/raid1/www/Hosts/bankrupt/CAR_Public/001024.MBX
C L A S S A C T I O N R E P O R T E R
Tuesday, October 24, 2000, Vol. 2, No. 207
Headlines
AUTO FINANCING: Lawsuits Allege Discrimination in Nissan, GM
BRIDGESTONE/FIRESTONE INC: Verbal Settlement Reached In First Lawsuit
CAMPBELL SOUP: Securities Suits Consolidated, Amended and Pending in NJ
COVAD COMMUNICATIONS: Cauley & Geller Files Securities Suit in CA
COVAD COMMUNICATIONS: Milberg Weiss Files Securities Suit in CA
FORD MOTOR: Stull, Stull Files Securities Suit in Michigan
HAWAII: Held In Contempt For Alleged Failure To Fix Special Ed
HOLOCAUST VICTIMS: Clouds over Austro-US Accord On Nazi Compensation
INTUIT INC: Faces Lawsuits in CA over Invasion of Privacy
INTUIT INC: Plintiff Willing to Quit Case over Ad. and Business Practice
MOTORCAR PARTS: Faces Securities Suit in CA; Insurer Objects to Coverage
MTBE LITIGATION: Supreme Court Dismisses Bid For Class Certification
NEW HAVEN: Fed Suit Challenges Strip Search at Juvenile Facility
OMAHA PUBLIC: Lawsuit in Lincoln Accuses of Employment Racial Bias
PAYDAY LENDERS: Lawsuit against Cash Today Certified in Texas
PRICELINE.COM, INC: Scott & Scott Files Securities Lawsuit in CT
ROBERT MUGABE: Faces Claim For Damages Over Zimbabwe Election Killings
SAGENT TECHNOLOGY: Milberg Weiss Files Securities Suit in CA
WATER CONTAMINATION: Walkerton Commission Adds 3rd Party to Claim
* Class Action Suit System To Be Put On Hold In Korea
*********
AUTO FINANCING: Lawsuits Allege Discrimination in Nissan, GM
------------------------------------------------------------
Tens of thousands of black consumers nationwide have been charged
millions of dollars more than white consumers seeking auto loans from two
prominent automobile finance companies, two class-action lawsuits
contend.
General Motors Acceptance Corp. and Nissan Motors Acceptance Corp.
"engineered and participated in a discriminatory kickback system that
materially hurt African-American car buyers," said Gary Klein, senior
attorney with the National Consumer Law Center in Boston, one of several
lawyers and law firms involved in the case.
GMAC and NMAC, the car makers' finance arms, deny the accusations in
court documents and argue that studies supporting the accusations are
flawed. Attempts Sunday to reach officials with the companies were
unsuccessful. "We allege (both companies) should have known that their
markup system would have a disparately negative impact on the black
community," Klein said Sunday.
The suits are seeking a change in the auto loan companies' practices and
money back for black consumers who paid more than the objective lending
rate over the last 11 years. Klein said the amount could be $100 million
or more. The cases were filed in 1998 under seal, but court documents
were recently unsealed on motions by news organizations. The suits gained
class-action status in August from two federal judges who refused to
dismiss the suits. The U.S. Justice Department also joined the case in
August. (The Associated Press State & Local Wire, October 23, 2000)
BRIDGESTONE/FIRESTONE INC: Verbal Settlement Reached In First Lawsuit
---------------------------------------------------------------------
Relatives of a Texas couple who died after a tire blew out on their
sport-utility vehicle have reached a verbal settlement with
Bridgestone/Firestone in the first product liability lawsuit scheduled
for trial since the company's August tire recall.
Details of the settlement, which was first reported in the Web edition of
the Wall Street Journal on Sunday night, were not disclosed.
Ryan Anthony Guillen, 21, and his sister, Kimberly Guillen, 18, sued the
Nashville, Tenn.-based tire manufacturer last November after their mother
and stepfather were killed when their Ford Explorer crashed May 30, 1999.
Nidia and Patricio Leal died when a Firestone tire unraveled, sending the
vehicle skidding into a ditch near Brownsville, Texas.
In a telephone interview with The Associated Press late Sunday, Robert J.
Patterson, a lawyer for the siblings, confirmed that a verbal settlement
was reached. He refused to elaborate. "We finalized it Friday, although
it's just verbal at this point," he said from his home in Corpus Christi,
Texas. "I really can't talk about the details but we've been talking for
a while."
Bridgestone/Firestone spokeswoman Jill Bratina confirmed an agreement was
reached but declined any further comment.
Patterson said he expected the settlement to be formally announced
sometime this week. "The timing certainly helped a lot," he told the Wall
Street Journal. "Firestone is doing jury studies, and if their studies
are showing what ours are, they don't have a chance." (The Associated
Press State & Local Wire, October 23, 2000)
CAMPBELL SOUP: Securities Suits Consolidated, Amended and Pending in NJ
-----------------------------------------------------------------------
As previously reported, ten purported class action lawsuits were
commenced against Campbell Soup Company and certain of its officers in
the United States District Court for the District of New Jersey. The
lawsuits were subsequently consolidated, and an amended consolidated
complaint was filed alleging, among other things, that Campbell and
certain of its officers misrepresented the company's financial condition
between September 8, 1997 and January 8, 1999, by failing to disclose
alleged shipping and revenue recognition practices in connection with the
sale of certain company products at the end of the company's fiscal
quarters in violation of Section 10 (b) and 20 (a) of the Securities
Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder.
