OPTrust's Role in Original Nortel Class Action Unaffected by Recent RulingPosted: July 26, 2004
Toronto (July 26, 2004) - The role of the OPSEU Pension Trust
(OPTrust) in a major class action lawsuit against Nortel Networks Corp. and
several of its senior officers is not affected by a recent court ruling on a
more recent complaint against Nortel.
On July 13, 2004, the United States District Court for the Southern District of New York appointed two other institutional investors - the Ontario Teachers' Pension Plan and the State of New Jersey Treasury Department - as co-lead plaintiffs in a class action lawsuit against Nortel covering its 2003 and 2004 fiscal years. These plaintiffs were selected from among more than 15 complainants, including OPTrust, based on the court's determination that they had experienced the largest losses during the affected period.
In December 2001, the U.S. District Court of the Southern District of New York named OPTrust as lead plaintiff in an earlier class action suit against Nortel - covering the period between October 24, 2000 and February 15, 2001. This suit alleges serious irregularities in Nortel's accounting and financial disclosure and seeks to recover damages for investors who bought Nortel shares during this “class period.”
The court certified the OPTrust-led class action in March 2004, following unsuccessful attempts by Nortel to have the complaint dismissed. In April, notice of the certification was issued all potential class members in Canada and the U.S. Pre-trial proceedings are now underway.
OPTrust is pursuing this lawsuit as part of its fiduciary responsibility to the members and pensioners of the OPSEU Pension Plan and to recover for losses in its investments. While OPTrust is actively pursuing recovery of damages, its losses have no material effect on the Plan's ability to meet its pension obligations to its members and retirees.
OPTrust's legal action is consistent with its role as a major institutional investor with a long-standing interest in the proper functioning of capital markets. OPTrust supports efforts to ensure full, timely and accurate financial disclosure and high standards of corporate governance, in the interests of all investors.
The original class action lawsuit against Nortel is not affected by the court decision in the more recent Nortel case. In addition to its role as lead plaintiff in the 2000-2001 proceeding, OPTrust remains a member of the class in the 2003-2004 action and retains a stake in any settlement or damages that are awarded.