Samji Class Action

UPDATED October 24, 2012

For further information: e-mail info@samjiclassaction.com

• Second Further Amended Notice of Civil Claim

Status of the Action

On March 2, 2012, a putative class action was filed in the Supreme Court of British Columbia, which alleges that Rashida Samji, a Notary Public, is responsible for promoting a fraudulent investment scam known as a the “Mark Anthony Investment Scheme”.  These actions seek a Court order requiring that Rashida Samji, her company Samji & Assoc. Holdings Inc., and her notarial practice “Rashida Samji Notary Corporation”, return the money that they received from investors on the pretext of the “Mark Anthony Investment” scheme. The action also seeks damages from a professional financial planner named Arvindbhai Bakorbhai Patel (a.k.a. Arvin Patel) and his former employer, Coast Capital Savings Credit Union and Coast Capital Insurance Services Ltd. (the “Coast Capital Defendants”) and Worldsource Financial Managmenet, for Patel’s negligent advice regarding the “Mark Anthony Investment” scheme and for their failure to properly supervise him. There are also claims against RBC, TD and Vancity for permitting their facilities to be used by Samji in perpetraing her fraud.

Securities Commission Proceedings

There are ongoing proceedings before the B.C. Securities Commission. We are not directly involved in those proceedings, but you can find out more by visiting the Securities Commission’s website, here.

Appointment of a Receiver

On April 3, 2012, a Receiver was appointed by the Court over some of Arvin Patel's property and certain bank accounts belonging to Samji & Assoc. Holdings Inc. This appointment took place outside the Jer v. Samji action. The B.C. Securities Commission applied for the appointment of MNP Ltd. as Receiver, with the consent of Ms. Samji and Mr. Patel. It is our understanding that the Receiver's mandate is to determine how best to use those assets to provide one source of recovery to investors.

An investors' meeting was held on May 14, 2012 at 2:00 pm at SFU Harbour Centre, Room 1700. We understand that the steps that the Receiver is likely to take are separate from the proceedings in the proposed class action. They are parallel proceedings, but the goal of both processes is to secure recovery for investors. As counsel for the proposed class action, we will not be directly involved in the Receiver’s work, but we will continue to monitor the progress of the Receiver’s mandate.

Appointment of Case Management Judge

On April 25, 2012, the Honourable Madam Justice Gerow was appointed judicial management judge for this action.

May 28, 2012 Case Management Conference 

Counsel for the Plaintiffs appeared Monday morning before the Honourable Madam Justice Gerow for the first judicial management conference in this action. She is the judge who will be managing this class action.

The Plaintiffs had two applications before Justice Gerow: the first, to seek production of Samji's documents held by the Securities Commission, and the second, to add TD and Royal Bank as defendants, and to add Janette Scott as an additional representative plaintiff, with an 'in trust' claim and to represent the direct (i.e. non-Coast) investors.

Counsel for the Plaintiffs were successful in obtaining both orders. It is anticipated that in the next several weeks, Plaintiffs’ counsel will receive the documents from the Securities Commission, review them, and decide whether there are any additional defendants that should be added to the lawsuit. Another Judicial Management Conference has been set before Justice Gerow in late June, to establish a schedule for certification and to address any other issues, such as adding additional parties or coordinating this action with the individual suits.

Worksheets from Coast Capital

As counsel for the Plaintiffs have previously indicated , there have been discussions with Coast Capital about the letter and ‘worksheet’ sent by Coast to some investors.  Plaintiffs’ counsel and counsel for Coast have now come to an agreement about how those letters should be handled. A joint email from Coast will be sent out very soon, and Coast investors are encouraged to read it carefully.

No agreement has been reached with Worldsource, and we do not recommend class members fill out any worksheets from that company.

Proceedings Before the Securities Commission

Class Counsel appeared at the BC Securities Commission on June 12, 2012 to represent the interests of the class in Mr. Patel’s application to the Commission to unfreeze his RRSP and brokerage accounts. It was our position, as well as the position of the Executive Director of the Commission and of the Receiver, that it is premature to unfreeze Mr. Patel’s remaining asset accounts as a proper tracing of funds has yet to be completed. Until that review is undertaken, we submitted the freeze order should remain in place.

