Updated: Ex-Nortel brass get ‘vindication’ after not guilty ruling at Nortel fraud trial

By Linda Nguyen - Monday, January 14, 2013 at 6:00 PM - 0 Comments

TORONTO – The former top brass at Nortel Networks said they finally got “vindication” Monday after being found not guilty of fraud, nearly a decade after being accused of manipulating financial records at the fallen Canadian technology giant.

Ontario Superior Court Justice Frank Marrocco acquitted ex-CEO Frank Dunn, ex-CFO Douglas Beatty and ex-controller Michael Gollogly because he was “not satisfied” the evidence showed the men had “deliberately misrepresented” the finances at the now-defunct telecom company in 2002 and 2003.

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Former Nortel execs to learn fate in multimillion-dollar fraud trial

By The Canadian Press - Monday, January 14, 2013 at 5:11 AM - 0 Comments

TORONTO – Three former Nortel executives accused of orchestrating a widespread multimillion-dollar fraud will learn their fate today.

Ontario Superior Court is set to rule on whether ex-CEO Frank Dunn, ex-CFO Douglas Beatty and ex-controller Michael Gollogly manipulated financial statements at Nortel Networks Corp., between 2002 to 2003.

The verdict comes nearly a year after one of the largest criminal trials in Canada’s corporate history began.

The men, who each face two counts of fraud, are accused of participating in a book-cooking scheme designed to trigger $12.8 million in bonuses and stocks for themselves at the once powerful Canadian technology giant.

The accused, who were fired in 2004, have all pleaded not guilty to the charges.

If convicted, each could face up to 10 years in prison.

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Former Nortel execs to learn fate in multimillion-dollar fraud trial

By The Canadian Press - Sunday, January 13, 2013 at 7:09 AM - 0 Comments

TORONTO – Three former Nortel executives accused of orchestrating a widespread multimillion-dollar fraud will learn their fate Monday, nearly a year after one of the largest criminal trials in Canada’s corporate history began.

Ontario Superior Court Justice Frank Marrocco is set to rule on whether ex-CEO Frank Dunn, ex-CFO Douglas Beatty and ex-controller Michael Gollogly manipulated financial statements at Nortel Networks Corp., between 2002 to 2003.

The men, who each face two counts of fraud, are accused of participating in a book-cooking scheme designed to trigger $12.8 million in bonuses and stocks for themselves at the once powerful Canadian technology giant.

The accused, who were fired in 2004, have all pleaded not guilty to the charges.

If convicted, each could face up to 10 years in prison.

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Crown to Nortel execs: “You cannot just monkey with the accounting”

By Linda Nguyen, The Canadian Press - Friday, September 28, 2012 at 3:33 PM - 0 Comments

TORONTO – Prosecutors in the high-profile Nortel fraud trial wound down closing arguments Friday, telling a Toronto courtroom that the former top brass at the defunct telecom giant knowingly breached accounting rules by orchestrating a scheme to “monkey” with numbers and trigger bonuses.

Crown attorney Robert Hubbard alleged that the company’s balance sheets were not simply inaccurate, but manipulated to trigger big bonuses for the executives and deceive the public about its flagging financial performance.

“You cannot just monkey with the accounting,” he said. “That’s what’s forbidden.”

Nortel’s ex-CEO Frank Dunn, ex-CFO Douglas Beatty and ex-controller Michael Gollogly are currently on trial each for two counts of fraud for allegedly falsifying the former technology giant’s financial statements in 2001 and 2003.

All three have pleaded not guilty.

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Hackers watched Nortel fall apart from up close

By Gustavo Vieira - Tuesday, February 14, 2012 at 5:49 PM - 0 Comments

For almost ten years, hackers had “widespread access” to Nortel’s corporate network, reports the Wall Street Journal. As early as the year 2000, hackers believed to be in China were able to access technical papers, research-and-development reports, business plans, employee emails and other documents, using passwords stolen from seven of Nortel’s top executives. Brian Shields, a former Nortel employee for 19 years who led an internal investigation into the case, says the hackers “had access to everything.”

