended and restated plan of compromise, arrangement and reorganization of CannTrust, CannTrust Inc. and Elmcliffe Investments Inc. (as may be further amended from time to time in accordance with its terms), pursuant to Canada’s Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36, as amended, (the “CCAA Plan”), which was approved by the Ontario Superior Court of Justice (Commercial List) (the “Canadian Court”) by a “sanction order” entered on July 16, 2021 (the “CCAA Sanction Order”). Click here for the CCAA Plan and CCAA Sanction Order.

The U.S. Court held a final Settlement Hearing on December 2, 2021 and approved the Settlements in relation to the U.S. Class Action. Click here for the U.S. Judgment.

2. What do the Settlements provide?

In exchange for the releases and dismissals contemplated by the CCAA Plan and the Settlements, the settling defendants have agreed to, among other things, cause payments totaling approximately $83,000,000 CAD (to date), which, along with any interest earned, will be distributed after the deduction of court-awarded attorneys’ fees and litigation expenses, taxes, notice and administration expenses and fees, ongoing litigation costs, and other fees, expenses, and liabilities allowed by the CCAA Plan and the A&DS (the “Class Compensation Fund”), to U.S. Securities Claimants and Canadian and Non-U.S. Securities Claimants (collectively, “Securities Claimants”) who submit valid and timely Claim Forms and are found to be eligible to receive a distribution from the Class Compensation Fund. The Class Compensation Fund will be administered as part of the Securities Claimant Trust.

Click here for important documents about the Settlements.

3. Why did I get the Notice?

The U.S. Court authorized that notice be sent to potential members of the U.S. Settlement Class. You may have purchased or otherwise acquired CannTrust publicly traded common stock on the New York Stock Exchange or on any U.S. based trading platform during the period from June 1, 2018 through March 31, 2020, inclusive, or pursuant or traceable to CannTrust’s offering materials issued in connection with the Company’s secondary offering, completed on or about May 6, 2019, which would make you a member of the U.S. Settlement Class (a.k.a. a U.S. Securities Claimant).

Click here for the Notice to U.S. Settlement Class Members.

If you are not a member of the U.S. Settlement Class, you may be a “Canadian and Non-U.S. Securities Claimant,” which means all Securities Claimants other than U.S. Securities Claimants. Canadian and Non-U.S. Securities Claimants are also entitled to submit Claim Forms to participate in the Settlements. Residency does not determine whether you are a U.S. Securities Claimant or a Canadian and Non-U.S. Securities Claimant.

Receipt of the Notice does not mean that you are a member of the U.S. Settlement Class or that you will be entitled to receive a payment. The Settling Parties do not have access to your individual investment information. If you wish to be eligible for a payment, you are required to submit the Claim Form no later than March 16, 2022.

If you have only recently received a copy of the Claim Form it is not too late. Include a note with your Claim Form explaining why your submission is late. The Claims Administrator will continue to process Claims received after March 16, 2022 for a period of time.

4. Are there exceptions to being included in the Settlements?

Yes. There are some individuals and entities who are excluded by definition from recovering from the Settlements.

The following are Excluded Persons:

(i) CannTrust, Cannamed Financial Corp, Cajun Capital Corporation, KPMG LLP, Merrill Lynch, Pierce, Fenner & Smith Inc., Merrill Lynch Canada Inc., Citigroup Global Markets Inc., Citigroup Global Markets Canada Inc., Credit Suisse Securities (USA) LLC, Credit Suisse Securities (Canada) Inc., RBC Dominion Securities Inc., Jefferies LLC, Jefferies Securities Inc., Canaccord Genuity LLC, Canaccord Genuity Corp., Paul Family Trust, Mar-Risa Holdings Inc., York Capital Funding Inc., Sutton Management Limited (the “Corporate Defendants”);