Justice Gerow Appointed Case Management Judge over actions filed against Samji

The B.C. Supreme Court announced on July 25, 2012 that Justice Gerow - the judge overseeing the class action - has been appointed to case manage all the actions filed against Rashida Samji. This means that all the actions filed against Samji will be overseen by a single judge and will be managed together. This will ensure that all the cases proceed in an orderly and efficient manner.

Worldsource and Vancity added as Defendants

On August 22, 2012, counsel for the Jer v. Samji class action appeared in court seeking to add two further defendants to the lawsuit. After a hearing before Master Taylor, he ordered that World Source Financial Management and Vancity Savings Credit Union be added as defendants.

September 24, 2012 Judicial Management Conference

A judicial management conference was held on September 24, 2012 at the BC Supreme Court before Justice Gerow.

At the hearing, we informed the Court that we had prepared draft certification materials and delivered them to the Defendants and that we expect to file full certification materials in the coming weeks.

Justice Gerow directed Defendants' counsel to provide us with dates for a five-day certification hearing in March, April or May 2013.

Justice Gerow also directed counsel for the parties to the class action and the invididual action to set a trial date for six weeks in late 2013 or early 2014, and then to work backwards from that date to arrange a master schedule for the actions. At the trial, representative test cases will be tried to determine the scope of liability against the defendants. We anticipate that the class representatives' cases will be tried at that time, following a successful certification.

Justice Gerow also confirmed that she is managing all actions related to the Samji scheme, and that she will hear or give directions on the hearing of any interim applications before trial or certification.

Counsel are moving as quickly as we can towards certification and to push the action forward.

NEW ***Important Upcoming Dates***

Class Counsel would like to inform investors of some important upcoming dates in the Jer v. Samji action:

1. November 13, 2012: Class counsel will attend the next case management conference to participate in the management of the action.
2. April 15-19, 2013: The class action certification hearing will take place before Madam Justice Gerow in Vancouver.

In addition, two other related hearings which do not directly involve Class Counsel may be of interest to investors:

1. December 2012: The Receiver is applying to expand its reach over more assets to increase the secure asset pool from which investors can recover, and an application will be heard by Madam Justice Gerow in Vancouver.
2. February 4-6, and 8-18, 2013: A hearing will be held at the B.C. Securities Commission in Vancouver on Rashida Samji’s case.

FREQUENTLY ASKED QUESTIONS

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Why is a class action being brought against Samji and the other Defendants?

The action alleges that Rashida Samji perpetrated a so-called Ponzi scheme, by purporting to take money from investors and holding it “in trust” as a notary public. The Notaries Act requires that notaries hold funds provided to them in trust in a special trust account and not pay funds out without specific instructions from the person to whom they belong. In fact, the lawsuit alleges that Rashida Samji breached her duties as a trustee of investors’ funds because she failed to hold those funds in a trust account and paid them out without specific instructions.

The action further alleges that the entire “Mark Anthony Scheme” was a fraud, having nothing to do with the actual “Mark Anthony Group”, which was designed to deceive investors, and that Rashida Samji and her company “Samji & Assoc. Holdings Inc.” and her notarial practice “Rashida Samji Notary Corporation” are liable to return those funds.

The action also alleges that Arvin Patel, in providing financial advice to clients and others, gave negligent advice when he recommended the “Mark Anthony Investment” scheme as a legitimate investment opportunity. The lawsuit goes on to say that the Coast Capital Defendants and Worldsource should be held legally responsible for Arvin Patel’s negligent advice and for failing to properly supervise him.

Finally, the lawsuit alleges that the Financial Institutions (RBC, TD and Vancity) caused or contributed to the losses suffered by investors when they allowed their facilities to be used by Samji to perpetrate the scheme.

For a more detailed understanding of the allegations of these putative class actions, please see the Notice of Civil Claim above.

Are you an investor?

If you invested funds with Rashida Samji or Arvin Patel in the “Mark Anthony Investment” scheme, please fill out this form to help class counsel in its investigation:

Investor Questionnaire

How can I become a class member?

If the actions are certified as class actions, then all investors that participated in the “Mark Anthony Investment” scheme will be automatically included as class members. If you would like to be added to our database in order to be updated with any news, please complete the Investor Questionnaire.