The actions seek compensation and other damages, and costs and expenses
associated with the litigation. Campbell believes the action is without
merit and intends to defend the case vigorously. In management's opinion,
the outcome of this lawsuit will not have a material effect on the
consolidated results of operations, financial position or cash flows of
the company.
COVAD COMMUNICATIONS: Cauley & Geller Files Securities Suit in CA
-----------------------------------------------------------------
The law firm of Cauley & Geller, LLP announced on October 21 that a class
action lawsuit has been filed in the United States District Court for the
Northern District of California on behalf of those who purchased or
otherwise acquired Covad Communications Group, Inc. securities between
September 7, 2000 and October 17, 2000 (the "Class Period"), including
those who acquired Covad shares in connection with Covad's acquisition of
BlueStar Communications Group ("BlueStar") and those who acquired Covad
convertible senior notes.
The complaint charges Covad and certain of its officers and directors
with violations of the Securities Exchange Act of 1934. The complaint
alleges that defendants misrepresented the revenues that Covad was
deriving from its newly acquired BlueStar business, which, together with
defendants' false representations that Covad would post Q3 2000 EPS of
$(1.18) and revenues of $ 74.7 million, operated to artificially inflate
the price of Covad stock to a Class Period high of $20.93 on September
11, 2000. This upsurge in Covad's stock caused by defendants' alleged
false and misleading statements enabled Covad to complete a $500 million
bond offering and the $140 million stock-for-stock acquisition of
BlueStar. On October 17, 2000, 15 business days after the acquisition of
BlueStar was completed and just 18 business days after Covad raised $500
million in a debt offering, Covad revealed that it was in fact suffering
a huge decline in revenues, was not posting smaller negative EPS growth,
and contrary to defendants' repeated assurances, Covad was forced to
reveal the problems it had been experiencing during the Class Period in
attempting to grow its business. This announcement caused its stock price
to drop to as low as $3.50 (or over $5 per share) on record volume of 70
million shares on October 18, 2000, causing hundreds of millions of
dollars in damages to members of the Class.
Contact: Cauley & Geller, LLP Sue Null, 888/551-9944 CauleyPA@aol.com
COVAD COMMUNICATIONS: Milberg Weiss Files Securities Suit in CA
---------------------------------------------------------------
Milberg Weiss (http://www.milberg.com/covad/)announced on October 20
that a class action has been commenced in the United States District
Court for the Northern District of California on behalf of those who
purchased or otherwise acquired Covad Communications Group, Inc.
(Nasdaq:COVD) securities between September 7, 2000 and October 17, 2000
(the "Class Period"), including those who acquired Covad shares in
connection with Covad's acquisition of BlueStar Communications Group
("BlueStar") and those who acquired Covad convertible senior notes.
The complaint charges Covad and certain of its officers and directors
with violations of the Securities Exchange Act of 1934. The complaint
alleges that defendants misrepresented the revenues that Covad was
deriving from its newly acquired BlueStar business, which, together with
defendants' false representations that Covad would post Q3 2000 EPS of
$(1.18) and revenues of $ 74.7 million, operated to artificially inflate
the price of Covad stock to a Class Period high of $20.93 on September
11, 2000. This upsurge in Covad's stock caused by defendants' alleged
false and misleading statements enabled Covad to complete a $500 million
bond offering and the $140 million stock-for-stock acquisition of
BlueStar. On October 17, 2000, 15 business days after the acquisition of
BlueStar was completed and just 18 business days after Covad raised $500
million in a debt offering, Covad revealed that it was in fact suffering
a huge decline in revenues, was not posting smaller negative EPS growth,
and contrary to defendants' repeated assurances, Covad was forced to
reveal the problems it had been experiencing during the Class Period in
attempting to grow its business. This announcement caused its stock price
to drop to as low as $3.50 (or over $5 per share) on record volume of 70
million shares on October 18, 2000, causing hundreds of millions of
dollars in damages to members of the Class.
Contact: Milberg Weiss Bershad Hynes & Lerach LLP William Lerach,
800/449-4900 wsl@mwbhl.com
ECONNECT: SEC File Shows Summary of 31 Shareholder Suits Filed this Year
------------------------------------------------------------------------
As reported previously in the CAR, securities suits were filed against
the company earlier in the year. In its report filed with the SEC, the
company presents a list of 31 complaints by investors against the
company. These thirty-one actions were filed on various dates between
March 14, 2000 and early May 2000, inclusive, and are all pending in the
United States District Court for the Central District of California.
These actions are brought by various putative classes of the purchasers
of the Registrant's common stock. The putative classes alleged, none of
which have been certified, range from no earlier than November 18, 1999
through March 13, 2000.
Plaintiffs in the various actions assert that the company and Thomas S.
Hughes, as well as (in certain of the actions) Jack M. Hall, Diane
Hewitt, Anthony L. Hall, and Kevin J. Lewis, have violated Section 10(b)
of the Exchange Act (false or misleading statements and omissions which
deceived stock purchasers) and also Section 20(a) of the Exchange Act
(liability as a "controlling person" with respect to a primary violation
of securities laws). The principal allegations concern various alleged
material misrepresentations and omissions which supposedly made the
company's public statements on and after November 18, 1999 (and/or on and
after November 23, 1999) false and misleading, thereby artificially
inflating the market in and for the Registrant's common stock.
