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            Monday, September 18, 2000, Vol. 2, No. 181


BREAST IMPLANT: British Woman Files Suit in CA over Soy-Based Implants
CASELLA WASTE: Amendment to Securities Suit in New Jersey Changes Period
CASELLA WASTE: Securities Suits in NJ against KTI May Be Consolidated
CENDANT CORP: Shareholders Appeal $2.85 Bil Settlement
DUTHIE: Class Denied But Usurpation Claim Survives over Repurchase

E.COLI: Judge in Ontario Says Court Process Undermined by Delays
EDWARDS J D: Securities Complaint in CO Consolidated; Hearing in Oct.
FIRESTONE, FORD: Other Brands Authorized in Canada for Replacement
FIRESTONE, FORD: Tampa Residents Seek Payment for Tires Not in Recall
FLAGSTAR BANK: State Laws for Mortgage Fees Not Preempted by Fed. Acts

GEORGIA POWER: Admits Disparities in Promotion but Denies Race Bias
HIGHLAND PARK: Aclu Defends Deal to End Profiling; Atty Files Objection
IBP INC: Cattlemen Ask Judge to Limit Class in Antitrust Suit
MERCURY CONTAMINATION: Homes Within Chicago City May Face Threat
NATIONAL AUTO: SEC Investigating Issues Re Deloitte & Touche Resignation

NATIONAL AUTO: Settles Lawsuit Related to Deloitte & Touche Resignation
NORTHWEST AIRLINES: Judge Considering Arguments in Antitrust Case
P&O HOLIDAYS: May Be Sued on Pneumonia Contracted on Cruise for Olympics
PLUG POWER: Milberg Weiss Files Securities Lawsuit in New York
WALL STREET: Sexual Discrimination Charges By Female Employees Continue

WASHINGTON SCHOOL: Schools Ask Property Owners to Turn Down Tax Refunds
XEROX CORPORATION: Milberg Weiss Files Securities Lawsuit in Connecticut


BREAST IMPLANT: British Woman Files Suit in CA over Soy-Based Implants
A British woman who received the soy-based Trilucent breast implant has
filed a proposed class action in a California federal court alleging the
medical devices were not adequately tested prior to being sold in the
England and Europe. She asserts that the fill material is dangerous because
it lacks biocompatibilty with the human body. Crane v. Collagen Aesthetics
Inc. et al., No. 00-2873 (N.D. Cal., Aug. 10, 2000).

Plaintiff Sarah Jane Crane also contends that the fluid becomes toxic when
introduced into bodily systems and may cause cancer, due to the oil's lack
of oxidative stability. She is suing seven companies, a university and
research professor for their involvement in the development and sale of the

Between 1995 and 1999, approximately 10,000 women received Trilucent
implants in Europe; of these, about 5,000 of these women received the
implant in England.

According to the complaint, in the 1980s researchers led by Vernon Leroy
Young, M.D. at the Washington University in St. Louis invented the implant
and obtained a patent.

The implant is described as a "radiolucent breast implant comprised of a
siliconeenvelope filled with any biocompatible triglyceride such as peanut
oil or sunflower seed oil, or any material having an effective atomic
number of 5.9 which is the effective atomic number of fat, the major
component of a human breast."

The patent was subsequently assigned to LipoMatrix Inc., a British Virgin
Islands corporation, says Crane, which was later acquired by Collagen
Aesthetics. Collagen is controlled b y McGhan Medical Corp. and both are
owned by Inamed Corp.

The implants were marketed from California, says Crane, and advertised as
presenting fewer health risks than silicone implants which, by that time,
had been pulled from the market due to the alleged dangers.

Collagen and LipoMatrix allegedly told women that triglycerides are a
natural fat and, in the event of any leakage, would be absorbed and
metabolized by the body.

The plaintiff had her implants for almost four years -- from October 1995
to August 1999. She had them removed after the U.K.'s Medical Devices
Agency reported serious health problems in implant recipients. After
further investigation, the MDA issued a "Hazard Notice" in June 2000, and
advised all women to have the implants taken out; see Breast Implant LR,
June 26, 2000, P. 5.

While Crane had the implants, one of them ruptured and she has experienced
chronic fatigue syndrome, joint pain and nausea. She has also been
diagnosed with immune deficiency syndrome and fears that the oil leaked
into her system may cause chronic degenerative disease, atherosclerosis and
even breast cancer. She is undergoing additional surgery next month to
remove more breast tissue that may have been exposed to the soy oil.

According to the complaint, around 1995 LipoMatrix contracted with TUV
Product Service to obtain a certification regarding the safety of the
implants. This certification was used to obtain a European Union "CE
Marking of Conformity" which constitutes regulatory approval throughout

TUV, with offices in Germany, allegedly prepared a declaration saying that,
based on clinical data, the Trilucent implant was in conformity with the
Council of European Communities Medical Devices Directive and would not
compromise the health and safety of women. The certification was false,
says Crane, because clinical studies had not been completed by LipoMatrix
and TUV, and existing studies showed that the oil presented a serious and
substantial danger of permanent damage and disease to the surrounding body
tissue and the entire body.

Prior to the release of the hazard notice, Collagen changed its name to AEI
Inc. and admitted the design defect in the Trilucent implant. It also
created the "AEI Trilucent Care Programme" to cover the medical expenses of
the implant recipients.

Inamed Corp. has contributed $100 million to the program which, Crane says,
amounts to $10,000 per woman and does not include the cost of future
medical care, disability or pain and suffering damages.

In response to the allegations, Senior Vice President and General Counsel
David Bamberger of Inamed said, "Clinical trials were conducted in the
United Kingdom, Spain, Italy and Germany prior to the CE Mark being
approved, and approximately 600 women participated in them. Contrary to the
assertions in the lawsuit, the implants have not been shown to be dangerous
and defective. In the Hazard Notice, the MDA took pains to stress that
women consider explantation as a precautionary measure but that there was
no clinical evidence of systemic illness due to the implants.

Moreover, the Trilucent breast implants were never manufactured by Inamed
or any subsidiary of Inamed -- now or in the past. The companies involved,
the medical records, and all witnesses are located overseas and the United
States is not a proper forum for this dispute."