(ii) Eric Paul, Peter Aceto, Greg Guyatt, Ian Abramowitz, Mark Dawber, John Kaden, Mark Ian Litwin, Fred Litwin, Robert Marcovitch, Mitchell J. Sanders, Stan Abramowitz, Brad Rogers, Michael Ravensdale, Shawna Page, Ilana Platt, Graham Lee, Kenneth Brady Green, Andrea Kirk, Norman Paul (“Individual Defendants”), any member of an Individual Defendant’s immediate family, and any company under the control of an Individual Defendant; and

(iii) the past and present subsidiaries, affiliates, officers, directors, senior employees, legal representatives, heirs, predecessors, successors and assigns of any such excluded person, provided, however, for the avoidance of doubt, that any “Investment Vehicle” shall not be excluded from the U.S. Settlement Class. Investment Vehicle means any investment company or pooled investment fund, including but not limited to, mutual fund families, exchange traded funds, fund of funds, and hedge funds, in which Defendants, or any of them, have, has, or may have a direct or indirect interest, or as to which its affiliates may act as an investment advisor, but in which any defendant alone or together with its, his or her respective affiliates is not a majority owner or does not hold a majority beneficial interest.

5. How can I receive a payment?

To be eligible to receive a payment from the Settlements, eligible Securities Claimants must submit a duly completed Claim Form, including the required supporting documentation, to the Claims Administrator no later than March 16, 2022, and their claim must satisfy the criteria set out in the Allocation and Distribution Scheme that can be found here. If you have only recently received a copy of the Claim Form it is not too late. Include a note with your Claim Form explaining why your submission is late. The Claims Administrator will continue to process Claims received after March 16, 2022 for a period of time.

You can submit your Claim Form:

Online – Click here to review and complete the Online Claim Form - it’s fast, easy and secure. Your Online Claim Form must be submitted no later than March 16, 2022.

By Mail, Fax or EmailDownload and print the Claim Form from the Documents tab, duly complete it, and submit it to the Claims Administrator no later than March 16, 2022.

Please contact the Claims Administrator if you would like to request that a Claim Form be sent to you by mail, email or fax.

6. How do we submit a claim if we are joint beneficial owners?

Separate Claim Forms should be submitted for each legal entity. For example, a claim submission from joint beneficial owners should include only the transactions of the joint beneficial owners, and not include any separate transactions of just one (1) of the joint owners. Conversely, a single Claim Form should be submitted on behalf of each individual owner and include all transactions made by that owner on one (1) Claim Form, no matter how many separate accounts that owner has (e.g., an individual shareholder with multiple accounts should include all transactions made in all accounts on one (1) Claim Form).

Please note: Separate Claim Forms should be submitted for each legal entity. For example, a Trust account or Retirement account are separate entities from an Individual account. Therefore, each account that is a separate legal entity should be submitted as its own claim.

7. How do we submit a claim if we are two (2) joint beneficial owners and we require two (2) separate payments?

One (1) Claim Form must be submitted for the joint account. Once the claim processing is complete, and if the claim is approved, the payment may be requested to be split into two. Documentation such as a separation agreement must be submitted to show the agreement made between the joint beneficial owners (i.e., each entitled to 50%).

8. What supporting claim documentation is typical and sufficient?

An individual claim submitted by an individual or entity on their own behalf, or on behalf of others such as estates, executors, administrators, guardians, and trustees, should provide the following information.

Any documentation provided must include the claimant's name, account number and address.

Appropriate documentation to support your claim includes:

  • Trade Confirmation - Trade confirmation slips showing the trade date, quantity, price per security and net amount of the transaction are acceptable forms of documentation to support your purchases and/or sales.

  • Official monthly, quarterly or other periodic broker statements - Monthly, quarterly or other periodic statements provided by your broker listing your transactions are sufficient to prove purchase and sale transactions so long as the necessary information for that transaction is included, such as the trade date, quantity and price paid or received for each security, and the total amount paid or received for each transaction. These statements may also be used to support the quantity of securities held after the class period has ended, if such section is provided in the document. On your claim form, these will be listed as Beginning Holdings and Ending Holdings.