Nortel filed for bankruptcy in 2009, the same year Shields sent the investigation’s report to the company’s CEO, Mike Zafirovski, telling him to avoid doing anything on his computer because it was being monitored. Nortel was eventually bought by a group of companies, but Shields says nothing was done to address the problem nor to inform the new buyers of the problems. The news comes a day after U.S. authorities approved the purchase of Nortel’s patent portfolio by a six-company consortium, including Apple and Microsoft, for $4.5 billion (U.S.) while former members of Nortel’s upper echelons are fighting off allegations they falsified financial statements.

Our looming constitutional crisis

By Aaron Wherry - Wednesday, January 25, 2012 at 1:15 PM - 0 Comments

In the midst of defending the Senate, Colin Kenny offers the following.

No question, initiators of legislation requiring public expenditures should be elected. That’s why we have the House of Commons. But the Senate is designed to review that legislation. While it can delay its passage, by convention everyone agrees that it can’t stop it. So the argument that it is “undemocratic” to appoint significant components of government doesn’t hold water. In the end, within the legal guidelines of the constitution, the elected component of Parliament has the last word. That’s all that matters.

Senator Kenny is right to note that an elected Senate would likely feel empowered to defeat bills passed by the House. But he seems to ignore the fact that the unelected Senate has felt sufficiently empowered to do so twice in recent years—see here and here.

Bert Brown has mused vaguely of some mechanism to ensure the House’s supremacy, but until such a thing exists, it is likely worth going back to one of the questions Alice Funke suggested for debate in the NDP leadership campaign.

How will a federal NDP government face what will almost certainly be its first constitutional crisis, namely a showdown with the Senate? 

So far as I’ve seen, only Brian Topp has engaged this scenario.

(Via Twitter, a couple of readers suggest Senator Kenny is referring specifically to money bills. He may well be, although in the next paragraph after the one noted above he seems to refer only to “legislation.” Either way, I think the point still stands: It is worth wondering how a Conservative Senate would interact with an NDP government and how would the presence of elected senators impact that situation, especially given the willingness of a Conservative Senate to override the House in recent years.)

Support the minister

By Aaron Wherry - Monday, November 28, 2011 at 10:48 AM - 4 Comments

The Department of National Defence didn’t want Parliament to know how much it was going to spend building itself a new headquarters.

On the Nortel file, the documents show DND officials were worried last year about how the renovation costs would be perceived. “Media, parliamentarians and Canadians will be focused on the cost to taxpayers for the acquisition of the Campus and the subsequent retro-fit costs,” noted a DND strategy document.

Such concerns were solved when Deputy Minister Robert Fonberg stepped in. Fonberg’s assistant wrote that the deputy minister was concerned about telling the public about the cost. According to an email, Fonberg asked, “Why are we using the $623m(illion) fit up cost? It is without context and will be a lightning rod!” The cost was removed from public documents about the Nortel purchase.

The future of manufacturing in Canada

By Erica Alini - Wednesday, September 21, 2011 at 6:20 AM - 4 Comments

Photography by Andrew Tolson

When the assembly line at Ford’s plant in St. Thomas, Ont., came to a halt on Sept. 15, it wasn’t just one factory that shut down. The closure could bring the death of an entire industrial ecosystem, experts warned. More than 300 suppliers feed into the St. Thomas plant—35 of them in Canada. Job losses are likely to extend far beyond the 1,100 workers directly employed at the southern Ontario plant that had been churning out Ford Crown Victorias, Mercury Grand Marquises and Lincoln Town Cars for the past 44 years.

The story of St. Thomas and its displaced workers follows a script well-known to this and most other rich countries. Between 2004 and 2008, Canada shed nearly 322,000 manufacturing jobs, according to Statistics Canada, and this was before the economic downturn took hold. In the U.S., the hemorrhage, driven, as elsewhere, by cheaper foreign competition and a general shift toward the service sector, amounts to eight million jobs lost since 1979. And workers transitioning to a job outside the factory often have to accept a painful pay cut—in Canada it averages around $10,000 less a year, according to a 2008 report by Toronto-Dominion Bank—driving up the divide between rich and poor. Yet the loss of industrial jobs has simply been assumed to be the price of advanced development.