What is a class action?

Generally, people seeking to start a lawsuit have three main options for pursuing their claims:

• File an individual action, on their own behalf
• File a group action, on behalf of a number of named plaintiffs, or
• File a class action.

What are the advantages of a class action?

A class action is an action brought by and in the name of a representative plaintiff on behalf of people with similar claims. A class action seeks to resolve all those similar claims in a single lawsuit. The idea behind class actions is that they more efficiently use court resources by going ahead as a single action, that they generate economic efficiencies and economic power for class members by combining multiple claims into one, and that they have a greater impact on defendants through their potential to redress power imbalances by proceeding on a class-wide basis, than either ordinary individual or group actions. All class members share in the benefits and are bound by the decisions in the class action.

One of the other advantages of a class action is that, under the Class Proceedings Act, if the plaintiffs are unsuccessful, the class members do not have to pay the costs of the other side, the defendants. In an ordinary individual or group action, there is no such automatic protection for litigants and if a plaintiff is unsuccessful, he may have to pay the costs of the winning party, the defendants.

All class actions are supervised by a judge of the B.C. Supreme Court. Any settlement and any legal fees payable must be approved the Court as being fair and reasonable. In an ordinary individual or group action, there is no such automatic protection for litigants.

Class actions are governed by the B.C. Class Proceedings Act.

What would a class action seek to do here?

A class action would seek to recover the losses of all people who paid funds to Rashida Samji in relation to the “Mark Anthony Investment” scheme.

Has a class action already been started?

An action has been commenced in Jer v. Samji, B.C. Supreme Court (Vancouver Registry) No. S-121627 under the Class Proceedings Act. Copies of the Notice of Civil Claim are available following the link above.

An action brought under the Class Proceedings Act is not a class action until it is approved or “certified” by the Court as a class action. At the present time, the Jer v. Samji action is a proposed class action and has not yet been certified.

What is the Jer v. Samji action about?

The Jer v. Samji action alleges that Rashida Samji perpetrated a so-called Ponzi scheme, by purporting to take money from investors and holding it “in trust” as a notary public. The Notaries Act requires that notaries hold funds provided to them in trust in a special trust account and not pay funds out without specific instructions from the person to whom they belong. In fact, the lawsuit alleges that Rashida Samji breached her duties as a trustee of investors’ funds because she failed to hold those funds in a trust account and paid them out without specific instructions.

The action further alleges that the entire “Mark Anthony Scheme” was a fraud, that it had nothing to do with the actual “Mark Anthony Group”, was designed to deceive investors, and that Rashida Samji and her company “Samji & Assoc. Holdings Inc.” and her notarial practice “Rashida Samji Notary Corporation” are liable to return those funds.

The action also alleges that Arvin Patel, in providing financial advice to clients and others, gave negligent advice when he recommended the “Mark Anthony Investment” scheme as a legitimate investment opportunity. goes on to say that the Coast Capital Defendants and Worldsource should be held legally responsible for Arvin Patel’s negligent advice and for failing to properly supervise him.

Finally, the lawsuit alleges that the Financial Institutions (RBC, TD and Vancity) caused or contributed to the losses suffered by investors when they allowed their facilities to be used by Samji to perpetrate the scheme.

For a more detailed understanding of the allegations of these putative class actions, please see the Notice of Civil

Who are the defendants in the Jer v. Samji action?

Currently, the defendants in the Jer v. Samji action are:

• Rashida Samji
• Rashida Samji Notary Corporation
• Samji & Assoc. Holdings Inc.
• Arvin Patel
• Coast Capital Savings Credit Union
• Coast Capital Insurance Services Ltd.
• Worldsource Financial Management Inc.
• Royal Bank of Canada
• Toronto-Dominion Bank
• Vancity Savings Credit Union

Additional defendants will may still be added as the class action moves forward.

The British Columbia Society of Notaries has not been named as a defendant. The Society of Notaries maintains what is called a "Special Fund", for compensating people who are the victims of the improper acts of a notary. However, the Notaries Act says that payments out of the Special Fund are discretionary, and it has no legal obligation to pay and thus cannot be named as a defendant. The facts of this case will likely be sufficient to trigger the involvement of the Special Fund in any event.

