Growing up in a working-class Italian neighbourhood in Toronto, Groia was inspired to pursue a career in law by the true-life and fictional examples of Clarence Darrow and Perry Mason. In the late ’70s, he attended the University of Toronto’s law school. He flourished, becoming a top student and chief justice of the moot court. He earned early notoriety for marching into the dean’s office and telling him he’d lost control of his classes to a couple of students who were monopolizing everyone’s time with their juvenile opinions. Groia then helped invent a game called “Asshole Bingo” to mock the offenders.
Fascinated by the intersection of corporate and criminal law, Groia was drawn to securities litigation. After being called to the bar in 1981, he went to work on Bay Street at the law firm McTaggart Potts before moving to McMillan Binch. “Joe’s a very, very good advocate,” says Stanley Fisher of Heenan Blaikie, who was at McMillan when Groia worked there. “Some people might find him to be somewhat abrasive and aggressive. I don’t find that at all.”
In person, Groia is not an angry man and, in fact, is a bit of a boulevardier who enjoys the finer things in life, especially wine. Last year, he and his wife, Susan Barnacal, started a winery in the Niagara Peninsula called Lincoln Cellars. Friends view Groia as good company and an entertaining conversationalist. “He’s an extremely loyal friend and a delightful companion and an engaging guy,” says Jim Douglas, who has known Groia since law school. “He’s very witty and lots of fun.”
Groia enjoys an intellectual fencing match as much as a good story, and he is fond of the media spotlight. Yet the views he espouses on policing the capital markets can seem contradictory. He believes the regulatory system is “broken, and has been for many years.” Yet he doesn’t think it’s wise to throw white-collar criminals in jail: Investors’ chances of getting their money returned diminish and it’s too expensive for the public. He argues that the Ontario Securities Commission could pursue five or six administrative or civil cases in half the time it takes to try one criminal case “and it would cost pretty much the same. As soon as you start thinking of criminal prosecution, all bets are off. You get very little co-operation, you have presumption of innocence, you have a bunch of Charter issues to deal with, you have judges who are less friendly and don’t understand the issues. And you have a whole raft of technical legal defences. So is the market going to be better with five cases where the guy loses all his money and is kicked out of the market, or with one criminal prosecution?”
A good raconteur he may be, but it was Groia’s pugnacious streak that got him recruited in 1985 to become a cop of the stock market, working for the OSC as associate general counsel. With the support of a crusading new OSC chair, Stanley Beck, Groia was instructed to give the commission more bite. He did just that by taking on some of Bay Street’s biggest players, including Gordon Capital, Canadian Tire and an alliance of the Torstar and Southam newspaper chains. By the time he left the OSC in search of better pay and new challenges in 1990, Groia was running an enforcement division that got results.
For this, he paid a price: Bay Street’s top law firms blackballed him. Groia says that prior to departing the OSC, he had half a dozen offers from various firms saying he should look them up when he left the commission. When he contacted them all, “I had six very sheepish litigation partners call me back and say, ‘I am surprised but it’s not going to work out here.’” The firms’ partners were worried that their corporate clients would be far from keen about Groia, many having felt his lash at the OSC.
Groia eventually landed a job with the Montreal law firm Heenan Blaikie, which had just opened a Toronto office. Now he was working for the other side, defending the very people he had once tried to kick out of the markets. And his career changed irrevocably when the OSC laid eight charges against John Felderhof in 1999 arising from the Bre-X mining scandal, a stock-market sensation based on the notion that the world’s biggest gold mine had been found in Borneo. When the mine turned out to be a sham, $6 billion in market capitalization disappeared. Felderhof, who had been Bre-X’s senior geologist and was accused of getting rich by cashing in his stock just before the mine was discovered to be a hoax, hired Groia to defend him. “He struck me as a straight-shooter, no-nonsense sort of guy with whom I could work,” says Felderhof.
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