In Silver v. IMAX Corp., shareholders in a proposed class action against IMAX Corporation and certain directors and officers are seeking $500 million in damages and an additional $100 million in punitives. The shareholders allege that IMAX misrepresented its 2005 earnings revenue in press releases and other disclosures for the period 9 March 2006 to 9 August 2006. It is alleged that 2005 revenues were overstated because IMAX recognized revenues from theatres that had yet to open and that this overstatement artificially inflated the trading price of IMAX securities. On 9 March, IMAX shares traded on the Toronto Stock Exchange (TSX) at $11.94. On 9 August, IMAX issued a press release stating that the U.S. Securities and Exchange Commission had made an informal inquiry about the company’s timing of revenue recognition. On 10 August, the price of IMAX shares dropped to $6.44 on the TSX. What will the plaintiffs have to prove to be successful in the proposed class action lawsuit? How do the secondary market liability amendments in securities legislation assist the plaintiffs? If the plaintiffs are successful, how will damages be calculated?