Under the Ontario Securities Act, RSO 1990, c S.5 (“OSA”) and equivalent securities legislation in other provinces, there are strict rules regarding the commencement of secondary market misrepresentation claims. For example, plaintiffs must obtain leave from the court to proceed with such claims and are generally not permitted to exercise discovery rights prior to obtaining leave.
However, what if a plaintiff makes targeted production requests to a non-party, former director of an issuer who had publicly accused the issuer’s management of misrepresentations and other serious misconduct, prior to obtaining leave? In Mcdonald v. Guyana Goldfields Inc., 2025 ONSC 2431 (“Guyana Goldfields”), Justice Morgan dealt with this scenario and granted a third-party production order in the context of a proposed class action seeking to advance a secondary market OSA claim.