No class has yet been certified in connection with any of these actions.
All cases have been combined into one case before the Honorable Margaret
M. Morrow, entitled In Re eConnect, Inc. Securities Litigation, Master
File No. 00-02674 MMM (JWJx). Negotiations are underway regarding the
settlement of these actions.
Additionally, a shareholder of the company named John P. Maloney, filed
an individual action for "securities fraud and misrepresentation" against
the company and Mr. Hughes on May 12, 2000 in small claims court in
Torrance, California. eConnect subsequently removed the action to the
United States District Court for the Central District of California, and
requested that it be consolidated with In Re eConnect, Inc. Securities
Litigation.
However, on September 11, 2000, the Honorable Margaret M. Morrow ruled
that Mr. Maloney's action should be remanded to the state small claims
court.
The 31 lawsuits pending are:
* Einhorn, et al. v. eConnect, Thomas S. Hughes, Jack M. Hall, Dianne
Hewitt, Anthony L. Hall, and Kevin J. Lewis, Case No. 00- 02674 MMM
(JWJx);
* Eckstein, et al. v. eConnect, Inc. , Thomas S. Hughes, Jack M. Hall,
Dianne Hewitt, Anthony L. Hall, and Kevin J. Lewis, Case No. 00-
02700 DDP (CWx);
* Bernstein, et al. v. eConnect, Inc., et al., Case No. 00-02703 FMC
(BQRx);
* Colangelo, et al. v. eConnect, Inc., et al., Case No. 00-02743 SVW
(SHx);
* Baron, et al. v. eConnect, Inc. , Thomas S. Hughes, Jack M. Hall,
Dianne Hewitt, Anthony L. Hall, and Kevin J. Lewis, Case No. 00-
02757 WJR (CTx);
* Warstler, et al. v. eConnect, Inc. , Thomas S. Hughes, Jack M. Hall,
Dianne Hewitt, Anthony L. Hall, and Kevin J. Lewis, Case No. 00-
02758 R (SHx);
* Prager, et al. v. eConnect, Inc. , Thomas S. Hughes, Jack M. Hall,
Dianne Hewitt, Anthony L. Hall, and Kevin J. Lewis, Case No. 00-
02759 GHK (RCx);
* Weisblum, et al. v. eConnect and Thomas S. Hughes, Case No. 00-
02770 MRP (CTx);
* Mazda, et al. v. eConnect, et al., Case No. 00-02776 LGB (Mcx);
* Pirraglia, et al. v. eConnect, et al., Case No. 00-02875 SVW (CWx);
* Hershkop and Hershkop, et al. v. eConnect and Thomas S. Hughes,
Case No. 00-03095 MRP (RNRx);
* Bacun, et al. v. eConnect, Inc. , Thomas S. Hughes, Jack M. Hall,
Dianne Hewitt, Anthony L. Hall, and Kevin J. Lewis, Case No. 00-
03161 FMC (JWJx);
* Fine, et al. v. eConnect, Inc. and Thomas Hughes, Case No. 00-
03290 SVW (BQRx);
* Smith, et al. v. eConnect, Thomas Hughes, Case No. 00-03301 DT
(Mcx);
* Reimer, et al. v. eConnect, Thomas Hughes, Case No. 00-03405 JSL;
* Tepper, et al. v. eConnect and Thomas S. Hughes, Case No. 00- 03444
WJR (CTx);
* Bury, et al. v. eConnect, Thomas Hughes, Case No. 00-03446 ABC;
Villari, et al. v. eConnect, Thomas Hughes, Case No. 00-03447 LGB
(SHx);
* Ringel, et al. v. eConnect, Inc. , Thomas S. Hughes, Jack M. Hall,
Dianne Hewitt, Anthony L. Hall, and Kevin J. Lewis, Case No. 00-
03591 RSWL (RNBx);
* Massaro, et al. v. eConnect, Inc., Thomas S. Hughes, Jack M. Hall,
Dianne Hewitt, Anthony L. Hall, and Kevin J. Lewis, Case No. 00-
03671 DDP (MANx);
* Gardner, et al. v. eConnect, Inc., Thomas S. Hughes, Jack M. Hall,
Dianne Hewitt, Anthony L. Hall, and Kevin J. Lewis, Case No. 00-
03897 MMM (RZx);
* Schneyer, et al. v. eConnect, Case No. CV-00-03783 MMM (JWJx);
* Ginocchi, et al. v. eConnect, Case No. 00-04003 MMM (JWJx);
* Matrisciani, et al. v. eConnect, Case No. 00-04181 MMM (JWJx);
* Dutton, et al. v. eConnect, Case No. 00-04505 LGB (Ex);
* Shaw, et al. v. eConnect, Case No. 00-04637 LGB (Ex);
* Gowrie, et al. v. eConnect, Case No. 00-04686 LGB (Ex);
* Belcher, et al. v. eConnect, Case No.00-04792 LGB (Ex);
* Lively, et al. v. eConnect, Case No. 00-03112 MMM (JWJx);
* Levine, et al. v. eConnect, Case No. 00-03649 MMM (JWJx); and
* Berkowitz, et al. v. eConnect, Case No. 00-04152 MMM (JWJx).