Crane is represented by Jeffrey A. Feldman of San Francisco, and Jeffrey M.
Herman and Stuart S. Mermelstein of Miami. (Breast Implant Litigation
Reporter, August 21, 2000)

CASELLA WASTE: Amendment to Securities Suit in New Jersey Changes Period
On or about March 24, 2000, a complaint was filed in the United States
District Court, District of New Jersey against Casella Waste Systems Inc.,
KTI, which was acquired by Casella Waste Systems Inc., and three of KTI's
principal officers, Ross Pirasteh, Martin J. Sergi, and Paul A. Garret. The
complaint purported to be behalf of all shareholders who purchased KTI
common stock from January 1, 1998 through April 14, 1999. The Complaint
alleged that the defendants made unspecified misrepresentations regarding
KTI's financial condition during the class period in violation of Sections
10(b) and 20(a) of the Securities Exchange Act of 1934, as amended. The
plaintiffs seek undisclosed damages. On or about April 6, 2000, the
plaintiffs filed an amended class action complaint, which changes the class
period covered by the complaint on behalf of all the defendants on July 21,

CASELLA WASTE: Securities Suits in NJ against KTI May Be Consolidated
On or about April 26, 1999, Salvatore Russo filed an action in the U.S.
District Court, District of New Jersey against KTI, which was acquired by
Casella Waste Systems Inc. and two of its principal officers, Ross Pirasteh
and Martin J. Sergi, purportedly on behalf of all shareholders who
purchased KTI common stock from May 4, 1998 through August 14, 1998.
Melanie Miller filed an identical complaint on May 14, 1999. The complaints
allege that the defendants made material misrepresentations in KTI's
quarterly report on form 10-Q for the period ended March 31, 1998 in
violation of Sections 10(b) and 20(a) of the Securities Exchange Act of
1934, as amended, concerning KTI's allowance for doubtful accounts and net
income. The Plaintiffs are seeking undisclosed damages. The Company
believes it has meritorious defenses to these complaints. On June 15, 1999,
Mr. Russo and Ms. Miller, together with Fransisco Munero, Timothy Ryan and
Steve Storch, moved to consolidate the two complaints. This motion is
currently pending in the District Court of New Jersey.

CENDANT CORP: Shareholders Appeal $2.85 Bil Settlement
Cendant Corp. said that several shareholders have appealed the company's
proposed $ 2.85 billion settlement of a class-action lawsuit brought over
alleged accounting irregularities.

Cendant said a final judgment on the settlement won't come until all rights
of appeal have been exhausted , and the company won't be required to fund
the settlement for some time.

In August, a federal court in Newark approved the deal, which is intended
to end shareholder claims resulting from the company's previously reported
accounting irregularities.

Cendant said the appeals focus primarily on the right of certain
shareholders to be excluded from the class-action suit and the allocation
of the settlement.

Cendant, which has its operational headquarters in Parsippany-Troy Hills
and which is the franchiser of brand names such as Ramada, Avis, and
Century 21, was formed after the merger of CUC International and HFS Inc.
in December 1997.

In April 1998, Cendant disclosed that there were accounting irregularities
in the past financial statements of the former CUC that would require
restated earnings for 1995-97. That disclosure prompted more than 70
class-action lawsuits against numerous parties, including Cendant and the
auditors for CUC in the affected years.

In December 1999, the consolidated class action against Cendant was settled
for $ 2.85 billion, and Ernst & Young, CUC's auditors, settled claims
commenced by shareholders against it for $ 335 million. (The Record (Bergen
County, NJ), September 15, 2000)

DUTHIE: Class Denied But Usurpation Claim Survives over Repurchase
Plaintiff shareholders of a utility company won one and lost one in two
rulings issued by Vice Chancellor Gottlieb Lamb in related lawsuits; he
dismissed their class action, but found that their derivative suit -- which
claimed that the directors passed up a golden opportunity to repurchase
stock -- states a valid usurpation claim. Kohls v. Duthie et al., No. 17762
(Del. Ch., July 26, 2000); see related story on P. 6.

The derivative action survived because the judge made a rare exception to
the guideline that judges employ to decide whether directors could fairly
evaluate a pre-suit demand. The vice chancellor held that the repurchase
was such a golden opportunity to benefit the Kenetech shareholders that a
pivotal director who passed it on to the CEO must have been conflicted.

The derivative suit by Robert and Louise Kohls alleged that, in 1997 when
Kenetech's largest shareholder told CEO Mark Lerdal that it was "shopping"
its 30 percent stake in the struggling utility company, the company had a
rare opportunity to repurchase 12.8 million shares for about $1,000.
Instead, the board, without formal deliberation, passed the opportunity to
Lerdal individually. When the company's fortunes improved after the sale of
a power plant, that stock was worth more than $8.2 million, plaintiffs

The complaint alleged that Lerdal -- without consulting an attorney --
advised the board that Kenetech was not legally able to buy the stock. They
claim that he knew, at the time the stock was offered, that the company was
about to close a major deal that would dramatically affect the stock price
in the short term.

Defendants moved to dismiss the suit on two grounds:

  -- plaintiffs failed to make a pre-suit demand on the board or specify
      why they should be excused from doing so; and

  -- the suit did not properly state a corporate usurpation claim.

The court said the first issue turned on whether the swing member of the
board would have been able to properly evaluate a pre-suit demand. Although
board member Charles Christenson had no disabling conflicts or allegiances,
that did not end the analysis in this rather special case, the court said.

Normally, an allegation that a board member would vote against having the
company take up a derivative suit (because of his or her possible
liability), is not sufficient to show that the director is disabled from
fairly evaluating a pre-suit demand, the court said.

However, according to the opinion, the special facts of this case provide a
strong indication that Christenson -- who made the challenged decision --
had reason to fear that he would face liability for failing to properly
consider the deal.

"The Kenetech board's apparent acceptance of Lerdal's assertions at face
value, without conducting any independent analysis or seeking independent
advice, tends to show a disregard for corporate interests," the court

As to the argument that the stock purchase did not present a valid
corporate opportunity, the vice chancellor rejected all of Kenetech's
proffered reasons why it could not have bought the stock. He found that:

  -- Kenetech had an "expectancy" that its officers would present it
      with an opportunity of this type -- even though it had no formal
      stock repurchase plan;

  -- The debt that Kenetech said prevented it from spending money on
      bargain stock could have easily been converted into a surplus if
      the company had accounted for the value of the pending power plant
      sale; and

  -- Similarly, it is highly unlikely that a creditor group would have
      vetoed a transaction that would have substantially increased the
      company's (and the shareholders') value.

Accordingly, the court denied the motion to dismiss.

Plaintiffs are represented by Edward McNally and John Meli Jr. of Morris,
James, Hitchens & Williams in Wilmington, Del.

Defendants are represented by Charles Richards Jr., Raymond DiCamillo and
Thad Bracegirdle of Richards, Layton & Finger in Wilmington. (Delaware
Corporate Litigation Reporter, August 21, 2000)

E.COLI: Judge in Ontario Says Court Process Undermined by Delays
Undue delays to a class action suit could prompt victims of Walkerton's
tainted water to accept government compensation and give up their right to
sue, a judge said last Thursday September 14.

Mr. Justice Warren Winkler of the Ontario Superior Court expressed concern
that the court process could become "meaningless" if potential claimants
become frustrated by delays and take the province's settlement offer. He
refused to grant lengthy delays to a group of 20 lawyers gathered in a
University courtroom.

"This is not a contest," said Alan Mark, lawyer for the Walkerton Public
Utilities Commission. "This is not a competition between Mr. Ritchie's
compensation plan and Mr. Harris' compensation plan," he said, in a
reference to victims' lawyer Scott Ritchie and Premier Mike Harris. "I
think it will be put to me as a contest," retorted Winkler, referring to
his experience as a class action judge in other cases, including Canada's
tainted blood scandal and the 1995 Toronto subway crash.

Winkler must decide whether any other procedure offers proper compensation
before giving the class action the go-ahead.

Ritchie, representing victims of the contamination last May that killed six
people and left 2,000 ill, asked for a date in early December for
certification of the class action.

