/raid1/www/Hosts/bankrupt/CAR_Public/010418.MBX             C L A S S   A C T I O N   R E P O R T E R

            Wednesday, April 18, 2001, Vol. 3, No. 76


APPLIED MICRO: Charles J. Piven Announces Securities Lawsuit
AUTO FINANCE: GMAC Fights Off Hidden Charges Accusation In Sp Ct
BRISBANE POST OFFICE: Postal Workers Fear Death Link To Workplace
CALIFORNIA AMPLIFIER: Cauley Geller Files Securities Suit in CA
CALIFORNIA AMPLIFIER: Hoffman & Edelson Announces Securities Suit in CA

CALIFORNIA AMPLIFIER: Schiffrin & Barroway Files Securities Suit in CA
CARNIVAL CRUISE: To Make Ships More Accessible to Disabled Passengers
CITY OF TUSTIN: Latino School Districts Sue over Disputed Land
EPA: Files Revised Consent Decree re FQRP Compliance of Pesticide
ESSO: Suit re 1998 Longford Explosion May Have To Begin Again In New Ct

FLEETBOSTON FINANCIAL: Vocal Fleet Foe Naca To Protest Privacy Record
FLORIDA SCHOOL: District Released From Court Supervision re Minorities
HUD, COUNTY: To Pay Residentsí Lawyers $550,000 in Sanders Bias Case
MITCHAM INDUSTRIES: Agrees in Principle to Settle Shareholder Lawsuits
NEW JERSEY: Not An Employer to Pay Corrections Officers OT under FLSA

OCCIDENTAL PETROLEUM: Settles For $ 25M Over Stock Ownership Plan
OPUS360 CORP: The Rosen Law Firm Files Securities Suit in New York
POWER WHOLESALERS: A.G.s Probe on Possible Violationf of Antitrust Laws
RECORDTV.COM: Agrees to Pay Movie Studios $50,000 of the $10M Demanded
SCHERING-PLOUGH CORP: Harvey Greenfield Announces Securities Suit in NJ

UNUMPROVIDENT CORP: Wins Jury Verdict re Brokers of Paul Revere Subsids
WALGREEN CO: Cleared of TX Lawsuit re Partially Filled Prescriptions
WINSTAR COMMUNICATIONS: Milberg Weiss Announces Securities Suit in N.Y.
WINSTAR COMMUNICATIONS: Shalov Stone Expands Securities Lawsuit in N.Y.

* NLJ Presents Advice on Preventing and Defending Mega-Suits


APPLIED MICRO: Charles J. Piven Announces Securities Lawsuit
Law Offices Of Charles J. Piven, P.A. on April 16 announced that a
private securities action requesting class action status has been
initiated on behalf of purchasers of the securities of Applied Micro
Circuits Corporation during the period November 30, 2000 through and
including February 5, 2001.

No class has yet been certified in the above action.

Contact: Law Offices Of Charles J. Piven, P.A., Baltimore Charles J.
Piven, 410/332-0030 pivenlaw@erols.com

AUTO FINANCE: GMAC Fights Off Hidden Charges Accusation In Sp Ct
General Motors Acceptance Corp., the financial-services arm of the No. 1
automaker, has fought off a legal bid for several hundred million dollars
by customers complaining of hidden charges in leasing agreements.

The U.S. Supreme Court, without comment, let stand a lower-court decision
that limited a class-action suit against the General Motors Corp. unit to
US$ 500,000 in potential damages.

Louisiana lease customers Paul M. Perrone and Doris McCullough argued
unsuccessfully in their appeal that the 5th U.S. Circuit Court of Appeals
set too high a standard for awards under the U.S. Truth in Lending Act.

They say Detroit-based GMAC failed to specifically disclose a $400
'acquisition fee' when they signed their leases. The company says the
charges were fully disclosed because they were rolled into the
agreed-upon monthly payments.

The question in the Supreme Court appeal was whether plaintiffs seeking
to recover the actual amount they lost must prove 'detrimental reliance'
-- in other words, that they were influenced by a misrepresentation by a

The 5th Circuit concluded borrowers must make that showing to win actual
damages. If they can't, the court held, consumers can recover only the
specified amounts available as so-called statutory damages, or US$500,000
per violation in the case of class actions.

Perrone and McCullough say the detrimental-reliance standard will be
impossible to meet in the typical Truth in Lending Act case.

'A $500,000 cap on exposure for any single disclosure violation will not
deter consumer creditors, like GMAC, from engaging in widespread
loan-packing practices involving millions of dollars,' the appeal argued.

GMAC defended the lower-court decision, which was in accord with the
rulings of other appeals courts.

The case now returns to a federal trial judge in New Orleans. (National
Post (formerly The Financial Post), April 17, 2001)

BRISBANE POST OFFICE: Postal Workers Fear Death Link To Workplace
A group of postal staff are considering legal action over deaths and
health complaints they believe may be related to working in a Brisbane
post office.

Former Australia Post worker Angie Adams, who quit because of illness in
1994, said she had identified at least 20 current and former workers at
the Capalaba branch, in Brisbane's south-eastern suburbs, who had died
from cancer or contracted serious illnesses since 1990.

Ms Adams, who was diagnosed with an auto-immune disease in 1993, said the
figure represented one-fifth of all of those who had worked at the branch
since it opened.

She said three counter workers and a cleaner had died from cancer, five
had leukaemia-related diseases, five had cancer, six had non-curable
auto-immune-related diseases, one suffered cystitis and three had serious

Ms Adams documented the deaths and illnesses and reported them to
Australia Post and the postal union, seeking independent tests of a
neighbouring Energex substation and the post office building. "There is
no chance of a coincidence," she told a media conference in Brisbane.

Since she reported the complaints, Australia Post has organised medical
screening of all current staff and Energex has conducted two tests of its
substation, both of which showed it was working within safe limits.

The results of the medical screenings and a third, independent test of
the substation have yet to be released.

"Depending on the results of the health screenings, none of which are
known at this point in time, I would be surprised if this is the
completion of our list," Ms Adams said. "I sincerely hope that this is
the final tally, however."

She said Australia Post and the postal union had taken the issue
seriously, but the building needed to be closed while further
investigations were conducted. "It is imperative that the staff at this
office are out of harm's way and no one else is subjected to the private
hell that I have had to endure," Ms Adams said. "The saddest part of this
is that four of us are no longer around to relate their own private

She said she and her colleagues would consider a class action if enough
evidence could be gathered.

Federal member for Bowman, Con Sciacca, who has taken up the workers'
cause, said he believed Australia Post had a duty to close the building
and conduct a series of environmental health tests. "It is not only fair
to do that for the people working there, but also for the people who go
there on a regular basis," Mr Sciacca said. (AAP Newsfeed, April 17,

CALIFORNIA AMPLIFIER: Cauley Geller Files Securities Suit in CA
The Law Firm of Cauley Geller Bowman & Coates, LLP announced that it has
filed a class action in the United States District Court for the Central
District of California on behalf of all individuals and institutional
investors that purchased the publicly traded securities of California
Amplifier, Inc. (Nasdaq: CAMP) between April 7, 2000 and March 28, 2001,
inclusive (the "Class Period").

The complaint charges that the Company and certain of its officers and
directors violated the federal securities laws by providing materially
false and misleading information about the Company's financial condition,
and as a result of these false and misleading statements the Company's
stock traded at artificially inflated prices during the class period. On
March 29, 2001, California Amplifier announced that it will restate its
fiscal 2000 financial statements because of accounting misstatements. The
press release issued in connection with the announcement stated, in part:
"California Amplifier Inc. today announced that during preparation for
the Company's fiscal year 2001 audit examination, the Company's corporate
controller abruptly resigned and advised by letter that in fiscal year
2000 he made certain adjustments to the Company's accounting records that
caused a reduction in recorded expenses which may have resulted in
overstating net income for the fiscal year ended February 26, 2000 by as
much as $2.2 million, or $.18 per basic share. The Company is actively
investigating the circumstances reported by the controller but has not
yet been able to interview the controller fully and, as a result, is
unable at this time to reach any definitive conclusions as to the exact
expenses or fiscal year 2000 quarters that are affected by this alleged
overstatement. Due to these developments, the previously scheduled
release of earnings for the fourth quarter and the fiscal year ended
March 3, 2001 on April 19, 2001 will be postponed to a future date to be
announced. If the investigation ultimately confirms an overstatement of
income in fiscal year 2000, the Company will be required to restate its
fiscal year 2000 consolidated financial statements." On this news,
trading in California Amplifier shares was halted at $5.03 -- or more
than 90% lower than the Class Period high of $59.25

Contact: Charlie Gastineau or Sue Null, both of Cauley Geller Bowman &
Coates, LLP, 888-551-9944

CALIFORNIA AMPLIFIER: Hoffman & Edelson Announces Securities Suit in CA
& Edelson, LLC (877/537-6532 toll free) on April 16 announced that a
class action has been commenced in the United States District Court for
the Central District of California on behalf of purchasers of California
Amplifier, Inc. (NASDAQ:CAMP) publicly traded securities during the
period between April 7, 2000 and March 28, 2001 (the "Class Period").

