sc13dza

0000950134-06-022521.txt : 20061201 0000950134-06-022521.hdr.sgml : 20061201 20061201171300 ACCESSION NUMBER: 0000950134-06-022521 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20061201 DATE AS OF CHANGE: 20061201 GROUP MEMBERS: DAVID EINHORN GROUP MEMBERS: GREENLIGHT CAPITAL INC SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: MI DEVELOPMENTS INC CENTRAL INDEX KEY: 0001252509 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 000000000 STATE OF INCORPORATION: A6 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-79210 FILM NUMBER: 061252038 BUSINESS ADDRESS: STREET 1: 455 MAGNA DR STREET 2: AURORA ONTARIO CITY: CANADA STATE: A6 ZIP: L4G7A9 BUSINESS PHONE: 9057136322 MAIL ADDRESS: STREET 1: 455 MAGNA DR STREET 2: AURORA ONTARIO CITY: CANADA STATE: A6 ZIP: L4G7A9 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: GREENLIGHT CAPITAL LLC CENTRAL INDEX KEY: 0001040272 IRS NUMBER: 133886851 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 140 EAST 45TH STREET STREET 2: 24TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 2129731900 MAIL ADDRESS: STREET 1: 140 EAST 45TH STREET STREET 2: 24TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10017 SC 13D/A 1 d41789sc13dza.htm AMENDMENT TO SCHEDULE 13D sc13dza


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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D/A

(Rule 13d-101)

Under the Securities Exchange Act of 1934
(Amendment No. 7 )*

MI DEVELOPMENTS INC.

(Name of Issuer)

Class A Subordinate Voting Shares, no par value

(Title of Class of Securities)

55304X104

(CUSIP Number)

Greenlight Capital, L.L.C.
140 East 45th Street, Floor 24
New York, New York 10017
Tel. No.: (212) 973-1900
Attention: Chief Operating Officer

(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)

- with copies to -

Eliot D. Raffkind
Akin Gump Strauss Hauer & Feld LLP
1700 Pacific Avenue, Suite 4100
Dallas, Texas 75201-4618
(214) 969-2800

November 29, 2006

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number.


CUSIP No.		55304X104


1	NAMES OF REPORTING PERSONS: Greenlight Capital, L.L.C.

	I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):
	13-3886851

2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
	(a) o
	(b) o

3	SEC USE ONLY:



4	SOURCE OF FUNDS (SEE INSTRUCTIONS):

	AF

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e):

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION:

	Delaware

		7	SOLE VOTING POWER:

NUMBER OF			2,377,500

SHARES		8	SHARED VOTING POWER:
BENEFICIALLY
OWNED BY			0

EACH		9	SOLE DISPOSITIVE POWER:
REPORTING
PERSON			2,377,500

WITH		10	SHARED DISPOSITIVE POWER:

			0

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:

	2,377,500

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):

	5.0%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):

	OO

Page 2 of 6


CUSIP No.		55304X104


1	NAMES OF REPORTING PERSONS: Greenlight Capital, Inc.

	I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):
	13-3871632

2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
	(a) o
	(b) o

3	SEC USE ONLY:



4	SOURCE OF FUNDS (SEE INSTRUCTIONS):

	AF

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e):

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION:

	Delaware

		7	SOLE VOTING POWER:

NUMBER OF			2,322,500

SHARES		8	SHARED VOTING POWER:
BENEFICIALLY
OWNED BY			0

EACH		9	SOLE DISPOSITIVE POWER:
REPORTING
PERSON			2,322,500

WITH		10	SHARED DISPOSITIVE POWER:

			0

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:

	2,322,500

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):

	4.9%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):

	CO

Page 3 of 6


CUSIP No.		55304X104


1	NAMES OF REPORTING PERSONS: David Einhorn

	I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):


2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
	(a) o
	(b) o

3	SEC USE ONLY:



4	SOURCE OF FUNDS (SEE INSTRUCTIONS):

	AF

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e):

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION:

	United States Citizen

		7	SOLE VOTING POWER:

NUMBER OF			4,730,000

SHARES		8	SHARED VOTING POWER:
BENEFICIALLY
OWNED BY			0

EACH		9	SOLE DISPOSITIVE POWER:
REPORTING
PERSON			4,730,000

WITH		10	SHARED DISPOSITIVE POWER:

			0

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:

	4,730,000

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):

	9.9%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):