Who would be included in the Jer v. Samji action?

The proposed class and class members in the Jer v. Samji action includes anyone, except the Defendants, who invested money with Rashida Samji by signing a “Letter of Direction”.

This would include people who invested directly through Rashida Samji and those who invested through Arvin Patel at Coast Capital. It would also include people who wrote cheques to Samji in order to invest, especially those who wrote "in trust" on their cheques.

If some class members have a claim against defendants that they do not share with other class members, then any money recovered from those defendants will be shared only between the people with the same claim.

For example, if some investors have a claim against Coast Capital, and others do not, and money is recovered from Coast Capital, then only those class members with a claim against Coast Capital would be entitled to share in that recovery.

Am I a member of the Jer v. Samji action?

Not yet.  At the present time, the case has not been approved (“certified”)  as a class action. Unless and until the case is certified, the case is not binding on other investors. 

If the action is certified as a class action by the Court, then anyone with the same claim – members of the same class – would become a part of the action, unless they choose to opt-out.

If you want to follow the Jer v. Samji action as it moves forward, please fill out the Investor Questionnaire at www.samjiclassaction.com.

What happens if an action is certified?

At some point in the future, the lawyers in the Jer v. Samji action will bring an application to have the case certified as a class action by the B.C. Supreme Court.

If the Court agrees that the proposed class action meets the requirements of the B.C. Class Proceedings Act, then it will certify the action and declare it to be a class action.

The Court would then authorize notice to be given to class members advising them that the action has been certified as a class action and advising them of how and when they can “opt out” of the class action.

The effect of certification is that all people who fall within the class definition established by the Court are class members, unless they opt-out.

The effect of certification on class members who do not opt-out is that any decision in the class action binds the class members. For example, if there is recovery of money, then the class members will share in the recovery. On the other hand, if the action is unsuccessful, then the class members are bound and they will not be able to bring any other claims on their own.

What is an opt-out?

When an action is certified, class members will receive notice explaining the class action and will be given an explanation of how and opportunity to opt out.

An opt-out is a decision by a class member not to participate in the class action. By choosing to opt-out, a person is removing themselves from the class. Once a person has opted out of a class action, they do not share in any benefits of the class action and are not bound by any decisions.

What is a representative plaintiff?

The representative plaintiff is the person whose claim stands on behalf of all people with similar claims. That is, instead of naming every person in the lawsuit, the name and facts of the representative plaintiff are used to determine the outcome of the others’ claims. The representative plaintiff instructs the lawyers, signs the retainer agreement, and has to give evidence in court, if required. It can be a difficult and onerous responsibility.

A representative plaintiff owes duties to act in the best interests of the class and class members. The representative is advised by the lawyers, and acts on their advice. Where there is a larger group of class members who have organized themselves, the representative plaintiff can also listen to their views on the progress of the action.

The representative plaintiff is also subject to the supervision of a judge of the B.C. Supreme Court

Who chooses the representative plaintiff?

The choice of the best representative plaintiff is a legal decision that is made by the lawyers in a class action. The choice of representative plaintiff will affect the conduct of the litigation and the chances of success, so it is important for the lawyers to select the person or people with the best claims. The choice of representative plaintiff must ultimately be approved by a judge of the B.C. Supreme Court.

Who is the representative plaintiff in the Jer v. Samji action?

The representative plaintiffs in the Jer v. Samji action are Mr. Larry Jer and Ms. Jun Jer, and Ms. Janette Scott.

Another representative plaintiff or plaintiffs may be added to the Jer v. Samji action in order to make some additional claims. The lawyers will work to select the best possible representative.

I didn’t ask for the Jers or Janette Scott to be the representative plaintiffs

The choice of representative plaintiff is a legal decision made by the lawyers in a class action and is subject to Court approval. Ordinarily, an action is started without consulting with everyone affected by the harm that has led to the lawsuit. It would not be possible to get the advice and opinion of everyone involved.  An important feature of class actions is that the Court supervises the process to ensure that the representative plaintiff fairly represents the interest of the class.  In addition, people can choose to opt out or start their own actions if they do not wish to be involved with the class action.

