Benjamin Ahdoot wins in Amaya insider trading case

Date Closed

June 06, 2018

Lead Office

Montréal

On June 6, 2018, Benjamin Ahdoot, a former executive of Amaya (now known as The Stars Group), won an important victory when the Court declared a stay of the proceedings which had been filed by the Autorité des marchés financiers (AMF). On March 23, 2016, 23 charges of conspiracy, insider trading, tipping, market manipulation and fraud on the market were filed against Benjamin Ahdoot, CEO David Baazov, Yoel Altman and his companies.

The co-defendants faced charges of conspiracy, insider trading, market manipulation and fraud on the market and exposure to multi-million-dollar fines and up to 20 years of imprisonment. In the context of our motion for a stay of proceedings, McCarthy Tétrault's team demonstrated that privileged information related to our Mr. Ahdoot's defence had been seized, analyzed and used by the AMF’s investigators and prosecutors. Following our motion, the AMF realized that it had accidentally disclosed over 330,000 potentially privileged documents belonging to third parties, which had been used in the preparation of the trial by all parties. In the middle of the trial, the AMF requested that the documents be recovered from the defendants in order to deal with the applicable privileges as the AMF should have done before disclosure to defendants. This led to a second motion for a stay of proceedings, this time on behalf of all defendants. 

The e-discovery phase involved review of significant volumes of electronic items by McCarthy Tétrault's e-discovery team. More than 34 waves of disclosure of evidence were disclosed for review by the parties containing over three million separate electronic items that included computer, telephone, text, email and trading records. More than nine different search warrants were executed, some by the regulator (AMF) with assistance from the RCMP.

After seven weeks of the anticipated 20-week trial, the trial judge ordered a complete stay of proceedings, finding that the AMF's repeated failures to properly disclose documentation to the defence and to protect privileged items constituted not only an abuse of process and an infringement of the defendants’ right to a make full and complete defence, but also undermined the integrity of the judicial process. 

McCarthy Tétrault LLP advised Benjamin Ahdoot with a team led by Julie-Martine Loranger that included Geneviève St-Cyr Larkin, Nicholas Trottier and Sarah-Maude Demers. The strong teamwork displayed by McCarthy  Tétrault's lawyers led to the judge noting “sloppiness” and “laxity” on the part of the AMF’s process, or lack thereof, in dealing with privileged documents. This is not only a victory in one of the largest insider trading cases in Canadian history, but also an unprecedented judgment on such breaches in the prosecution’s handling of documents.

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