Another Class-Action Lawsuit

Failing to disclose material facts about company's health is a hysterical understatement. They have been hyping up a storm all along. Even their web site looked like a sales flyer. Analysts had to hunt through mountains of pages to find the bad news well befoire this. Today they gagged inquiry after bankruptcy.

Nortel never wants to disclose the bad news, with intent, and motive. To this day.

Nortel is the poster boy for hyping up endless propaganda that led to endless contradictions, endless… while paying ongoing bonuses with exorbitant pay practices all along. To be seen to be believed, to this very day!

All this after settling the largest fraud lawsuit in Canada to boot.

They lie and lie and lie… with intent… and with motive. Again, After the largest fraud settlement in Canada as fraud trials loom on both sides of the border. No wonder they increased lawsuit insurance recently. I wonder what the premiums are who would dare underwrite such a risk with their history and so many still there.

Nortel has become synonymous to Canada's live walking and talking Enron with so many still there, afforded extraordinary liberties under the benefit of doubt, revisions, ultimatums, punch line projections, etc., so the plaintiffs representative is certainly as fitting as what Binning was there to do.

Nothing has changed, for the better with the green team, CEO defrauding past employer from day one to promoting criminally charged green pal over a veteran.

Hiding behind safe harbor and bankruptcy while driving gagged shareholders to zero, cut gagged employees and their severances and pensions, circumventing creditors who wanted to see a plan before bonuses were approved, and a court system that as laughable as this misleading leading to endless contradiction throughout and not just 2008, … to this very day!

Gee, one has to wonder when the topic of those still with Nortel and in the deferred compensation plan who choose to cash out knowing that bankruptcy was Plan A? Maybe they feel that their latest filing with the US court is armor against this and other law suits? Or maybe they have had a fund approved to pay off law suits such as this one?

BTW, has anyone else been contacted by the “Fraud Recovery Group”?

Looks like anyone who held Nortel shares can join this lawsuit. Wondering can we sue for thousands of dollars most employees have lost in their 401K accounts?

If mike z and his band of cronies did commit criminal acts then the court system needs to nail them to the wall. That would represent at least a small dose of justice in this whole sad story. Z and execs would lose all that money that they never should have received in the first place.

In particular, Coughlin Stoia alleges that Nortel failed to disclose that:

(i) demand for the Company’s products was declining as carriers cut back their capital expenditures and other customers deferred purchase decisions;

re
Q1 2008 report did not disclose falling orders. I don't remember any disclosure about that.
We know now that in Q1 2008 new orders declined about $300 mill or more.
Q2 2008 showed new orders falling about $500 mill but Nortel still “pumped” single digit growth.
Nortrel (was it Mike Z?) invented that management operational margin which was not GAAP ratio and which definitely was misleading about “real operations”.
Was it a coincidence that bonuses were tied up to that margin?
That margin was showing constant improvement of the business year after year.

(ii) that the Company’s financial results were materially overstated as the Company was failing to properly write-down its goodwill;

Re
We joked about Nortel's biggest assets, goodwill and deferred tax credits.
============

(iii) that the Company’s restructuring was not meeting with success as the Company was struggling to cut costs and improve profitability;
re
Restructuring progress was measured by that margin as well.
However cash flow uncovered the truth about business going down each and every quarter.
The big picture was that Nortel had unlimited resources, including 800 accountants to do proper calculations and to show the real numbers and inform investors about real shape of the business..
IN Conclusion
Public was able to read between the lines, public knew that using that management operational margin was to fool investors
The question was
Why Nortel misled public for so long, misled about improving operations, about growing revenues for 2008?
The new class action law suits should bring answers to that question.
Btw
watching Nortel, how Nortel started to recognize deferred revenues in Q4 2007 and later on, quarter after quarter in 2008 will give some answers too.
As I remember, Nortel recognized about $1.3 bill of the deferred revenues in 2008.
It would surprise all to compare that to the year 2007 or 2006.
I remember NT investors were betting and lost the bet in 2006 that Nortel would recognize billions of deferred revenues placed in deferred sections after restatements. /main restatements reported Jan 2005/.
Rest in 2005 created $3.5 bill deferred revenues. (just a reminder)

People read the story and read between the lines before you post.
This latest class action is nothing. It is just another lawsuit filed by a bunch
of greedy laywers hoping to hop on the nortel legal gravy train.
Key point…
COUGHLIN STOIA GELLER RUDMAN & ROBBINS LLP FILES CLASS ACTION SUIT AGAINST FORMER EXECUTIVES OF NORTEL CORP.
Do you get it.
Nortel is exempt from any lawsuits since this action was filed under BP.
They are going after Z and binning.
What?
Good Luck.
What a joke. Feeble money grab attempt to get blood out of a stone.
A story like this is extremely lame and shouldn't even be posted. Does AAN have nothing new to put up?

You must be one of KEIP or KERP guys. Take blood money is not a luck, be prepare for a defendent in the court anytime future. You never know.