The complaint charges California Amplifier with violations of the
Securities Exchange Act of 1934. California Amplifier designs,
manufactures and markets microwave components used in both defense and
commercial markets. The Company's products are used for the amplification
and conversion of microwave signals for satellite television, Global
Positioning Satellite, wireless cable, two-way voice and data
communications, and broadband applications.

On March 29, 2001, California Amplifier announced that it will restate
its fiscal 2000 financial statements because of accounting misstatements.
The press release issued in connection with the announcement stated, in
part: "California Amplifier Inc. announced that during preparation for
the Company's fiscal year 2001 audit examination, the Company's corporate
controller abruptly resigned and advised by letter that in fiscal year
2000 he made certain adjustments to the Company's accounting records that
caused a reduction in recorded expenses which may have resulted in
overstating net income for the fiscal year ended Feb. 26, 2000 by as much
as $2.2 million, or $.18 per basic share. The Company is actively
investigating the circumstances reported by the controller but has not
yet been able to interview the controller fully and, as a result, is
unable at this time to reach any definitive conclusions as to the exact
expenses or fiscal year 2000 quarters that are affected by this alleged
overstatement... Due to these developments, the previously scheduled
release of earnings for the fourth quarter and the fiscal year ended
March 3, 2001 on April 19, 2001 will be postponed to a future date to be
announced. If the investigation ultimately confirms an overstatement of
income in fiscal year 2000, the Company will be required to restate its
fiscal year 2000 consolidated financial statements." On this news,
trading in California Amplifier shares was halted at $5.03 - or more than
90% lower than the Class Period high of$59.25.

Contact: Hoffman & Edelson, LLC Marc H. Edelson, Esq. or Jerold B.
Hoffman, Esq. 877/537-6532 (toll free) Fax: 215/230-8735 E-mail:

CALIFORNIA AMPLIFIER: Schiffrin & Barroway Files Securities Suit in CA
The following statement was issued April 16 by the law firm of Schiffrin
& Barroway, LLP:

Notice is hereby given that a class action lawsuit was filed in the
United States District Court for the Central District of California on
behalf of all purchasers of the common stock of California Amplifier,
Inc. (Nasdaq:CAMP) from April 7, 2000 through March 28, 2001, inclusive
(the "Class Period").

The complaint charges California Amplifier and certain of its officers
and directors with issuing false and misleading statements concerning the
Company's business and financial condition throughout the Class Period.
On March 29, 2001 the Company announced that it will restate its fiscal
2000 financial statements because of accounting misstatements. Because of
the accounting misstatements, California Amplifier's common stock price
was artificially inflated throughout the Class Period. As a result,
purchasers of the Company's common stock have been damaged.

Contact: Schiffrin & Barroway, LLP Marc A. Topaz, Esq. Robert B. Weiser,
Esq. 888/299-7706 (toll free) or 610/667-7706 e-mail: info@sbclasslaw.com

CARNIVAL CRUISE: To Make Ships More Accessible to Disabled Passengers
Carnival Cruise Lines has agreed to "make substantial changes" to its 15
ships to make them more accessible to the disabled, settling a 1998 class
action lawsuit filed in Miami.

In the settlement, signed Monday, Carnival has agreed to renovate cabins,
lounges, showrooms and elevators on its entire fleet, and provide a
pathway throughout each ship for wheelchair accessibility, said Matthew
W. Dietz, a Miami attorney who filed the lawsuit on behalf of Access Now,
a nonprofit organization that advocates for the disabled, and its
president, Edward Resnick, a Miami Beach resident who has used a
wheelchair since 1954 because of polio.

"It means that people who are disabled will finally be able to travel and
will finally be able to cruise independently," Dietz said. "So, they can
get from point A to point B on a ship without encountering barriers to
access, will be able to see a show, take an elevator and go to the
various discos on a ship."

The agreement, which is expected to cost Carnival millions of dollars,
represents the first voluntary settlement between a disabilities rights
organization and a cruise line to ensure access for the disabled
community, Dietz said.

The lawsuit, filed in Miami federal court, alleged that Carnival vessels
calling on Florida ports discriminated against disabled passengers
because shipboard amenities did not provide adequate access or required
the aid of an assistant.

According to the suit, Carnival ships failed to comply with the Americans
with Disabilities Act by not making public restrooms handicapped
accessible, by making stateroom aisles and bathroom entrances too narrow
to accommodate passengers in wheelchairs without assistance and by
erecting safety barriers aboard ships that prevent access to handicapped

Carnival spokesman Tim Gallagher confirmed that the cruise line had
agreed to make "substantial changes" to its vessels, but declined comment
on the specific terms until the settlement is approved by the court.

"We have made every effort to address all the issues and concerns in good
faith that Access Now has brought to our attention," Gallagher said. "And
we are hopeful that this settlement agreement will get the court's

A final hearing on the settlement, which encompasses 54 million disabled
Americans considered part of the class, is expected within 90 days, Dietz

The cruise line has also agreed to pay up to $ 166,000 in attorney and
expert fees and costs, he said.

As part of the agreement, between 20 and 25 cabins aboard each Carnival
ship will be accessible to the disabled, with four to five cabins in each
vessel fully compliant with the ADA, Dietz said. That means the cabins
must have doorways that are 32 inches wide instead of the usual 25
inches, have a 36-inch path of travel within the room, and have
accessible bathrooms with roll-in showers.

All work must be completed within six years, Dietz said.

In addition to the suit against Carnival, Access Now has similar pending
suits against Magical Cruises, Royal Caribbean International and
Celebrity Cruises, Norwegian Cruise Line, Holland America Line-Westours
and Costa Crociere. (The Miami Herald, April 17, 2001)

CITY OF TUSTIN: Latino School Districts Sue over Disputed Land
Escalating a dispute over land at the closed Tustin Marine base, two
overwhelmingly Latino school districts in Santa Ana sued the city of
Tustin on Monday, alleging that the city's base reuse plan violates their
students' civil rights.

"First they didn't want our students on the base; now they want to give
us land that will be harmful to our students, parents and employees,"
said John Palacio, a board member with the Santa Ana Unified School
District, which along with Rancho Santiago Community College District
filed the class action lawsuit in a Los Angeles federal court.

Negotiations between Tustin and the school districts fell apart last week
amid accusations by the districts that a final offer from the city
included land in the base that was highly contaminated.

"The allegations of racial discrimination are baseless, outrageous and
offensive," said Tustin City Manager William A. Huston. "We intend to
fully defend ourselves against those charges."

The school districts want 100 acres on the base for a unique
kindergarten-through-college campus. Tustin and the U.S. Education
Department initially granted the request in 1994, but the city later
changed its plan and offered the land to the South Orange County
Community College District.

"That same plan sets aside nearly 200 acres of free land to accommodate
the construction of new schools for two school districts and one
community college district which have substantial non-Hispanic
populations and do not have a critical need for such land," the lawsuit

Last week the districts rejected Tustin's final offer of 22 acres to
Santa Ana Unified, 15 acres to the Rancho Santiago district and $ 20
million for the districts to buy land elsewhere.

The districts allege that the smaller parcels have two ground water
"plumes" with high levels of the gasoline additive MTBE and other
dangerous chemicals, such as ethyl benzene, toluene and acetone.

              Pollution Issue Not New, City Says

"Discrimination is the only word that can be used to explain why the City
has sought to exclude Santa Ana Unified students--almost 92% of which are
Hispanic--from sharing in the benefits that will flow from the
redevelopment of the Marine Corps Air Station," the lawsuit contends.

Huston, strongly denying discrimination, said all the parties knew that
the base had underground contamination and that the Navy is obligated
under federal law to clean up the land before reuse.

"All the documents dealing with the environmental cleanup have been out
for years," Huston said. "It is not a secret that in any military base
there are cleanup issues. For them to represent that we conspired to give
them dirty land is ridiculous."

                          Hot Zone

Two Santa Ana school districts sued the city of Tustin on Monday over
disputed land at the closed Tustin Marine base that the districts want
for a school. (Los Angeles Times, April 17, 2001)

EPA: Files Revised Consent Decree re FQRP Compliance of Pesticide
EPA announced March 20 that it has submitted an amended consent decree to
a federal court to resolve lawsuits involving the agency's compliance
with provisions of the Food Quality Protection Act.

The revised agreement was reached between EPA and the Natural Resources
Defense Council, the lead plaintiff in the case, which was filed in the
U.S. District Court for the Northern District of California. Interveners
in the case, including representatives from the pesticide industry and
the farming community, were involved in crafting the new agreement,
according to EPA.

