D008 | S024 | CV-26-00094941-0000 Mechanical extraction of the PDF’s existing text layer. No OCR performed. Reading order, stamps, handwriting, tables and symbols may be incomplete or inaccurate. Compare quotations with the unchanged original PDF; PDF page numbers refer to file pages, not necessarily printed page labels. Extraction is not court authentication or legal verification. PDF page 1 — text-layer available Court File No. CV-26-00094941-0000 ONTARIO SUPERIOR COURT OF JUSTICE B E T W E E N: JAMES KURTZ Plaintiff and XCMG CANADA Defendant STATEMENT OF DEFENCE 1. Except as hereinafter expressly admitted, the Defendant, XCMG Canada, denies each and every claim and allegation against it set out in the statement of claim. 2. The Defendant denies the Plaintiff is entitled to the relief claimed in paragraph 1 of the statement of claim, or to any other relief whatsoever. 3. The Defendant is a corporation duly incorporated under the laws of Alberta and operates across Canada. 4. The Plaintiff was employed by the Defendant on or about November 1, 2023 as a Technical Service Manager . The Plaintiff was terminated for just cause on or about October 27, 2024 after approximately one year’s service. PDF page 2 — text-layer available -2- 5. The Defendant denies that it recruited the Plaintiff from a previous employer. The Plaintiff was searching for work and was cautious due to a previous incident where he was terminated by Haulotte North America without notice. As a result, the Plaintiff heavily negotiated his employment terms and willingly accepted the terms agreed upon. 6. The Plaintiff’s employment was conditional on him agreeing to the terms and conditions of an Employment Agreement and was subject to its terms. The Defendant pleads and relies on the Employment Agreement dated October 17, 2023 (the “October EA”). 7. On or about May 16, 2024, the Plaintiff was promoted to Director of Service Operations. 8. In exchange for the consideration of the salary increase and associated promotion, the Plaintiff entered into a second employment agreement dated May 13, 2024 (the “May EA”). 9. It was a specific term of the May EA that the Plaintiff would adhere to all of the Defendant’s policies, rules, systems and procedures. 10. It was a specific term of the May EA the Plaintiff undertook to treat confidentially all information received in the course of employment and to not disclose the information to any third party either during his employment or after its termination. PDF page 3 — text-layer available -3- 11. The Plaintiff’s promotion was conditional on him agreeing to the terms and conditions of the May EA and was subject to its terms. The Defendant pleads and relies on the May EA and the October EA (collectively, the “EAs”). 12. The EAs were carefully reviewed, heavily negotiated, and expressly agreed to by the Plaintiff. 13. Under the EAs, the Plaintiff agreed and acknowledged that the Defendant was entitled to terminate the Plaintiff’s employment without cause upon providing the minimum notice or minimum pay in lieu of notice, benefits continuation and severance pay, if any, as required by the Employment Standards Act, 2000, S.O. 2000, c. 41(“ESA”). 14. By signing the EAs, the Plaintiff accepted that, upon termination without cause, he would be entitled to the termination pay outlined in the EAs , including that he would not be entitled to any notice or pay in lieu if terminated for just cause. 15. The Defendant pleads that the termination clauses in the EAs are enforceable at law, unambiguous and rebut the common law entitlement to reasonable notice of termination. 16. The May EA set out the specific requirements of the Plaintiff’s new role as Director of Service for Eastern Canada. The Plaintiff was to, inter alia: (a) Provide guidance for the Defendant’s serviceability and growth, and support the key dealerships; (b) Set out strategic direction and leadership of the service department; PDF page 4 — text-layer available -4- (c) Ensure health and safety requirements were strictly adhered to; (d) Develop strong relationships with dealership service; and (e) Travel to dealers’ and customers’ sites to perform training, programming and troubleshooting. 17. Travelling to and supporting the Defendant’s dealerships across Canada was essential to the Plaintiff’s role as Director of Service. 18. Unfortunately, it soon became apparent that the Plaintiff was not performing the core aspects of the new role, but more or less continuing to perform his previous duties associated with his prior role as Service Manager. 