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CAE Inc. has agreed to settle a shareholder class-action lawsuit for $38.25 million over alleged misleading statements about fixed-price defence contracts. The company will pay up to $5 million, with insurers covering the rest, pending court approval on Dec. 22.
MONTREAL - CAE Inc. has reached a deal to settle a class-action lawsuit by shareholders against the company, its former chief executive and its former chief financial officer that will see the defendants pay $38.25 million.
CAE Settlement Terms and Allegations
Under the proposed agreement, CAE will pay up to $5 million with the remaining amount to be paid by its insurers. The lawsuit alleged the company and executives made misleading statements related to fixed-price contracts in the defence sector that inflated its share price. The defendants denied all of the allegations, however, a statement by lawyers for the plaintiffs said the two sides agreed to settle to avoid the delays and risks associated with continued litigation and trial.
The class includes investors who bought CAE shares during the period from Aug. 10, 2022, to May 21, 2024, and still held some or all of the shares at any time between Feb. 14, 2024, and May 22, 2024. A settlement approval hearing is set for Dec. 22 in a Quebec court. This report by The Canadian Press was first published Oct. 2, 2026.
The proposed settlement resolves claims that CAE and its former top executives misled investors about fixed-price defence contracts, which allegedly inflated the company's share price during the class period. The defendants continue to deny all allegations of wrongdoing. The settlement was reached to avoid the delays, costs and risks of continued litigation and a trial, according to a statement from lawyers for the plaintiffs.
Investors who purchased CAE shares between Aug. 10, 2022, and May 21, 2024, and still held some or all of those shares at any time between Feb. 14, 2024, and May 22, 2024, are included in the class. The agreement must still be approved by a Quebec court. A settlement approval hearing is scheduled for Dec. 22. Under the terms of the proposed deal, CAE will contribute up to $5 million, while its insurers will pay the remaining $33.25 million.
Defence Contract Claims and Liability
The case centered on statements related to fixed-price contracts in the defence sector. Shareholders alleged those statements were misleading and artificially inflated the company's share price. CAE, its former chief executive and its former chief financial officer were named as defendants in the lawsuit. The settlement does not include an admission of liability by any of the defendants.
Lawyers for the plaintiffs said the agreement was reached to avoid the uncertainty and expense of a trial. Investors in the class do not need to take any action at this time. Further details about the settlement and the approval process are expected to be provided ahead of the Dec. 22 hearing. The Canadian Press first published this report on Oct. 2, 2026.
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CTVNews:This story was compiled and edited by the HeadTopics newsroom and HT AI from the reports above.
Justice Manufacturing CAE Inc. Class-Action Settlement Shareholder Lawsuit Defence Contracts Quebec Court
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