A class-action lawsuit filed in New York claims Nortel wasn’t so forthcoming about its financial troubles in the summer of 2008.
The suit names CEO Mike Zafirovski and CFO Pavi Binning as defendants, claiming they “failed to disclose adverse facts about the company’s true financial condition, business and prospects.”
More specifically, the lawsuit says carriers were buying less from the company, earnings reports were exaggerated and restructuring was going poorly, but the word from the top was that everything was going fine.
The law firm representing the plaintiffs has a lot of experience in this area. It took on the case of Enron investors a few years ago.