April 18, 2018 / 11:24 PM / a month ago

Judge dismisses Catalyst’s C$1.3 bln Wind Mobile-related lawsuit

TORONTO/NEW YORK, April 18 (Reuters) - An Ontario judge on Wednesday dismissed a C$1.3 billion lawsuit by Catalyst Capital Group Inc in a case involving Canadian wireless carrier Wind Mobile, citing an “abuse of process” by the Canadian private equity firm.

Catalyst sued VimpelCom Ltd, Canadian investment firm West Face Capital Inc, UBS Securities Canada and others in 2016. VimpelCom, a Russian cellphone operator that changed its name to Veon Ltd, owned a large stake in Wind through a subsidiary. Claiming that it had an exclusive agreement with VimpelCom to buy Wind Mobile, Catalyst alleged misuse of confidential information by West Face and others, as well as a breach of contract against some of the defendants. The core issue was whether West Face and others used confidential information from a former Catalyst employee in the acquisition of Wind.

A spokesman for Catalyst did not respond to a request for comment.

“This decision is yet another independent confirmation of lack of merit to the serial litigation being pursued by Catalyst against West Face for almost four years,” West Face Chief Executive Greg Boland said in a statement.

The lawsuit was one of two filed by Catalyst against West Face Capital and others after it lost a bidding process to buy Wind Mobile from VimpelCom in 2014.

Judge Frank Newbould, originally hearing both cases in Ontario’s Superior Court, dismissed one of them in August 2016, concluding that West Face and others had not used confidential information from a former Catalyst employee to make its winning bid. Catalyst appealed Newbould’s dismissal, and that appeal was dismissed in February.

Catalyst told its private equity fund investors last year that its VimpelCom Wind claim could be highly lucrative. In an annual meeting presentation in April 2017, Catalyst estimated the claim was worth US$446.9 million at the end of 2016 and that the firm has “a reasonable likelihood of success at trial.” In a letter to investors sent in March, Catalyst said, “We remain convinced that Catalyst’s confidential work product, information, and strategies regarding the WIND transaction were improperly conveyed” and that “such breaches caused significant damages to Catalyst Fund investors.”

Reporting by John Tilak and Lawrence Delevingne Editing by Leslie Adler

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