SNC-Lavalin asks court to review remediation rejection

MONTREAL — Arguing that federal prosecutors unreasonably excluded SNC-Lavalin Group Inc. from negotiating an agreement that could have resolved corruption and fraud charges before trial, the company has filed for a judicial review of the decision.

On Oct. 10, the engineering giant announced the Public Prosecution Service of Canada had declined to “invite” it to take part in a remediation regime introduced in the Criminal Code this year.

A conviction on the charges filed in 2015 could prevent the company from bidding on any federal project for up to 10 years, but SNC had hoped to reach a deal that would set them aside in return for fines, co-operation and other penalties.

The request for judicial review, filed in Federal Court, cites “the extremely negative consequences the underlying legal proceedings have had and will continue to have [even in the event of an acquittal] on SNC and innocent stakeholders, including employees, suppliers, pensioners and stakeholders, in the absence of an invitation to negotiate.”

According to the document, prosecutors provided SNC no explanation why they judged it would not be “appropriate” for the company to take part in the remediation regime.

SNC is “in the dark as to how they failed to meet the requirement of ‘appropriateness,’ or why the public interest requirement, though met, has apparently been ignored,” the document says.

It adds that prosecutors failed to consider information SNC provided “regarding the turnover of senior management and the severance of any individuals who might have directed, condoned or participated in the wrongdoing which gave rise to the charges.”

The company had offered to have its president and CEO, Neil Bruce, meet with prosecutors to explain why remediation was crucial. The announcement of the refusal to negotiate sent SNC stock plunging to its lowest level since 2016.

The request for judicial review comes as a preliminary hearing into the charges opened this week in Montreal to determine whether the evidence merits moving forward with a criminal trial.

In February 2015, the RCMP charged SNC and two subsidiaries with paying nearly $48 million to public officials in Libya between 2001 and 2011 to influence government decisions under the Moammar Gadhafi regime.

The RCMP also hit the Montreal-based company, its construction division and a subsidiary with one charge each of fraud and corruption for allegedly defrauding various Libyan organizations of about $130 million.

An RCMP officer testified before Judge Claude Leblond, who placed a publication ban on all evidence presented at the hearing.

The hearing continues through November.