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McGinn Not Alone in Two-Timing Lucent

Light Reading
News Analysis
Light Reading

Richard McGinn wasn't the only senior Lucent executive backing a competitor while Lucent's share price fell. While still at Lucent, Dan C. Stanzione, a former president and COO of Bell Labs, served as a director of Zhone Technologies Inc., a startup that competes directly with Lucent and with which McGinn also is involved (see McGinn Backed Lucent Competitor).

According to Lucent, Stanzione left his post as special advisor to McGinn last month, in September. But according to the S-1 filed by Zhone with the U.S. Securities and Exchange Commission, October 19, Stanzione has been a Zhone director since February 2000.

Stanzione was president of Bell Labs until October 1999, when he was succeeded by Arun Netravali. At that point, Stanzione took the post as special advisor to McGinn.

"This type of behavior is unacceptable and is one of the reasons why I left a few weeks ago," a former Lucent employee wrote to Light Reading today.

Lucent says Stanzione wasn't aware of any potential double-dealing. "At the time Dr. Stanzione got involved with Zhone, it did not appear to be a competitor to Lucent," said Lucent spokesperson Mary Lou Ambrus in a call today. Also, she says, Stanzione's decision to join the Zhone board was "reviewed and cleared" by other Lucent execs. Dr. Stanzione himself had not returned calls at press time.

Zhone's S-1 is littered with references to other Lucent executives, some of whom appear to have only recently left. James Zeitlin, ex-VP of business development at Lucent Internetworking Systems, for example, still has a mailbox on Lucent's voicemail network, and his message states that he is "on leave from Lucent." He also is a limited partner in Zhone. But Zeitlin's admin says he left Lucent altogether "a couple of months ago" and that his voicemail should be fixed to reflect that.

According to the ex-Lucent employee who wrote to us today, there are "many other" examples of executive double-dealing at Lucent. "The bottom line," the note says, "is Lucent is rotten to the core."

-- Mary Jander, senior editor, Light Reading http://www.lightreading.com

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