Greg Noval

April 02, 2009 19:42 ET

Canadian Superior Chairman Responds Aggressively to Palo Alto Investors

CALGARY, ALBERTA,--(Marketwire - April 2, 2009) - Canadian Superior Energy Chairman, Greg Noval, responded aggressively today to Palo Alto Investors' inaccuracies in their letter dated April 1, 2009 and demands an apology or will sue Palo Alto Investors and their associates. Mr. Noval is Chairman of Canadian Superior whose stock symbol is (TSX:SNG) (NYSE Alternext US:SNG).



April 2, 2009

Palo Alto Investors, LLC
470 University Avenue
Palo Alto, CA 94301

Attention: David J. Anderson

Dear Sir:

RE: Canadian Superior Energy Inc.

I write on behalf of Mr. Greg Noval, in response to your "Open Letter" to
the Board of Directors and all shareholders of Canadian Superior Energy
Inc., which was published online at www.marketwatch.com on April 1, 2009.

In my opinion, your Open Letter contains remarks and statements that are
defamatory of my client, as more particularized in the Notice under the
Defamation Act of Alberta being served concurrent with the sending of this
letter.

Not only are certain of the statements false and defamatory, your Open
Letter is inaccurate and unfair by virtue of its conspicuous omission to set
out certain facts of which you are well-aware. These facts include: (i) Mr.
Noval's position as Chairman of Canadian Superior and his position as
Chairman of Challenger up to the date of his resignation from its Board on
October 23, 2008, had existed for a number of years and was fully disclosed
in numerous public filings; (ii) Palo Alto would either have had this
knowledge at the time of its investment in Canadian Superior, or was
willfully blind to such public knowledge; (iii) Palo Alto invested
aggressively in Canadian Superior in the fall of 2008 in spite of the issues
of which it now complains; (iv) Mr. Noval is not, contrary to your
allegations, the largest shareholder of Challenger; (v) the agreements
between Canadian Superior and Challenger, including the Credit Facility,
were properly handled in the manner prescribed by Canadian corporate and
securities laws; (vi) the Credit Facility was reviewed in advance by the
Alberta Securities Commission; (vii) the TSX accepted notice of the loan
under the Credit Facility; (viii) approval of the Credit Facility was given
by Canadian Superior's Board of Directors; and (ix) it was, in the opinion
of counsel to Canadian Superior, then and now, prudent and appropriate for
Canadian Superior to have entered into the Credit Facility. Many of these
facts were set out in my letter to Steelhead Partners LLP dated October 10,
2008, with which you appear to be completely familiar.

We deliberately refrain from responding to the other allegations in your
Open Letter, other than to say there are numerous factual inaccuracies,
errors and other omissions.

On behalf of Mr. Noval, I herewith request that you cause to be published in
Marketwatch a full and complete apology to Mr. Noval within forty-eight (48)
hours from the date hereof, failing which I am instructed to commence an
action again Palo Alto Investors, LLC and yourself, for defamation.

Yours very truly,

BROWNLEE LLP
PER:

V. Phil Lalonde


Contact Information

  • Greg Noval
    Chairman
    (808) 649-0027