Canwest Global Communications Corp. has announced the settlement of the long-standing copyright class action lawsuit about the electronic rights of freelancers that has worked its way through the courts for 13 years. Canwest (Canada) Inc., Canwest Limited Partnership / Canwest Societe en Commandite,-- collectively called LP Entities -- and the named writer in the suit, Heather Robertson, have agreed on a $7.5 million valuation of all claims by freelance writers who are parties to the lawsuit as unsecured creditors.
In return Heather Robertson in the name of those creditors will vote in favour of a plan of arrangement in the insolvency proceedings of Canwest Publishing, which filed for creditor protection in January. All agreements in the case are subject to approval by the court on June 16.
The settlement is part of the dismantling and restructuring of CanWest by its major creditors and holders of its bonds, who have agreed to acquire all of the financial and operating assets of the company for about $1.1 billion, including all shares of the National Post Inc. and to inject about $950 million in cash. Most of the cash will be used to pay off the senior secured creditors (called AHC) -- mostly made up of chartered banks.
Larger creditors will receive shares in a new corporate entity dubbed Newco, which will issue 40 million shares -- 27 million to AHC at $9.26 a share and 13 million to other creditors at a nominal price of $11.54 per share. Up to $130 million or about 35% of the cash injection, potentially could go to pay off smaller affected creditors, including the freelancers covered by the Robertson class action, providing they have proven claims. Those owed less than $1,000 would receive full cash payments. Those owed more than $1,000 would have the choice of accepting a $1,000 cash payment or receive shares in Newco on a pro rata basis.
The drawn-out class action over copyright in what has become called The Robertson case is winding its way to a conclusion; the suit was launched more than 13 years ago by Heather Robertson on behalf of thousands of freelance writers claiming their work was reproduced electronically without proper permission or compensation.
In May 2009, an $11 million settlement was reached with with The Thomson Corporation (now Thomson Reuters Corporation), Thomson Reuters Canada Limited, Thomson Affiliated and Information Access Company (formerly The Gale Group Inc.) and CTVglobemedia Publishing Inc. (formerly Bell Globemedia Publishing Inc.), the publishers of the Globe and Mail newspaper.After legal fees and other costs, about $4 to $5 million in compensation was to be available to individual writers, photographers and illustrators for freelance work published prior to May 1, 2009 in various newspaper databases.
The Canwest settlement does not terminate Heather Robertson's lawsuit against the remaining defendants in her class action: Proquest Information and Learning LLC, CEDROM-SNI Inc., Toronto Star Newspapers Ltd., and Rogers Publishing Limited.
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