If you do not wish to take advantage of this class action, you can start your own action or, if the action is certified, then you can opt-out of the Jer v. Samji action.

How will other investors have input into the Jer v. Samji action?

The lawyers involved in the Jer v. Samji action have agreed to work with a Committee of investors, chosen by the investors to communicate their interests and opinions. The Committee will provide advice and the lawyers and the representative plaintiffs will consider that advice in making decisions about the conduct of the class action.

However, the Committee is not the representative plaintiff, nor will it have the power to give formal instructions to the lawyers. A class action is a complicated legal process and the important legal steps must be guided by the lawyers’ advice, expertise and experience.

Can I still start my own lawsuit? Can I still choose my own lawyer?

Yes, you can still start your own lawsuit and if you do so, then you can choose your own lawyer. If you do not want to take advantage of the Jer v. Samji action, then you can find another lawyer and start your own lawsuit.

Can I start my own class action?

It would be possible to start another class action, but the courts – and defendants – are generally opposed to more than one class action involving the same claims. A class action is no longer efficient or effective if there is more than one, so courts take steps to combine or stay (stop) competing actions. Disputes over which class action should proceed generally slow down the resolution of claims.

What do I have to do to participate in the Jer v. Samji action?

You do not have to do anything to participate in the Jer v. Samji action. If the class action is certified, you will automatically become a part of the class. If the action is certified and you do not want to participate, you will have an opportunity to opt out.

The best way to keep informed about the progress of the action is to visit www.samjiclassaction.com and fill out the Investor Questionnaire. This will allow you to receive updates on the lawsuit.

How long will the Jer v. Samji action take?

Civil litigation is not a speedy process, especially for complicated issues likes the ones raised by the Rashida Samji investment scheme. The lawyers in the Jer v. Samji action are moving ahead with all appropriate speed, but it will be months or potentially more than a year before an application for certification can reasonably be made. In the meantime, there will likely be other court hearings, such as applications to add parties and possibly motions by the defendants challenging the proceedings. In any class action, once an application for certification is heard, there is usually a delay while the judge prepares his or her decision.  Following a successful certification, a case proceeds
towards trial, which takes significant time for preparation and hearing. Settlement discussions may be held at any time during the course of an action.

The lawyers realise that the slow pace of litigation can be frustrating to participants, but urge investors to be patient and focus on recovering from these events.

Who are the lawyers for the Jer v. Samji action?

Two law firms with extensive experience in class actions have agreed to work together on the Jer v. Samji action. Hordo Bennett Mounteer LLP (www.hbmlaw.com) and Camp Fiorante Matthews Mogerman (www.cfmlawyers.ca) are acting together on the case. The lead counsel are Paul Bennett (from Hordo Bennett Mounteer LLP) and Reidar Mogerman (from Camp Fiorante Matthews Mogerman).

What is the role of the lawyers in a class action?

Lawyers take an active role in running any class action. Because class actions are complex, the representative plaintiff must rely on the lawyers for advice.

How do the lawyers get paid in a class action?

In most class actions, lawyers are paid what is called a contingency fee. That means that the lawyers do not get paid unless they recover money or other benefits for the class members. If the lawyers are unsuccessful, then the class members do not have to pay anything. If the lawyers are successful, then the class members have to pay a portion of the money recovered to the lawyers.

The retainer agreement sets out the fee schedule. The retainer agreement is signed by the representative plaintiff and the lawyers involved.

However, any fee must be (1) approved by a judge of the B.C. Supreme Court after a hearing and (2) must be fair and reasonable given the work done by the lawyers, the amount recovered, and the risk taken by the lawyers, among other factors.

The lawyers in the Jer v. Samji action have agreed to work with the Committee to find a fee that is appropriate and acceptable to both sides.

How much do the lawyers get paid in a class action?

In a class action, most retainer agreements provide for a fee of up to 35% of the money recovered. In reality, most lawyers charge a fee of between 25% and 30% of the money recovered. This amount always has to be approved by the Court. Remember, if the class action is unsuccessful, you do not have to pay anything and the lawyers do not get paid. Only if the class action is successful do the lawyers get paid at all.