There are signs, though, that the factory era may not be over in Canada just yet. Some manufacturers in niche markets are flourishing. Others are showing how the production plant, with a high-tech spin on it, could even be the future of the Canadian economy—or at least an integral part of it.

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Julian Assange: The man who exposed the world

By Luiza Ch. Savage - Monday, December 13, 2010 at 5:20 PM - 69 Comments

Assange calls himself the ‘editor-in-chief’ of WikiLeaks, and says his group has created ‘scientific’ journalism; WikiLeaks’ confidential files are stored in a Cold War bunker in Stockholm | Leon Neal/AFP/Getty Images; Banhof AB/Polaris

When Julian Assange was finally arrested in London on Dec. 7, it was on allegations of having had unwelcome, unprotected intercourse with two Swedish women, and not for convulsing global diplomacy with his slow, controversial leak of diplomatic cables that infuriated allies, embarrassed kings and princes, were condemned by Washington for endangering lives, and dismissed by Tehran as a CIA plot. In a story worthy of a bestseller by Stieg Larsson, with its mix of state secrets, sex, and self-righteous computer geeks, it could come to pass that the man at the helm of WikiLeaks, who could not be pinned down by the U.S. Espionage Act, is vulnerable to a Swedish law against “sex by surprise.”

Assange, with his pale Warholian looks, is now a world hyper-celebrity or international super-villain, out of hiding and in custody, but still defiant. The Swedes may be the first to get him, but many more governments would like to get their hands on him. It has been a remarkable journey for someone who started out as a teenage hacker in his native Australia but became one of the most notorious men in the world—an individual who may have drastically altered the rules both in the world of diplomacy and the business of journalism. It is a story that has left people wondering about his motives, and pondering the question: what drives Julian Assange?

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Fear factor

By Cathy Gulli - Tuesday, October 13, 2009 at 11:40 AM - 7 Comments

Despite signs that the global economy is recovering from the recession, many people are still afraid of losing their jobs. A recent study in the U.K. indicates that workers are so terrified about being fired, they’re eschewing sick days. Forty-three per cent of Brits say they haven’t once called in sick this year for fear of seeming like a slacker—that’s a 20 per cent increase over 2008. For some, no ailment is too severe, including a migraine, bad back or swine flu.

Canadians are feeling similarly insecure: two recent polls, one by Harris/Decima and another by Desjardins Financial Security, revealed that more than one third of Canadians still worry about being fired because of the economic downturn. And if they’re looking for hope, they won’t find it in Finance Minister Jim Flaherty’s assertion earlier this month that “we will have a persisting unemployment problem well into 2010.” It’s no wonder that across the country anxious workers have been skipping vacation or clocking overtime in an effort to appear dedicated, capable and indispensable to their bosses. Continue…

Nortel, and our techno-nationalist delusions

By Andrew Coyne - Tuesday, August 25, 2009 at 4:15 PM - 13 Comments

Technology and nationalism are heady enough intoxicants on their own; combined, the high is very nearly fatal. Still, it’s rare that you get quite such a frenzy of nonsense as has attended Nortel’s bankruptcy proceedings. It’s not uncommon for those who inhale the techno-nationalist fumes to forget some basic principle of economics or other. But in this case they can’t even seem to get their facts straight.

