UPDATE 1-Nortel's legal mess pits bondholders against retirees
* Creditors seeking $20 bln square off over $9 bln in cash
* No agreement on which laws to apply
* Bondholders cite legal rights, pensioners cite hardship
By Tom Hals
Jan 11 (Reuters) - Nortel Networks was once the largest telecommunication equipment company in North America, but since it filed for bankruptcy in 2009 it has earned a new label: one of the world's most complicated legal proceedings.
Bondholders, suppliers, governments and former employees from around the globe hold $20 billion in claims based on different insolvency laws and are competing for Nortel's last remaining asset - $9 billion in cash.
On Monday, Ontario Chief Justice Warren Winkler, who has spent the past few months analyzing proposals, begins a week of talks in a Toronto hotel intended to find common ground.
Winkler has called the case "one of the most complex transnational legal proceedings in history." Failure of the mediation would mean years of litigation, with the possibility that parallel legal fights in different countries could reach inconsistent outcomes, according to Winkler, who was appointed to mediate by the U.S. and Canadian courts.
John Penn, a bankruptcy attorney who is not involved in the case, said the mediation is comparable to a football playoff between the New England Patriots, the Hamilton (Ontario) Tiger-Cats, Manchester United and Australia's Sydney Swans. Continued...