The Łútsël K’é Dene First Nation’s lawsuit against KPMG is on hold while the accounting firm appeals a decision to have the case proceed in NWT Supreme Court.
The First Nation alleges KPMG knowingly assisted the former chief executive officer of its business arm in misappropriating millions of dollars.
KPMG, which denies wrongdoing, says the First Nation’s allegations should be dealt with through private arbitration in British Columbia. In January, a judge disagreed and ruled the case can proceed in open court in the territory.
Last week, however, the NWT Court of Appeal issued a stay – a pause in proceedings – that allows a KPMG appeal of that ruling to conclude before anything else can happen in court.
(The First Nation is also appealing a separate part of the January ruling that prevented it from trying a different means of avoiding arbitration.)
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In her written decision, NWT Court of Appeal Justice Anne Kirker said the appeals are expected to be heard in June and come to a conclusion by the end of 2026, so waiting would mean only “a relatively short delay.”
Kirker accepted KPMG’s argument that pressing ahead in NWT Supreme Court while the appeal goes on elsewhere could risk “irreparable harm.”
The firm had argued proceeding in open court would mean surrendering its right to the arbitration process – a right the appeal might yet preserve. The practical effect would likely be the production of more documents in open court than an arbitration process would reveal.
Kirker said she was also “concerned about the practical and substantial risk of wasted time and expense if KPMG is required to file a statement of defence and then undertake discovery procedures” before the arbitration question is decided.