From the country that brought you Bre-X and other unprosecuted scandals, presenting…ta-da, Nortel!

What will Pavirofski's defense be? Conjectures:

(1) The Marlboro stupid smokers' defense? (We knew it caused cancer all along. Even the surgeon general knew it too. Don't act surprised on your death bed)

(2) The casino defense? (We knew the odds of winning with Nortel stock were low. Everyone else knew it too. Don't act surprised the marble didn't land on black)

(3) The Oliver North defense? (We knew the…my memory has gone hazy. I can neither confirm nor recall whether I did in fact funnel my paycheck to the Contras. Don't act alive.)

(4) The Homework defence (We knew the company was going down the can, but Pavi's dog ate those documents. Bow wow wow, woof woof)

(5) The Not my job defence. (The Board was distracted with Hollinger corporate events hosted by Conrad Black to bother babysitting Nortel.)

(6) Ah, okay, yeah those allegations are in fact true. We surrender.

Nortel is a wreck-o-nized bleeder

( 'nized' comes from 'synergized')

(i)

November 6, 2007
Nortel CEO Sees 2008 Growth
Nortel Networks Ltd. (NYSE/Toronto: NT) CEO Mike Zafirovski says his company has turned a corner and is on course to increase its full-year revenues in 2008.
http://www.lightreading.com/document.asp?doc_id…

September 17th, 2008
Nortel whacked by currency, carrier spending, delays
The technology confession season continues. Next up to bat is Nortel, which lowered its third quarter revenue targets because it is seeing “significant pressure” as telecom carriers cut back on spending and enterprise customers curb IT spending.
http://blogs.zdnet.com/BTL/?p=10070

________________________________________________________

(ii)

Nov 10- 2008

Nortel Posts Biggest Loss Since 2001, Fires Workers

wireless networks dropped 24 percent to $822 million, the worst performance among Nortel's businesses.

Zafirovski has eliminated more than 6,000 jobs since the start of 2006.

The third-quarter loss was $3.4 billionthat included a $3.2 billion expense to write down the value of deferred tax assets (their largest asset was this tax credit for years on books they sought to clean)

The company brought in $10.9 billion in 2007.

http://www.bloomberg.com/apps/news?pid=20601082…

________________________________________________________

(iii)

“As a leader who came to “recreate a great company”, Zafirovski said that things were on track in his 3 to 5 year plan for Nortel. Today he is 20-21 months into the plan.”
http://www.expresscomputeronline.com/20070903/m…

Nortel has lost more than $4.5 billion since Chief Executive Officer Mike Zafirovski took over in 2005
(as of Nov 10, 2008)
http://www.bloomberg.com/apps/news?pid=20601082…

________________________________________________________

(iv)

Mike and Pavi also maintained overall guidance for the full year of 2008.

Mike Z and Pavi Binning highlighted several times the continued progress with gross margins and operating margins.
In the press release, Mike Z highlights: “We delivered gross margin of 43.1%, the seventh consecutive quarter of year-over-year improvement, and management operating margin of 4.3%, the eighth consecutive quarter of year-over-year improvement.”

The presentation highlighted gross margin improvements in Carrier Networks, Enterprise Solutions, and Global Services.

Mike Z said that: We have invested heavily in Enterprise and MEN, and we are starting to see the trajectory to growth in those areas.

http://community.nortel.com/go/blogs/buzzboard/…

you are a dick

Is it from these guys ?

http://www.fraudrecoverygroup.com/index.htm

MC

Nortel's quarterly results communication we're treated as a PR opportunity. Fabricated. Spinning of numbers and stories in an effort to indicate that the 5 year plan was working. Sales teams were given scripts on how to communicate results to customers. Everything was prescribed. If the numbers were that good, there would be no need for a detailed communication plan on what to say, when to say it and how to say it. Because the (pertinent) numbers were not good, operational metrics were positioned carefully into the story, to give the story structure. Blaming the situation on the economy is TOTAL CRAP (sorry about the term, but I'm so fed up with the executives now that it's hard to be professional).

As I mentioned before rev recognition caused a lot of this but so did the continued focus on operational metrics. Nortel got very good at measuring processes and procedures, but never took the time to consider if the processes themselves made any sense. Doing great on a bad process gets you nowhere.
The execs totally deserve to be called out on this, whether they did it on purpose or because they were so naive they had no idea what they were doing. Either way, ignorance is NO EXCUSE when you are running a billion dollar company. Hear no evil, see no evil, speak no evil. The execs didn't listen. They lived in their bubble and they were full of it. Go back again to the analyst days held in 2007 and 2008. It was UNBELIEVABLE what was shared and how analysts believed it. Fancy slides (created by not sure who). A TOTAL MARKETING ACTIVITY. Reporting results is about giving factual information to those who need it, so effective investing decisions can be made. Nortel treated results as a means to create stories and justify poor exec behaviour.
They deserve everything that is thrown at them. TOTALLY.

Oh , How I wish to hear from some sectors of former employees to
take them to the SUPREME COURT OF CANADA.

