Nortel filed for bankruptcy protection in 2009 and on Monday the US Justice Department approved the sale of over 6,000 of Nortel's patents to a number of companies, including Microsoft. However, Nortel's owners reportedly failed to tell anyone that their PC network had previously been breached by hackers based in China, who allegedly gained access to company secrets for most of the previous decade.
The Wall Street Journal reports that the hackers somehow got stolen passwords that were used by Nortel executives and breached Nortel's PC network as early as 2000. The hackers downloaded R&D papers, technical reports, emails and more from Nortel and also installed spyware on the company's servers.
Nortel suspected the hacker attacks as early as 2004. An investigation was launched and in 2009 spyware was discovered on at least two of Nortel's servers. However, the company's leadership decided not to reveal the cyber attack on their services when they started selling off their assets. Two companies, Avaya and Genband, bought part of Nortel and used some of their old PC servers and machines.
For its part, the former CEO of Nortel, Mike Zafirovski, who lead the company for part of the time the network was breached, said simply, "People who looked at [the hacking] did not believe it was a real issue."