FORD MOTOR: Stull, Stull Files Securities Suit in Michigan
----------------------------------------------------------
A class action lawsuit was filed on October 20, 2000, in the United
States District Court for the Eastern District of Michigan, Southern
Division on behalf all persons who purchased the common stock of Ford
Motor Company, (NYSE:F) ("Ford," or the "Company") between January 21,
1999 through and including August 9, 2000 (the "Class Period"). This
action is also brought as a class action on behalf of a sub-class of
persons and entities who acquired Ford common stock pursuant to a
Registration Statement filed with the SEC on or about June 1, 2000, in
connection with a recapitalization of Ford stock, and those who acquired
such stock in the aftermarket that can be traced to the stock issued
pursuant to the Registration Statement.
The complaint charges that statements regarding Ford's business, as
contained in Ford's reports to shareholders, SEC filings including
Registration Statement, Proxy Statement and Form 10-K, and other of its
public disclosures during the Class Period were materially false and
misleading. The company misled the investing public regarding the safety
of the Ford Explorer in combination with Firestone tires, and failed to
disclose the significant number of deaths, accidents, complaints and
claims resulting therefrom, both in the United States and in foreign
countries.
Contact: Stull, Stull & Brody, New York Tzivia Brody, Esq.,
1-800-337-4983 fax: 212/490-2022 SSBNY@aol.com
HAWAII: Held In Contempt For Alleged Failure To Fix Special Ed
--------------------------------------------------------------
In a class action spanning most of the past decade, the U.S. District
Court, District of Hawaii held that the state of Hawaii in contempt for
failing to bring its special education programs in line with the IDEA and
Section 504. Felix by Servietti-Coleman v. Cayetano, 32 IDELR 230 (D.
Haw. 2000).
The class action was initiated in 1993 by a group of students with mental
health needs. In 1994 the parties entered into a consent decree in which
the state agreed to "implement a seamless system of care." Following
modifications to the decree and the state's subsequent noncompliance, 141
benchmarks were established to gauge the state's progress toward
compliance in each of its school facilities. The class charged that the
state failed to comply with the decree and asked the court to find it in
contempt.
The court found that the state failed to meet many of the most
significant benchmarks, such as modifying its facilities and updating
personnel procedures. The state also could have offered special
incentives, higher salaries, or better working conditions to attract
qualified special education teachers, but it did not. The state was
unable to satisfactorily explain why it did not meet the benchmarks,
whose deadlines the court termed "firm but manageable." While it made
progress, the court scolded the state for failing to take "every
reasonable step" to comply with the decree. A good faith effort to comply
was also irrelevant, for all that was required to find the state in
contempt was noncompliance with the decree. The court ordered further
hearings to determine the appropriate relief. (Special Education Law
Monthly, October 18, 2000)
HOLOCAUST VICTIMS: Clouds over Austro-US Accord On Nazi Compensation
--------------------------------------------------------------------
Austria and the United States are to sign an accord Tuesday to compensate
victims of Nazi slave labour programs, in what Vienna hopes will end
legal action against it over the policy.
But the agreement is clouded by the threat of continuing claims for
compensation for forced labourers and from Jews who had assets seized by
Nazis after Hitler annexed Austria into the Third Reich in 1938.
US Deputy Treasury Secretary Stuart Eizenstat, who will sign the
agreement at a ceremony in Vienna, has said it will protect Austria
against class-action suits pledged by US lawyers representing victims.
Austria has pledged to pay 6 billion schillings (436 million euros) in
compensation to the some 150,000 survivors of the Nazi slave labour
policies, a sum accepted by Washington. Payouts could begin this year,
Vienna says.
The slave labour accord is to be signed at the Austrian chancellory by
Eizenstat and Maria Schaumayer, the Austrian government's chief
negotiator and representative on the issue.
But for the accord to have any force, lawyers with suits against Austria
currently must be persuaded to drop them first.
Schaumayer said at the weekend she remained "wary" about forced labour
agreement, according to the APA news agency.
She notably pointed out that Germany signed a similar agreement on slave
labour compensation in July -- but that legal suits remained in place
against Germany despite the July agreement. "Nothing has been withdrawn,"
she said.
New York lawyer Ed Fagan -- who played a key role in securing accords in
Switzerland and Germany, is demanding that Austria pay out 12 billion
schillings (876 million euros) to Jews whose assets were seized by the
Nazis.
German lawyer Michael Witti, who has worked with Fagan on Nazi-era claims
in other countries, said that the two lawyers will sign the accord
Tuesday.
But an Austrian weekly reported Saturday that a new law suit has been
launched against Austria, including claims for forced labour and for
property confiscated from them.
The new suit has been launched against both the state of Austria and
Austrian firms by Jay R. Fialkoff, a lawyer in the New York office of
Moses and Singer, according to the magazine Profil.
Austria is also to sign bilateral compensation accords with ex-communist
countries where survivors still live, including Belarus, the Czech
Republic, Hungary, Poland, Russia and Ukraine.
Whatever happens on the slave labour issue, Austria is committed also to
begin negotiations immediately on the issue of compensation for Jews
whose assets were seized by the Nazis after 1938.
Austria's Jewish community, which says such assets included some 70,000
appartments as well as personal valuables and belongings, agreed to a
payment of some 150 million dollars for some of those assets, or about
7,500 dollar for each of the 21,000 survivors.
But they insist that sum is only the start -- in contrast to Ernst
Sucharipa, the government's representative in charge of the issue, who
says any further payments must come from private industry.