As countless commentators have informed us, the issue at stake in Nortel’s sale of its wireless division to Ericsson, the Swedish telecoms giant, is whether this precious national icon and its next-generation technology will be allowed to fall into foreign hands. Unless Ottawa steps in to prevent the sale, we are warned, we risk a repeat of the Avro Arrow debacle of 50 years ago. Continue…

Nortel and the Avro Arrow myth

By Andrew Coyne - Thursday, August 13, 2009 at 6:03 PM - 106 Comments

I’ll have lots to say about this Nortel nonsense in a bit, but for now let me just deal with the inevitable Avro Arrow analogy. Appearing before the Commons industry committee the other day, Research in Motion co-CEO Mike Lazaridis trotted out the well-worn Arrow story to pressure lawmakers into blocking Nortel’s deal to sell its wireless operations to the Swedish telecom giant Ericsson.

He told MPs that allowing Nortel’s next-generation wireless patents to go to a foreign-based company would be similar to Canada’s notorious decision to cancel development of the Avro Arrow aircraft in 1959….

Lazaridis noted that he has a model of the Canadian-designed Avro Arrow on his desk and that 2009 marks the 50th anniversary of its cancellation. “Fifty years later we consider the disposition of another beachhead built by Canadian ingenuity,” he remarked. “Let us learn from our history and not make the same mistake again.”

There are any number of things wrong with RIM’s case, but the first and worst is the notion that killing the Arrow was some sort of terrible mistake. Indeed, if the best RIM can do is cite the Arrow, darling of every nationalist drama queen and high-tech trainspotter who never bothered to actually inform themselves of the reasons for its demise, that tells you just how weak their case is — though it was enough to send the Toronto Star into one of its patented teenage swoons.

For those in need of a refresher course, let me point you to Michael Bliss’s classic history of Canadian business, Northern Enterprise, pgs. 474-477. I’m going to quote it at some length, because, well, it’s just so damning…

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Pressure rises to protect our pensions

By Julien Russell Brunet - Thursday, August 13, 2009 at 1:20 PM - 11 Comments

At long last, there is a ray of hope for workers whose employers have filed for bankruptcy. Currently pensioners, the disabled, and employees owed severance pay are treated the same way as banks and other sophisticated creditors: when a company goes under, they have to get in line to fight for a piece of what’s left with everyone else.

But a group of former Nortel employees is looking to change that. They have asked the federal government to make an emergency amendment to the Bankruptcy and Insolvency Act to give preferred status to the claims of pensioners, the disabled and severed employees—essentially putting workers at the front of the line. Continue…

ITQ Committee Liveblog Bonus: You have made a powerful enemy, Chairman Chong.

By kadyomalley - Friday, August 7, 2009 at 4:22 PM - 58 Comments

So, remember how Michael Chong kinda sorta took a cheap shot at RIM co-founder Mike Lazaridis just as he was finishing up his testimony before the Industry committee today? When he suggested that there seemed to be a double standard as far as his objections to the way the Nortel auction was handled, and his fellow co-founder Jim Balsillie’s objections to the NHL league auction process? And then instead of giving Lazaridis the chance to reply, he gaveled down and adjourned the meeting? Which ITQ thought was a little bit unfair, since it was sort of taking advantage of his chairmanly powers?

Anyway,  as we were filing out of the committee room this afternoon, we were greeted by a RIM official handing out copies of the following written response to Chong’s comments.

Your move, Chairman Chong:

August 7, 2009
The Honourable Michael Chong, M.P.
Chair
Standing Committee on Industry, Science and Technology
House of Commons
Ottawa, Ontario

Dear Mr. Chong,

Thank you for allowing me to appear before the Industry Committee this morning. I appreciated the opportunity to make a statement, table a brief, and in particular to answer the questions posed to me. At the end of the session, as we ran out of time, you raised some important issues without giving me the chance to reply. As such, I would appreciate it if you could read this reply into the record before adjourning today.
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Nortel: Two more thoughts

By Paul Wells - Wednesday, August 5, 2009 at 8:48 AM - 11 Comments

We’re having a pretty good discussion about Nortel over here, as we try to decide whether Roger Martin’s stern lecture in Monday’s Globe about How The World Really Works is, you know, reality-based. Results so far are inconclusive. Meanwhile, two more thoughts, of perhaps varying orders of seriousness, on this whole business.