The original agreement, which was finalized on Jan. 19, established
deadlines for progress on cumulative risk assessments for organophosphate
pesticides. Among other issues, it also established deadlines for the
issuance of Reregistration Eligibility Decisions (REDs) for 11

"The changes we negotiated in the settlement agreement will guarantee new
opportunities for public participation and additional external review of
critical pesticide decisions," said EPA Administrator Christie Whitman.
"We have set specific milestones for the review of certain pesticides,
and EPA will meet deadlines required by the Food Quality Protection Act
to reassess existing pesticides using current health and safety
standards. We will do so using a rigorous scientific review process that
will allow extensive opportunity for public involvement and comment, to
ensure that all perspectives are heard."

                   Modifications to decree

According to an EPA statement, the revised agreement continues to include
the following components:

* establishes dates to conduct cumulative risk assessments for
  organophosphate pesticides,

* establishes dates to issue REDs or revised risk assessments for the
  same 11 pesticides,

* establishes dates for certain regulatory decisions that may be
  required for three pesticides,

* establishes dates to determine if certain classes of pesticides share
  a common mechanism of toxicity, and

* continuation of efforts to establish a scientifically validated
  screeni9ng and testing program for potential endocrine disrupting

After "consultation" with USDA, industry, agricultural and animal rights
interveners, a number of modifications have been made to the consent
decree, according to EPA. These include:

   -- "Specific language has been inserted providing that, in developing
relative potency factors (RPF) for use in a cumulative risk assessment
for the organophosphates, EPA will makes its RPF analyses available to
the public by July 31, 2001"

   -- a public comment period will commence after issuance of a draft
cumulative risk assessment for organophosphates

   -- EPA has "clarified ... that it intends to consider label changes
and other changes to the terms and conditions of a pesticide's
registration when conducting a risk assessment for a pesticide"

   -- the agency clarified its intention "to provide opportunities for
public participation" in its tolerance reassessment and pesticide
reregistration activities

   -- EPA clarified its intention "to consider new data in the
development of risk assessments and reregistration eligibility
determinations if the new data" are submitted in a timely manner

   -- adding four months to the scheduled date for the Interim
Reregistration Eligibility Determination for phosmet to enable EPA "to
better coordinate its analyses of pesticide benefits with USDA

   -- the addition of language providing that, "when determining whether
chemical compounds share a common mechanism of toxicity, EPA will follow
its existing policies or explain, in writing, any deviations from such
policies, and

   -- the addition of language providing that "after it makes a
determination as to whether chemicals in four specified classes of
pesticides share common mechanisms of toxicity, EPA will accept public
comment on the determinations and will consider the comments in any
subsequent risk assessments involving the chemicals. [EPA could also
issue revised determinations based upon the comments]."

                   Industry quick to react

"We are very pleased they went as far as they did," Douglas Nelson,
senior vice president and general counsel of the American Crop Protection
Association, told PTCN. "They tried to make the process a bit more public
and transparent." The association still expects to oppose the consent
agreement in court.

The ability to carry out congressional intent regarding the FQPA has
"just become more complicated," said Jay Vroom, ACPA's president, in a
written statement. "On the one hand we are disappointed that the final
settlement agreement could not have been improved more than the changes
agreed to between NRDC and EPA. However, a separate but connected
directive by new EPA Administrator Whitman sends a clear commitment that
we have entered a new era where transparency and sound science will be
pursued and not just talked about in connection with FQPA. This outreach
is very welcome, indeed."

                     A Role for CARAT

The Committee to Advise on Reassessment and Transition (CARAT), which has
both EPA and USDA participation, has been tasked to provide EPA's Office
of Pesticide Programs with ideas on ways to "optimize" public involvement
in FQPA implementation.

The EPA deputy administrator has been delegated to co-chair the CARAT for
this purpose, but the position is currently vacant. The White House has
indicated this job will go to Linda Fisher, a former executive with
Monsanto who has extensive experience at EPA, including a stint heading
the Office of Prevention, Pesticides and Toxic Substances. (Pesticide &
Toxic Chemical News, March 26, 2001)

ESSO: Suit re 1998 Longford Explosion May Have To Begin Again In New Ct
A class action against Esso over the 1998 explosion at its Longford gas
plant is to move to a new court after more than two years of Federal
Court proceedings and may have to begin from scratch.

Federal Court judge Justice Ron Merkel has ordered that the negligence
action be moved to the Victorian Supreme Court. He ruled that justice
would be best served and Federal Court resources saved if the claims were
heard in the state court. "The present proceeding will severely tax the
resources of this court to hear and determine all of the claims in the
matter," he said.

Justice Merkel said there was a risk that related action being taken by
Esso in the High Court could result in a ruling that the Federal Court
did not have jurisdiction to hear the case. "The interests of justice are
best served by this court taking appropriate steps to enable the claims
to be brought on for the earliest possible hearing before the court least
exposed to the risk of absence of jurisdiction to hear such claims, which
has now become the Supreme Court," Justice Merkel said.

On April 12, he gave those suing Esso two weeks to relaunch their action
in the Victorian Supreme Court, otherwise he would simply transfer it.

The action is being taken by three applicants on behalf of gas users who
suffered loss as a result of the two-week shutdown of the state's gas
supply caused by the explosion: Johnson Tiles Pty Ltd, a small business;
Gregory Dean, a stood-down worker; and Douglas Chalmers, a domestic

The decision could potentially affect every Victoria gas consumer who
suffered loss as a result of the shutdown.

Lawyer for the three applicants, Lisa Nichols of Slater and Gordon, said
the case would be relaunched, and the Victorian court would be asked to
take into account all that had already happened in the Federal Court. If
the case was simply transferred by Justice Merkel it was possible,
although unlikely, that proceedings may have to begin from scratch
because Esso had refused to give an undertaking to agree to the steps so
far being accepted by the Victorian court.

"We will be seeking orders from the court for it to continue at the point
it was transferred," she said. "Esso have refused to give undertakings
they will accept the steps taken. "We think that they will, in keeping
with their past performance, take any and every procedural course open to

Justice Merkel thought it "inconceivable", but not impossible, that a
Victorian judge would insist that the work done so far be repeated.

Ms Nichols said she was not opposed to moving the case and hoped the
Victorian court would give an early hearing date.

Justice Merkel also ruled that the applicants must pay Esso's costs
relating to another action in which they alleged the company had breached
the Trade Practices Act - an action the Full Court struck out as
untenable last year.

Ms Nichols said the judge had ruled the costs could be paid at the end,
rather than immediately, so if the applicants won those costs could be
offset. (AAP Newsfeed, April 17, 2001)

FLEETBOSTON FINANCIAL: Vocal Fleet Foe Naca To Protest Privacy Record
Protesters from the Neighborhood Assistance Corp. of America, distinctive
in their yellow T-shirts, descended on FleetBoston Financial Corp.'s
annual meeting a year ago. Accusing Fleet of using a virtual New England
monopoly to gouge customers on fees, the crowd shouted down bank
defenders and jostled with State Police outside the meeting.

NACA chief executive Bruce Marks said his troops will be back for this
year's annual meeting. Only this time they'll be protesting Fleet's
record on customer privacy. "This bank has not kept its promises when it
comes to selling private information to telemarketers," Marks said. "When
[Fleet chief executive] Terry Murray tells customers one thing and the
bank does another, that is an act of fraud."

NACA started the protest on Monday to take advantage of Patriots Day
crowds. Mingling among Boston Marathon watchers, the group's volunteers
handed out fliers with Murray's phone number and home address. Marks said
NACA has other information, including Social Security numbers for all
Fleet directors, but would give it out only with permission from the
individuals affected. It's the same standard, Marks said, that Fleet
should use for its customers' personal information.

The Jamaica Plain advocacy group planned to take the street theater up a
notch on Tuesday. In addition to protests outside the meeting, NACA
planned to announce at a morning news conference that it will file a
class-action lawsuit over Fleet's sale of its mortgage borrowers'

"Fleet was a poster child for predatory lending in the mid-'90s," said
NACA general counsel Eric Bove. "Now we're going to make them into a
poster child for predatory privacy policies."

Fleet spokesman Jim Mahoney countered that NACA "hasn't done its homework
in this case" and that its annual protest "has become tired and tiring."

Mahoney said Fleet agreed to pay NACA $140 million in 1995 (Bank of
Boston, since acquired by Fleet, gave another $75 million) to have the
organization administer a mortgage program for low- and moderate-income
people around the country. But that deal came only after NACA had
protested Fleet's tactics, and Mahoney said Marks is clearly hoping that
another round of protests will lead to a second payment.

"There are thousands of people out there who have mortgages because of
NACA's programs, which is a good thing," Mahoney said. "But at this
point, Marks's tactics are counterproductive, making it harder for us to
work with him in the future."

The latest dispute between Fleet and NACA stems from the bank's now-ended
partnerships with a half-dozen telemarketing companies over the past
three years.

