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newsmakers A 'hell' of a year for Purdy Crawford Toronto lawyer led the charge in ABCP BY KELLY HARRIS combining credit owed to them and sell- ing that credit to another party, generally banks. This allows the creditor to free up debt owed to the company creating liquidity in the short term. About $32 billion in ABCP is held by third parties in Canada and with the subprime mortgage fiasco in the summer of 2007, the market for commercial paper all but evapo- rated. This made it more difficult to raise the needed capital to repay the short-term loans. About one-third of all ABCP in Canada are held by third-party investors. In September 2007, the PCIC was created, with Crawford as chairman, to seek a settlement. An agreement to convert the short-term loans into longer-term loans was struck and taken to investors across Canada. Most of the investors were considered retail Purdy Crawford was at the centre of some of Canada's largest financial stories in 2008. T oronto business law guru Purdy Crawford found himself at the apex of 2008's largest financial stories and he was set to end the year with a flurried finish. The year started with Crawford up to his eyeballs in paper — of the asset backed commercial variety. As chairman of the Pan-Canadian Investors Committee for third-party structured asset backed com- mercial paper, he led the charge in seeking to convert short-term loans into those of the longer-term variety while protecting $32-bil- lion worth of the paper in the process. The deal was originally supposed to be struck in October 2007, however delays and lawsuits pushed a possible resolution into 2008. In mid-November, the Osler Hoskin and Harcourt LLP counsel told Law Times he expected a resolution to the crisis by the end of 2008. This was after a resolution expected in October 2008 was delayed by the worldwide financial crisis. "I did come on rather strong," Crawford said of the previous interview when he told reporters at the Financial Post that he was "mad as hell" at that latest delay. The restructuring plan will take short- term, third-party ABCP notes and create longer-term notes. ABCP refers to a creditor 4 December 2008 investors and the Ontario Superior Court of Justice ruled that a vote could go ahead on the restructuring plan. The vote was approved by 96 per cent of investors; however, a group of disgruntled investors, representing about $3.2 billion, appealed the ruling. In September, the appeal was dismissed allowing for the restructuring plan to go ahead. However, on Sept. 15, invest- ment bank Lehman Brothers announced bankruptcy — the largest in U.S. history — sending worldwide stock markets into a downward spin. Thus the resolution was further delayed. While Crawford was attempting to shuffle commercial paper, another of his interests, Maple Leaf Foods Inc., a company where he sits as a director, found itself embroiled in one of the most tragic business stories of 2008. A deadly listeriosis outbreak at one of the company's plants was linked to 17 deaths. Crawford recalls being on telecon- ferences when the outbreak occurred and hearing the debates over the course of action CEO Michael McCain took. "The board was very active in terms of meetings," Crawford said. "We were on the phone it seemed to me, everyday, not everyday, such an exaggeration, probably twice a week or more talking to the CEO and others." It was on those calls that Crawford learned of the course of action McCain would take, first accepting responsibility and then running a very public information campaign to explain the bacteria and what had happened. Boyd Neil, senior vice president and national practice director for corporate communications at consultancy firm Hill & Knowlton Canada, told Law Times in Sep- tember that Maple Leaf 's response to the listeriosis outbreak is "a case study in how to effectively handle a crisis." One of Neil's main reasons for hailing the response is McCain's public statement, made shortly after the outbreak was discovered, that legal considerations were secondary. "Michael [McCain] led it and he didn't need to be told that he had to go up front and accept responsibility from day one," Crawford said. "He had to push back on some lawyers and things like that, but he sure as hell did." While working with a company in crisis and trying to find a solution to ABCP, Crawford was deeply involved with another brewing issue. He was the chairman and title author on the Crawford Panel on a Single Canadian Securities Regulator. The report released in 2006 favoured a single Canadian securities regulator and a single Canadian securities act, rather than separate provincial acts and regulators, that would enhance market effi- ciencies and competitiveness. Additionally, the report stressed the need to wipe away multi-jurisdictional systems and the inherent problems they bring, not the least of which is a lack of security and investor confidence. The report also favoured plain language regulations "to replace bureaucratic legalese" and "make the system more user friendly." On Feb. 21, the federal government announced the formation of an Expert Panel on Securities Regulation in Canada. Accord- ing to its web site (www.expertpanel.ca/eng/ documents/public-consultation-paper.php), "the expert panel is charged with providing advice and recommendations to the minister of finance, and the provincial and territorial ministers responsible for securities regula- tion, on the best way forward to improve securities regulation in Canada." The Crawford report is cited as one of the resources for the panel, which is due to report out by the end of this year.