VANCOUVER — A British Columbia Supreme Court judge has ruled in favour of Edward Rogers after he replaced five independent directors on the board of Rogers Communications Inc.
Justice Shelley Fitzpatrick’s decision validates the changes made by Rogers in opposition to the wishes of his mother and two sisters, who are also members of the board and the respondents in the case that has pitted family members against each other.
“I am granting the order sought by Edward, and granting him costs,” Fitzpatrick said Friday.
The three women questioned Edward Rogers’ leadership in the battle over control of the board, saying his choice to arbitrarily nominate his own directors violated the company’s governance practices.
Fitzpatrick did not read her decision in court, saying the reasons were lengthy and it would take hours.
Ken McEwan, a lawyer for Edward Rogers, argued this week his client used his authority as chair of the family trust, which has 97.5 per cent of the voting rights.
He told a hearing on Monday that Edward Rogers also had that power under a unique corporate law in B.C., where the Toronto-based company is incorporated.
Lawyer Stephen Schachter, who represents Loretta Rogers and her daughters Melinda Rogers-Hixon and Martha Rogers, told the court they will appeal the ruling.
Loretta Rogers said in her affidavit filed last week that her son “secretly” planned to remove the majority of independent directors with his own nominees, going against the company’s governance structure to include the votes of shareholders.
She said Edward Rogers also failed to abide by her late husband’s 2006 “memorandum of wishes,” complete with checks and balances aimed at preventing such problems by the chair of the family trust. Ted Rogers died in 2008.
“Nothing worried him more than a needless public spectacle,” she said.
“The nearly 24,000 employees today, our investors, families and those who have lent the company money now count on Rogers’ board of directors and the control trust’s discipline to provide stable and competent leadership,” Loretta Rogers said, describing herself as co-founder and the first investor of Rogers.
In the affidavit, signed Oct. 28, she said her son had waged an “unconscionable” campaign to oust board members, which was inconsistent with his duties and limited authority as chair of the family trust.
“He planned to effect this through his position as control trust chair using a written shareholders’ resolution without a meeting of Rogers’ shareholders. Rogers had never made changes to its board of directors in that manner before.”
Loretta Rogers also said Edward Rogers planned to fire CEO Joe Natale without the board’s input and misled her about Natale’s poor job performance as a reason to replace him with chief financial officer Tony Staffieri.
Natale was ultimately terminated and Staffieri was fired.
“It brings me no joy to swear this affidavit. But I feel compelled to do so in light of Edward’s conduct, which has put what we built at risk,” she said.
This report by The Canadian Press was first published Nov. 5, 2021.
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Camille Bains, The Canadian Press