With his company reeling from massive stock market losses, and executives facing allegations of insider trading, Nortel Networks chief executive John Roth insisted Monday Nortel would weather the storm and emerge stronger than before.

John Roth assured hundreds of people he'll stay on at the helm of Nortel Networks and blamed a sudden economic downturn in the United States for cutting Nortel's profits, saying it had affected customer demand for Nortel products.

It's becoming very clear that all of our customers are starting to adjust their budgets to the very sharp and severe downturn in the United States, he said during a speech to the Canadian Club of Toronto.

Still, Roth insisted Nortel remained the most viable company in Canada.

Nortel has continually reaffirmed its outlook. But surprise profit warning late Thursday sparked a stock selloff Friday that wiped billions of dollars off the value of the company. Shares fell $15.15 to $31 on the Toronto Stock Exchange, pulling the market down almost 600 points.

Roth brushed off questions about three class-action lawsuits filed against the company in the U.S. regarding its quickly reduced financial estimates.

Any time there is meaningful movement in a stock, up or down, you can expect a class action suit, he said.

One of the suits filed on behalf of investors of investors who bought Nortel stock between Jan. 19 and Feb. 15 alleges Nortel misrepresented its financial condition.

But another suit alleges two Nortel dumped a load of shares just before the profit warning.

The Globe and Mail says court documents claim William F. Connor, president of Nortel's e-business solutions division, and Chahram Bolouri, president of global operations, sold more than $7 million US of company shares in late January, only weeks before the company issued a surprise earnings warning and announced more job cuts.

Documents allege Nortel shares gained more than 10 per cent on Jan. 19, just one day after strong quarterly results were released and just days before Connor and Bolouri sold their shares.

This substantial amount of insider trading activity occurred after defendants had caused the price of Nortel stock to rise following the company's Jan. 18, 2001, press release, the court documents allege.

The documents were filed Friday in a U.S. District Court in eastern New York -- just one day after Nortel announced it was cutting its work force by 4,000 more than had been expected and trimming its profit expectations for this fiscal year by almost 20 per cent.

Nortel said Thursday that it expects growth of about 15 per cent, with profits expected to grow about 10 per cent for the fiscal year, or about 80 cents a share.

Analysts had expected 96 cents a share.