Austria's Jewish community leader Ariel Muzicant also wants negotiations
to include compensation not only for survivors, but for descendants of
Jews whose assets were stolen: some 65,000 Jews who died in the Holocaust
and 115,000 others who have died since World War II. (Agence France
Presse, October 23, 2000)
INTUIT INC: Faces Lawsuits in CA over Invasion of Privacy
---------------------------------------------------------
On March 3, 2000 a class action lawsuit, Bruce v. Intuit Inc., was filed
in the United States District Court, Central District of California,
Eastern Division.
Two virtually identical lawsuits were later filed: Rubin v. Intuit Inc.,
was filed on March 8, 2000 in the United States District Court, Southern
District of New York and Newby v. Intuit Inc. was filed on April 27,
2000, in the United States District Court, Central District of
California, Eastern Division.
A similar lawsuit, Almanza v. Intuit Inc. was filed on March 22, 2000 in
the Superior Court of State of California, San Bernadino County, Rancho
Cucamonga Division.
The Bruce and Newby lawsuits were then consolidated into one lawsuit, In
re Intuit Privacy Litigation, filed on July 28, 2000 in the United States
District Court of California, Eastern Division.
These purported class actions allege violations of various federal and
California statutes and common law claims for invasion of privacy based
upon the alleged intentional disclosure to third parties of personal and
private customer information entered at Intuit's Quicken.com website. The
complaints seek injunctive relief, orders to disgorge profits related to
the alleged acts, and statutory and other damages. Intuit believes these
lawsuits are without merit and intends to defend the litigation
vigorously.
INTUIT INC: Plintiff Willing to Quit Case over Ad. and Business Practice
------------------------------------------------------------------------
In addition, on April 19, 2000, Bosch v. Intuit Inc. was filed in the
Superior Court, State of California, County of Los Angeles, Central
District. This lawsuit alleges violations of California statutes for
alleged false and deceptive advertising and unlawful business practices
related to QuickBooks products and purchasing the Basic Payroll Service.
In September 2000, the plaintiff voluntarily dismissed this lawsuit.
MOTORCAR PARTS: Faces Securities Suit in CA; Insurer Objects to Coverage
------------------------------------------------------------------------
The Company Motorcar Parts and Accessories is a defendant in a class
action lawsuit pending in the United States District Court, Central
District of California. The complaint in this action alleges that the
Company misstated its earnings in violation of securities laws over a
three-year period and seeks damages on behalf of all investors who
purchased Company common stock from August 1, 1996 to July 30, 1999. The
Company's insurance carrier has also filed a claim against the Company
and certain officers that seeks to invalidate coverage for claims made
against the Company's officers in the class action lawsuit. The outcome
of these cases cannot presently be determined.
MTBE LITIGATION: Supreme Court Dismisses Bid For Class Certification
--------------------------------------------------------------------
The Supreme Judicial Court has dismissed an appeal that sought to grant
class-action status to a lawsuit by five Maine well owners against
manufacturers of the gasoline additive MTBE.
In upholding a judge's denial of class certification earlier this year,
the justices agreed unanimously that the issue was not ripe for appeal
because there has yet to be a final judgment in the case.
The plaintiffs may renew the appeal for certification following a final
decision, said their attorney, Jon Hinck.
The lawsuit alleges that Atlantic Richfield Co. and its subsidiaries,
which manufacture MTBE, or methyl tertiary butyl ether, violated state
law by failing to warn the public that the additive can seep into the
ground and contaminate well water.
The judge who denied class certification concluded that there were many
ways that wells can be contaminated and that the lawsuit did not
adequately encompass the concerns of all well owners in Maine. (The
Associated Press State & Local Wire, October 23, 2000)
NEW HAVEN: Fed Suit Challenges Strip Search at Juvenile Facility
----------------------------------------------------------------
A city lawyer has filed a federal lawsuit claiming the strip search
policy at the New Haven Juvenile Detention Center violates the
constitutional rights of children. The suit contends the state and
supervisor Leonard Barbieri are responsible for inflicting mental and
emotional distress on the youths.
"The taxpayer charges the state of Connecticut to protect our children,
keeping them safe and off the streets and locking them up when needed,"
said Anthony A. Wallace, who filed the lawsuit in U.S. District Court.
"But here they are abusing the children and taking away their dignity."
Wallace said the center policy is to perform a strip search on all
detainees even if they are truant or runaways and not charged with
crimes.
Barbieri declined to comment, referring calls to the state Judicial
Department. A spokeswoman in the Chief Court Administrator's office said
she could not comment on pending litigation. Attorney General Richard
Blumenthal said he had not seen the lawsuit and could not comment.
The suit seeks an injunction that would prohibit the use of strip
searches at all state juvenile detention centers, compensatory and
punitive damages and attorneys' fees. It also seeks class action status
to include people in the state who were held for their own protection or
arrested for misdemeanors and non-criminal offenses and were strip
searched. The suit asserts that at least 10 federal appeal courts have
ruled strip searches of adults charged with misdemeanors or held in civil
matters are a violation of the Fourth Amendment unless there is
reasonable suspicion to believe the person arrested is concealing weapons
or contraband. It claims juveniles should be similarly protected.
Plaintiffs in the case are not named.
