When the financial-going got tough at Nortel in 2001, former CEO John Roth got going. Now, eight years after he retired from the company, Roth wants his former employer to give him $1 billion indemnification against shareholder lawsuits.
Roth's claim, which was filed earlier this month, is designed to protect his assets in the event that U.S. courts mandate that he pay plaintiffs if they win class action lawsuits, which were on hold due to Nortel's bankruptcy proceedings. These lawsuits, which were filed about four years ago, name Nortel and other executives, who encouraged Nortel employees to continue to invest in the company's 401(k) plan despite the company's weakening financial state.
Roth, who left the company in 2001--a time when Nortel's financial state really began to falter--made off with about $130 million in stock options, bonuses and retirement benefits.
And this $130 million amount, says Diane Urquhart--an independent financial analyst who is helping some former Nortel employees--makes Roth a "good target" for the lawsuit.
- CBC News has this article
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