Silver Wheaton – Tax Court of Canada denies class action plaintiffs access to documents provided on discovery in transfer pricing dispute
Silver Wheaton (renamed Wheaton Precious Metals) was assessed in 2015 for Cdn.$353M respecting CRA’s position that, pursuant to s. 247(2), Wheaton’s income should be increased by an amount equal to substantially all of the income earned outside Canada under precious metal streaming contracts by its Caymans subsidiaries for the 2005 to 2010 taxation years. This produced an immediate drop in its share price, and a U.S. federal securities class action was immediately brought against it. The representative plaintiffs in that action brought a motion in the Tax Court seeking a declaration that an implied undertaking of confidentiality did not apply to Wheaton’s discovery evidence in the Tax Court action (which subsequently was settled in December 2018). In denying this motion, D’Arcy J stated:
The granting of the Non-parties’ motion would result in the very evil the Supreme Court cautions against: defeating the objective of the implied undertaking of confidentiality, which is to encourage open and generous discovery by assuring the parties being discovered of confidentiality.
Neal Armstrong. Summary of Silver Wheaton Corp. v. The Queen, 2019 TCC 170 under Tax Court Rules, s. 16.1(1).