7:50 AM -- Speaking with multiple sources on background this week, we think we've got a picture of the process around today's auction of Nortel Networks Ltd. assets.

We're talking about the stalking horse auction for Nortel's CDMA and LTE assets, of course, a process triggered when Nokia Networks made its $650 million offer. (See NSN Picks at Nortel's Mobile Bones .)

Nortel's lawyers weren't handy to confirm everything, but sources offered up an outline of the rules. Bottom line: The bids are in, but Nokia Siemens can still stage a comeback if it's been outbid by someone like MatlinPatterson Global Advisers LLC or Ericsson AB (Nasdaq: ERIC). (See PE Firm Edges NSN's Nortel Bid and Ericsson Bids for Nortel Wireless Assets.)

Bids had to be filed by Tuesday, but the real auction happens today at Nortel's outside counsel's office -- and not every bidder gets to attend. Just the serious ones, as picked by Nortel. So, Larry the Light Reading Attack Monkey, with his offer of $4.20, a crate of bananas, and a year's supply of pocket lint, shouldn't be waiting by the phone.

(BlackBerry isn't invited either, and has been quite noisy about it -- see RIM Cries Foul Over Nortel Bidding Process. In a recent letter to employees, Nortel CEO Mike Zafirovski says RIM "was not willing to comply with the procedures" approved by the courts.)

At the auction, Nortel will disclose the highest bid. The bidders will then have a chance to rebid, but they have to beat the leader by at least $5 million. So, again, Larry's plot to swoop in on a vine and outbid the winner by one more cent, AH-HAHAHAHA! isn't going to work.

We're told the auction will be a sober affair. They didn't hire this guy.

Eventually, someone's bid ends up being the highest. But wait, as Billy Mays would say -- there's more!

The winning bid has to get approved by the U.S. bankruptcy court, the institution whose rules are forcing this auction in the first place. So, Nortel has an appointment on Tuesday, July 28, to submit the winner as a recommendation, which the judge will probably approve, unless he's in a mood to just mess with people.

Apparently, Nortel's creditors and stakeholders can offer up objections during this final step. So, it's going to be interesting to see who shows up for that -- like, maybe, John Tyson and Ian Craig, the former Nortel executives still lobbying to bring the company back.

Don't hold your breath waiting for the results. At least, don't literally do it. We're told it's likely Nortel won't disclose the winner until after the business day ends -- or maybe even after the weekend. And Nortel's under no obligation to tell anyone what the losing bids were, or who made them.

— Craig Matsumoto, West Coast Editor, Light Reading