	IN

Page 4 of 6

AMENDMENT NO. 7 TO SCHEDULE 13D

This Amendment No. 7 to Schedule 13D (the “Amendment”) is being filed on behalf of Greenlight Capital, L.L.C., a Delaware limited liability company (“Greenlight LLC”), Greenlight Capital, Inc., a Delaware corporation (“Greenlight Inc.” and together with Greenlight LLC, “Greenlight”), and Mr. David Einhorn, the principal of each of Greenlight LLC and Greenlight Inc. Greenlight and Mr. Einhorn are referred to herein as the “Reporting Persons.” This Amendment modifies the original Schedule 13D filed with the Securities and Exchange Commission on August 11, 2004, as amended by Amendment No. 1 filed on September 2, 2004, Amendment No. 2 filed on January 18, 2005, Amendment No. 3 filed on April 8, 2005, Amendment No. 4 filed on April 15, 2005, Amendment No. 5 filed on August 2, 2005 and Amendment No. 6 filed on October 18, 2005.

This Amendment relates to Class A Subordinated Voting Shares, no par value (the “Class A Shares”), of MI Developments Inc., a Canadian company (“MID” or the “Issuer”), owned by Greenlight LLC for the account of (i) Greenlight Capital, L.P., of which Greenlight LLC is the general partner and (ii) Greenlight Capital Qualified, L.P., of which Greenlight LLC is the general partner, and the Class A Shares purchased by Greenlight Inc. for the account of Greenlight Capital Offshore, Ltd., for which Greenlight Inc. is the investment advisor. This Amendment also relates to the Class A Shares purchased by affiliates of Greenlight for the accounts of (i) Greenlight Masters, LP, (ii) Greenlight Masters Qualified, LP, (iii) Greenlight Masters Offshore, Ltd., (iv) Greenlight Masters Offshore I, Ltd., and (v) Greenlight Masters Offshore Partners, L.P. (collectively, “Affiliates”).

Item 4. Purpose of the Transaction

Item 4 of the Schedule 13D is hereby amended by adding the following:

On November 29, 2006, Greenlight Inc. and certain affiliates filed a Notice of Appeal with the Ontario Superior Court of Justice (Divisional Court) (the “Court”) appealing the October 30, 2006 decision of the Court that dismissed the Application. In the Notice of Appeal, Greenlight Inc. sets forth several reasons why it believes the Court erred in its decision to dismiss the Application. A copy of the Notice of Appeal is attached hereto as Exhibit 11 and incorporated herein by reference.

Item 7. Material to be Filed as Exhibits

Item 7 is hereby amended by adding the following exhibit:


Exhibit 11		Notice of Appeal with the Ontario Superior Court of Justice (Divisional Court) filed by Greenlight Inc. and certain affiliates on November 29, 2006.

Page 5 of 6

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated: December 1, 2006


	GREENLIGHT CAPITAL, L.L.C.
	By:	/s/ David Einhorn
		David Einhorn, Senior Managing Member

	GREENLIGHT CAPITAL, INC.
	By:	/s/ David Einhorn
		David Einhorn, President



	/s/ David Einhorn
	David Einhorn

Page 6 of 6

EX-99.11 2 d41789exv99w11.htm NOTICE OF APPEAL exv99w11

Exhibit 11

Court File No. 05-CL-6008

ONTARIO
SUPERIOR COURT OF JUSTICE
(Divisional Court)

B E T W E E N:

GREENLIGHT CAPITAL, INC.,
GREENLIGHT CAPITAL, LP, GREENLIGHT CAPITAL QUALIFIED, LP,
GREENLIGHT CAPITAL OFFSHORE, LTD.,
GREENLIGHT MASTERS, LP, GREENLIGHT MASTERS QUALIFIED, LP
AND GREENLIGHT MASTERS OFFSHORE, LTD.

(Appellants)

- and -

FRANK STRONACH, 445327 ONTARIO LIMITED, M. DOUGLAS YOUNG,
PHILLIP K. FRICKE, MANFRED JAKSZUS, BRIAN TOBIN, JOHN SIMONETTI,
BARRY BYRD, and
MI DEVELOPMENTS INC.

(Respondents)

NOTICE OF APPEAL

THE APPLICANTS, APPELLANTS, APPEAL to the Divisional Court of Ontario from the order of the Honourable Mr. Justice J. Ground dated October 30, 2006, made at Toronto dismissing the within application.

