Nortel Networks, North America's biggest telephone equipment manufacturer, Gottschalks, the regional department story chain, and Goody's, the clothing retailer, all filed for Chapter 11 bankruptcy protection today as the credit crisis claimed more victims.

Toronto-based Nortel has been hit by plummeting demand for its equipment as customers moved to faster technology.

Nortel, whose shares hit a $900 high during the dot-com boom, was warned last month by the New York Stock Exchange that it would be delisted if it did not bring its share price above the $1 minimum within six months.

Yesterday, Nortel's shares closed at 32 cents each.

Goody's a privately-held company based in Tennessee, has stores across 20 states in the US, while Gottschalks has 58 department stores.

California-based Gottschalks ran into trouble after a deal with an offshore investor to pump $30 million into the company failed in November.

El Corte Ingles, the Spanish department store company that has a 16 per cent stake in Gottshalks, was last month also reportedly in talks with the company to put in additional investment.

The chain said today that it would put itself up for sale or look for some other kind of transaction to take it out of bankruptcy.

Goody's blamed financial pressures following unexpectedly poor sales over the Thanksgiving and Christmas period.

According to today's bankruptcy court filing, Nortel has more than $1 billion (£685 million) in assets but, as of September 30 last year, it had total liabilities of almost $12 billion.

Bank of New York Mellon is listed as its largest unsecured creditor as the trustee on more than $3.8 billion of notes.

The company has lost almost $7 billion over the past three years and, Mike Zafirovski, the chief executive of Nortel, has tried to cut costs by dismissing 18 per cent of the workforce.

Nortel, which began in 1895 as Northern Electric and Manufacturing, was the first company in Canada to produce dialling equipment.

However, in recent years it has lost market share to rivals such as Cisco and Juniper Networks, whose products allowed phone companies to transmit signals over internet lines.

In recent years, the company has been dogged by scandal.

After the IT bubble burst, Nortel was sued by shareholders who accused the company of faking sales figures by accelerating the booking of some contracts.

Frank Dunn, the chief executive at the time, lost his job as a result and in 2006 Nortel paid $575 million and issued almost 63 million new shares to settle the lawsuits.

Mr Dunn has since been charged by the Canadian federal police with misstating Nortel's results in 2002 and 2003, alongside Douglas Beatty, the former chief financial officer, and Michael Gollogly, the former controller of the company.

They were also charged with accounting fraud by the US Securities and Exchange Commission and the Ontario Securities Commission.

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