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Nortel on Hot Seat: Lawmakers Question Ericsson Sale

Nortel Networks Corp. (NT) was on the hot seat Friday, sticking up for its pending wireless unit sale to Ericsson (ERIC).

Canadian lawmakers this week decided – after months of inaction – to hold a hearing on the transaction amid concerns it could jeopardize Canada’s security and economy. Nortel’s CDMA and LTE patents were among the most-discussed topics Friday. Some lawmakers and other observers contend government money helped fund R&D for those technologies. But Nortel’s strategy executive said that’s not the case. George Riedel told policymakers that Nortel never got any government R&D tax credits for the LTE and CDMA technologies, the Wall Street Journal reported.

He also dismissed arguments that selling those technologies to a foreign company would hurt national security.

To be sure, the patents are not part of the sale to Ericsson. In fact, BlackBerry maker Research In Motion, also based in Canada, is hoping to secure that intellectual property.


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