The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry.
Early in 2012, the Law Society of Upper Canada convicted Toronto securities lawyer Joe Groia of “incivility” during his defense of John Felderhof against quasi-criminal charges laid by the Ontario Securities Commission of insider trading and issuing false or misleading information. (Felderhof was never charged with a criminal offence.) The geologist hired Groia in 1997, the trial began in 2000, and in 2007 Justice Peter Hyrn cleared Felderhof of all eight charges. Groia, who faces a four-month suspension and $250,000 in costs, recently sat down with The Northern Miner to discuss the Bre-X trial and its aftermath.
The Northern Miner: What are some of the points you’d like to make about the Bre-X case?
Joe Groia: John Felderhof’s case illustrates beyond any doubt that Bay Street convicts people — you’re guilty until proven innocent — and even then, it’s not altogether clear how you go about rehabilitating yourself.
TNM: Felderhof was called a pariah, and you were called a pariah for defending him.
JG: The regulators needed to charge and convict someone, and John’s bad luck was that he was the last man standing, and therefore he was the fellow who faced the hurricane. For the 10 years of that trial, the attitude on Bay Street was: ‘Well, of course John is guilty. If he wasn’t guilty, why would he have been charged?’ I think the Ontario Securities Commission directly and indirectly did a lot of things that contributed to that mindset.
TNM: What disappoints you the most?
JG: John was acquitted on the merits, and there is a 600-page judgment that painstakingly goes through the evidence. But even as recently as a couple of weeks ago, a fairly senior lawyer in the mining industry who practices in the private sector and who claims to know a lot about the Bre-X case essentially said that it’s really too bad the judge got bamboozled by the defence team. Yet you read Justice Hyrn’s judgment, and it’s a textbook on due diligence and the work done by the Bre-X team.
TNM: Many people in the industry still believe he is guilty.
JG: It’s impossible to have a rational, sensible conversation with the naysayers out there, the people who want to believe John Felderhof is guilty. They don’t want to be bothered by the facts or the details.
TNM: Did you think the outcome of the acquittal would make a difference?
JG: I thought that if John was acquitted in the very strongest of language that people on Bay Street would say: ‘Maybe he was right.’ But it’s like spitting in the wind. It is extremely troubling, not just for John but for everyone who faces this kind of controversy, to think that they’ll be convicted in the court of public opinion just because they are charged, and even when they win, people won’t believe it. You would hope that a white-collar senior executive who gets acquitted would have a better chance of coming back to his old life than some criminal who gets convicted and sent to jail, and yet I think the sad reality is that Bay Street works at a standard that makes that almost impossible, and I think we all lose as a result.
For the rest of this article, please go to the Northern Miner website: http://www.northernminer.com/news/groia-ground-down-but-defiant-after-felderhofs-bre-x-trial/1001960248/