Aspen Group Resources Corp. Class Action

The content of this page has not been approved by the Court nor does it constitute legal advice. It is for the purpose of providing general information only.

Important Update

A final settlement of the action has been reached. The settlement provides
for the payment of CDN $2,400,000.

In resolving this action, a total gross settlement recovery of CDN $3,285,000 has been realized for the benefit of former Endeavour Resources Inc. security holders.

The settlement, as well as the plan for how the settlement funds will be distributed to class members, must now be approved by the Court. The settlement agreement, the proposed distribution protocol, and Court-approved notices are available for review below.

If the settlement and distribution protocol are approved by the Court, a separate notice will announce when class members can make a claim for compensation.  Please contact Class Counsel, below, if you would like to receive this notice directly.

WHAT IS THIS CLASS ACTION ABOUT?

Pursuant to a circular dated November 23, 2001, Aspen Group Resources Corporation (“Aspen”) completed a take-over of Endeavour Resources Inc. (“Endeavour”) whereby Endeavour Securities were tendered or otherwise acquired in exchange for securities of Aspen. This class action was brought on behalf of former Endeavour security holders, who sought damages under the Ontario Securities Act for alleged misrepresentations in Aspen’s take-over bid circular (the “Action”).

HOW DO I KNOW IF I AM A CLASS MEMBER?

You are automatically a class member if you have not previously “opted-out” (elect to exclude yourself) of the Action, and:

You held common shares, Series I special warrants or Series II special warrants of Endeavour that were tendered or otherwise acquired by Aspen pursuant to Aspen’s take-over bid dated November 23, 2001. (“Class Members”)

Former or current defendant(s), any of their subsidiaries, affiliates, officers, directors, senior employees, legal representatives, heirs, predecessors, successors or assigns, or any individual provided with a release by any settlement agreement in this action, are not entitled to any share of any settlement.

WHAT SETTLEMENTS HAVE BEEN REACHED IN THE ACTION?

The Action was brought against Aspen, its directors as at November 23, 2001, its legal representation (WeirFoulds LLP) and its auditors (Lane Gorman Trubitt LLP).

Previous settlements were reached during the litigation of the Action.  The Action was scheduled to proceed to trial in September of 2019. In the lead-up to trial, through judicial mediation, a final settlement, the Aspen Settlement, was reached which would resolve the litigation in its entirety. The Aspen Settlement remains subject to Court approval. The settlements are not an admission of liability, fault, or wrongdoing by the defendants, and such liability is in fact denied.

The settlements reached in the Action are outlined below:

SETTLEMENTS APPROVED BY PREVIOUS ORDERS OF THE COURT

DEFENDANTS

DATE OF SETTLEMENT AGREEMENT

DATE OF COURT APPROVAL

AMOUNT ($CDN)

Lane Gorman
Trubitt LLP
May 14, 2012 December 19, 2012

$325,000

Lenard Briscoe August 9, 2012

$235,000

Weirfoulds LLP April 23, 2014

September 15, 2014

$325,000

TOTAL:

$885,000

SETTLEMENTS BEFORE THE COURT FOR APPROVAL

DEFENDANTS

DATE OF SETTLEMENT AGREEMENT

AMOUNT ($CDN)

Aspen Group Resources Corporation, Wayne T. Egan, Anne Holland, Randall B. Kahn, Peter Lucas, James E. Hogue and Jack Wheeler August 8, 2019

$2,400,000

TOTAL:

$2,400,000

GRAND TOTAL OF ALL SETTLEMENTS:

$3,285,000

HOW MUCH MONEY WILL I BE PAID?

The proposed Distribution Protocol is posted in draft form below and is subject to approval by the Court. As described below, you have the right to comment on the proposed Distribution Protocol.

The Proposed Distribution Protocol

This Distribution Protocol has been designed for consistency with the allegations made in the Action. The Action alleges that every Class Member suffered a loss through the tendering of their Endeavour Securities into the take-over, which would not have occurred but-for the alleged misrepresentations.

The proposed Distribution Protocol stipulates that any claimant who establishes that they are a Class Member will receive a share of the Net Settlement Funds based on the number of Endeavour Securities they tendered into the take-over.

The proposed Distribution Protocol also provides an additional share of the Net Settlement Funds to Class Members who can establish they sold Aspen common shares received in the take-over at a loss or held those Aspen common shares at the time Aspen common shares were delisted from the TSX in or around September 14, 2009.

The Distribution Protocol further provides that the minimum compensation paid to any eligible Class Member is $20, subject to potential pro-ration.

WHEN WILL THE COURT APPROVE THE SETTLEMENT AGREEMENT AND THE DISTRIBUTION PROTOCOL?

The Aspen Settlement and the Distribution Protocol must be approved by the Court before they become effective (the “Approval Hearing”). If the Aspen Settlement is approved, the action will be resolved in its entirety, and any claims Class Members have against the defendants in respect of the take-over will be extinguished.

The Approval Hearing has been set for November 5, 2019 at 10:00 a.m. at 330 University Avenue, Toronto M5G 1R7.

The Court will also determine what fees and expenses, plus applicable taxes, will be paid to the lawyers for the plaintiff as a result of the Aspen Settlement. The lawyers for the plaintiff will ask the Court to approve legal fees of 30% of the Aspen Settlement plus disbursements, applicable taxes, and an honorarium to the representative plaintiff for his service to the class since 2001. This request will be paid out of the Aspen Settlement funds (the “Fee Request”).

WHAT DO I NEED TO DO AT THIS TIME?

If you wish to comment on or object to the Aspen Settlement, the Distribution Protocol, or the Fee Request, you must deliver a written submission to Harrison Pensa LLP at the address below by October 18, 2019. The lawyers will forward any submissions to the Court.

If you do not wish to object or comment on the Aspen Settlement, Distribution Protocol, or Fee Request, you do not need to take any action at this time.

The Court-approved deadline to opt out of the Action was November 12, 2012. If you did not previously opt out, you are legally bound by the result of the Action, including the Aspen Settlement and the Distribution Protocol.

A separate notice will announce when Class Members can make a claim for compensation.  Please contact Class Counsel, see particulars below, if you would like to receive this notice directly.

DOCUMENTS

Documents Re: Final Settlement and Distribution of the Settlement Funds

Settlement Agreement in respect of Aspen and Remaining Defendants

Draft Distribution Protocol

Long-Form Notice

Short-Form Notice

Other Court Documents

Fresh as Amended Statement of Claim – February 12, 2008.

Reasons for Decision on Certification – December 4, 2009

Previous Settlement Agreements

Settlement Agreement with WeirFoulds LLP

Settlement Agreement with Lane Gorman Trubitt LLP

Settlement Agreement with Lenard Briscoe

Class Members

Inquiries should be directed to 1.800.263.0489 ext. 608 or by email to

Mail correspondence should be directed to:
Harrison Pensa LLP
Attention: Jonathan J. Foreman
450 Talbot Street
London, ON N6A 5J6