Industry News

Quebec court declines CIBC WM request to stay proceedings

By James Langton |

A Quebec court has declined to stay a hearing of the province's Labour Relations Board into possible remedies in a case decided last year, which found that a brokerage firm was wrong to fire two employees who stand accused of tipping inside information.

According to the decision from the Quebec Superior Court dated May 8, CIBC World Markets Inc. sought a stay of proceedings being carried out by the Quebec Labour Relations Board into a complaint from a former advisor and his assistant, Paul Azeff and Korin Bobrow, who were dismissed by the firm amid allegations that they were involved in illegal tipping.

The Ontario Securities Commission (OSC) first brought the tipping allegations back in 2010, but the regulatory case has yet to be heard, and the allegations have not been proven. The hearing into those claims is scheduled to start later this year.

In the meantime, the two were dismissed from the firm. They filed a complaint with the Labour Relations Board, which ruled last summer that the firm did not have cause to dismiss them. According to a translation of its decision, the board said that while the allegations against them are "extremely serious", they are still just allegations and not evidence.

"In this case, the employer has chosen to justify its decision to dismiss the plaintiffs solely on non-compliance with its policies and their lack of credibility. It failed in both cases," it said.

At the time, the board reserved its decision on remedies in the case, and the remedies hearing is now scheduled to start on May 14 and to continue into June.

CIBC World Markets sought to stay that hearing on the basis that it is appealing the board's initial decision to the Superior Court; that hearing is scheduled for May 26-27.

CIBC first asked the board to stay the remedies hearing, pending the judicial review of the initial decision. However, that was denied by the board. CIBC then appealed the decision not to stay the remedies hearing to the court, which has now also denied its application.

The court found that the firm did not establish that it will suffer irreparable harm by allowing the remedies hearing to go ahead before the judicial review is heard, nor did the balance of convenience favour halting the remedies hearing. Therefore, the court dismissed CIBC's application.