Lawyers representing the Ontario government and the utilities commission
and two of five defendants, said they needed more time - possibly into next
February or March - to prepare their responses.

But Winkler ordered the lawyers to get their arguments in by Oct. 30.

So far, five people have received compensation through the government plan,
said a spokesperson for the attorney-general's ministry. Another 99 have
filed applications. (The Toronto Star, September 15, 2000)

EDWARDS J D: Securities Complaint in CO Consolidated; Hearing in Oct.
As previously reported in the CAR, on September 2, 1999, a complaint was
filed in the United States District Court for the District of Colorado
against Edwards J D & Co. and certain of its officers and directors. The
complaint purports to be brought on behalf of purchasers of the Company's
common stock during the period between January 22, 1998 and December 3,
1998. The complaint alleges that the Company and certain of its officers
and directors violated the Securities Exchange Act of 1934 through a series
of false and misleading statements. The plaintiff seeks to recover
unspecified compensatory damages on behalf of all purchasers of J.D.
Edwards' common stock during the class period. Two additional suits were
filed on behalf of additional plaintiffs alleging the same violations and
seeking the same recovery as the first suit.


The three complaints were subsequently consolidated into one action and a
consolidated amended complaint was filed on March 21, 2000. On May 9, 2000,
the Company and the individual defendants filed a motion to dismiss the
amended complaint. The court has scheduled a hearing on the motion to
dismiss for October 6, 2000.

FIRESTONE, FORD: Other Brands Authorized in Canada for Replacement
Nevertheless, Ford Motor Co. of Canada, which has 60,000 customers
affected, has authorized 30 other tire brands as replacements -- including
Goodyear and Michelin -- in addition to Firestone's own supplies.

Firestone, for its part, said it will pay up to $ 150 per tire for owners
to buy other brands. The company was forced to make the drastic move
because of a worldwide shortage of its own tires that could take months to

Bridgestone/Firestone Canada said customers must bring their proof of
purchase and the Firestone recall tires to a Firestone store or authorized
dealer. Customers can expect a cheque in four to six weeks after the claim
is verified and processed, the company said August 31.

At that time, Canadian Tire Corp. announced that it had made 40,000 tires
of various makes from its stocks available to its dealers across the
country in the wake of Firestone's offer to pay for replacements.

"We really do believe this is going to take an industry-wide effort to get
these replacement tires on the road," Canadian Tire spokesman Scott
Bonikowsky says. "It's a significant challenge," Bonikowsky says. "It's
going to take a while to get everybody that's been affected by the recall
covered off with replacement tires." (The Edmonton Sun, September 15, 2000)

FIRESTONE, FORD: Tampa Residents Seek Payment for Tires Not in Recall
Five Tampa Bay area residents are suing the makers of Firestone tires and
Ford Motor Co., asking for an expanded recall of tires and for payments to
those who have defective tires not covered in the nationwide recall.

The group asked a judge to declare the suit a class action in which
customers throughout the nation could join if they purchased defective
Firestone 15-inch ATX and ATX II tires manufactured in North America or
15-inch Wilderness AT tires manufactured at the company's Decatur, Ill.,
plant. More than 6-million of those tires have been recalled.

But the suit goes a step further, seeking payments to people who owned
other Firestone tires that are not now part of the recall. Those tires
include 16-inch models of the Wilderness AT, radial ATX and ATX II,
regardless of where they were manufactured.

The suit wants payments for anyone who replaced those tires at their own
expense after learning of the recall of the other models.

"Consumers who desire a fully functional and safe tire have thus been left
with no choice but to purchase replacement sets on their own," according to
the suit.

Since Aug. 9, almost 8-million Firestone tires used on sport utility
vehicles and light trucks have been recalled. Officials with
Bridgestone/Firestone apologized to the American public and vowed to find
the cause of the problem. Federal investigators are looking into what role,
if any, the tires had in 88 deaths and more than 250 injuries.

They are trying to sort out what caused accidents in which Firestone tires
suddenly lost their tread or suffered blowouts. They are looking into the
combination of flawed tires and the design of sport utility vehicles.

National reports indicate the company had data indicating problems years
before the recall. A tire recall began in 16 other countries more than a
year ago, but U.S. authorities were not notified.

The suit, filed last Wednesday September 13 in Pinellas-Pasco Circuit
Court, was filed by Donna and Ralph Cordasco of Gulfport, E. Frank Griswold
of Lutz, and John V. Monsour and Richard H. Sollner, both of Tampa. Their
attorney, Chris Hoyer, could not be reached.

The suit claims that the tires are defective and that the companies acted
negligently, breached expressed or implied warranties and violated the
Florida Deceptive and Unfair Trade Practices Act. (St. Petersburg Times,
September 15, 2000)

FLAGSTAR BANK: State Laws for Mortgage Fees Not Preempted by Fed. Acts
A state law requiring lenders to pay fees for recording the discharge of
mortgages is not preempted by the Home Owners' Loan Act or the Depository
Institutions Deregulation and Monetary Control Act of 1980. The federal
acts only partially preempt state banking laws and do not bar claims that a
bank improperly charged mortgage borrowers for recording the discharges,
according to the Michigan Court of Appeals. (Konynenbelt v. Flagstar, No.
214784 (Mich. App. 7/25/00).)

                           Recording Fee

A group of borrowers who had prepaid their mortgages filed a class action
against Flagstar Bank FSB. The suit was based on the bank's decision to
charge all customers a fee when they prepaid their loans. The fee
reimbursed the bank for a fee charged by the register of deeds whenever a
mortgage was marked as discharged. The borrowers argued that this policy
violated state law and the terms of the original mortgages.

According to Michigan law, whenever a mortgage is paid off, the mortgagee
must file a discharge and "pay the fee for recording" it. Additionally, the
mortgage documents stated that upon payment of the loan, "Lender shall
prepare and file a discharge of [the mortgage] without charge to Borrower."

Flagstar did not dispute that it collected over 269,000 in recording fees.
The bank moved for summary disposition on the grounds that federal laws
regulating savings banks preempted state law. According to Flagstar,
because it was a federal savings bank only the Office of Thrift Supervision
could regulate it. Additionally, the lender argued that the DIDMCA
preempted any state law regarding charges assessed in connection with
mortgage loans.

                          Partial Preemption

The trial court denied Flagstar Bank's motion to dismiss.

On appeal, the Court of Appeals examined both acts and the regulations
promulgated under them. According to 12 CFR Part 545, the regulations
promulgated under the HOLA preempt "any state law purporting to address the
subject of the operations of a Federal savings association." Based on a
general policy disfavoring preemption, however, and based on interpretation
of the preamble to the OTS' regulations, the court determined that Congress
only intended a partial preemption. Further, a California decision, Siegel
v. American Savings & Loan Ass'n., 258 Cal. Rptr. 746 (Cal. App. 1989),
held that a similar state statute was not preempted. The U.S. Supreme Court
also vaguely suggested in another case that the federal regulatory scheme
may not have fully occupied the field of bank regulation.