THE APPELLANTS ASK:

1.		That the Order be set aside and the Application be granted;

2.		That the Appellants be awarded their costs of the Application below and of this Appeal; and

3.		Such further and other relief as the Appellants may request and this Honourable Court may consider just.

- 2 -

THE GROUNDS OF APPEAL are as follows:

1.		The Learned Application Judge erred in deciding that there was no oppression or unfair prejudice to shareholders of MI Developments (“MID”) without first making a finding with respect to what were the reasonable expectations of MID shareholders in light of MID’s public disclosure record, including its road show presentation;

2.		The Learned Judge erred in law by intertwining the reasonable expectations of MID shareholders and the legal principles governing judicial deference to the business judgment of directors when the legal determination of each issue should have been made separately; first with a finding of what were the reasonable expectations; and second with a finding of whether the business judgment of the directors was exercised on a basis that respected those expectations;

3.		The Learned Judge erred in determining that the reasonable expectations of the Appellants and other MID shareholders should have extended to the Project Financings and Bridge Loans simply because he was unable to find any specific statement that MID would restrict its investments in Magna Entertainment Corporation (“MEC”) instead of determining what were the reasonable expectations of MID shareholders based on the totality of MID’s public statements;

4.		The Learned Judge, after finding that the MID shareholders had no expectation of a privatization of MEC, erred in failing to find that the proposed privatization of MEC along with the Project Financings and the Bridge Loans was part of a continuing pattern of oppressive conduct which frustrated the reasonable expectations of MID’s shareholders concerning the nature of MID’s relationship with MEC;

- 3 -

5.		The Learned Judge erred in law by failing to distinguish between the determination of reasonable expectations pursuant to section 248 of the OBCA and the requirements of prospectus disclosure pursuant to the Securities Act. The Learned Trial Judge further erred by misapprehending the expectations actually raised by the language of the prospectus to support an apparent finding that significant financial support of MEC by MID was within the reasonable expectations of MID shareholders;

6.		The Learned Judge erred in finding that it was reasonable to expect that MID would be influenced by Magna’s culture and business philosophy when in fact MID was spun out of Magna International Inc. (“Magna”) in a public offering without the Magna Charter that other Magna Companies adopt and without any prospectus disclosure indicating that the Magna culture or business philosophy would apply to MID;

7.		The Learned Judge erred in law by failing to apply an appropriate standard of scrutiny to the decisions of the Special Committee with respect to the Project Financings, the Greenlight Proposals and the Bridge Loan. In addition, the Learned Judge erred by focusing on the form rather than substance of the Special Committee proceedings;

8.		The Learned Judge erred in his consideration of the business judgment of the Special Committee by failing to consider the evidence of the Corporate Analytics Report concerning the financial deterioration of MEC and the failure of the Special Committee to take account of that report in approving the Project Financings;

9.		The Learned Judge erred in failing to consider whether the Project Financings and Bridge Loan recommended by the MID Special Committee fell within the reasonable

- 4 -

		expectations of the shareholders and instead confined his analysis to whether the transactions were done on commercially reasonable terms;

10.		The Learned Judge erred in his consideration of whether the directors on the Special Committee were in fact independent and misapprehended the evidence concerning Barry Byrd’s conflicts of interest;

11.		The Learned Judge erred in concluding that the Respondent, Frank Stronach did not exercise undue influence over the Board of MID, the Special Committee of MID and the board of MEC by failing to consider the evidence of the Respondent Frank Stronach’s involvement in delaying management of MID from terminating the proposed privatization, appointing a new CEO and new directors of MID, and proposing the Project Financings in August of 2004 and basing his conclusion on the fact he declared his interest and did not vote on certain resolutions;

12.		The Learned Judge erred in failing to consider whether the Respondent Frank Stronach’s belief concerning the future prospects of MEC were in the best interests of MID in light of the expectations that he and other directors of MID had created for MID shareholders concerning the limited nature of MID’s relationship with MEC;

13.		The Learned Judge failed to properly consider all of the evidence before him on the Application;

14.		In particular, the Learned Judge failed to consider at all the following evidence:

(i) the road show presentation to MID investors and its impact on the reasonable expectations of MID shareholders;

- 5 -

(ii) the Corporate Analytics Report concerning the financial deterioration of MEC and its impact on the reasonableness of the business judgment of the Special Committee and the foreseeability of MEC’s financial deterioration;

(iii) the Class A shareholder vote of May 4, 2005 in favour of the Greenlight Proposals and its impact on the reasonableness of the business judgment of the Special Committee;

(iv) the involvement of Respondent Frank Stronach in delaying the withdrawal of the privatization, the appointment of Respondent John Simonetti as CEO, the appointment of directors who served on the Special Committee and the circumstances surrounding the initiation of the Project Financings.

15.