Will I have to pay the lawyers in the Jer v. Samji action?

If the Jer v. Samji action is certified by the Court, and you do not choose to opt-out, then you will become a class member and share in any recovery if the case is successful. If you are a class member and money is recovered, then money equivalent to the fee charged by the lawyers and approved by the Court will be deducted from your recovery.

For example, if the Court approves a fee of 25%, and you recover $100,000, then $25,000 will be deducted from your award. If the Court approves a fee of 30%, and you recover $100,000, then $30,000 will be deducted from your award.

If the class action is unsuccessful, then you will not be charged anything.

Where can I find out more?

Please visit www.samjiclassaction.com regularly for more information.

Please also take the time to fill out the Investor Questionnaire on the website.

By filling out the Investor Questionnaire am I agreeing to be a part of the Class Action?

No. The Investor Questionnaire at www.samjiclassaction.com is being used for information gathering purposes only. By filling it out, you are not agreeing to be a part of any class action, or giving up any rights. By filling it out, you will get updates on the progress of the Class Action and will assist the lawyers in their investigations. We recommend that you visit www.samjiclassaction.com for more information.  

What should I do if the Defendants or the Notaries Society wants to talk to with me?

It is not in your best interests to speak to any of the defendants or anyone contacting you from the defendants about your legal proceedings including this class action.  In addition, we would recommend that you contact us before speaking with anyone from the Notaries Society concerning your claim.

If you are contacted by any of the Defendants or the Notaries Society, please contact us by emailing info@samjiclassaction.com. 

What should I do if the RCMP, the police or the B.C. Securities Commission wants to talk to me?

Cooperating with the B.C. Securities Commission and the RCMP is advised. Doing so won’t hinder your case, and is in your best interest as it will hopefully assist those bodies in helping to prosecute those who have wronged you.

I took financing in order to invest with Rashida Samji and I still have to make payments on my loans – what should I do?

Many investors appear to have taken out lines of credit, mortgages or other loans in order to invest with Rashida Samji. The lawyers are aware that payments still have to made on these obligations while the Jer v. Samji action is in progress, and the lawyers will try to get some form of temporary relief from those people who took out financing with Coast Capital or any other defendants.

Please be cautious in approaching Coast Capital on your own to ask for relief from your loans or financing obligations. We do not recommend that you sign anything in order to obtain relief, because that may impact your ability to make a claim, whether in the Jer v. Samji action or another lawsuit.

The lawyers in the Jer v. Samji action are in discussions with the Defendants about interest relief.

Should I discuss the progress of the case in public?

Please be careful with your own personal communications. In particular, it is not in your best interests to post information on the case on Facebook or on other social media sites. Information from these “personal” sites are increasingly being used by the Court, and could potentially harm your case. 

Still have questions?

Visit www.samjiclassaction.com regularly or email info@samjiclassaction.com for more information.

If you would like to read the B.C. Class Proceedings Act for yourself, please visit http://canlii.org/en/bc/laws/stat/rsbc-1996-c-50/latest/rsbc-1996-c-50.html.

 

DISCLAIMER

This list of Frequently Asked Questions (“FAQ”), the Investor Questionnaire, and the websites www.samjiclassaction.com and www.complexlitigation.ca/samji-classaction.html (collectively, the “Website”) are intended to provide general information only. The information that the Website contains, including information that may be provided by Hordo Bennett Mounteer LLP and Camp Fiorante Matthews Mogerman (collectively, the “Lawyers”) in the form of comments or replies to comments, does not constitute legal or other advice and must not be used as a substitute for legal advice from a qualified legal professional in your jurisdiction who has been fully informed of your specific circumstances. The Lawyers do not guarantee the accuracy or completeness of any information on the Website. Information may not be updated subsequent to its initial posting and may therefore be out of date at the time it is read or viewed. Links to other websites are provided for convenience only: the Lawyers do not endorse any website, or guarantee the accuracy or completeness of any information, accessible through links from the Website.

Information submitted to the Lawyers by e-mail or as a question or comment through the Website will not be treated as confidential. In no case will any such submission or response thereto create, or influence or support the creation or continuation of, a lawyer-client relationship between the Lawyers and any other person.