  • Official authorized broker generated statements.

Please Note: The Claims Administrator, Class Counsel or the Court reserve the right to request additional information or documentation.

Spreadsheets, charts, tax forms, handwritten information, and other documentation prepared by the claimant are not considered adequate supporting documentation.

In the event that an individual claimant is deceased, the executor or representative of the estate may submit a Claim Form on their behalf and must also:

a) Duly complete and sign the Claim Form - must provide their name in Section II of the Claim Form;
b) Submit a copy of the death certificate; and
c) Submit a copy of the will, which indicates who the executor or representative of the estate is.

Other authorized representatives of an individual claimant, including guardians, conservators, and trustees must also:

a) Duly complete and sign the Claim Form - must provide their name in Section II of the Claim Form;

b) Submit valid proof of authority to file and sign claims on behalf of the claimant, stating the authorized representative’s titles or capacities. The telephone number of the beneficial owner may be used in verifying the claim.

Important: If such documents are not in your possession, please obtain copies or equivalent contemporaneous documents from your broker. Failure to supply this documentation could delay verification of your claim and could result in rejection of your claim.

Do not send original documents. Please keep a copy of all documents that you send to the Claims Administrator.

Nominee Claim Submissions

Click here for the Nominee page.

If you are a Nominee, you must provide the following five (5) documents:

1. DULY COMPLETED MASTER CLAIM FORM

  • You must submit one (1) master Claim Form per submission. Your submission may contain one or more accounts.

  • You must complete the Claimant Identification section, (Section II on page 4) and the Acknowledgements section (Section IV on page 7). The Claimant Identification Page must contain your institution contact information. The Acknowledgements Page must be signed by an authorized signatory who is listed in your signature verification document and must state the capacity (job) of the signatory.

2. SIGNATURE VERIFICATION DOCUMENT

  • If you are an institution or claim preparer filing on behalf of client/customer or proprietary accounts (i.e., not an individual claimant), you must provide a document verifying that the individual who signed the Claim Form and any supplemental documents is authorized to sign on behalf of his/her company.

  • Some common types of documents that fulfill this requirement include the following. (Please note that some entities may have different documents that fulfill this requirement. If you cannot submit the documents listed below, you must submit an equivalent document):

    - Copy of company's By-Laws, including signature page(s)

    - Copy of company's Corporate Resolution, including signature page(s)

    - Notarized affidavit signed by an officer of the institution clearly granting a specific individual(s) authorization or confirming his/her authority to sign on behalf of his/her company.

3. DATA VERIFICATION DOCUMENT(S)

• If you are an institution or claim preparer filing on behalf of client/customer or proprietary accounts (i.e. not an individual claimant), you must provide a notarized affidavit or signed letter on firm letterhead which meets the below criteria:

- Confirms the number of distinct accounts and transactions on your file

- Discloses the source of your data (i.e. internal data retention system)

- Attests to the truth and accuracy of the transactions and holdings on your electronic file

- Is executed by an authorized signatory who is listed on your signature verification document, and specifies both the capacity and contact information of that signatory.

4. AUTHORIZATION DOCUMENT (IF FILING ON BEHALF OF CLIENT OR CUSTOMER ACCOUNTS)

• If you are an institution or claim preparer filing on behalf of client/customer accounts (i.e. not an individual claimant), you must provide a current document verifying that you are authorized to file and sign claims on behalf of your clients.

• Some common types of documents that fulfill this requirement include the following:

- Power of Attorney

- Service Agreement

- Signed/dated letter on client's company letterhead specifically granting your company authority to file/sign claims on their behalf.

- Notarized affidavit or signed letter on your company's letterhead confirming your authority to file and sign claims on behalf of your clients. It must be executed by an officer of the company who is also listed on your signature verification document and reference the capacity and contact information of the signatory.