In each case, Fleet sold lists of its home-loan borrowers to the
companies, which had sales representatives call people on the lists to
pitch discount programs on services ranging from car repairs to dental
work, eyewear, prescription drugs, and even privacy protection. The
monthly subscription fees for the programs ranged from $4 to $17 apiece,
which were added - in small type, Marks adds - to the customers' mortgage

In a complaint filed Dec. 28, Minnesota Attorney General Mike Hatch said
Fleet broke that state's law by failing to tell customers that their
personal information was being sold and by actively helping the
telemarketers mislead people about the nature of the services in

Among the exhibits Hatch filed with the court were results of a survey
Fleet conducted of its own customer service representatives. In virtually
all of the cases, the Fleet employees reported taking calls from
customers angry about the charges and denying they had ever agreed to pay

Mahoney said Fleet not only ended the practice two years ago, but has one
of the more progressive privacy policies in the banking industry.

"The practices NACA is complaining about have not been in place for
almost two years," Mahoney said. "And at the time they were in place, the
whole concept of information sharing was just beginning to develop."

Marks, though, said NACA plans to stick to its guns. He said Fleet has a
history of maximizing profitability at the expense of customers, and this
is just the latest example.

"After we settled with Fleet on the predatory lending stuff, we went away
for a while," Marks said. "But in light of what they've done, we're going
to be their worst nightmare again."

FLORIDA SCHOOL: District Released From Court Supervision re Minorities
The Hillsborough County, Fla., School Board has achieved "unitary
status," entitling it to freedom from further federal supervision, the
U.S. Court of Appeals for the 11th Circuit, held on March 28. Manning v.
The School Board of Hillsborough County, Fla., No. 99-2049.

The ruling puts to rest a post-Brown v. Board of Education class action
filed in 1958 on behalf of all "minor Negro children and their parents"
residing in the school district. Although the current appellees, a class
of black schoolchildren, argued the necessity of continued supervision
under a federal desegregation decree, the appellate panel's opinion, by
Judge Susan H. Black, said that it was convinced that, had the district
court judge applied the correct legal standard, she would have found good
faith on the part of the school board, "notwithstanding the absence of an
effective [majority-to-minority transfer] program and other possible
discrepancies." (The National Law Journal, April 16, 2001)

HUD, COUNTY: To Pay Residentsí Lawyers $550,000 in Sanders Bias Case
A federal judge has ordered the U.S. Department of Housing and Urban
Development and the Allegheny County Housing Authority to pay nearly
$550,000 to lawyers who represented public housing residents in the
Sanders housing discrimination case.

Senior U.S. District Judge Gustave Diamond also promised to enter a
separate judgment for unspecified legal fees against Allegheny County
because of actions in 1996 and 1997 that forced the residents' lawyers to
perform additional work.

Attorneys for the plaintiffs, who include all blacks in public and
subsidized housing and those on public housing waiting lists, asked for
$813,984 for legal work from 1995 to 1998.

Diamond reduced the fees to $548,357 through elimination of costs for
some lawyers and a paralegal. The judge approved nearly all the requested
costs for Donald Driscoll, one of the attorneys who filed the lawsuit in
1988 and who has taken the lead in legal matters since the December 1994

If the judgment stands, it will mean Driscoll and the other attorneys
will be paid a total of $1,415,857 for their work on the case. HUD in
June 1998 paid them $867,500.

Under Diamond's ruling, HUD must pay the lion's share of the legal costs
because "HUD is primarily responsible for the violations of law which led
to the litigation and the [settlement]."

The Housing Authority must pay 35 percent of the $548,357, Diamond

Driscoll will receive almost 60 percent of the legal fees -- $320,359.

The request for legal fees was filed in December 1999 by attorney Jere
Krakoff, who has requested $26,325 for his work on the motion.

The Sanders case is named after Cheryl Sanders, a Braddock woman who is
the lead plaintiff in the lawsuit. Sanders was among six women who lived
in the former Talbot Towers public housing complex in Braddock when the
suit was filed.

The plaintiffs charged that they and others were victims of a
decades-long pattern of discriminatory housing practices in which poor
blacks were funneled into certain communities.

The lawsuit, which includes a class of 5,000 people, was settled after
HUD acknowledged its role in the housing discrimination. The settlement
contains a number of provisions, including the establishment of new
public housing units over a seven-year period ending this year.
(Pittsburgh Post-Gazette, April 17, 2001)

MITCHAM INDUSTRIES: Agrees in Principle to Settle Shareholder Lawsuits
Mitcham Industries Inc. (Nasdaq:MIND) announced on April 17 that it has
reached an agreement in principle with plaintiffs to settle the
shareholder class action suits pending against the company and certain of
its officers and directors in the United States District Court for the
Southern District of Texas. The principal terms of the agreement call for
the establishment of a settlement fund consisting of $2,700,000 to be
paid by the company and its insurance carrier. The agreement is subject
to execution of definitive settlement documents and Court approval.

Mitcham Chairman, President and CEO Billy F. Mitcham, Jr. commented,
"Although we were prepared to defend the lawsuits vigorously, we
concluded that it was in the best interests of the company and its
shareholders to resolve the litigation in light of the inherent
uncertainties of complex litigation and to avoid both substantial legal
fees and the continued unnecessary demands on management's time."

Mitcham Industries Inc., a geophysical equipment supplier, offers for
lease or sale, new and "experienced" 3-D seismic equipment to the oil and
gas industry, seismic contractors, environmentalists, government agencies
and universities. Headquartered in Texas, with sales and services offices
in Calgary, Canada and associates throughout Europe, South America and
Asia, Mitcham conducts operations on a global scale and is the leading
independent exploration equipment lessor in the industry.

NEW JERSEY: Not An Employer to Pay Corrections Officers OT under FLSA
A-146 September Term 1999; Supreme Court; per curiam opinion; partial
dissent by Long, J.; decided April 10, 2001. On certification to the
Appellate Division, 327 N.J. Super. 14 (App. Div. 1999). (Sat below:
Judges Pressler, Landau and Ciancia in the Appellate Division; Judge
Ferentz in the Law Division.) DDS No. 25-1-6630

Because there is no New Jersey statute authorizing suit against the State
for Fair Labor Standards Act claims, and because the New Jersey Wage and
Hour Law does not include the state in the definition of employer, state
corrections officers are not entitled to incidental overtime wages under
the FLSA or the Wage and Hour Law.

*Plaintiffs are state corrections officers who seek incidental overtime
wages under the Fair Labor Standards Act, 29 U.S.C. '' 201 to 219, and
New Jersey's Wage and Hour Law, N.J.S.A. 34:11-56a1 to -56a30. They filed
this class action against the state, the governor, and the commissioner
of corrections, the latter two in their official capacities only.

*The trial court dismissed both counts of plaintiffs' complaint, and the
Appellate Division affirmed, holding that the Wage and Hour Law did not
apply to the state because that statute does not include the state in the
definition of "employer," N.J.S.A. 34:11-56a1(g), and also held that
plaintiffs could not bring an action under the FLSA because the state had
not waived its sovereign immunity and consented to suit under the FLSA.
327 N.J. Super. 14, 19-20, 21 (App. Div. 1999).

*I. Seminole Tribe of Florida v. Florida, 517 U.S. 44 (1996), held that
Congress does not have authority pursuant to the commerce clause of the
U.S. Constitution to abrogate a state's Eleventh Amendment sovereign
immunity and to require it to face suit under the FLSA in federal court,
absent the state's consent to suit. Not long thereafter, Alden v. Maine,
527 U.S. 706 (1999), held that Congress similarly does not have the
authority to render states susceptible to FLSA suits in their own courts,
absent their consent to suit. Alden was based not on Eleventh Amendment
grounds, but rather on the very structure of the Constitution and the
"inviolable" and "residuary" sovereignty retained by the states following
ratification of the U.S. Constitution.

*Thus, the Court was left with the issue of whether Maine had waived its
immunity from suit for the FLSA claims. In considering that question, the
Court stated that Maine "adheres to the general rule that 'a specific
authority conferred by an enactment of the legislature is requisite if
the sovereign is to be taken as having shed the protective mantle of
immunity.'" Id. at 757-58. Because immunity was not shed concerning
claims brought under the FLSA, the dismissal of plaintiffs' action was

*II. Historically, New Jersey's courts have long recognized that an
essential and fundamental aspect of sovereignty is freedom from suit by
private citizens for money judgments absent the state's consent. Willis
v. Department of Conservation and Economic Development, 55 N.J. 534
(1970), and P, T & L Construction Co. v. Commissioner, Department of
Transportation, 55 N.J. 341 (1970), opened the courts to litigants who
sought to sue the state in tort or contract actions, with the
understanding that, nonetheless, the Legislature retained its power to
accept the judgment and provide for payment.

*In the Tort Claims Act, N.J.S.A. 59:1-1 to 12-3, and the Contractual
Liability Act, N.J.S.A. 59:13-1 to 13-10, the Legislature agreed to waive
" sovereign immunity from liability arising out of an express contract or
a contract implied in fact," but not for "punitive or consequential
damages arising out of contract" or "for claims based upon implied
warranties or upon contracts implied in law." 59:13-3. Rules of strict
statutory construction control application of that statute because it
derogates sovereignty.

*III. Held: There is no New Jersey statute authorizing suit against the
state for FLSA claims.