                          Bank Operations

The Court of Appeals then decided that the state recording law did not
purport to address the subject of bank operations. Instead, the fee was
charged after the lending was complete. The federal regulations "expressly
preserve[d] the viability of certain state laws, including those based on
contract and real property law." As the law in question addressed
discharging mortgages, the court rejected Flagstar's argument that it was
preempted by the federal regulations.

The bank also argued that 12 USC 1735f-7a, a DIDMCA provision that
expressly preempted state regulation of interest rates, finance charges and
"other charges," included preemption of the recording law establishing the
9 fee. The court again disagreed based on the legislative history of the
DIDMCA. The history showed that the purpose of the act was to overcome
state usury statutes and to "stimulate the purchase of homes by assuring
the availability of home loans ... ." In contract, the court in a per
curiam opinion held that the 9 fee had "nothing to do with the lending of
money ... because the fee is imposed after the loan has already been made."

The court also pointed to legislative history, stating that the statute was
intended to "exempt only those [state] limitations that are included in the
annual percentage rate." Other consumer protection limitations were left
intact by the act highlighting the limited scope of the preemption.
Therefore, the Court of Appeals affirmed the trial court's decision to deny
the motion for summary disposition. (Consumer Financial Services Law
Report, September 5, 2000)

GEORGIA POWER: Admits Disparities in Promotion but Denies Race Bias
Power Co., responding to a racial discrimination lawsuit brought by seven
employees, denied that "any unlawful discrimination or harassment''
occurred at the utility company.

In its response, the company acknowledges a number of apparent disparities
in promotion and compensation between white and black employees. In
addition, Georgia Power acknowledged that in 1998 African-Americans
accounted for 19.2 percent of its work force but only 22 of its top 408
employees, or 5.3 percent.

But the company's actions "were not malicious, egregious, in bad faith or
in willful or reckless indifference or disregard of any legal rights of any
plaintiffs,'' the company contends.

The company added that "even if any unlawful discrimination or harassment
occurred (which the defendants deny), such conduct was prohibited by
defendants' policies and was not committed, countenanced, ratified or
approved by higher management.''

The company's formal response to the July 27 lawsuit is in a 67-page brief
filed in U.S. District Court on behalf of Georgia Power and parent Southern
Co., both defendants in the civil case.

The lawsuit alleges that the company "maintains a pattern and practice of
discriminating against African-American employees'' in employment. A "
reckless indifference'' to a racially hostile workplace environment,
including tolerance of the display of a hangman's noose at a company
facility, is also alleged. The suit seeks class-action status to represent
all 2,100 employees of Georgia Power and Southern.

In its response, the company again acknowledges that a "rope tied in a
noose" was present at its operating headquarters in Cornelia between 1997
and 1999. But it denies claims that management allowed "one of the most
chilling representations of racial harassment'' to be displayed.

The company "exercised reasonable care'' to prevent the type of misconduct
alleged and "promptly investigated and took prompt action to investigate
reports of alleged harassment, discrimination or retaliation," the filing

While steadfastly denying unlawful discrimination, the company acknowledges
a number of facts in the original lawsuit. For example, two
African-American employees were the lowest-paid data processing operators
in a particular department, it acknowledges. One employee who sued was paid
less than white- co-workers in comparable posts. Another advanced much more
slowly than a white co-worker with less experience at the company.

Steven Rosenwasser, an attorney for the employees, said the admissions
validate his clients' claims. "They (Georgia Power) admit the facts that
prove discrimination but refuse to admit discrimination,'' he said.

The next step in the case is for U.S. District Judge Orinda Evans to issue
an order that lays out a schedule for gathering and hearing evidence,
including access to company records for lawyers representing the seven
plaintiffs. The process could take years.

Since the lawsuit was filed, noted trial attorney Johnnie Cochran has
joined the employees' legal team. No talks on an out-of-court settlement
have been reported.

A group of current and former Southern Co. employees announced last
Thursday September 14 plans for a rally Saturday across the street from
Georgia Power's downtown Atlanta headquarters to discuss the company's
response to the suit. Some of the seven employees who have sued are
expected to attend.

"We respect their right to have their thoughts known and to demonstrate,''
said company spokesman Todd Terrell. "No one is going to interfere with
them. '' (The Atlanta Journal and Constitution, September 15, 2000)

HIGHLAND PARK: Aclu Defends Deal to End Profiling; Atty Files Objection
An American Civil Liberties Union spokesman said that the group stands
behind its proposed pact with Highland Park to curb racial profiling
despite an objection filed by an attorney seeking to derail the accord. "We
believe that the agreement we came to with Highland Park is the best
solution and best remedy for racial profiling," ACLU spokesman Ed Yohnka

The consent decree, which would legally require city officials to implement
initiatives they had introduced in response to a pending federal lawsuit,
is the most "forward and progressive-thinking" plan accepted by any city,
Yohnka added.

The agreement also would relieve the city from paying damages, penalties
and legal fees relating to a class-action lawsuit filed by the ACLU on
behalf of Karen Lynn Ledford and Michael Ledford, an African-American
mother and son who alleged they were unfairly targeted by police. Also, the
ACLU would agree not to file future racial-profiling complaints against the
city, which denies wrongdoing in the Ledford case.

A hearing on the consent decree is scheduled for Sept. 27 before U.S.
District Judge William Hart.

Broadcast news reports suggesting that racial profiling still was being
practiced in the affluent suburb surfaced after Chicago-based attorney
Keevan Morgan filed an objection to the consent decree on behalf of four
minority members who were stopped by Highland Park police.

Morgan also is the attorney representing three current and two former
police officers in a pending lawsuit that alleges that high-ranking
Highland Park police officials encouraged racial profiling and sexism.
"This consent decree does absolutely nothing," Morgan said. "The same
people are in power and nothing has happened to them." Morgan's complaint
states: "If the city is allowed to settle without an admission and without
paying damages, it will have completely gotten away with it."

But City Manager David Limardi said the city is determined to implement
changes that would prevent any possibility of racial profiling. Even if the
consent decree is not entered, Highland Park "is going to keep moving down
the road" with its plans, including installing video cameras in every
patrol car.

The camera plan and 10 other initiatives, including formation of a Human
Relations Commission, were introduced in May after former U.S. Atty. Thomas
P. Sullivan found that although racial profiling is not a department
policy, there have been isolated incidents of racial insensitivity.
Sullivan had been hired by the city to probe the charges raised in the
police lawsuit.

Two of the men listed in Morgan's objection to the consent decree, Lorenzo
Rodriguez and Roberto Calderon, were arrested for drunken driving in 1999.
Rodriguez, who was named in the Sullivan Report, alleged he was sprayed
with pepper spray while he was police custody in July 1999. Police said his
cell was sprayed because he was "swinging his arms, rocking back and forth
and hitting his head against the back cell wall," according to the report.
Rodriguez had a blood-alcohol level of .145 and used the name Luiz Lopez
when he was arrested.

Neither Calderon nor James Lockhart and Lee Pratt, two other men listed in
Morgan's objection, had filed complaints with the Human Relations
Commission, Limardi said.

