The backstage dispute that has moved one of Canada’s largest telecom businesses has gone into a B.C. courtroom this week, with both sides asking a judge to decide that they are rightfully in charge of the company.
On Monday, lawyers serving Rogers Communications Inc. and its renegade Chairman, Edward Rogers, clashed in court. Last month, it was revealed that Edward, the company’s founder Ted’s son, tried to fire CEO Joe Natale and replace him with Anthony Staffieri, the company’s then-CFO, in a dangerous family fight.
Natale got a report of the plot and informed the company’s board of what was going on. Other members of Edward’s family, including his sisters Martha and Melinda and his mother Loretta, decided to stop Edward’s power grab and have him removed as chair.
Instead of ending the story with a failed hall revolution that saw him removed as chair, Edward ratcheted up the drama in October by removing five board members, replacing them with followers of his choosing, and reinstalling himself as chair.
On Monday, B.C. Supreme Court Justice Shelley Fitzpatrick heard arguments from both sides.
Lawyer Stephen R. Schachter, speaking on behalf of the company, contended that Edward Rogers’ choice to appoint a new board of directors is in contravention of the firm’s operating guidance.
Schachter claims that the new board is invalid since it was not named by a complete meeting of all shareholders but rather by a single person’s “stroke of a pen.”
“What Edward is trying to achieve has never been done at Rogers,” he said, adding that the behind-the-scenes family drama is secondary to the subject of effective corporate governance. Meanwhile, Edward’s lawyer claims that his client had every right to do what he did because he controls all of the company’s voting shares.
Only the B shares of Rogers Corporation are freely traded on the Toronto Stock Exchange. Despite owning over 70% of the company’s stock, they do not have voting rights. The A-shares have full voting rights, and the Rogers Control Trust, which Edward still leads, owns 97.5 % of them.
Source: CBC News
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