*Plaintiffs point to a reference in a collective-bargaining agreement
that states:

Where incidental overtime assignments are made, records of such time
worked shall be kept and may be scheduled as compensatory time on an hour
for hour basis unless the total hours worked in a payweek in which they
occur require compensation at time and one-half in accordance with the
Fair Labor Standards Act.

Based on that single reference to the FLSA, plaintiffs claim that they
may sue New Jersey in state court for damages under the FLSA, seeking
unpaid additional overtime, liquidated damages, prejudgment interest,
costs and attorneys' fees. But nowhere in the complaint do plaintiffs
assert a contract claim. Their cause of action is singularly statutory.
Plaintiffs seek to avoid that difficulty by arguing that theirs is an
action based in contract under the contractual language cited from their
collective-bargaining agreement, and therefore the legislative waiver of
sovereign immunity in the Contractual Liability Act stretches to
encompass a right to sue the state in state court under the FLSA. That is
at best a "bootstrapping" argument put forward by plaintiffs because they
cannot demonstrate that the Legislature has expressly consented to suit
against the state under that federal statutory scheme.

*First, plaintiffs' claim is not contractual; it is statutory. It seeks
statutory remedies. Second, plaintiffs' argument proceeds from a flawed
impression of the effect of the Contractual Liability Act. The act waived
the state's historic immunity from suits based on an express contract or
contracts implied in fact. It did not waive other immunities, nor did it
empower state officials to surrender such rights of the sovereign through
contract. The Contractual Liability Act does not confer on state
officials the authority or legal right to act. It merely states that if a
state official, having the legal authority to do so, makes a written or
implied-in- fact contractual commitment, that contractual undertaking
will be legally enforced. If the promise, however, was beyond the legal
authority of the maker, no enforceable commitment will be found.

*No one has pointed to a specific legislative enactment waiving immunity
for FLSA claims or delegating the power to do so to members of the
executive branch. The Contractual Liability Act does not constitute such
an authorization because it is not an enabling act. The Contractual
Liability Act only provides a mechanism to enforce an express or
implied-in-fact promise otherwise lawfully authorized. It does not expand
the authority of a state officer to act, and the act certainly does not
delegate the power to waive the state's Eleventh Amendment or other
immunities from federal acts. An independent, specific act of the
Legislature is required to accomplish that result.


* * *

*Long, J., concurring in part and dissenting in part, fully subscribes to
the majority's conclusion that the New Jersey State Wage and Hour Law, by
its very terms, excludes the state from the definition of "employer,"
N.J.S.A. 34: 11-56a1(g), and that plaintiffs have no claim against the
state based on that enactment.

*The Contractual Liability Act waives sovereign immunity for contractual
obligations assumed by the state. The only limit on the waiver is for
contracts that could expose the state to unforeseen risks, such as, for
example, a contract implied in law. That is also the rationale underlying
the exclusion from the statutory waiver of punitive and consequential
damages and implied warranties. Each of those excluded categories could
subject the state to losses that it could not foresee or for which it
could not plan.

*By contrast, the Contractual Liability Act broadly waives immunity for
express contracts or those implied in fact, presumably because the state
should be required to live up to clear promises just like any other
litigant and because, by entering into a contract, the state can foresee
the financial outcome in case of breach.

*Here, the collective-bargaining agreement makes it unnecessary to
grapple with the more difficult question of whether an otherwise silent
agreement incorporates existing applicable statutes under the "implied in
fact" doctrine.

*What the Court is faced with in this case is an express contract
specifically stating that the FLSA standard for recompensing incidental
overtime shall govern. The majority's suggestion that that is a
"statutory" claim and not a contract claim misapprehends the nature of
the state's undertaking here and miscasts simple contract shorthand as
some other legal form. This contract falls squarely within the waiver
contemplated by the Contractual Liability Act because it defines the duty
the state is willing to undertake and, concomitantly, puts the state on
notice of the potential sequellae of a breach. Unlike the position of the
state of Maine in Alden, New Jersey clearly waived immunity against suits
on express contracts such as the one at issue here. It could not have
done so more clearly.

*Justice Stein joins in this opinion.

Digested by Steven P. Bann

(The slip opinion is 22 pages long.)

*For appellants -- David Tykulsker (David Tykulsker & Associates). For
respondents -- Patrick DeAlmeida, Deputy Attorney General (John J. Farmer
Jr., Attorney General; Robert H. Stoloff, Assistant Attorney General, and
Mary C. Jacobson, former Assistant Attorney General, of counsel; Todd A.
Wigder, Deputy Attorney General, on the brief).

Syllabus (A-146-99) *5 (New Jersey Law Journal, April 16, 2001)

OCCIDENTAL PETROLEUM: Settles For $ 25M Over Stock Ownership Plan
Case Type: breach of fiduciary duty, ERISA

Case: Croucher v. MidCon Corp. Employee Stock Ownership Plan
Administrative Committee, No. H-98-4159 (S.D. Texas)

Plaintiffs' Attorneys: Lee L. Kaplan, Larry R. Veselka and Justin M.
Waggoner of Houston's Smyser Kaplan & Veselka; Andrew L. Jefferson Jr.,
solo practitioner, Houston

Defense Attorneys: John H. Smither and Thomas H. Wilson of Houston's
Vinson & Elkins

Settlement Amount: $ 25 million

In November 1996, Occidental Petroleum Corp., in anticipation of selling
its MidCon Corp. subsidiary, established an employee stock ownership plan
(ESOP) for about 1,900 MidCon employees. Occidental promised to share
with MidCon's workers a portion of any increase in the value of MidCon
after the inception of the ESOP in order to "encourage MidCon's employees
to stay while the company was up for sale," said plaintiffs' attorney
Larry R. Veselka.

Following this, MidCon's value increased dramatically and in January
1998, the Occidental subsidiary was purchased by KN Energy Inc. for $ 3.9
billion. The MidCon ESOP participants received $ 258 million, but claimed
that they were shortchanged.

The ESOP participants sued Occidental, the MidCon Corp. Employee Stock
Ownership Plan Administrative Committee and U.S. Trust Corp., alleging a
breach of fiduciary duty. Following mediation, the parties settled, with
Occidental, which had indemnified the other defendants, agreeing to pay $
25 million to the plaintiffs' accounts. U.S. District Judge Kenneth
Hoyte, who approved the settlement on March 15, also added $ 3.5 million
in attorney fees and costs to be paid by Occidental. (The National Law
Journal, April 16, 2001)

OPUS360 CORP: The Rosen Law Firm Files Securities Suit in New York
The Rosen Law Firm P.A. (http://www.rosenlegal.com)on April 17 announced
that the firm has commenced a class action in the United States District
Court for the Southern District of New York on behalf of purchasers of
OPUS360 Corporation ("OPUS") (NASDAQ:OPUS) publicly traded common stock
during the period from the initial public offering on April 7, 2000 and
continuing through December 6, 2000 (the "Class Period"), including those
persons who purchased shares in the OPUS initial public offering on April
7, 2000.

The complaint charges OPUS and certain of its officers and directors, as
well as OPUS' investment bankers (JP.Morgan Securities, Robertson
Stephens, E*Offering and Bear Stearns) and certain shareholders that sold
stock in the initial public offering (Safeguard Scientifics and Compucom
Systems) with violations of the Securities Act of 1933. The Complaint
alleges that the Prospectus and Registration Statement filed with the
Securities and Exchange Commission and distributed to OPUS investors was
false and misleading and failed to disclose, among other things, that
OPUS XCHANGE, one of its flagship products did not work as claimed and
contained fatal flaws. The Complaint further alleges that OPUS misled
investors as to the acceptance of XCHANGE by customers and the true
usability of the product. The complaint also alleges that the Company
misled investors as to the true nature of the contracts that it had
entered into with customers for its OPUS XCHANGE and FREEAGENT products.

The Complaint also alleges that the Registration Statement distributed in
connection with OPUS' IPO failed to disclose that it would be necessary
for OPUS to complete a secondary financing within 12 months of the IPO.
The complaint alleges that OPUS failed to disclose to investors that it
would run out of cash within 12 months of the IPO at its then current
rate of cash expenditures, absent a substantial secondary financing. In
fact OPUS had told investors that it would have enough cash for its
planned rapid growth for at least 12 months. The Complaint alleges that
OPUS' disclosures regarding its financing needs and ability to maintain
its planned growth rate were misleading to investors.

Contact: The Rosen Law Firm P.A. P.C. Laurence Rosen, Esq. Toll Free:
1-866-rosenlegal (866-767-3653) lrosen@rosenlegal.com www.rosenlegal.com

POWER WHOLESALERS: A.G.s Probe on Possible Violationf of Antitrust Laws
Houston, it's known as "the power corner." Separated by just a few city
blocks, four major power wholesalers run trading exchanges that have a
strong influence on energy prices nationwide.

The trading floors run by Enron Corp., Reliant Energy Inc., Dynegy Inc.
and Duke Energy Corp. represent ground zero in a power crisis threatening
the quality of life in much of the western United States this summer.

