Nortel's CCAA Proceedings Stay Ministry Of Environment Clean-Up Obligations

Since Nortel Networks Corporation, and a number of related companies (together, "Nortel"), initially filed under the Companies' Creditors Arrangement Act (CCAA) over two years ago, the Ontario Ministry of the Environment (the "MOE") has sought to hold Nortel responsible for environmental contamination remaining on properties it once owned. Specifically, the MOE has issued a remediation and prepared several other draft remediation orders (together, the "MOE Orders"). Nortel estimated that completing the work required by the orders would cost approximately eighteen million dollars. Nortel has long maintained that such environmental clean up orders should not be prioritized ahead of obligations set out in their CCAA plan of arrangement. Today, the Ontario Superior Court of Justice released its reasons in a number of motions relating to these environmental matters, brought together before Justice Morawetz.