Wallace said similar lawsuits have been filed in Rhode Island,
Massachusetts, New York City and Kentucky. In Kentucky, he said, the case
was settled for $17 million. (The Associated Press State & Local Wire,
October 23, 2000)
OMAHA PUBLIC: Lawsuit in Lincoln Accuses of Employment Racial Bias
------------------------------------------------------------------
In a federal lawsuit filed last week, Omaha Public Power District is
accused of discriminating against black employees by denying them
promotions, fair job evaluations, compensation and training.
Four current employees and a former worker filed the class-action lawsuit
in U.S. District Court in Lincoln. The plaintiffs are seeking a judgment
giving them and every other black employee the job positions they would
hold if not for the alleged discrimination. They also want monetary
compensation for the lost earnings.
Omaha attorney Marlon Polk said the complaining employees are not trying
to drag the utility through the mud, but are seeking redress for the
unfair situations black employees have had to endure.
The lawsuit claims OPPD managers "hand-pick" preselected white employees
for promotions before the openings are posted companywide. "The posting
policy is then followed as a formality by supervisors and managers," the
lawsuit says. The lawsuit also accuses the utility of paying black
employees less than white counterparts for identical or similar jobs and
subjecting black employees to so-called "lead walls," which restrict
their lateral movement into other positions within the company.
According to the lawsuit, black employees account for about 7 percent of
the company's 2,292 workers, yet represent less than 1 percent of the
senior level positions. The five named plaintiffs include a manager, a
secretary, a stenographer, an account clerk and a former employee.
OPPD president Fred Petersen said the company still was reviewing the
lawsuit, filed in U.S. District Court in Omaha. The case later was
transferred to the federal court in Lincoln, where it has been assigned
to Judge Richard G. Kopf.
Petersen said OPPD has a long-standing record of compliance with Equal
Employment Opportunity guidelines in its hiring and employment practices
and is committed to fairness. (The Associated Press State & Local Wire,
October 23, 2000)
PAYDAY LENDERS: Lawsuit against Cash Today Certified in Texas
-------------------------------------------------------------
In an action against payday lenders, the District Court for the Southern
District of Texas certified a class of borrowers so financially strapped
they borrowed money at extremely usurious rates. Henry, et al. v. Cash
Today Inc., et al., Nos. H-99-3335, C-99-305 (S.D. Tex. 9/19/00).
Wesley Timothy Henry and George Rodriguez filed separated actions against
Cash Today Inc. and other payday lenders, alleging the lenders' "payday
loans" violated the Truth in Lending Act, the Racketeer Influenced and
Corrupt Organizations Act, state usury laws, Texas Debt Collection Act
and the Texas Deceptive Trade Practices Consumer Protection Act. In an
amended consolidated complaint, the borrowers claimed the "defendants are
unlicensed lenders engaging in a practice, centrally directed by Cash
Today, U.S.A., of making high interest (at more than twice the rate
permitted by Texas law) payday loans throughout Texas, while pretending
to sell advertising and operating a check cashing business in order to
avoid liability for usury and violations of TILA." Specifically, the
borrowers alleged the lenders violated the TILA by failing to disclose
the amount financed, the finance charge, the annual percentage rate and
the total number of payments. They also contended the lenders engaged in
prohibited debt collection practices by making threats of criminal
prosecution and misrepresenting that the plaintiffs' transactions were
not loans.
The borrowers moved for certification of a class of all Texas residents
who entered into transactions with lenders "purporting to be cash-back
advertising sales."
The lenders argued that the borrowers failed to satisfy the commonality,
typicality and adequacy of class representation requirements. They also
contended the borrowers failed to satisfy Rule 23(b)(3) requirements by
showing a class action was superior to other available methods for
dealing with their claims.
The court concluded that the borrowers satisfied the numerosity
requirement by showing the lenders maintained 30,000 to 40,000 loan
customer files throughout Texas. Second, the court found the borrowers
satisfied the commonality requirement because common questions "linked"
all class members on all causes of action. As to the TILA claim, the
court stated, the "shared questions are whether defendants were engaged
in making consumer loans and whether their failure to provide required
disclosures violated the statute."
The court added, "because a borrower need not show reliance or injury for
a TILA cause of action, but simply make an objective comparison of
defendants' disclosure practices with the requirements of TILA ... there
is no danger of individual differences undermining class similarities."
The court also found that the plaintiffs' usury cause of action created a
common issue: Whether the transactions were loans and whether they
exceeded the statutory interest rate. Finally, the court said "[t]he
nature of the misleading representations ... in violation [of] the DTPA
would be the same for all class members.
The borrowers satisfied the typicality requirement because each member
entered into the same type of payday loan. Lastly, the court determined
that the proposed representation was adequate because the representative
and members sought money damages, and their counsel was experienced.
As the court noted, to maintain a class action under Rule 23(b)(3), the
borrowers must show that (1) common questions predominate over any
questions affecting only individual members and (2) the class resolution
is superior to other available methods for the "fair and efficient
adjudication of the controversy." The court observed that the lenders
"operated in essentially the same manner, as centrally directed by
Defendant Cash Today USA, with regard to all customers" and determined
that the borrowers satisfied the predominance requirement of Rule
23(b)(3).
With regard to the TILA claim, the court stated the lenders engaged in
the same practices of alleged nondisclosure. The court also stated, "the
'common nucleus of operative fact' for purposes of the Count Two usury
claim is that Defendants lent Plaintiffs' money at a rate exceeding 600%
per annum."