By seizing upon opportunities created by deregulation, the energy traders
have turned up the juice in the electricity business in ways similar to
how junk bond traders ignited Wall Street in the 1980s and venture
capitalists fueled Silicon Valley last decade.

And thanks to an exemption granted in the early 1990s, nobody monitors
daily trading to detect unfair or illegal practices.

Utility bills in California have gone up nearly fourfold in the past
year, to $27.1 billion. Without fundamental changes in the energy market,
this year's bill will rise to $70 billion - more than $2,000 for every
person in the state, according to operators of the state's power grid.

The staggering electricity price increases have pushed the state's
largest utility, Pacific Gas and Electric, into bankruptcy and left No. 2
Southern California Edison on the brink of insolvency. California's
once-ample budget surplus also has shriveled, as the state is spending
about $50 million a day to buy enough power to keep the lights on.

The energy wholesalers say they're doing nothing wrong.

They blame the high prices on the rising price of natural gas, burned to
generate electricity, and the state's botched deregulation plan. By
failing to line up reliable power ahead of time and by imposing price
caps for consumers, the state put itself into this mess, the companies

"There have been accusations of wrongdoing for eight months now and there
isn't a shred of evidence to support the allegations," said Gary
Ackerman, executive director of the Western Power Trading Forum, a Menlo
Park, Calif., trade group. "People are very angry and frustrated about
electricity right now and attorneys are trying to take that anger out on

Attorneys general in Washington, Oregon and California are probing
whether the wholesalers have violated antitrust laws or engaged in unfair
business practices. A California state senate committee may issue
subpoenas for records and the testimony of top energy executives, and at
least five lawsuits accuse energy companies of market abuses.

"This is the best fraud I have ever seen," attorney Michael Aguirre of
San Diego, who is involved in one of the class-action suits. "The
generators are doing everything that you think that they might be doing,
only it's worse than you ever imagined."

The lawsuits and investigations allege that generators have conspired to
hijack billions of dollars from consumers and taxpayers by withholding
electricity from energy-starved California until the last minute, and
then supplying it at exorbitant prices.

At Enron's headquarters in Houston, energy specialists among the
company's 1,500 traders swap electricity and natural gas contracts like
stocks and bonds. Mathematicians, meteorologists and economists make
complex calculations to identify where to buy the cheapest power and
where to deliver it at the greatest profit.

"They are extremely good at what they do," said Severin Borenstein,
director of the University of California at Berkeley's energy institute.

The Internet has provided the traders with the tools to do their jobs
even better. Online marketplaces and password-protected exchanges provide
them with invaluable real-time information on the buying and selling
patterns of their rivals.

Two lawsuits allege that traders have parlayed the sensitive information
collected online to fix prices artificially high, a violation of
antitrust laws.

Aguirre has spent six months assembling reams of data about traders and
their activities, but he has yet to develop concrete evidence to prove
his price-fixing allegations.

A March 21 report by California's electricity grid managers concluded
that, between last May and November, 98 percent of trading bids were
driven up by noncompetitive patterns of behavior.

The California Independent System Operator report stopped short of
accusing wholesalers of illegal market manipulation, but it did determine
that the wholesalers collected as much as $6.9 billion in "unjust and
unreasonable" rates.

Enron says its trading system, particularly the online exchange, has
resulted in fairer and more efficient markets. The allegations of market
abuse are "just some sour grapes from people who didn't come up with the
idea in the first place," said Enron spokesman Eric Thode.

The online exchanges and other industry Web sites provide the energy
traders with a window to see the energy availability and bids in markets
around the country.

Power industry critics, however, contend the Web's instant access
provides the traders a way to exploit a delicate supply-demand balance.
If the scale is tipped even slightly toward an inadequate supply, they
say, prices soar and energy traders reap huge gains.

"The whole trading thing is just a front that lets them game the market,"
Aguirre said. "They can get away with it because no one (outside the
industry) can figure out what they are doing."

Whatever the energy traders are doing, it's not closely monitored by
government regulators.

In 1993, the trading of energy products received an exemption from
oversight by the Commodity Futures Trading Commission, a federal agency
that oversees commodity and options trading to protect markets from fraud
and manipulation. Energy is the only commodity that has received a
blanket CFTC exemption.

The exemption was shepherded beginning in 1992 by then-CFTC chairwoman
Wendy Gramm, wife of Texas Sen. Phil Gramm. She left the CFTC three
months before the exemption received final approval in 1993. That same
year, she joined the Enron board of directors, a post that last year
earned her $50,000.

Gramm, an economist at the Mercatus Center at George Mason University,
said she doesn't recall talking with Enron about the exemption, which she
characterized as a routine matter triggered by an antitrust case
involving crude oil.

"It really didn't have anything to do with Enron or any specific
company," said Gramm. "It had to do with a general market problem."

In granting the exemption, the CFTC accepted the industry's contention
that it shouldn't be subjected to the government's usual commodities
regulation because its markets are dominated by "large sophisticated
commercial entities" capable of protecting themselves - in short, that
there would be no little people to hurt.

At the time, then-CFTC commissioner Sheila Bair scoffed at the reasoning,
comparing energy traders to boiler room sales operations that had the
potential to violate federal anti-fraud laws.

"Is it really that much of burden on market participants (for the CFTC)
to retain a sliver of authority regarding fraudulent activity?" Bair
wrote in a dissenting opinion.

Wholesale electricity prices negotiated by the traders are eventually
compiled in quarterly reports and reviewed by the Federal Energy
Regulatory Commission. And while FERC by law is supposed to prevent
unfair prices, a majority of its commissioners have advocated a hands-off
approach to California's energy crisis, insisting that the market can
correct itself.

That posture may finally be changing somewhat. FERC chairman Curt Hebert
told lawmakers that his agency hopes to begin "monitoring and mitigating"
the wholesale electricity market by May 1. This could allow FERC to
preemptively influence prices.

Energy economists who have studied the market see signs of ruthless, but
perfectly legal, behavior.

Paul Joskow, an MIT economist, concluded in January that electricity
producers deliberately withheld power to drive up prices.

"Every business exercises market power when it can, so I don't know why
people are so surprised that (the generators) used their market power,"
Joskow said. "I didn't see any evidence of collusion in what they did ...
It was just good business."

Enron's specific trading methods remain a mystery even to industry
analysts, partly because the company considers its techniques to be
proprietary. But it yielded a big payoff last year - an operating profit
of $1.6 billion, up 160 percent from $628 million in 1999.

When electricity and natural gas prices soared to record highs in the
fourth quarter, Enron's trading profit more than tripled to $538 million.

Without providing specifics, Enron officials said the profits poured in
from all over the country.

"Our success is linked to efficient markets, not higher prices in
California, or anywhere else for that matter," Steve Kean, an Enron
executive vice president, said in January testimony before the U.S.
Senate. "What we are interested in is competitive and well-functioning
markets. Our financial success is not built on California's back." (The
Associated Press State & Local Wire, April 17, 2001)

RECORDTV.COM: Agrees to Pay Movie Studios $50,000 of the $10M Demanded
A nine-month legal fight between an Internet-based TV taping service and
a group of movie studios ended when RecordTV.com agreed to pay just
$50,000 of the $10 million demanded in the suit.

RecordTV had signed up 100,000 people who could have the site record
specific TV shows and then play them back over the Internet at a later

Twelve members of the Motion Picture Association of America, including
MGM and Disney, filed a lawsuit in federal court in June, alleging
copyright infringement.

Monday's settlement requires RecordTV to stop offering recordings without
permission from the corresponding MPAA member; to pay the $50,000 in
plaintiffs' legal fees; and to stop using plaintiffs' trademarks while
advertising the site.

An MPAA lawyer on Monday called the site "defunct," but RecordTV
representatives said the operation is very much alive. Founder David
Simon said he hopes to create a new business model that allows his
company to enter legitimate deals with MPAA members.

That's not likely, said Robert Schwartz, an attorney for the plaintiffs.
"There are no plans by any of the studios to do business with Mr. Simon
or his defunct Web site," Schwartz said. "There is simply no technical or
business reason that necessitates anyone doing business with the

The studios originally planned to seek $150,000 for each act of alleged
copyright infringement - an amount estimated at $10 million. But the
plaintiffs agreed on the small settlement because RecordTV.com didn't
have much money, Schwartz said.

Simon said the stress of the suit took its toll on him and his family,
and he was ready to move on. "We didn't have the funding to continue
fighting, which is unfortunate, because I still think we were in the
right - but whatever," Simon said. "I am a guy with a mortgage, a wife,
two girls and a dog."

