The Canadian and U.S. judges charged with dividing the $7.3 billion from the liquidation of Nortel Networks rejected proposals from former regional businesses and opted for a pro rata split of the money, Reuters reported yesterday. Judges on the U.S. Bankruptcy Court in Wilmington, Del., and Ontario Superior Court of Justice held an unprecedented joint cross-border trial on the dispute, with the courtrooms linked by video. Nortel filed for bankruptcy in 2009 and sold its global operations and patents, raising the cash in dispute. In the years that corporate entities in Canada, the United States and Europe have fought over the funds, retirees and bond investors have awaited repayment. Bankruptcy Judge Kevin Gross and Justice Frank Newbould said in separate opinions that each regional business would receive cash to pay its creditors based on their claims against it as a percentage of the overall claims worldwide. The judges said in their simultaneous opinions that a pro rata division was the most fair and satisfactory way to split the money. Read more.
For more information on cross-border proceedings, be sure to pick up a copy of ABI’s Chapter 15 for Foreign Debtors.
