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Pedestrians use their mobile phones in front of a Wind Mobile location in Toronto on Tuesday, May 5, 2015.

darren calabrese The Globe and Mail

The latest instalment in a long-running Bay Street feud began Tuesday, as Catalyst Capital Group Inc. appealed a court decision that went against the distressed-debt fund and in favour of rival asset manager West Face Capital Inc.

Toronto-based Catalyst wants a new trial of its lawsuit against a former employee, analyst Brandon Moyse, and West Face, which hired Mr. Moyse in 2014. Catalyst alleged Tuesday in a filing with the Court of Appeal for Ontario that the judge on the case made numerous errors.

In August, Ontario Superior Court Justice Frank Newbould dismissed the Catalyst lawsuit "in its entirety." He found no evidence of wrongdoing on the part of the Mr. Moyse and West Face and accepted the testimony of West Face executives as "straightforward."

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However, Justice Newbould said in his decision: "I had considerable difficulty accepting as reliable much of the evidence of Mr. Newton Glassman," the chief executive officer and founder of Catalyst. The appeal claims that the judge "deprived Catalyst of procedural fairness by applying an inconsistent standing in his evaluation of the witnesses' credibility."

In the original lawsuit, Catalyst claimed Mr. Moyse shared confidential data on a Catalyst potential investment in Wind Mobile Corp. with West Face, and then scrubbed his BlackBerry and computer to hide evidence of this activity. Catalyst attempted to acquire Wind, but West Face ultimately won the company and later sold it for a significant gain.

Mr. Moyse admitted in court that he cleaned up his computer prior to turning it over to lawyers, but only to get rid of his browsing history on adult entertainment websites. In the appeal, Catalyst argued that the judge should have concluded "evidence was destroyed to affect the outcome of litigation."

"Justice Newbould's judgment correctly made findings of credibility against Catalyst's witnesses, including Newton Glassman," said West Face CEO Greg Boland in an email.

"In response, Catalyst first publicly accused the distinguished Justice Newbould of bias, and without recanting that shocking allegation, they now assert a new laundry list of trial deficiencies. None have any merit," he added.

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