Bankrupt Nortel Networks may have sold all of its valuable assets but the fallout from the process is far from done.
Nortel which filed for bankruptcy in January 2009 has netted about $6 billion in cash and assets from its recent division auctions and now creditors from around the world want their share. As the Ottawa Citizen reported on Wednesday, drawn-out negotiations have failed to result in a settlement.
So, a number of those creditors now are turning to a high-powered lawyer whos charging an upfront $101,250 retainer for preparation and five days of dispute work from Los Angeles for help. Mediation proceedings will begin next month. If those dont work, a judge will be required to arbitrate.
But perhaps whats most interesting in all of this is the paperwork. There are millions of pages of Nortel records, and Nortel has hired consultants to advise what should be saved and what should be destroyed. And as the Ottawa Citizen pointed out, lawyers for Frank Dunn, the former Nortel CEO at the heart of the companys accounting scandal, object. They want to test 22 million pages of Nortel documents before a fraud trial begins in Canada in fall 2011.