19. The Plaintiff refused to travel to dealerships and did not maintain good relationships with them. He allowed client relationships to sour as a result of his lack of attention to those relationships. 20. The Defendant began receiving complaints about the Plaintiff’s failure to appear at scheduled meetings or to travel to the dealerships. 21. On September 30, 2024, the Plaintiff was placed on a performance improvement plan (“PIP”) with the goal of assisting him to develop the skills necessary to fulfill his responsibilities in his role of Director of Service, including but not limited to requiring him to regularly visit dealers and customers to provide technical support. At all relevant times, the Defendant treated the Plaintiff’s performance issues in a confidential manner. PDF page 5 — text-layer available -5- 22. One of the requirements of the PIP was that the Plaintiff: (a) Submit a weekly plan detailing which customers would be visited; and (b) Submit a summary of each visit. 23. The Plaintiff was advised that his performance would be closely monitored over the following three weeks and that if satisfactory results were not achieved, a follow -up meeting would be arranged to discuss further actions. 24. The Plaintiff’s performance over the next three weeks seriously deteriorated and he refused to comply with the action plan set out in the PIP. He became insolent and combative and was verbally insubordinate. 25. On October 11, 2024, the Plaintiff sent an email to the CEO, Victor Jiang, advising that sometime early in 2024, he was advised that the manufacturing date was changed on certain equipment by changing the serial number plates. He advised that he had failed or neglected to report this issue earlier even though it was his responsibility to ensure that health and safety requirements were adhered to. 26. The Defendant investigated the safety concern raised and necessary corrective actions were taken to ensure compliance with the applicable regulations. 27. The Defendant denies all allegations in the statement of claim that his termination arose from his report of a potential safety violation. In fact, it was in the scope of the Plaintiff’s duties as set out in the EAs that he was to insure that health and safety rules and regulations were followed and the Defendant expected that he would report any PDF page 6 — text-layer available -6- health and safety concerns immediately. It was not until after the Plaintiff was placed on a PIP and refused to improve his performance that he sent a self -serving email outlining an alleged safety issue. 28. The Defendant denies that disciplinary measures followed any report by the Plaintiff of safety concerns and/or fraudulent activity. The Plaintiff was already on a PIP before he reported a safety concern. Furthermore, the disciplinary actions arose out of the deficiencies in work performance described above in paragraphs 18 – 21 and were as such completely unrelated to the Plaintiff’s report. 29. On October 16, 2024, the Defendant sent the Plaintiff an invitation for a meeting on October 18, 2024 for a follow- up meeting to discuss the PIP. Although the Plaintiff accepted the invitation, he failed to appear without excuse. 30. On October 18, 21 and 22, 2024, the Plaintiff forwarded confidential information belong to the Defendant to unauthorized email addresses, including his personal email and another unknown email address. 31. On October 25, 2024, the Defendant re scheduled the three week PIP follow-up meeting by videoconference. This time the Plaintiff attended the Zoom meeting. At that meeting, the Plaintiff was reminded that the meeting was confidential and that it was important that the discussions in the meeting remain confidential , which the Plaintiff acknowledged. 32. When the Defendant raised its continued performance concerns, the Plaintiff was unable to control himself and refused to discuss the concerns raised. He was immediately PDF page 7 — text-layer available -7- combative, used foul language, including but not limited to responding to performance concerns by calling them “bullshit” calling his supervisor s “fucking idiots” and “fucking weasels” who didn’t have the “fucking balls” to confront him , and telling the meeting participants to “fuck off”. At one point, the Plaintiff allowed his wife to join the meeting, and she also became verbally threatening and told the participants to “fuck off”. 