Lockhart and Pratt were stopped by Highland Park police May 20 after state
police issued a statewide bulletin of a "road rage" incident where the
occupants of the wanted car had a weapon, Limardi said. The men, who were
never arrested, were stopped because their vehicle fit the description,
Limardi said. "It was one of those circumstances where we had an obligation
to follow through," he said, adding the men were treated with "respect and
courtesy" when they were questioned by police.

Lockhart and Pratt wrote to complain to the Highland Park police about the
incident. But when police twice asked the two to elaborate, they refused to
do so, Limardi said.

Police will not be obligated to file reports with the commission, but in
the future they will be required to inform all those they have stopped that
they have an option to go to the commission if they feel they were unfairly

Morgan and several others attended the Human Relations Commission meeting
to press officials about any pending disciplinary actions in the police
department. Limardi said it was not appropriate to discuss any pending
punishment. (Chicago Tribune, September 15, 2000)

IBP INC: Cattlemen Ask Judge to Limit Class in Antitrust Suit
The cattlemen behind an antitrust lawsuit against IBP Inc., the nation's
largest meatpacker, asked a federal judge on September 15 to exclude some
cattle producers from their class-action claim. The cattlemen who filed the
lawsuit say large cattle producers who sell to IBP through special
arrangements rather than through open auctions should not be included in
their litigation.

The lawsuit contends that IBP is violating antitrust laws by buying mostly
packer-owned cattle and cattle committed to packers under long-term
contracts - rather than bidding on auction markets - to unfairly depress
prices paid to producers. "The packer captures part of the demand, lowering
need for cattle and lowering what it pays for the residual supply,"
attorney David Domina argued for the cattlemen before Senior U.S. District
Judge Lyle Strom.

IBP has argued that an oversupply of beef and limited access to foreign
markets are to blame for low livestock prices, not packers. Attorneys for
IBP said that even cattle producers on the cash market want the option of
special sales agreements with meatpackers so they are not harmed and should
not be part of a class-action lawsuit.

The cattlemen who filed the lawsuit were seeking to have the case
re-certified as a class-action lawsuit after the 11th U.S. Circuit Court of
Appeals threw out the lawsuit's original class-action definition. Domina
asked Strom to include in the lawsuit only cattle producers who have
directly sold cattle to IBP. The federal appeals court had ruled that the
original request for class-action certification also included those
cattlemen who had sold cattle to IBP under special marketing arrangements.

Strom said he would take Domina's request under advisement. Strom ruled in
April 1999 that the cattlemen who filed the lawsuit had demonstrated they
might be able to prove IBP has illegally controlled cattle prices. Strom
certified the case as a class action, including all producers who sold
cattle for slaughter to IBP since February 1994.

The cattlemen originally filed the lawsuit in 1996, claiming that IBP
colluded with other meatpackers to restrain competition and control prices.
The case originally was filed in federal court in Montgomery, Ala.

Strom, who normally hears cases in Nebraska, agreed to help the Alabama
court with its caseload. U.S. District Judge W. Harold Albritton of
Montgomery, Ala., dismissed the class-action lawsuit in 1998 after the
cattlemen asked the court to include all cattlemen who felt they had not
received a fair price on the open market.

Albritton ruled that differences were too wide among various cattle
operations to qualify as a class action, with some cattle owners running
cow-calf operations, others operating feedlots, and others grazing cattle.

IBP, which is based in Dakota Dunes, S.D., controls more than a third of
the U.S. beef packing industry. The company's total sales of beef and pork
last year totaled $14.1 billion. (The Associated Press State & Local Wire,
September 15, 2000)

MERCURY CONTAMINATION: Homes Within Chicago City May Face Threat
For the first time, city and gas company officials said that residences
within Chicago may face the same problems of mercury contamination plaguing
suburban homes.

Mayor Richard M. Daley asked Peoples Energy for assurances that
approximately 30,000 homes in the city are not contaminated by mercury
after the U.S. Environmental Protection Agency confirmed a substance found
in a Chicago home was the potentially poisonous material.

The EPA said there was not enough of the toxic substance at the home to
pose a health risk.

While Daley said there is no immediate cause for alarm, the discovery
follows the revelation that more than 200,000 homes in the Chicago suburbs
may be at risk for contamination. The mercury in the suburban homes was
apparently spilled when old gas regulators were replaced by the Nicor gas

Chicago residences were not considered at risk because the city never used
medium-pressure gas lines that required the gas regulators.

But three communities annexed by the city on the Southwest Side - Edison
Park, Clearing and Mount Greenwood - did have medium pressure gas lines and
could potentially face the same contamination risks.

Mercury is a toxic metal that can damage the kidneys and brain at certain
levels of exposure.

Compounding the problem are a shortage of investigators, almost all of whom
have been hired by Nicor to detect mercury spills in its service area. (The
Associated Press State & Local Wire, September 15, 2000)

NATIONAL AUTO: SEC Investigating Issues Re Deloitte & Touche Resignation
National Auto Credit Inc. reveals that the Securities and Exchange
Commission, the United States Attorney for the Northern District of Ohio
and the Federal Bureau of Investigation are investigating the issues raised
as the result of the resignation of Deloitte & Touche. The Company says it
is fully cooperating with the investigations. Although the Company has
accrued certain costs it expects to incur in responding to the
investigations, the ultimate outcome of these investigations cannot
presently be predicted and the Company has not recorded any provision for
any monetary penalties that may result from civil or criminal proceedings
that might be commenced at the conclusion of such investigations. The
Company tells investors its liquidity will be adversely affected as it
incurs costs to respond to the investigations. An unfavorable resolution of
any of these investigations, the company says, could have a material
adverse effect on the Company's financial position, results of operations
and liquidity.

NATIONAL AUTO: Settles Lawsuit Related to Deloitte & Touche Resignation
In addition, the Company and certain of its former and current officers and
directors have been named as defendants in eleven purported class action
lawsuits which were filed in the United States District Court for the
Northern District of Ohio subsequent to the January 1998 resignation of the
Company's former independent auditors, Deloitte & Touche. The actions,
which were consolidated, allege fraud and other violations of the federal
securities laws and seeks monetary damages as the result of various alleged
frauds and violations of the Securities Exchange Act of 1934, including
misrepresentations about the adequacy of the Company's allowance for credit
losses and its loan underwriting practices.

In April 2000, the Company and the class action plaintiff's representatives
reached an agreement in principle to settle the class action securities
litigation. Under the terms agreed upon, the Company will pay to the
plaintiffs' class $6,500,000 in consideration for, among other things, the
release of all defendants from liability. The settlement is not an
admission of liability by any party. The settlement is subject to
preparation and execution of final documentation and court approval. The
Company believes that the proposed settlement is fair, reasonable and
adequate and accordingly should be approved by the court, and as a result
believes it is probable that the settlement will be approved by the court
and completed on the terms agreed to in principle.

On August 15, 2000, the United States District Court provided, by way of a
Notice Order, preliminary approval of the proposed settlement and set a
Settlement Hearing to be held on November 14, 2000.

NORTHWEST AIRLINES: Judge Considering Arguments in Antitrust Case
A federal judge is deciding whether to grant class action status to a
consumer lawsuit alleging that Northwest Airlines engaged in monopolistic
pricing after its 1986 merger with Republic Airlines. U.S. District Judge
Donovan Frank heard arguments on September 15 and took the matter under

The 8th U.S. Circuit Court of Appeals revived the case in February 1999 and
sent it back to District Court, ruling that U.S. District Judge David Doty
had erred in dismissing the lawsuit a year earlier.