Simon's lawyer, Ira Rothken, said he hoped the MPAA had learned a lesson
from the legal battle. "We hope that the benefit of the litigation will
be that the MPAA will see there is enough demand for providing
Internet-based VCRs, so people won't be limited to recording in the
house," he said. Schwartz said he knew of no other Internet sites
operating like RecordTV. (The Associated Press State & Local Wire, April
17, 2001)

SCHERING-PLOUGH CORP: Harvey Greenfield Announces Securities Suit in NJ
The the Law Firm of Harvey Greenfield gives notice that class action
lawsuit was filed in the United States District Court for the District of
New Jersey, Newark Division, on behalf of all purchasers of common stock
of Schering-Plough Corporation (NYSE: SGP) ("SGP" or the "Company") who
purchased or acquired shares of SGP between July 25, 2000 and March 30,
2001, inclusive (the "Class Period"), including those who acquired shares
through a dividend reinvestment plan. The lawsuit is identified as Bryna
Stepak v. Schering-Plough Corp., et al. (case number and judge to be

The Complaint alleges that SGP and certain of its officers and directors
violated the Securities Act of 1933 and the Securities Exchange Act of
1934. Among other things the complaint alleges that SGP issued false and
misleading public statements about SGP's earnings and revenue in its
earnings releases during the class period, which highlighted the success
and continued growth of the Company. The releases omitted material facts
concerning manufacturing difficulties at certain of the Company's plants,
and the problems it was encountering in receiving FDA approval of a
significant new product, desloratadine, since the FDA was forcing the
Company to curtail its operations and delay introduction of desloratadine
because of noncompliance with its quality control guidelines. In
addition, the Company was, unbeknownst to the public, engaging in
unreasonable restraint of trade by entering into anti-competition
agreements with at least two other drug manufactures.

SGP finally disclosed the extent of its manufacturing problems after the
close of market on February 15, 2001, announcing that it would reduce its
sales and earnings expectations for the first quarter of 2001 and for the
full year 2001. It also revealed that the FDA was requiring that SGP
resolve all its manufacturing deficiencies before the FDA would grant
approval of desloratadine. As a result, the price of SGP stock plunged in
after-hours trading from a high for the day of$48.32 to $38.75.

On March 30, 2001, the Federal Trade Commission, following an
investigation into SGP's anti-competitive practices, filed a complaint
charging SGP and others with entering into anti-competitive agreements in
violation of the antitrust laws. As a direct result of this negative
information, SGP stock again dropped from a high of $40-1/16 on March 29,
to a low of $35 on April 2, 2001.

The public dissemination of materially misleading financial information
caused SGP's common stock to be artificially inflated throughout the
Class Period. During the Class Period, the officer and director
defendants and other SGP insiders collectively sold $41.3 million worth
of personally-held SGP stock, thereby profiting from the stock's
artificially inflated pricing.

Contact: Law Firm of Harvey Greenfield Harvey Greenfield, Esq.,
212/949-5500 hgreenf@banet.net

UNUMPROVIDENT CORP: Wins Jury Verdict re Brokers of Paul Revere Subsids
UnumProvident Corporation (NYSE: UNM) announced that a jury in the
Superior Court in Worcester, Massachusetts, returned a verdict on Friday,
April 13, 2001 in favor of UnumProvident's subsidiaries in a class action
brought by two independent brokers on behalf of a class of more than
33,000 brokers.

In 1997, following the acquisition of The Paul Revere Life Insurance
Company and its subsidiaries by Provident Companies, Inc., which is a
predecessor to UnumProvident, a series of lawsuits were filed by sales
managers as well as by representatives of independent brokers and career
agents of the Paul Revere companies claiming, among other things, breach
of their contracts by Paul Revere.

The lawsuit brought on behalf of the independent brokers was certified by
the court as a class action. It claimed that Paul Revere breached its
contracts with the brokers who sold individual disability income policies
when it changed the commission schedule on premium received on the
exercise of certain benefit riders after 1994. The representatives also
claimed Paul Revere violated the Massachusetts Consumer Protection Act as
part of the actions it took on commission changes and that the brokers
were entitled to treble damages and attorneys fees under that Act.

Glenn Felton, Vice President and Assistant General Counsel, stated, "The
Company has consistently disputed the claims made on behalf of the
brokers throughout the four years the lawsuit has lasted. We think the
jury reached the correct decision that there was no breach of contract.
Hopefully this verdict will end this litigation that was undertaken by
class representatives of these brokers."

               About UnumProvident Corporation

The subsidiaries of UnumProvident Corporation offer a comprehensive,
integrated portfolio of products and services backed by industry-leading
return-to-work resources and disability expertise. UnumProvident
Corporation is the world leader in protecting income and lifestyles
through its comprehensive offering of group, individual, and voluntary
benefits products and services. UnumProvident has operations in the
United States, Canada, the U.K., Japan, and elsewhere around the world.

WALGREEN CO: Cleared of TX Lawsuit re Partially Filled Prescriptions
On September 29, 1999, the company was served with an action based on the
company's handling of partially filled prescriptions for private
third-party plans by the Board of Trustees of the Carpenters Millrights
of Houston Vicinity Welfare Trust Fund, Civil Action No. 599CV216, which
was filed in the United States District Court for the Eastern District of
Texas. The complaint sought certification as a class action, as well as
treble damages in excess of $1,000,000.

On March 8, 2001, the District Court entered an order, at Plaintiff's
request, dismissing the complaint against the company with prejudice. No
monies or other consideration was paid to Plaintiffs.

WINSTAR COMMUNICATIONS: Milberg Weiss Announces Securities Suit in N.Y.
The law firm of Milberg Weiss Bershad Hynes & Lerach LLP announces that a
class action lawsuit was filed on April 16, 2001, on behalf of purchasers
of the securities of Winstar Communications, Inc. ("Winstar" or the
"Company") (NASDAQ:WCII) between August 2, 2000, and April 2, 2001

A copy of the complaint filed in this action is available from the Court,
or can be viewed on Milberg Weiss' website at:

The action, numbered 01 CIV 3187, is pending in the United States
District Court, Southern District of New York, located at 500 Pearl
Street, New York, NY 10007 against defendants Winstar, William J.
Rouhana, Jr., Richard J. Uhl and Nathan Kantor. The Honorable Richard
Owen is the Judge presiding over the case.

The complaint alleges 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 August 2, 2000 and April 2, 2001, regarding the Company's
performance and future prospects. Specifically, defendants indicated to
investors that the Company was experiencing significant growth and was
sufficiently funded through the first quarter of 2002. In truth, however,
Winstar's strong financial results were the result of improper accounting
practices in which Winstar capitalized numerous capital expenditures as
assets instead of as expenses causing the Company's EBITDA to be
materially overstated. Winstar also overstated its revenues by improperly
reporting uncollectible receivables as revenues. Investors finally became
aware of Winstar's problems when, on April 2, 2001, Winstar announced
that it would be delaying the filing of its Form 10-K because it was
involved in material transactions that precluded it from making a timely
filing. On April 5, 2001, the Company announced that it was "halting" its
expansion plans and would be laying off approximately half of its
workforce. The reaction to these announcements was immediate and
punitive. On April 2, 2001, shares of Winstar stock closed at $0.875 per
share from a prior close of $2.16 per share. On April 6,2001, shares of
Winstar stock declined even further to close at $0.40, far less than the
class period high of $32 per share.

Contact: Milberg Weiss Bershad Hynes & Lerach LLP, New York Steven G.
Schulman or Samuel H. Rudman Phone number: (800) 320-5081 Email:
winstarcase@milbergNY.com Website: http://www.milberg.com

WINSTAR COMMUNICATIONS: Shalov Stone Expands Securities Lawsuit in N.Y.
The law firm of Shalov Stone & Bonner on April 16 announced that the
previously announced class action on behalf of Winstar Communications
Inc. investors (NASDAQ:WCII) will be expanded to include investors who
purchased Winstar securities in the period from June 2000 to April 2,

The complaint names Winstar, William Rouhana, Richard Uhl and Nathan
Kantor as defendants. The lawsuit was filed by the law firm of Shalov
Stone & Bonner in New York City (www.lawssb.com). Shalov Stone & Bonner
conducted the investigation leading to the filing of the Winstar action
and it was the first law firm to take action in these cases.

The complaint alleges that the defendants made material
misrepresentations and omissions of material facts concerning the
company's business performance during the relevant time. According to the
complaint, throughout the relevant time period, defendants repeatedly
assured investors that the company was performing well, that the company
was enjoying strong growth and that it was well-funded to follow its
growth-oriented business plan through the first quarter of 2002. At the
same time, however, the complaint alleges that the defendants knew or
recklessly disregarded that Winstar was overstating revenues and assets.
In April 2001, contrary to prior representations, Winstar announced that
it was halting its expansion and laying off thousands of employees. The
company has delayed the filing of its annual Report on Form 10-K with the
SEC and its stock price has collapsed. The lawsuit was filed in the
United States District Court for the Southern District of New York.

Contact: Shalov Stone & Bonner, New York Mark J. Nemetz, Law Clerk,

* NLJ Presents Advice on Preventing and Defending Mega-Suits
Byline: Barry Richard; Mr. Richard, based in Tallahassee, Fla., is a
partner and co-chairman of the national litigation group at Greenberg
Traurig. He was lead litigation counsel in Florida for George W. Bush
during the Bush-Gore election dispute.