• Does Research In Motion really want to be in the business of arguing for national preference for tech firms and their intellectual property? RIM operates in 195 countries. It has already sought growth through takeovers of strategic firms, and while the case that comes most readily to mind, Certicom, was Canadian, RIM will surely want to buy out promising smaller firms abroad from time to time. So it maybe shouldn’t be arguing now, in Canada, that such takeovers should be forbidden.

• Don’t “the Nortel patents” function as a perfect MacGuffin in this story? As the Hitchcock scholars among you know, a MacGuffin is that rare and prized object that everyone desires so much it drives the plot of a movie. It’s best if its nature isn’t explained too specifically. It’s just…the thing everyone wants. The Lost Ark. The Maltese Falcon. The oscillation overthruster. The briefcase. The Nortel patents. By God, Smithers, don’t you see? We’ve got to get our hands on the Nortel patents before the Swedes do….

Roger Martin on Nortel: Business hardball as she is played, or not

By Paul Wells - Tuesday, August 4, 2009 at 8:13 PM - 40 Comments

I’m surprised Roger Martin’s piece on Nortel and RIM and the Harper government and, well, Sweden for that matter, from yesterday’s Globe didn’t get more attention. But then, it was yesterday’s Globe and it was a day off for most of us and maybe you were grilling. But here’s the dean of Canada’s largest business school — well, I’m guessing; I’m pretty sure it’s the University of Toronto’s largest business school — Mr. Productivity himself, making quite an impassioned argument about the largest non-wafer-related chip-related public-policy issue currently facing this sleepy land.

And if he’s right then this whole should-Ottawa-let-Ericsson-have-Nortel thing is an open-and-shut No. But I’m not sure he’s right. Perhaps you can help?

Martin’s is quite a blunt argument. Basically, he says, it’s a tough old world, and you need to look out for your own, and the grownups in other countries sure know that, and if they had a Nortel they would block its sale to any but their own. So smarten up, Canadian federal government, and take Canada out of the global market for this round. Martin’s nut grafs:

…Had crucial Swedish telecom intellectual property been up for sale instead, there would be no chance that any foreign company would have even have had a sniff at it, let alone get $300-million in financing for it (as Export Development Canada offered to Nokia Siemens Systems in its failed bid for the Nortel assets). And that’s because the Swedish economic policy leaders aren’t boy scouts.

The time is now – right now – for the Canadian government to step up to the plate and use the Investment Canada Act review provisions to demonstrate that, like the leaders of Canada’s great global companies, it has graduated from scout status to being a full partner in global competitiveness…

I am used to working on complicated policy issues that have many legitimate points of view. This one isn’t complicated. It is simple. The Canadian people who financed the R&D behind the intellectual property won by Ericsson must be assured that it will not be used to the detriment of their own Canadian companies. The Swedish government would not dream of allowing that to happen if the shoe were on the other foot.

Now here’s the thing. I got my BA at Western, mostly at University College and the dreary Social Sciences building up at the top of the hill, not at the Ivey School of Business, which anyway didn’t have that name yet, halfway down, so I don’t know from business cases. But if Martin’s op-ed were a student essay in Political Science, I’d note that it’s awfully thin on empirical evidence and awfully heavy on ex cathedra arguments. He’s got a lot of what Sweden would do and not much — OK, none — of what Sweden has done in similar circumstances. (Martin properly acknowledges his interest — he’s a RIM director — but I don’t think he’s the kind of guy who’d peddle baloney just to please his CEO.)

I did a little poking around this morning and I confirmed, as I’d suspected, that Sweden is a pretty handy place to go shopping for assets if you’re a foreign investor. In fact the openness of their economy is rather a point of pride with them. So I’m worried that Martin offers no evidence because there’s not much on offer. Does anyone know about large faltering firms whose intellectual property was the product of R&D financed by the Swedish people, but whose sale to non-Swedes the Kingdom tolerated? Or better yet: can anyone demonstrate that Martin’s assertion is grounded in historical fact? Does anyone know of a large faltering firm whose intellectual blah blah blah and whose sale to non-Swedes the Swedish government actively blocked?