Seven consumers filed the lawsuit in 1997, alleging that the
Northwest-Republic merger stifled competition and led to artificially high
fares at Minneapolis-St. Paul International Airport, where Northwest
accounts for about 80 percent of the traffic. The consumers who sued
Northwest don't want to undo the merger, but they seek as much as $400
million in alleged fare overcharges each year. If the case is certified as
a class action, goes to court and Northwest is found to have engaged in
monopolistic pricing, travelers could be in line for refunds.

Northwest denies it has monopolistic control and has long disputed studies
showing higher ticket prices in the Twin Cities. The airline also argues
that because the merger was approved by the U.S. Department of
Transportation, it can't be challenged under the Clayton Antitrust Act. "We
believe the evidence shows that it wasn't the Northwest-Republic merger
that caused the results they are claiming," Northwest spokeswoman Kathy
Peach said after September 15's hearing. "Some prices are lower. There are
lots of competitive issues involved."

States that have filed friend-of-the-court briefs in the case include
Delaware, Hawaii, Iowa, Michigan, New York, North Dakota, Ohio, South
Dakota, Utah, West Virginia and Wisconsin. (The Associated Press State &
Local Wire, September 15, 2000)

P&O HOLIDAYS: May Be Sued on Pneumonia Contracted on Cruise for Olympics
MELBOURNE, Sept 15 AAP - Tourists who contracted pneumonia while on a
cruise ship headed for the Sydney Olympics have spoken to lawyers about
possible legal action against P&O Holidays.

Melbourne law firm Maurice Blackburn Cashman on September 15 said it was
considering mounting a class action against the company on behalf of
passengers who travelled on the Fair Princess between August 14 and
September 10 this year.

The ship, now berthed in Sydney Harbour, is housing broadcast journalists
covering the Olympic Games. Five elderly passengers were evacuated in
ambulances from the the Fair Princess when it berthed in Sydney on
September 10. Earlier in the same cruise, four passengers were hospitalised
in Noumea. "We know that both of these (earlier) voyages carried passengers
who were later diagnosed with bacterial pneumonia and our clients tell us
that numerous other passengers got sick on both these voyages," partner
Eugene Arocca said in a statement. "It is particularly concerning that
people appear to be suffering from the same symptoms over two successive

Mr Arocca said the firm had asked P&O Holidays to provide it with details
of infection control procedures in place on the cruise ships. Maurice
Blackburn Cashman is currently running a class action on behalf of more
than 100 people who contracted Legionnaires' disease after visiting the
Melbourne Aquarium. (AAP NEWSFEED, September 15, 2000)

PLUG POWER: Milberg Weiss Files Securities Lawsuit in New York
The law firm of Milberg Weiss Bershad Hynes & Lerach LLP announces that a
class action lawsuit was filed on September 14, 2000, on behalf of
purchasers of the securities of Plug Power Inc. (Nasdaq:PLUG) between
February 14, 2000 and August 2, 2000 inclusive. A copy of the complaint
filed in this action is available from the Court, or can be viewed on
Milberg Weiss' website at: http://www.milberg.com/plug/

The action, numbered 00-CV-5553, is pending in the United States District
Court for the Eastern District of New York, located at 225 Cadman Plaza
East, New York, NY against defendants Plug Power Inc., Gary Mittleman,
Manmohan Dahar and Louis R. Tompson. The Honorable Edward R. Korman is the
Judge presiding over the case.

The complaint charges that defendants violated Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder
by issuing a series of material misrepresentations to the market between
February 14, 2000 and August 2, 2000, thereby inflating the price of PLUG
stock. PLUG is a developmental stage company in the business of designing
and developing fuel cells for commercial and residential use. In February
1999, PLUG partnered with General Electric and formed GE Fuel Cell Systems
LLC, which was dedicated to providing marketing, distribution, service and
installation and maintenance of residential fuel cells through GE's global
network. The complaint alleges that PLUG's contract with GE was a material,
if not the most important, asset of the Company. The complaint further
alleges that PLUG failed to disclose that PLUG was unable to produce fuel
cells in conformance with the contractual specifications in the GE contract
and that, as a result, the Company's relationship with GE was subject to
increased risk and uncertainty and GE would be able to terminate its
agreement with PLUG without having to purchase PLUG fuel cells. The
complaint further alleges that the Company failed to disclose that (i)
PLUG's fuel cell technology was not commercially viable and the Company's
plans to refine its technology were not meeting with success and (ii) PLUG
would experience greater operating losses than anticipated by the market
and therefore would not be profitable in the near future.

As alleged in the complaint, on August 2, 2000, PLUG issued a press release
disclosing (i) that it would cut its fuel cell systems manufacturing
schedule from 2000 to 125 for the year, thus demonstrating, contrary to its
previous representations, that it was just an R&D shop with a potential
product the commercial development of which was a distant hope; (ii) that
it would have operating losses which would continue through the year 2003;
and (iii) that PLUG's fuel cells would not become commercially available
until 2002 at the earliest Upon news of these revelations, PLUG's stock
declined by more than $12 per share to close at $39.50 per share. Prior to
the disclosure of the true facts about the Company, certain PLUG insiders
sold their personally-held PLUG common stock to the public, generating
proceeds of $9 million.

Contact: Milberg Weiss Bershad Hynes & Lerach LLP Steven G. Schulman or
Samuel H. Rudman 800/320-5081 plugcase@milbergNY.com http://www.milberg.com

WALL STREET: Sexual Discrimination Charges By Female Employees Continue
When women went to work on Wall Street 25 years ago, the bias against them
was blatant. Merrill Lynch, for example, gave prospective stockbrokers a
test with this question: "Which quality in a woman do you consider most
important?" The choices: beauty, intelligence, dependency, independence and
"affectionateness." Applicants scored two points for answering dependency
and affectionateness, one point for beauty and no points for intelligence
or independence, according to a class-action lawsuit filed in 1974 by the
U.S. Equal Employment Opportunity Commission.

Fast forward to this summer: Women on Wall Street are regularly filing
complaints of "sexual jokes, derogatory comments, pornographic material,
strippers at the office and company-sponsored trips to strip clubs and
male-only golf and ski outings," says Ida Castro, chairwoman of the EEOC.

Despite the industry's efforts to treat women equally, Castro says her
agency "continues to receive a steady flow of charge filings by women
working on Wall Street alleging sexual discrimination."

Consider: In June, the EEOC ruled that Morgan Stanley Dean Witter
discriminated against a group of women at the brokerage firm and retaliated
against at least one who complained.

In July and August, a handful of current and former female brokers at
Merrill Lynch, together with local chapters of the National Organization
for Women, have picketed the company's New York headquarters and several
branches across the country to protest the firm's slow pace at settling
hundreds of sexual discrimination claims from a 1996 class-action lawsuit.