33. Following the meeting, the Defendant discovered that the Plaintiff had sent confidential communications regarding the disciplinary meetings to outside third parties, and also breached his duty of confidentiality by printing out multiple private communications and keeping them in his possession and control. 34. The Plaintiff’s refusal to accept correction in the follow up meeting was insubordinate and in violation of the Defendant’s Code of Conduct . The meeting participants found the Plaintiff’s behaviour shocking and completely lacking in civility and respect. 35. Nevertheless, the Defendant advised the Plaintiff that the parties could take the weekend to cool off, after which they could discuss next steps calmly. 36. Following the meeting, the Plaintiff wrote an inflammatory and self -serving email to his superiors and copied various other individuals at the company, which was a flagrant breach of the Defendant’s policies and unprofessional conduct and a breach of confidentiality. The Plaintiff then sent an immediate demand for a settlement payment. His actions constituted extortion. PDF page 8 — text-layer available -8- 37. Following the Plaintiff’s improper email copied on other employees, the Defendant called the Plaintiff and advised him that due to his insubordination and aggressive and violent outburst and unprofessional conduct , including but not limited to angry outbursts and breaches of confidentiality, that continued employment with the Defendant was no longer feasible as the trust necessary for him to continue in the Defendant’s employ was irreparably broken. 38. A formal termination letter was emailed to the Plaintiff on October 29, 2024. 39. On October 30, 2024, the Defendant sent a cease and desist letter to the Plaintiff, as a result of his continued circulation of the Defendant’s sensitive and private information, which circulation was designed to cause the Defendant harm. 40. The Defendant states that the Plaintiff’s actions constitute wilful misconduct under the ESA and just cause at common law, disentitling the Plaintiff to reasonable notice. 41. In the alternative, the Plaintiff’s claim for damages, which is denied, is excessive in all the circumstances and not supported at law , including but not limited to the claims set out in paragraph 23 of the statement of claim. 42. Further the Plaintiff is not entitled to any damages because he failed to mitigate his damages during the notice period by diligently seeking and reasonably accepting alternate employment or making efforts to earn self-employment income. 43. If the Plaintiff has, in fact, obtained alternative employment or earned self - employment income since the date of his alleged termination, those earnings must be PDF page 9 — text-layer available -9- deducted from any damages allegedly sustained, such damages being denied in any event. 44. There are no particulars in the statement of claim that would support an award of aggravated and punitive damages and/or breach of honest performance of contractual obligations. The Defendant denies that it has ever conducted itself in a manner even remotely close to the harsh vindictive, reprehensible and malicious conduct necessary to justify such an award and that this claim is entirely without merit. 45. The Plaintiff’s claim for damages, which is not admitted but denied, is within the jurisdiction of the Small Claims Court and should have been commenced there. If the Plaintiff recovers an amount within the monetary jurisdiction of the Small Claims Court, the court may order that the Plaintiff shall not recover any costs pursuant to Rule 57.05 of the Rules of Civil Procedure. 46. The Defendant asks that this action be dismissed with costs. July 9, 2026 FRIEDMANS LLP Barristers and Solicitors 150 Ferrand Drive, Suite 800 Toronto, ON M3C 3E5 Judy Hamilton (LSO No. 39475S) Tel: (416) 649-4462 Fax: (416) 497-3809 Email: jh@friedmans.ca Lawyers for the Defendant PDF page 10 — text-layer available -10- TO: HUDSON SINCLAIR LLP 55 University Avenue, Suite No.1100 Toronto ON M5J 2H7 Alexander J. Sinclair (LSO No. 62028U) Tel: (647) 697-0588 Email: alex@hudsonsinclair.com Lawyers for the Plaintiff RCP-E 18A (July 1, 2007) PDF page 11 — text-layer available JAMES KURTZ -and- XCMG CANADA Plaintiff Defendant Court File No. CV-26-00094941-0000 ONTARIO SUPERIOR COURT OF JUSTICE PROCEEDING COMMENCED AT HAMILTON STATEMENT OF DEFENCE FRIEDMANS LLP Barristers and Solicitors 150 Ferrand Drive, Suite 800 Toronto, ON M3C 3E5 Judy Hamilton (LSO No. 39475S) Tel: (416) 649-4462 Fax: (416) 497-3809 Email: jh@friedmans.ca Lawyers for the Defendant RCP-E 4C (September 1, 2020)