CannTrust Holdings Inc. (TSX: “TRST”, NYSE: “CTST”, FRA: “C9S”)
Ontario Superior Court of Justice, Court File No: CV-19-001554-00CP
For more information about this action, or to obtain a copy of the most recent statement of claim, please contact the Firm at email@example.com
This securities class action relates to the Defendants releasing core and non-core documents which contained misrepresentations and omissions of material fact about CannTrust Holdings Inc. (“CannTrust”) illegally growing cannabis in unlicensed rooms contrary to applicable regulations, and providing Health Canada misleading information and pictures in order to obtain its cannabis license. The Plaintiff further alleges that the value and price of CannTrust’s shares were artificially inflated after the Defendant released each impugned statement alleged to contain a misrepresentation.
On July 8, 2019, CannTrust released a statement revealing that Health Canada had determined that one of its production facilities was not in compliance with regulations because the Company was growing cannabis in five unlicensed rooms between October 2018 and March 2019 and because it had provided inaccurate information to Health Canada with regards to its licensing application. This finding resulted in Health Canada placing a hold on 5,200kg of dried cannabis grown in the unlicensed rooms. Additionally, CannTrust announced that it was voluntarily going to place an additional 7,500kg of dried cannabis on hold because it too was grown in unlicensed rooms. On July 11, 2019, CannTrust announced that it was implementing a voluntary hold on the sale and shipment of all of its cannabis products. Additionally, it announced that a Special Committee for the board of directors was created to conduct an internal investigation. On July 24, 2019, it was reported that senior executives of CannTrust were intentionally attempting to deceive Health Canada and that CannTrust was terminating its recently appointed Chief Executive Officer and asking the chair of its board of directors to step down. CannTrust’s share price dropped by over 60% from July 5 – July 25, 2019.
Morganti & Co. is also representing investors against five (5) other Canadian cannabis companies.
Class or Motion for Authorization issued: August 7, 2019
Class Period: November 14, 2018 to July 25, 2019, inclusive
Motion Record for Leave to Proceed with Statutory Claim Filed: TBA
Shareholders’ Counsel: Albert Pelletier and Hadi Davarinia, Morganti & Co., P.C.
Corporate Defendants’ Canadian Counsel: TBA