Nortel Ex-CEO Roth Wants Protection
Roth has filed a creditor claim asking for $1 billion indemnification against shareholder lawsuits, Canada's CBC reported last night.
The claim, filed Dec. 1, would protect Roth's personal assets should the plaintiffs win certain class-action lawsuits. The suits claim that executives knew the company's finances were in trouble but still encouraged employees to keep investing in 401(k) plans.
The lawsuits are on hold due to Nortel's restructuring and bankruptcy filings, but the CBC quotes a financial analyst -- one who's been serving some Nortel ex-employees -- speculating that Roth's creditor filing means he sees the suits as a potential threat.
Roth exited Nortel in October 2001, about six months earlier than planned, during one of the steepest parts of Nortel's collapse. And he took quite a few parting gifts with him; the CBC story measures his haul at $130 million (including benefits and options), making him a ripe target if shareholders win any of those lawsuits. (See Nortel Swings Axe, Switches CEOs, Nortel's Roth Rakes It In, and The Decline & Fall of Nortel Networks.)
— Craig Matsumoto, West Coast Editor, Light Reading