On September 10, 2010, Siskinds LLP commenced a proposed securities class action against Redline Communications Group Inc. (TSX: RDL). The action also included, as defendants, the principal subsidiary of RDL, Redline Communications, Inc., certain of RDL’s current and former officers and directors, and RDL’s former auditors, KPMG LLP.
The action arose from RDL’s restatements of its financial statements for the years ended December 31, 2006, 2007 and 2008, and for the three-month periods ended March 31, June 30, and September 30, 2009. The plaintiffs in the action sought damages arising from the restatements which showed, generally speaking, that revenues and profits had been overstated, and costs had been understated, as at the time they were reported to shareholders. The plaintiffs alleged, among other things, that RDL misrepresented that its financial statements had been compiled in accordance with Canadian generally accepted accounting principles.
In June, 2011 the parties reached an agreement in principal to settle the action (the “Settlement”). The Settlement is a compromise of disputed claims and there is no admission of wrongdoing by Redline or any of the other named defendants, all of whom expressly deny any liability or wrongdoing, and continue to do so. The Settlement was memorialized in an agreement dated September 6, 2011 (the “Settlement Agreement”). You may view a copy of the Settlement Agreement here: [Settlement Agreement].
It is the intention of the parties to the Settlement Agreement that Class Members’ entitlements to compensation will be calculated pursuant to the Plan of Allocation. You may view a copy of the Plan of Allocation here: [Plan of Allocation].
The Settlement Agreement and Plan of Allocation were approved by the Ontario Superior Court of Justice (the "Court") by order issued on November 22, 2011.
The claim deadline has now passed. Cheques were mailed to eligible claimants in February 2013.