Battle over billions to begin

A complex trial to determine how billions of dollars in Nortel Networks Corp.’s remaining assets are to be divided begins Monday in a pricey cross-border hearing that’s considered the first of its kind.

A complex trial to determine how billions of dollars in Nortel Networks Corp.’s remaining assets are to be divided begins Monday in a pricey cross-border hearing that’s considered the first of its kind.

Lawyers for former employees, pensioners and creditors will descend on two courtrooms — one in Toronto and the other in Delaware — to argue over who gets a share of $7.3 billion from the sale of the former technology giant’s patents and other assets from its international operations.

What’s unique is the sheer magnitude of the proceeding, which is considered one of the biggest bankruptcy trials in Canadian history, and the escalating costs associated with it.

The cost of the Nortel case has climbed to US$1.185 billion since early 2009, according to an estimate from Diane Urquhart, an independent adviser assisting former Nortel employees.

Expenses range from legal fees to cutting-edge technology that links both courtrooms that are expected to be filled mostly with lawyers. An overflow room has been set up for everyone else, including the media and public.

A document from the Canadian creditors filed with the courts provides a glimpse of just how massive the case has become over the past year since the trial was approved to proceed.

About 16,000 documents will be presented as exhibits, whittled down from an initial three million, and 110 depositions of witnesses have been taken, the filing said.

More than 50 people are listed as witnesses for the trial, though it’s unlikely that all of them will be called on to testify over the next seven weeks.

Less clear is how Nortel lawyers will present their case to Delaware bankruptcy Judge Kevin Gross and Ontario Superior Court Justice Frank Newbould. Most pretrial arguments and evidence have been sealed in the U.S. Bankruptcy Court in Wilmington, Del., over concerns from Nortel’s corporate lawyers that proprietary agreements with the company’s former business partners may be exposed.

However, once the trial begins many of those documents are expected to be made public.

Last Thursday, the judges decided that concerns over confidentiality were overstated and agreed that at least some of those documents should be unsealed, said Mark Zigler of Koskie Minsky LLP, a lawyer who represents some former Nortel employees and was present at the hearing.

“We’re working through the weekend to try and get them out,” Zigler said.

“Some things have to be redacted, according to certain parties. There’s just so many thousands of documents.”

The main trial, which is scheduled to continue until the end of June, is proving to be an expensive and technologically complicated endeavour.

Lawyers from both Canada and the United States will communicate through encrypted live streaming video and audio created by California-based Live Deposition.

“We have the technology in place and we have our fingers crossed,” said Alan Mark, a lawyer for Goodmans LLP, the court-appointed Canadian monitor for Nortel’s liquidation.

“Procedurally it’s certainly precedent setting having a trial proceed jointly.”

Both countries will adhere to rules for their own jurisdictions.

At its height in 1999 to 2000, Nortel was worth nearly $300 billion, employed more than 90,000 people globally and was regarded as one Canada’s most valuable companies.

In 2009, the company filed for bankruptcy in North America and Europe, shedding thousands of jobs.

Last year, three former top executives at the firm were acquitted of fraud charges nearly a decade after being accused of falsifying financial records at the beleaguered company. The Crown had alleged that the three had been involved in a book-cooking scheme to trigger $12.8 million in bonuses and stock payments for themselves.

Just Posted

Get your guilty pleasures: Westerner Days food

Traditional sugary treats were served up by the plate, bowl and bucket… Continue reading

Count shows slight decrease in Red Deer’s homeless

In two years, the number of homeless in Red Deer has decreased… Continue reading

Redoing hip surgeries are costly, says new study

Redoing hip and knee replacements costs Canada’s health system $130 million a… Continue reading

WATCH: Red Deer gets a taste of unique, fun chilis at cook off

From deer meat to Grand Marnier to raspberry jam everyone at the… Continue reading

Walk to raise overdose awareness

Leah’s Light registration deadline July 25

WATCH: Cirque ZUMA ZUMA puts on a show at Westerner Days

ZUMA ZUMA performs three times a day during Westerner Days

Brazilian police arrest ‘Dr. Bumbum’ after patient dies

RIO DE JANEIRO — Brazilian police have arrested celebrated plastic surgeon Denis… Continue reading

Canadian marijuana company Tilray has first US pot IPO

SEATTLE — A Canadian company is the first marijuana business to complete… Continue reading

Dolphins anthem punishment includes suspensions

Miami Dolphins players who protest on the field during the national anthem… Continue reading

Soy “milk” makers may need to find alternative description

NEW YORK — Soy and almond drinks that bill themselves as “milk”… Continue reading

Calgary woman convicted in son’s strep death granted day parole

CALGARY — A woman whose son died after she failed to take… Continue reading

Greenpeace members arrested for climbing Olympic Stadium tower in Montreal

MONTREAL — Several Greenpeace members climbed the outside of the Olympic Stadium… Continue reading

B.C.’s Site C dam project behind schedule, plagued by problems: expert

British Columbia’s mammoth Site C hydro-electric project is seriously behind schedule, plagued… Continue reading

Charges laid against woman found in Innisfail hotel room with eight dogs

A woman faces 12 charges after eight dogs were seized from an… Continue reading

Most Read


Five-day delivery plus unlimited digital access for $185 for 260 issues (must live in delivery area to qualify) Unlimited Digital Access 99 cents for the first four weeks and then only $15 per month Five-day delivery plus unlimited digital access for $15 a month