Update on Deferred Prosecution Agreement

Rhea-AI Summary

On October 21, 2021, Ericsson announced that the U.S. Department of Justice (DOJ) identified breaches in its Deferred Prosecution Agreement (DPA) from December 6, 2019. The breaches relate to failures in document submissions. Ericsson plans to respond and continue cooperating with the DOJ. The DOJ has the sole discretion to determine the breach's implications, making it too early to assess potential outcomes.

Positive

• Ericsson intends to respond to the DOJ and demonstrate its cooperation with the terms of the DPA.

Negative

• The DOJ has determined that Ericsson breached its obligations under the DPA.

STOCKHOLM, Oct. 21, 2021 /PRNewswire/ -- On December 6, 2019, Ericsson (NASDAQ: ERIC) entered into a Deferred Prosecution Agreement (DPA) with the United States Department of Justice (DOJ). Ericsson has received correspondence from the DOJ stating that it has determined that Ericsson breached its obligations under the DPA by failing to provide certain documents and factual information, and that Ericsson will have the opportunity to respond in writing to explain the nature and circumstances of such breach, as well as the actions Ericsson has taken to address and remediate the situation.

At this stage it is premature to predict the outcome of these developments.  DOJ has sole discretion under the DPA to determine whether a breach occurred. Ericsson intends to respond to DOJ and to continue cooperating with DOJ consistent with the terms of the DPA, including requirements regarding production of documents.

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About Ericsson
Ericsson enables communications service providers to capture the full value of connectivity. The company's portfolio spans Networks, Digital Services, Managed Services, and Emerging Business and is designed to help our customers go digital, increase efficiency and find new revenue streams. Ericsson's investments in innovation have delivered the benefits of telephony and mobile broadband to billions of people around the world. The Ericsson stock is listed on Nasdaq Stockholm and on Nasdaq New York. www.ericsson.com

This is information that Telefonaktiebolaget LM Ericsson is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 01:00 CEST on October 22, 2021.

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Update on Deferred Prosecution Agreement

 

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SOURCE Ericsson

FAQ

What breach did Ericsson commit regarding the Deferred Prosecution Agreement?

Ericsson failed to provide certain documents and factual information as required by the Deferred Prosecution Agreement with the DOJ.

What is the response plan of Ericsson following the DOJ's breach determination?

Ericsson plans to respond in writing to the DOJ to explain the nature of the breach and the actions it has taken to address the situation.

What date was the communication from the DOJ regarding the breach received?

The communication from the DOJ regarding the breach was received on October 21, 2021.

What does the Deferred Prosecution Agreement entail for Ericsson?

The Deferred Prosecution Agreement requires Ericsson to meet certain obligations, including document production and cooperation with the DOJ.

What implications does the DOJ's breach determination have for Ericsson's stock?

The breach determination creates uncertainty about the potential consequences for Ericsson, which could impact investor sentiment and the stock price.