Can't catch Nortel in a bottle

By Paul Wells - Wednesday, July 29, 2009 at 2:01 PM - 34 Comments

It’s at times like this, with the future of Nortel’s coveted wireless technology up for grabs and billions of dollars at stake, that I like to recall the wise counsel of old John C. Lobb. He was a jowly fellow who became the president of Northern Electric, Nortel’s predecessor, in 1971. He picked that dusty old company up by the scruff of its neck and shook it wide awake. Profits tripled in his first year and doubled again in his second. He used to ask employees what the company made. They’d tell him it made telephone switching equipment. He’d bellow, “We don’t make switching, God damn it! We make money.”

I love those great Canadian success stories. John Lobb, incidentally, was a lawyer from Minneapolis who ran Crucible Steel of Pittsburgh before he moved north, and who died in Pennsylvania.

All of which teaches us two lessons that may be appropriate to the current fuss over ownership of Nortel assets. Continue…

Readier than thou

By Aaron Wherry - Thursday, July 23, 2009 at 9:42 PM - 7 Comments

More from Michael Ignatieff’s incredibly anticipated appearance in public this afternoon.

Bipartisan negotiations on employment insurance reform got off to a rocky start Thursday, with the Liberal leader slamming what he called the Conservative government’s indifference to the plight of Canada’s jobless. Michael Ignatieff issued the criticism just as three Liberals and three Conservatives – members of an EI reform panel struck last month in an 11th-hour deal to avert a summer election – were sitting down for their first meeting.

“We note that the government has taken five weeks to get its act together on this. We were ready to go at the end of June with this committee,” Ignatieff said. ”It’s a sign I’m not sure that they give any real importance to employment insurance reform but we certainly do.”

Plus comment on Nortel and Abdelrazik.

In defence of the corporate jet

By Colin Campbell - Friday, February 6, 2009 at 5:04 PM - 34 Comments

In the corporate jet business, there are three people who are especially unpopular these days: the heads of the Detroit Three automakers. When the trio jumped on their corporate planes and flew to Washington late last year, they turned the business jet from being a nice perk for well-off executives into a symbol of corporate excess. How, people screamed, could these businessmen display such excess when the entire purpose if their trip was to beg for a public bailout? The “delicious irony,” as one congressman said, was too much.

The CEOs elected to drive to Washington on their next trip, but the damage was done. Even today, the outrage over corporate aircraft burns brightly. Last week, U.S. President Barack Obama chastised Citigroup for its plans to buy a new $50 million jet after accepting $45 billion in government bailout money. His administration is now talking about  rules that could force companies that receive federal money to relinquish their private jets. This week, Bank of America Corp. said it will sell a number of its corporate aircraft.

But while there are some ethical dilemmas at play, not all corporate jet travel is bad or unjustified, say ethics and business experts. In some cases, company boards (like the one at General Motors) actually require that their CEOs fly private jets for security reasons. The optics may be terrible in these recessionary times, but flying the corporate jet isn’t always the evil it’s made out to be. “Whether there’s a problem depends on the circumstances,” says Leonard Brooks, a professor of business ethics at the University of Toronto. When jets are used for business purposes and they free up time for executives to work, or improve their state of being when they arrive somewhere to do business, the costs may well be justified, he says. In an interview last month, GM’s vice chairman Bob Lutz was unapologetic, saying that he’d still elect to fly to Washington via private jet, even if it was to ask for tax dollars. (He was not one of the executives who made the now infamous trip in November.) Imagine, he argued, a haggard executive showing up late to a congressional hearing because he’d been bumped off his Northwest Airlines flight. Continue…

Going broke is good news?

