Wed Mar 26, 2008 9:40 AM EDT
TORONTO — Small investors in asset-backed commercial paper have retained Juroviesky and Ricci LLP, a law firm noted for class action expertise.
Holders of more than $33-billion worth of short-term notes which have been illiquid since August face a vote on a court-administered restructuring arranged by large institutional investors in the seized-up ABCP.
Lawyer Henry Juroviesky said Wednesday his goal is to negotiate a deal enabling small investors to sell their notes immediately for full value.
Under the Companies' Creditors Arrangement Act proposal from the so-called Pan-Canadian investors committee headed by Bay Street lawyer Purdy Crawford, ABCP holders would receive restructured long-term notes which would ultimately be expected to provide all or most of their face value, but in the short term would likely trade at steep discounts.
Juroviesky and Ricci said it has been retained by investors Brian Hunter, Ted Mcfeely and a Facebook group of ABCP holders. The firm said it will be advised by Diane Urquhart, an independent investor advocate who has been harshly critical of the banks and others that sold ABCP to retail investors.
Juroviesky said small clients — many already suffering “significant financial hardship — can't afford to wait until maturity to recover their holdings, as proposed by the Crawford committee.
Retail investors also are balking at the proposal's requirement that they give up all rights to sue the banks, brokers and others involved in the ABCP market collapse.
“We will be looking to the institutional clients and other stakeholders in the Pan-Canadian committee arrangement that stand to benefit from the proposal, to assist our clients in making the arrangement a positive plan for them as well,” Mr. Juroviesky stated.