Smith Barney, which became infamous for its "Boom-boom room" and was also
sued for sexual discrimination in 1996, still hasn't settled 705 claims.
These complaints, coupled with details from the lawsuits, provide anecdotal
evidence that even after a quarter century of grappling with the problem, a
macho culture is still entrenched in some areas on Wall Street. The
continuous complaints also raise questions about what it is going to take
to change the industry's treatment of women.

Myra Strober, an economist at Stanford University, says that to change a
corporate culture, "there has to be commitment from the top. There needs to
be a new incentive system, so new behavior is rewarded and old behavior is
not sanctioned. And even when you do all those things, it's still going to
be tough."

Wall Street has made some dramatic changes, especially in the past four
years. Hiring and promotion of women continues to rise. On-site childcare
centers, paid maternity leave and mentoring programs have become the rule
instead of the exception. In fact, in the current issue of Working Mother
magazine, Merrill Lynch moved into the top 10 of the 100 best companies for
working mothers. The magazine noted that, "Merrill Lynch has dramatically
improved its commitment to women after settling a class-action suit
launched against the company two years ago by 900-plus current and former
female employees."

But so far, Merrill Lynch has settled just 19% of those claims. More than
700 women, many still working at the firm, are awaiting mediation hearings,
scheduled to start at the end of the month.

And while Smith Barney has settled 63% of its claims, several women,
including the woman who started the case, have opted out of the settlement
and are suing the firm separately.

Morgan Stanley, for its part, has been negotiating with the EEOC for the
past three months, and the talks have reached the make-or-break stage,
according to a lawyer familiar with the case.

The EEOC claims that Morgan Stanley failed to promote women who worked in
its institutional equity division, paid them less than men in the same
jobs, and excluded them from business outings to strip clubs. The EEOC also
found that Morgan Stanley retaliated against at least one woman who
complained about what she said is a glass ceiling at the firm.

Morgan Stanley disputes the agency's findings and says it does not tolerate
sexual discrimination.

                        Attitudes Run Deep

Men built Wall Street on a foundation of family and business connections,
networks and alma maters. The timeworn friendships and partnerships that
helped build traditions in the investment banks have been slow to yield to
the rising tide of women in the workforce.

When the EEOC filed the first class-action lawsuit against Merrill Lynch in
1974, almost 97% of the brokers and all the branch managers, assistant
managers and sales managers at Merrill Lynch were white men. Women worked
as sales assistants, answering phones and opening mail.

When Merrill Lynch settled the case in 1976, the company promised to
increase its hiring of women to 16% of all new hires annually over five
years. Twenty years later, Merrill Lynch had not yet reached the target.
And women at the firm filed another class-action lawsuit for sex

While more women were being hired at Merrill Lynch in 1996 when the second
class-action suit was filed, they complained they weren't getting their
fair share of new accounts and referrals. They also complained of
locker-room antics, crude language and sexual assaults.

Meanwhile, circumstances were no better at Smith Barney. Pamela Martens'
story of the fraternity-style "Boom-boom room" with a toilet on the ceiling
and a trash can for a punch bowl, grabbed headlines and national attention.

Both companies initially denied the problems, but Smith Barney soon
relented and said it had gender-based issues to address. "I don't think
there was any question about acknowledging the need for change," says Joan
Guggenheimer, a general counsel at Citigroup, which now owns Smith Barney.

The company agreed to settle the case and to set up a $ 15 million fund to
pay for diversity initiatives and recruitment efforts. It also promised
that 33% of its new hires would be women, up from 20% at the time.

By the time the ink was dry on the final settlement contract in February
1999, Smith Barney was spending the diversity funds and 37% of its hires
were women that year, surpassing its goal.

The firm also had put 2,000 managers, administrators and assistants through
diversity training. And to make sure the training sunk in, Smith Barney
tied 10% of the bonus pay of the 366 branch managers to their efforts to
hire, retain and promote women and minorities.

When the time came to file claims, 1,920 women did, and only 12% were
current employees.

                     Merrill Lynch's Surprise

At Merrill Lynch, senior executives admit they were initially slower to
react because they seemed to have underestimated the extent of the problem.
"If we had seen it differently, we would have mobilized a little faster,"
says Terry Kassel, the first vice president at Merrill Lynch who handled
the case. "We had no idea how many current or former employees would make a
claim. We recognized that we did have situations, isolated situations, that
had to be addressed -- we didn't think it was pervasive."

When the time came for the women to file complaints, 904 did -- one of
every three female brokers who worked at the company during the previous
five years. More than 40% were current employees.

One of them was Nancy Thomas, a broker at a Merrill Lynch office in New
York City. Thomas described in the class-action lawsuit how she once
received a package containing a sex toy, lubricating cream and an obscene
poem from a male broker. When she complained to her boss, he failed to take
any action and said something along the lines of, "Let's wait and see if
anything else happens," according to the complaint.

Merrill Lynch spokesman Bill Halldin says, "We investigated that fully, and
could not determine who had sent what were clearly very offensive items."

After Thomas complained, she says, she was isolated at her office and
denied the same resources and support her male co-workers received. Thomas
says her 10-year and 15-year anniversaries at the firm passed without
recognition. She left the company in February and is currently unemployed.

While Thomas' case has not yet been settled, Merrill Lynch has made
concessions on other fronts. As part of its class-action settlement, the
company agreed to give up the industry practice of requiring employees to
settle discrimination complaints through arbitration. The company also
agreed to make sure that departing brokers' accounts are redistributed
equally. Merrill also changed the way it calculates tenure so women who
take maternity leave are not penalized.

                         Settling Claims

Four months after the claims were filed, Smith Barney began making
settlement offers to 96% of the women. It sent settlement letters, which
included a financial offer and read: "To the extent that any woman was
subjected to an unprofessional, disrespectful, hostile or discriminatory
environment, we sincerely apologize and assure you that we have taken and
will continue to take significant steps to improve the workplace for all of
the company's employees."

Almost two-thirds of the first offers were accepted.

With Merrill Lynch, the process was a bit slower. It initially classified
the claims based on how it perceived each one's merits. The firm offered
all complainants an apology "for any discrimination or unfair treatment
that you believe you may have experienced." Less than 6% of the letters
included an invitation to negotiate a settlement. About one-third of the
letters asked for more information about the claim. Almost two-thirds of
the women received letters saying: "We have concluded that you are not
entitled to any relief under federal or state law. This letter constitutes
Merrill Lynch's final response to your Claim Form."

Kassel says the firm "thoroughly investigated the claims," most of which
didn't have much detail. "I still don't know today whether, in a court of
law, these claims would prevail," she says. But as the months went by, the
unresolved claims became an increasingly sensitive issue. Many of the
current employees who filed claims against Merrill Lynch later filed
additional claims detailing more instances of discrimination.

Nine months after the original claims were filed, Merrill Lynch began
making settlement offers to 80% of the women. Three-quarters were rejected.
"It's really hard for me to pinpoint for you why we haven't been able to
resolve a more significant number of claims," Kassel says. "We think the
offers we made are fair."

