Carl Icahn in his take-over bid for Lions Gate Entertainment Carl Icahn in his take-over bid for Lions Gate Entertainment

Carl Icahn made a take-over bid seeking control of Lions Gate Entertainment Corp. In response, Lions Gate put in place a tactical shareholders’ right plan intended to defeat the bid. Lions Gate did not seek an alternative bidder. Osler, representing Icahn, had the shareholder rights’ plan cease trade by the B.C. Securities Commission, a decision that was upheld by the B.C. Court of Appeal. It was a significant decision in that ran counter to prior decisions of the Alberta and Ontario Securities Commissions.

In a subsequent proxy contest launched by Icahn following the expiry of his take-over bid, the board of directors of Lions Gate implemented a “debt conversion” transaction, one of the objectives of which was to put additional shares under the control of one of the existing shareholders. Icahn challenged the decision under the oppression remedy, but was unsuccessful and that decision was upheld by the Court of Appeal. The decision is significant because it advances the law on the types of defensive tactics that target boards can engage in when faced with a proxy contest or an actual or threatened take-over bid.

Osler, Hoskin & Harcourt LLP represented Carl Icahn with a team led by Mark Gelowitz (Litigation) and Allan Coleman (Litigation), along with Shawn Irving (Litigation), Lauren Tomasich (Litigation) and Jason Comerford (Corporate).