I like to do it, but I have no big wads of cash to pay the freakin Lawyers!!

Let's face the only ones that will make any money on this are the lawyers.

The only people who will pay a price for this are the insurance company and employees that will get laid off because the company had to pay another large sum of money to these lawyers if they win. Does any one who own Nortel stock during the last major class action suite remember collecting a large sum of money. I do remember collecting a couple dollars and then getting a captial gain statement from the bank that was higher then the amount I collected.

The executives that make these decisions will continue to collect bonuses and big salaries and will not lose any sleep. It a game for them. It is survival for the rest.

Is the Law firm E & Y Inc. really assisting the company in the
preparation of the “PLAN OF ARRANGEMENT?”
or just taking advantage of the CLAUSE in CCAA which says
“there is no time limit on how long the 'stay' can be extended” ?

or will they just keep on extending untill the company goes into
BANKRAUPTCY? DISSOLUTION , LIQUIDATION or EVAPORATION
of the company ..whichever?

Under CCAA:

The Monitor's ( E & Y Inc. ) Duties:

1. Monitoring the business.

2. Reporting to the court on any events that might impact the VIABILITY
of the company.

3. Assisting the company in the preparation of the “PLAN of ARRANGEMENT.”

4. Notifying the creditors ( and shareholders ) of any meetings and
tabulating the votes at these meetings. How could they do this duty
when there was no more Annual General Meeting?

5. Prepares a report on the Plan Of Arrangement that is usually included
in the mailing of the plan.

IT IS VERY ODD AND STRANGE THAT UNDER THE CANADIAN CCAA,
THERE IS NO “CLAIMS PROCESS” in place. NOW WHO WILL SET THIS
PROCESS????????

1. NORTEL or
2. The Monitor or
3. The Bankruptcy Court Judge ???????/

Or really, as Individual like me , can not interpret the CCAA statutes.
Only the Lawyers does!!!

I think that the Bankruptcy Court is bias … in favour only to the awarding
of bonuses to the BOD and Key Executives.
To HELL with the PENSIONERS and former employees and recently
severed employees without notices. Besides EI ( employment insurance
will just cover that ) So sneaky way of syphoning the coffers of taxpayers!
.

(9) Too busy watching the game on TV to realize the company was going to shambles

(10) Had a 'thing. You wit' me, bro?

“Nortel's quarterly results communication we're treated as a PR opportunity. Fabricated. Spinning of numbers and stories in an effort to indicate that the 5 year plan was working.”

My God! That sounds like Communism.

And WiMax'ers were all Chinese.

Do you think there might be a connection?

I don't even want to comment on that but I thought you should see it; it just feels so biased.

From Z's wikipedia page: http://en.wikipedia.org/wiki/Mike_S._Zafirovski

[...] Over the past three years, Zafirovski has slashed costs, redirected R&D, enhanced marketing and communications, and driven new relevance with key customers worldwide.
The recent economic downturn and credit crisis has stalled the turnaround as Nortel struggles to cope with the massive obligations on its balance sheet.

Hey Helmet Head.
Class Action lawsuits don't matter when you are under BP.
When they come out of BP there won't be any outstanding lawsuits.
Everything will be settled.
Man.
You really are living on another planet.

Hey Helmet Head.
Class Action lawsuits don't matter when you are under BP.
When they come out of BP there won't be any outstanding lawsuits.
Everything will be settled.
soundslikesourgrapes
====
re
See the pattern in that chaos
In my opinion, the new class actions are mounting to give shareholders a say in BK proceedings.
I remember my posts about Six Big Losers
six biggest hedge funds
Brandes, Wellington….and others
They were losing Big on NT.
They believed in numbers Mike Z reported quarter after quarter
They believed in the Turn Around Story he fed them,.
If they prove they were defrauded, they will have a chair in the BK proceedings.
read the claim numbers
There is power in these numbers
Class Period May 2, 2008 – September 17, 2008

Lost stock value multiplied by 500 mill shares!

check the link
http://www.csgrr.com/csgrr-cgi-bin/mil?case=nor…

Helmet Head.
……..update……
Today I saw another one
You know why?
Because investors lost sooo much on NT, because the pain is so bad, because BK protection pushed the real investors out of the picture… because of that they are coming back!
Yes.
Investors found the back door to come back to the negotiating table.
They claim to be defrauded by crooked company and they want to have their voices heard during BK proceedings.
read this
http://finance.yahoo.com/news/Kendall-Law-Group…
it's been 3rd class action

More executives that just Z and Pavi knew what was going on. I tried to get some approvals for investment in August '08 and was denied up to Dennis Cary, citing a “financial situation” — they knew as early as August or September that Nortel would be filing BANKRUPTCY.

Look at Richard “DICK” Lowe, for prime example of INSIDER TRADING, pulling his $$$$$ out while paying a 10% penalty. Dick should go to jail along with Z, Hackney, Carey, Pavi and other “leaders”.