But Donna Sabb, a 13-year broker at Merrill Lynch, is one who rejected a
settlement offer that she calls "dog food." Sabb, who managed $ 40 million
for clients, says a male coworker groped her three times. After she
complained to human resources, the man stayed away from her, but Sabb says
fewer accounts were passed her way. When she filed a claim against the
company last year, she says, she was driven out of the firm's New Jersey
office. She left just five months before she was eligible for a 10-year, $
110,000 performance bonus.

Merrill Lynch, for its part, says it didn't learn of the alleged assaults
against Sabb until she filed her claim, seven years after she says the
incidents occurred.

Though Merrill Lynch included Sabb's claim among those it initially offered
to settle, Sabb says the offer was less than the bonus she would have
collected last January. The company wouldn't comment on the offer.

Ironically, Sabb went to work at a nearby office of Smith Barney, and she
says she couldn't be happier. Her new boss is a woman, and Sabb says,
"Right off the bat, she was asking me for my opinions and my input. That
never occurred at Merrill Lynch."

                  Not All Smiles At Smith Barney

While the corporate culture at Smith Barney appears to be changing quickly,
not all women are happy: Pamela Martens, who started the litigation against
Smith Barney, opted out of the settlement and is suing the company
separately. Martens, who was fired in 1995, is now a vice president for
A.G. Edwards. The 705 women with unsettled claims are still waiting for
mediation dates. Cara Beth Walker, another claimant, filed a complaint
against the judge. Smith Barney still makes new employees sign an agreement
to arbitrate all employment disputes, including sexual discrimination.

Merrill Lynch has made strides to improve its environment for women, going
beyond steps outlined in the settlement. The company improved its
maternity-leave policy and has linked the pay of its 19 district directors
to diversity efforts by making it one of the performance goals. In March,
Merrill Lynch unveiled a campaign that aims to increase the number of women
in top management to 30% within three years from 23% today.

"There is a lot going on that makes me feel pretty proud about what Merrill
Lynch is doing," Kassel says. She says she was unaware how many claims
Smith Barney had settled and could not explain why the two firms had widely
different acceptance rates. Kassel says their cases involved economic
issues, while Smith Barney's involved a hostile work environment. "Besides
the fact that we're in the same industry, I don't know that comparisons are
appropriate," she says.

But both cases put Wall Street on notice and have provided lessons for some
other brokerages. "We hired a lot of the women who left Merrill," says Judy
Zeilmann, a general partner at Edward Jones, a St. Louis-based brokerage
with almost 7,000 brokers. Zeilmann says her discussions with the former
Merrill Lynch brokers helped change the firm's recruiting and retention
efforts, mentoring program, employee-assistance program and disability

And Edward Jones is seeing results: It surpassed its hiring goal for women
by more than 50%, while turnover among women has fallen by almost a third.
But, she says, "The industry has a long way to go." (USA TODAY, September
15, 2000)

WASHINGTON SCHOOL: Schools Ask Property Owners to Turn Down Tax Refunds
A judge has given public schools permission to send out fliers asking
people to "help the kids" by not applying for property tax refunds under
successful class-action lawsuits. The fliers are to go out with a mailing
of more than 100,000 letters to Washington County property owners. Those
taxpayers may be eligible for refunds under terms of settlements approved
by the court to resolve the lawsuits.

The one-page insert is illustrated with an apple sitting atop a school desk
and pleads "Support your public schools. Please don't file for a refund!"
"Think about the child you saw walking to school in your neighborhood,
perhaps your child or the child of someone close to you," the school flier
states. "Do we want to shortchange their education?" Also included with the
flier will be a one-page letter from Washington County, which asks
taxpayers to leave their tax dollars "invested in county services and

The plea is identified as a message from the nine school districts in
Washington County, all of which are defendants in the taxpayer lawsuits.

Attorneys for the plaintiffs had objected to the wording, but special
Circuit Judge Paul Danielson denied a request to change the letters,
attorneys said.

Taxpayers led by Jeanne M. Hicks of Fayetteville first sued in 1997,
claiming school districts, cities and the county violated Amendment 59 of
the Arkansas Constitution when they failed to roll back millage rates after
a countywide reappraisal. The defendants have settled the cases for $18.6
million. People who owned property during 1994-1999 are entitled to
refunds, the dollar amounts of which will depend on how much they paid in

County officials are putting together a list of taxpayers eligible for
refunds. Officials will send the property owners a claim form, which they
can use to apply for a refund. Taxpayers can begin filing refund claims
Oct. 1. Administering the settlements is expected to cost more than
$500,000. (The Associated Press State & Local Wire, September 15, 2000)

XEROX CORPORATION: Milberg Weiss Files Securities Lawsuit in Connecticut
The law firm of Milberg Weiss Bershad Hynes & Lerach LLP announces that a
class action lawsuit was filed on September 14, 2000, on behalf of
purchasers of the securities of Xerox Corporation.  (NYSE: XRX) between
January 25, 2000 and July 27, 2000, inclusive (the "Class Period'). A copy
of the complaint filed in this action is available from the Court, or can
be viewed on Milberg Weiss' website at: http://www.milberg.com/xerox/

The action is pending in the United States District Court for the District
of Connecticut, located at 141 Church Street, New Haven, CT 06510, against
defendants Xerox, KPMG, LLP (the Company's independent auditor), Paul
Allaire (Chief Executive Officer, Chairman of the Board), G. Richard Thoman
(President and Chief Operating Officer until May 11, 2000), Barry Romeril
(Chief Financial Officer, Executive Vice President), and Ann Mulcahy
(President and Chief Operating Officer since May 11, 2000).

The complaint charges that defendants violated Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder,
by issuing a series of material misrepresentations to the market between
January 25, 2000, and July 27, 2000. For example, as alleged in the
complaint, on January 25, 2000, Xerox issued a press release announcing
that the Company is successfully addressing its domestic operational
problems, and reporting excellent growth in its Mexican operations for the
fourth quarter of 1999. The statement was materially false and misleading,
the complaint alleges, because--in connection to its operations in Mexico--
the Company improperly recognized uncollectible receivables as income, and
failed to properly account for liabilities. These misrepresentations were
repeated in the Company's Form 10-K, filed on March 27, 2000, which
contained a letter from KPMG, representing that, based upon its audits of
the Company, the Form 10-K fairly presented the financial information it
contained. The statement was materially false and misleading because KPMG
knew, or was reckless in not knowing, of the Company's improper accounting.
On July 26, 2000, Xerox announced that its earnings for the second quarter
of 2000 would be below analysts' earnings expectations, and that the
Company was cooperating with the SEC's investigation of accounting
irregularities in Xerox's Mexican operations. In response to the
announcement, the price of Xerox shares dropped 16% from $18.19 per share
to $15.25 per share.

Contact: Milberg Weiss Bershad Hynes & Lerach LLP Steven G. Schulman or
Samuel H. Rudman 800/320-5081 Xeroxcase@milbergNY.com


S U B S C R I P T I O N  I N F O R M A T I O N

Class Action Reporter is a daily newsletter, co-published by Bankruptcy
Creditors' Service, Inc., Princeton, NJ, and Beard Group, Inc.,
Washington, DC. Theresa Cheuk, Managing Editor.

Copyright 1999.  All rights reserved.  ISSN 1525-2272.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
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Information contained herein is obtained from sources believed to be
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