The Learned Judge also misapprehended the evidence he did consider in that among other things, he mistakenly stated:

(i) MID was a subsidiary of Magna after MID became a public company, when it was not;

(ii) that Respondent John Simonetti was the CEO of MID in 2003 when he was not appointed CEO until 2004;

(iii) that Greenlight put forward proposals relating to the elimination of MID’s dual class share structure at a meeting of MID shareholders on May 4, 2005 when it did not;

(iv) that the Respondent Barry Byrd had not been involved in any transactions involving the Respondent Frank Stronach for 3 years;

(v) that the fresh evidence submitted by the Applicants indicated and “ongoing concern” about MEC’s financial condition, when the actual evidence was audit report letter which questioned MEC’s ability to continue as a “going concern”;

(vi) the Einhorn provided Dennis Mills with a number of articles and papers with respect

- 6 -

		to REIT’s where in fact, the exact opposite occurred; (vii) that Respondents Tobin and Simonetti indicated that they were prepared to discuss the need for a shareholder vote on the Proposed Privatization matter further during August 9, 2004 telephone conversation with Greenlight; and (viii) that Einhorn made a number of gratuitously insulting comments about Stronach including comparing him to Fidel Castro at the annual and special shareholders meeting of MID in 2005.

16.		The Learned Judge erred in misapprehending fresh evidence admitted following the hearing of the Application on the basis that the financial crisis at MEC disclosed by that evidence could not have been foreseen when, in fact, the Corporate Analytics Report predicted MEC’s financial crisis;

17.		The Learned Judge erred in drawing an adverse inference concerning the evidence of Vinit Sethi where it was unnecessary to do so given that the reasonable expectations of MID shareholders were analyzed by the Learned Judge as a matter of law on the basis of the public statements of MID, including its prospectus, road show presentation, and investor calls, all of which were in evidence and the content of which was not in dispute. In addition, the Learned Judge erred when he agreed with the Respondents’ characterization of Einhorn’s affidavit as largely hearsay;

18.		The Learned Judge misapprehended the evidence concerning the conduct of Greenlight and considered that conduct even though it had no bearing on the determination of reasonable expectations of MID shareholders, the business judgment of the Special

- 7 -

		Committee, and the influence of the respondent Frank Stronach on the directors of MID; and

19.		Such further and other grounds as counsel may advise and this Court permit.

		THE BASIS OF THE APPELLATE COURT’S JURISDICTION IS:

		s.255 of the Ontario Business Corporation Act

		Rule 61.04 of the Ontario Rules of Civil Procedure.


November 29, 2006		McCarthy Tétrault LLP
		Suite 4700
		Toronto Dominion Bank Tower
		Toronto, ON M5K 1E6

		R. Paul Steep LSUC No. 21869L
		René Sorell LSUC No. 17613G
		Jeffrey Feiner LSUC No. 51277C

		Tel: (416) 601-7998
		Fax: (416) 868-0673

		Solicitors for the Appellants


TO:		GOODMANS LLP
		Barristers & Solicitors
		250 Yonge Street, Suite 2400
		Toronto, ON M5B 2M6

		Benjamin Zarnett
		Tom Friedland
		Rebecca Burrows

		Tel: 416 979-2211
		Fax: 416 979-1234

		Solicitors for the Respondents, M Douglas Young,
		Philip K. Fricke, Manfred Jakszus and Barry Byrd,

- 8 -


AND TO:		STIKEMAN ELLIOT LLP
		Barrister & Solicitors
		5300 Commerce Court West
		199 Bay Street
		Toronto, ON M5K 1B9

		Peter F. C. Howard
		Eliot N. Kolers
		Shanin Lott

		Tel: 416 869-5913
		Fax: 416 861-0445

		Solicitors for the Respondents,
		Frank Stronach and 445327 Ontario Limited

AND TO:

		DAVIES WARD PHILLIPS & VINEBERG LLP
		44^th Floor, 1 First Canadian Place
		Toronto, ON M5X 1B1

		Kent Thomson
		James Doris
		Sean Campbell

		Tel: 416 863-5566
		Fax: 416 863-0871

		Solicitors for the Respondents,
		John Simonetti and MI Developments

B E T W E E N :


GREENLIGHT CAPITAL, INC., et al		- and -		FRANK STRONACH, et al

Court File No. 05-CL-6008


		ONTARIO
		SUPERIOR COURT OF JUSTICE
		(Divisional Court)

		Proceeding Commenced at TORONTO

		NOTICE OF APPEAL

		McCarthy Tétrault LLP
		Box 48, Suite 4700
		Toronto Dominion Bank Tower
		Toronto, ON M5K 1E6

		R. Paul Steep LSUC No. 21869L
		René Sorell LSUC No. 17613G
		Jeffrey Feiner LSUC No. 51277C

		Tel: (416) 601-7998
		Fax: (416) 868-0673

		Solicitors for the Appellants

		#4132322