Right on the heels of a tough Q1 earnings report, Alcatel-Lucent (NYSE: ALU) is being sued by El Instituto Costarricense de Electricidad (ICE), Costa Rica's telecommunications and electricity provider, which alleges that Alcatel-Lucent directed bribery and civil racketeering out of Miami, Fla.
The suit is connected to Alcatel-Lucent's bribing of Costa Rican government officials to secure telecom contracts with ICE. If ICE wins, they could receive three times the amount of its damages.
Alcatel-Lucent has owned up to the bribery charges. The vendor crafted an agreement with U.S. Securities and Exchange Commission by admitting it violated the U.S. Foreign Corrupt Practices Act and agreed to pay criminal fines and disgorge $137 million in profits to avoid criminal prosecution and SEC enforcement action in connection with actions in Costa Rica and other countries.
"Alcatel Lucent's unlawful conduct significantly impacted ICE and affected Costa Rica's telecommunications system, and has caused a tremendous amount of damage to both the company and the system," said ICE's executive director, Don Pedro Pablo Quieros in a release. "Alcatel Lucent acted criminally, tried to take advantage of ICE and Costa Rica, and although it has taken a step in the right direction by admitting its criminal behavior, it must pay for the significant damages it has caused to ICE."
- see the release here
Component shortage put damper on Alcatel Lucent's Q1 2010 results
Alcatel Lucent reports profit, but lowers 2010 outlook
Alcatel-Lucent hit by component shortage, slumps to wider loss
Alcatel-Lucent assigns Agnellini to transformation post
AlcaLu's Verwaayen: M&A is not a panacea
AlcaLu: No Chinese acquisition here