By Cathy Gulli - Tuesday, January 20, 2009 at 1:19 PM - 1 Comment

Going broke is rarely considered a gift from the gods, but it’s possible that Nortel Networks has just been blessed. The telecom titan recently filed for bankruptcy protection in Canada, the U.S., and Europe—and a recent study shows that may have been exactly the right thing to do to finally turn the company around. “It gives them some breathing room to reorganize and focus on the business changes that might need to be made,” says Mike Lemmon, a finance professor at University of Utah and a one of the study’s authors. “Rather than worrying about having to generate enough cash just to make next month’s interest payment.”

The study, published online by the Social Sciences Research Network, looked at 530 companies that declared bankruptcy between 1991 and 2004, and classified each in one of two ways. “Financially distressed” companies were good businesses that would be profitable if their debt were removed. “Economically distressed” companies wouldn’t be. The study found that 80 per cent of the former group emerged from bankruptcy with only seven per cent fewer assets—so they were the stronger for it. Meanwhile, only 37 per cent of the economically distressed companies managed to reorganize with less than half of their original assets. The rest were liquidated or bought up. “The bankruptcy process seems to be doing what it’s supposed to do,” says Lemmon, “which is allowing good firms with financial problems to restructure and keep their businesses going. And getting rid of bad firms.”

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Debt, Bankruptcy, and Cutbacks

By Jonathon Gatehouse - Wednesday, January 14, 2009 at 4:17 PM - 5 Comments

Vancouver’s 2010 Games are starting to look more red than green.

Nortel Networks filed for bankruptcy in the United States and Canada on Wednesday, earning it the dubious distinction of being the first official 2010 sponsor to go mams up. (GM can’t win anything these days it seems.)

The company, which has limped along since mid-2000, enduring 16 rounds of layoffs, had accumulated US $6.3 billion in debt as of the end of last Sept. and has almost twice that amount in liabilities. It was also suppose to be Vancouver 2010′s official supplier of network telecommunications equipment.

The “in-kind” sponsorship deal, signed in May 2007, called for the company to supply somewhere between $3 million and $15 million in hardware so that Bell—the official telecommunications service provider—could create a secure video, voice and data sharing network.

In a statement, Ward Chapin Vanoc’s chief information officer, shrugged off the news, saying the company kept organizers apprised of their troubles, and remains “committed” to the Games

“Today, Nortel reaffirmed its commitment to its Vancouver 2010 sponsorship. Much of Nortel’s commitments to the Games have been delivered and will be in place by May,” said Chapin.

But it’s yet more negative publicity for what is threatening to become the bad news Olympics. Continue…

There, there, Nortel. Will $30 million in short term financing turn that frown upside down?

By kadyomalley - Wednesday, January 14, 2009 at 11:13 AM - 24 Comments

Minister of Industry Responds to Nortel Networks’ Restructuring Under Companies’ Creditors Arrangement Act

OTTAWA, January 14, 2009 — On January 14, 2009, Nortel Networks announced that it is seeking an order to initiate a court-supervised restructuring under the Companies’ Creditors Arrangement Act (CCAA) from the Ontario Superior Court of Justice. The Honourable Tony Clement, Minister of Industry, made the following statement:

“Nortel Networks is known as a leader in the field of information and communications technologies and for its research and development in Canada. The decision to file for creditor protection was made by its Board of Directors in an effort to turn the company around. The Government of Canada appreciates the importance of the telecommunications industry to our economy and will continue to work with Nortel during its restructuring through Export Development Canada (EDC). EDC has agreed to provide up to $30 million in short-term financing through its existing bonding facility and is open to discussing with Nortel post-filing financing in conjunction with other financial institutions. It is important to note that Nortel is filing for court-supervised restructuring under the CCAA, not bankruptcy. Nortel has stated that it has every intention of emerging from this restructuring under the CCAA as a viable business. We will monitor its progress closely.”

The CCAA allows for a court-administered process that gives corporations the opportunity to restructure their business so that they can continue to be a viable and sustainable entity contributing to Canada’s economy.

Background on Nortel’s restructuring-not-bankruptcy here. Also, is it just me, or is anyone else perpetually surprised to rediscover that Tony Clement is now at Industry, while Jim Prentice is – wait, where is he again? Oh, right: environment.