Please note that some entities may have different documents that fulfill this requirement. If you cannot submit the documents listed below, you MUST submit an equivalent document.

5. EXCEL SPREADSHEET CONTAINING TRANSACTIONS AND HOLDINGS

You must provide all transactions and holding amounts for each account you are filing for by following the required format set out in the Electronic Filing Instructions.

Click here to download the Electronic Filing Instructions.

Click here to download the Microsoft Excel Preformatted Spreadsheet for submitting your transactions.

ADDITIONAL DOCUMENTATION (IF REQUESTED) - DATA INTEGRITY AUDIT

The Claims Administrator may request that certain entities, as designated by Epiq, which submit claims electronically provide additional documentation to support certain transactions and/or holdings in the claims. This data integrity audit is designed to verify the overall integrity of a data submission. Accordingly, the documentation provided must be independent in nature and sufficient to verify the validity and accuracy of the entire data submission. Even if you provided a letter/affidavit attesting to the truth and accuracy of your data when initially submitting your claim electronically, we will require specific documentary evidence (trade confirmations, monthly statement, or equivalent), to independently verify the details of the transactions and/or holdings requested, if your claim is selected for a data integrity audit.

9. What documentation is typical and sufficient for proof of authority?

If you are filing a claim on behalf of an individual or joint account owners:

Some common types of documents that fulfill this requirement include the following:

  • Copy of a Retainer Agreement;
  • Copy of a Power of Attorney; or
  • Signed letter from the Beneficial Owner(s)

If you are filing a claim on behalf of any other business or legal entity:

Some common types of documents that fulfill this requirement include the following:  

  • Copy of company's By-Laws, including signature page(s) 
  • Copy of company's Corporate Resolution, including signature page(s)
  • Copy of the Articles of Incorporation 
  • Signed letter on the company’s letterhead by an officer of the filing institution or company clearly granting you authorization to file/sign on behalf of the company
10. What are the CUSIP (Committee on Uniform Security Identification Procedures) and Ticker symbols for CannTrust common stock?

The nine-digit, alphanumeric CUSIP number that is used to identify CannTrust common stock is 137800207. CannTrust common stock also traded in the U.S. under these symbols: CNTTF, CTST, CNTTQ. It traded in Canada under the symbol: TRST. It traded in Germany under the symbol: C9S.

11. What is the difference between primary and secondary market?

The difference between the primary capital market and the secondary capital market is that:

  • In the primary market, investors buy securities directly from the company issuing them, usually at a predetermined price as per the Offering Materials and around a predetermined date;

  • In the secondary market, investors trade securities among themselves, and the company with the security being traded does not usually participate in the transaction.

12. In the Claim Form, what does the transaction type (P/R) (S/D) mean?

P means Purchase - When you purchased your shares - There is a price associated with the transaction.

R means Receipt - A transfer of shares into an account. Generally, if you did not pay money for the received shares that were transferred, they should be considered transferred shares (a transfer in).

S means Sale - When the shares are sold or disposed of – There is a price associated with the transaction.

D means Delivery - A transfer of shares out of an account. Generally, if you did not receive money for the delivered shares they should be considered transferred shares (a transfer out).

13. What is my account number?

Use the account number for the account where the shares were purchased (should match the documentation that you are submitting).

Please note: you must file one (1) claim per beneficial owner, regardless of the number of accounts.

14. Must I exclude commissions, taxes, and fees in the total purchase amount and total sales proceeds?

Yes. Commissions, taxes, and fees must be excluded from the total purchase amount and total sales proceeds.

15. Will I be notified if my claim is deficient or rejected?

Yes, you will be notified if your claim is deficient or rejected to give you an opportunity to remedy any deficiency in the completion of a Claim Form. The Claims Administrator may request and require via email or mail, if an email address is not available, that additional information be submitted by a claimant by a certain deadline.

Any person who does not respond to such a request for information within the required time period will be barred from receiving any payments pursuant to the Settlements.