Ericsson Announces Settlement with Nokia
Ericsson has reached an agreement with Nokia for settling a damages claim against the Swedish company. The settlement relates to events that were the subject of a 2019 resolution with the US Department of Justice and U.S. Securities and Exchange Commission of investigations into Ericsson’s violations of the U.S. Foreign Corrupt Practices Act.
Ericsson agreed to pay €80 million to settle a damages claim by Nokia related to a bribery case in the US. The Sweden-based vendor stated the payment relates to a $1.06 billion settlement agreed with the US government in 2019 after it admitted to bookkeeping breaches and bribery spanning 16 years.
Ericsson noted the amount it will pay to cover damages claimed by Nokia reflected uncertainty, risk, expense and potential distraction from business focus which could be caused by lengthy and complex litigation. It expects the payment to impact its earnings before taxes in the current quarter, with a €26 million hit on cash flow. There will be lingering effects, with the payment to be spread over three instalments.