The court further found a class action a superior method for resolving
the dispute. As the court stated, "Plaintiffs emphasize that most of the
affected borrowers are probably unaware of the violation of their rights
and the claims individually are for relatively small amounts of money,
making the likelihood of individual litigation unlikely."
According to the court, "the nature of the case indicates that the
potential class is composed of individuals so financially strapped that
they would borrow money at extremely usurious rates." The court concluded
that the borrowers met their burden of proof for class certification and
granted the borrowers' motion. (Consumer Bankruptcy News, October 17,
2000)
PRICELINE.COM, INC: Scott & Scott Files Securities Lawsuit in CT
----------------------------------------------------------------
Scott & Scott, LLC, (scottlaw@scott-scott.com) a Connecticut-based law
firm, filed suit in the United States District Court for the District of
Connecticut on behalf of all persons who purchased the common stock of
Priceline.com, Inc. (NASDAQ:PCLN) from July 24, 2000 through September
26, 2000. Scott & Scott, LLC announces that it has extended the class
period to represent shareholders of Priceline.com, Inc. who purchased
those shares from January 31, 2000 to October 4, 2000.
The complaint alleges that Priceline.com and certain of its directors and
officers violated the Securities Exchange Act of 1934 by issuing false
and misleading statements. It contends that Priceline.com did not
disclose that its third quarter results would not meet expectations even
though it knew that it would not due to lower than anticipated sales.
That, coupled with insider trading and the disclosure of missed earnings
on September 27, 2000, caused shareholders to lose 42% value on that date
when shares plunged from$18.64 to $ 10.75.
Contact: Scott & Scott LLC Neil Rothstein, 619/251-0887
ROBERT MUGABE: Faces Claim For Damages Over Zimbabwe Election Killings
----------------------------------------------------------------------
President Robert Mugabe is facing a $400 million ( pounds 260 million)
compensation claim from the victims of political violence in Zimbabwe
during the campaign for parliamentary elections in June.
Three victims will give evidence against Mr Mugabe at a hearing in the US
District court in New York. They include Maria Stevens, whose husband
David was shot dead by so-called war veterans in April.
Mr Mugabe, who was served with the civil claim while attending a United
Nations summit in New York last month, is being sued for serious human
rights abuses allegedly committed against his political opponents.
Any damages award will be difficult to enforce. But the victims,
supported by Zimbabwe's main opposition party, the Movement for
Democratic Change, hope to highlight their cause in an international
setting.
The MDC's leaders fear that Mr Mugabe has been allowed to get away with
his systematic abuses of power as international attention has moved on
elsewhere.
The Zimbabwe Human Rights Forum has documented more than 1,000 crimes
from beatings to torture. International observers confirmed the
widespread use of violence during the campaign. Thirty-one people were
killed.
Most of the violence was attributed to supporters of Mr Mugabe's ruling
Zanu-PF party who recently granted an amnesty for their crimes.
The victims, acting with the support of the Human Rights Forum, also hope
that should Mr Mugabe be ousted, either by the recently instigated
impeachment proceedings or by civil unrest, damages could be extracted
from his considerable overseas assets.
A judgment against him in New York would also make it difficult for him
to visit America to attend meetings of the UN and other world bodies for
fear of having a damages claim enforced against him.
Earlier this year a jury in New York ordered Radovan Karadzic, the former
Bosnian Serb leader, to pay $745 million ( pounds 300 million) to a group
of women who accused him of killings and other atrocities.
Mrs Stevens said her primary concern was to draw attention to the fact
that there was "no justice and no redress" in Zimbabwe.
Since her husband, a white tobacco farmer, was abducted from a police
station and shot at point-blank range Mrs Stevens has been trying get
justice for herself and her children. "I have been going through all the
channels and all the relevant authorities but without success. When I go
to the ministry of justice they say I am in the wrong office and cannot
take any action," she said.
Also giving evidence will be Adella Chiminya, who says she is not afraid
to testify despite the real possibility that she could be arrested on her
return to Zimbabwe. Her husband, Tichaona, was burned alive in his car
near Buhera, southern Zimbabwe, in April.
Witnesses recognised the attackers as Zanu-PF supporters and members of
the feared Central Intelligence Organisation but no arrests were made.
Mrs Chiminya, 34, whose husband was the campaign manager for the
opposition leader, Morgan Tsvangirai, has been left to bring up two
children, Faith, 15, and Blessed, 11, on her own.
"What we want is for the whole world to know that there is no justice in
Zimbabwe. It is now six months since my husband was killed and nothing
has been done," she said.
The third plaintiff in what lawyers hope to broaden into a class action
is Elliot Pfebve. His brother, Matthew, 49, was beaten to death by
Zanu-PF activists during an attack by a mob of more than 300 on the
family home in April.
He said: "As the MDC candidate for the Bindura constituency I was the
target that day but I think they mistook my brother for me. My father was
also beaten unconscious and lost two fingers on his right hand."
"After all these atrocities Mugabe is still free and with the amnesty no
one will ever be brought to justice for these crimes." (The Daily
Telegraph(London), October 23, 2000)
SAGENT TECHNOLOGY: Milberg Weiss Files Securities Suit in CA
------------------------------------------------------------
Milberg Weiss (http://www.milberg.com/sagent/)announced on October 20
that a class action has been commenced in the United States District
Court for the Northern District of California on behalf of purchasers of
Sagent Technology Inc. ("Sagent") (NASDAQ:SGNT) common stock during the
period between Oct. 21, 1999 and April 18, 2000 (the "Class Period").
