Environmental firm sues Quebec Securities Commission, claiming $43M in damagesEnviromondial is suing the Quebec Securities Commission (Commission des Valeurs MobiliËres du QuÈbec - CVMQ) for $43 million, claiming $18 million for economic damage, $5 million for moral damage and $20 million for damage caused to its approximately 2,000 shareholders.
Enviromondial claims that, in spite of its good faith effort to comply with the Quebec Securities Act, the company and its management have been under systematic and malicious attack by the Commission's management and representatives. The Commission, it states, failed to respond to the company's request, made in September 2001, for assistance in complying with the Act.
Enviromondial's management, says the suit, became "the target of a campaign of degradation and denigration carried out by the management and representatives of the CVMQ, at every level, causing irreparable harm and damage to Enviromondial."
The Commission, it says, began "inquiries that were systematic, completely arbitrary, unfounded and illegally conducted with the intent to obtain statements that would allegedly incriminate Enviromondial and/or its management." The Commission went even further, claims the suit, "by uttering immoderate threats against potential witnesses within the framework of their inquiry, by telling such potential witnesses that their failure to co-operate would result in their receiving prison sentences or having to pay substantial fines, amounting to several tens of thousands of dollars."
Enviromondial is involved in the commercialization of environmentally sound "green" technologies. The company's thermo-electric power plant is based on its patented technology which uses gasification to produce synthetic biogas from organic wastes.
In January 2002, the Commission issued the company a cease-trade order, which was extended in July 2002. In August 2002, the order was partially lifted to allow Enviromondial to pay $69,000 in administrative expenses. In October 2002 the Commission laid charges against four of the company's officers and laid further charges against two officers in July 2003 in connection with violating the cease-trade order. A new cease-trade order was issued in November 2003 and in December 2003, the Commission issued a cease-trade order on the $69,000 (which had been held in trust). The case still has yet to be resolved.
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