The complaint charges Sagent and certain of its officers and directors
and its underwriter with violations of the Securities Exchange Act of
1934. Sagent is a provider of Real-time eBusiness Intelligence Solutions
which purport to enable enterprises to win new customers and improve
operational effectiveness. On April 13, 1999, defendants arranged for
Sagent to sell over 5.7 million shares of Sagent stock to the public for
$9 per share (the "IPO" or "Offering") for total proceeds of more than
$50 million. The IPO was over-subscribed, causing Sagent's share price to
jump to $15-9/16 per share on the same day.
The complaint alleges that as part of defendants' effort to boost the
price of Sagent stock, they misrepresented Sagent's true 1999 and 2000
prospects in an effort to conceal Sagent's true prospects until they were
able to sell at least $8 million of their own Sagent stock and were able
to renew and/or expand Sagent's credit line which was set to expire in
early 2000. Renewing Sagent's credit line was extremely important to
defendants, as Sagent had not been, and would not be able to, fund its
operations from cash generated by its business operations, because Sagent
was continuing to post substantial losses.
On April 18, 2000, after representing throughout late 1999 and early 2000
that Sagent would achieve Q1 results of $17.4 million in revenue and $.04
in EPS, defendants revealed that Sagent would fall seriously short of the
results theretofore promised by defendants. In fact, defendants were
forced to reveal that contrary to their representations of closing
Sagent's largest software deal ever and strong growth in revenue and EPS,
Sagent was, in fact, suffering revenue and EPS declines.
The price of Sagent shares dropped to as low as $7-7/32 per share on
record volume of 17.5 million shares, a decline of more than 70% from
where defendants had sold their own Sagent shares at prices as high as
$27.875 months prior. Defendants further revealed that both Sagent's Vice
President of Sales and Chief Financial Officer had resigned after the two
officers had just collectively received more than $6 million in proceeds.
Contact: Milberg Weiss Bershad Hynes & Lerach LLP William Lerach,
800/449-4900 wsl@mwbhl.com
WATER CONTAMINATION: Walkerton Commission Adds 3rd Party to Claim
-----------------------------------------------------------------
Two of the defendants in a proposed class-action suit are trying to pass
the liability on to others. The Walkerton Public Utilities Commission and
manager Stan Koebel have added eight "third parties" to the claim.
A third-party action is a lawsuit within the context of another suit
already under way, lawyer Scott Ritchie said.
"The defendants who we have sued are asking to have blame cast on
others," explained Ritchie, who represents victims of last May's E. coli
outbreak, which killed seven people and left 2,300 ill. The move has no
effect on his clients' suit, Ritchie said. It targets five defendants,
including the Ontario government, Town of Brockton and Bruce-Grey- Owen
Sound health unit.
A document filed Oct. 16 in Superior Court alleges negligence by:
* Farmers David and Carolyn Biesenthal, whose farm, next to one of
Walkerton's three wells, is the source of the E. coli bacteria.
(Health officials have stated that their farming practices are not
at issue, ascribing the outbreak to the fact the well was not
secure.)
* Hydrogeologist Ian Wilson, who advised the utility during well
construction.
* Davidson Well Drilling Ltd., which drilled the three wells and was
retained in 1999 to conduct a review and refurbishing of Well 5.
* Three firms that successively acted as consulting engineer - Earth
Tech (Canada) Inc., of Toronto, Conestoga-Rovers and Associates
Ltd.
of Waterloo and B. M. Ross and Associates Ltd. of Goderich.
* Two firms that tested the town's water: GAP EnviroMicrobial
Services Inc. and AL Canada Laboratories East Inc. (The Toronto
Star, October 23, 2000)
* Class Action Suit System To Be Put On Hold In Korea
-----------------------------------------------------
The adoption of a mandatory collective voting system which would allow
small shareholders to form voting blocs to influence board of directors
elections is very likely to be put on hold, sources said Saturday.
The collective voting system, which favors small shareholders, was
proposed by civic groups as part of efforts to improve corporate
governance, but the government and the ruling party have been reluctant
to make the system mandatory.
A policy decision-making source at the ruling Millennium Democratic Party
said that "the government is strongly against making the collective
voting system mandatory, and the MDP concurs." He added, "It is,
therefore, hard to adopt the system."
A government source said that the collective voting system is not a
global standard. In advanced countries, corporations that adopt such
systems are very rare, according to the source.
In another issue related to small shareholders, the future of a class
action suit system for stock trading disputes, looks uncertain.
Under the system, when class action suits filed by a limited number of
shareholders against specific listed companies are won, other small
shareholders, not involved in the suit, could receive compensation, such
as in cases where damages are incurred by false public disclosures.
"The Justice Ministry remains very lukewarm about the class action suit
system, and even the Finance-Economy Ministry shows some negative
undercurrents, while in the government party, opinion is split," the
source said.
"For the moment, we cannot say for sure about the possible adoption of
the system, but a final decision will be made sooner or later, pending
inter-agency consultation and consultation with the ruling party," a
Finance-Economy Ministry source said. (Asia Pulse, October 23, 2000)
*********
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.
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