Mega-cases involve multiple complaints, sometimes numbering in the
hundreds or even thousands, filed in different jurisdictions, involving
the same core issues. Such cases require special consideration -- by both
the defending corporation and its lead law firm -- of organization, venue
and discovery.

The corporation should be prepared for the mega-suit before it happens.
It is not uncommon for an initial complaint served on a corporation to
pass through the hands of several employees and officers, sometimes in
different cities, before litigation counsel is retained -- often days or
even weeks later. Although it is not ideal, the delay rarely has serious
consequences in a typical one-of-a-kind case. But the same delay can be
fatal in a mega-case. Mega-cases tend to become very big, very fast.

The problem was illustrated by litigation against American Home Products,
which was forced to withdraw its anti-obesity drug Redux in late 1997
under pressure from the Food and Drug Administration. The suits began
almost immediately after the announcement and proliferated rapidly. By
March 1998, there were 797 lawsuits pending in more than 30 states.

           Be Prepared Before The First Suit Is Filed

Delay and disorganization can result in defaults, orders to compel,
sanctions and a growing tactical disadvantage that cannot be overcome. A
guiding principle of mega-litigation defense is this: Once the first suit
is filed, it is already too late to begin preparation. Corporations at
risk of mega-suits must have an organizational structure and a plan of
defense in place before the first suit is filed, and all corporations
that sell multi-state products or services are at risk. There are three
key steps that a corporation can take to prepare.

Establish a continuing relationship with an outside law firm that will
act as coordinating counsel in the event of mega-litigation. It will
likely be necessary for the company to retain separate law firms in a
number of cities. To avoid costly duplication and assure consistency, the
company must engage one firm to oversee and coordinate all the firms
representing the company in the related actions. Mega-litigation is
unique and requires a coordinating firm that has the extensive resources
and unique experience necessary to handle it. There is insufficient time
after the first suit has been filed to begin searching for and
interviewing firms. The obligation of an insurance company to provide
defense does not eliminate this precaution. Mega-cases often involve
allegations that evade coverage, and potential judgments can far exceed
coverage. Moreover, insurance defense firms rarely have the resources or
experience to handle a true mega-case on their own.

Establish a system for detecting the first signs of possible
mega-litigation. An experienced attorney within the company's in-house
legal department should be designated to monitor all legal papers served
on the company and all events that could presage a mega-suit. Red flags
include any suit against the company or any of its affiliates that
alleges a tortious act, contract violation or statutory violation that
could have general application to a wide range of the company's
employees, customers or contracting parties; a regulatory action against
the company or another company in the same industry alleging
improprieties in products, services or practices materially similar to
those of the company; a class action or individual action that makes such
allegations against another company and that receives widespread
publicity; or widespread publicity relating to problems with a product or
service sold by the company or to a similar product or service sold by
another company. The recent Firestone recalls illustrates the problem of
adverse publicity surrounding similar products or other companies in the
same industry. In addition to spawning thousands of suits against
Bridgestone/Firestone, the publicity spurred a rash of suits against
tiremakers Cooper and Goodyear.

Establish a rapid-response team within the company that consists of at
least one in-house attorney, at least one high-level corporate officer
and a member of the company's public relations department. The team, in
turn, should maintain an up-to-date in-house communications network that
will enable the team or the coordinating law firm to quickly reach the
proper person when decisions, information or discovery responses must be
obtained without delay.

       The Coordinating Law Firm Must Play A Leadership Role

The coordinating law firm must gear up early. For the coordinating law
firm, a mega-case is not business as usual. Mega-cases can appear
deceptively simple at their inception, but the firm must assume that the
case will rapidly become large, complex and time-consuming. The
organization of the coordinating law firm will depend on the practices of
the firm and the exigencies of the particular litigation, but several
matters should be given early and careful attention.

The core of the team of lawyers and support staff should be gathered at
the first sign of mega-litigation. Members of the team must be in a
position to devote a substantial portion of their time to the litigation
for an indefinite period. A paralegal should be assigned the task of
keeping up-to-date dockets of all filings.

The most pressing problem in mega-litigation is inconsistency. A
statement in a pleading, a motion or an interrogatory response in one
case that is inconsistent with a position asserted elsewhere can have
devastating repercussions in all cases. The coordinating firm should
consider designating a single lawyer to monitor all documents filed in
all cases for uniformity of position.

Rapid and regular communications among lawyers working on the litigation
both inside and outside the coordinating firm are essential. A regular
schedule of meetings of the lawyers within the firm and conference calls
with those outside should be established at the beginning and adhered to
religiously. Many large law firms have the technological ability to share
documents, dockets and general case information with outside lawyers by
the use of an extranet. In mega-litigation, an extranet can be an
enormous advantage. Drafts of documents can be posted to the extranet,
where they are immediately available for review and discussion by all

           Forum Strategy Is Key In Mega-Litigation

Forum strategy is especially significant. Decisions regarding federal or
state forum selection, transfer and consolidation are often important but
have added significance in mega-cases. Ordinarily, the defendant
corporation will remove as many cases as it can to federal court and then
seek an order of consolidation for pretrial proceedings from the Panel on
Multidistrict Litigation (MDL). The cost to the defendant company of
defending dozens, hundreds or even thousands of separate cases in
different states -- in terms of money and bad publicity -- is enormous.
There will be rare instances when there will be too high a risk that the
panel will order consolidation in a district in which the substantive law
of the forum state is materially less favorable to the defendant than in
other states in which the litigation is pending. Although multi-district
consolidation is for pretrial purposes, the transferor court can rule on
dispositive motions. (Unlike normal forum non conveniens transfer in
diversity cases, in which the substantive law of the transferor state
carries with the case, in the case of MDL panel transfers, the transferee
court uses the substantive law of its own state.) In most cases, however,
the advantages of consolidation will outweigh any potential

There will often be some state cases that cannot be removed because of
lack of diversity or a federal question, but consolidation of the federal
cases will still substantially reduce the extent of the litigation. In
the Redux litigation, 467 cases were consolidated in a single federal
court. In addition, state judges are sometimes receptive to abating the
state proceedings to await decision in the consolidated federal case.

Most often, one or more of the cases is filed as a plaintiffs' class
action. Certification should not automatically be opposed. Class
certification, with a properly worded class definition, can be beneficial
to the defendant in a megasuit. Besides the obvious advantage of barring
continuing litigation once it is finally disposed of, class certification
will often facilitate consolidation or result in abatement or dismissal
of other cases.

Saving money and reducing adverse publicity are not the only benefits of
consolidation. It also has the tactical advantage of forcing together
numerous separate plaintiffs' law firms, each serving a different master.
Unlike the properly prepared corporate defendant, these firms will begin
a critical stage of the litigation with no organizational structure and
will frequently never achieve a smooth, efficient working relationship.

Discovery presents unique problems. No aspect of mega-litigation is more
burdensome than discovery. The cost of sending millions of pages of
documents to hundreds of lawyers is itself tremendous. The most expensive
element of discovery compliance, however, is the cost of manpower.
Locating documents and drafting interrogatory responses can consume many
thousands of man-hours. The documents must also be rearranged and the
responses redrafted to fit each of hundreds of separate requests. It is
here that federal consolidation can prove most useful. The Manual for
Complex Litigation and Federal Rule of Civil Procedure 26 provide an
excellent framework for imposing reasonable restrictions on the
plaintiffs to avoid endless, repetitious discovery.

Even in the absence of consolidation, it is sometimes possible to
persuade all or most of plaintiffs' counsel to stipulate to a uniform
discovery procedure. In either case, defense counsel should take the
initiative at an early stage by developing a uniform plan of discovery. A
comprehensive set of relevant documents can be gathered, indexed and made
available for inspection by plaintiffs' counsel at one or more
depositories. If opposing counsel balks at the cost of traveling to the
nearest depository, it will usually be less costly for the defendant to
pay for the cost of such travel in lieu of shipping a set of documents. A
comprehensive set of interrogatories and answers can be agreed on by
counsel for use in all cases, with the understanding that a second round
of interrogatories -- limited to matters unique to particular cases --
will be permitted.

           Avoid Inconsistent Statements At All Costs

Depositions of corporate officers and employees present a particularly
difficult problem. There is the obvious impact on time and productivity
that would result from tying up key officers and employees in endless
depositions. Additionally, repetitive depositions raise the prospect of
statements that, if not actually inconsistent, can give the appearance of
inconsistency. It is generally more difficult to obtain cooperation from
opposing counsel as to depositions than with respect to other forms of
discovery. It will almost always require court intervention. If a large
number of cases have been consolidated before a federal court, the
defendant should include in its proposed discovery plan a coordinated
deposition arrangement. One effective approach is to require plaintiffs'
counsel to agree on one or more of their number as the lawyers who will
take particular depositions, and on a series of dates. Each deponent can
be scheduled for an initial and a supplemental deposition. Other
plaintiffs' lawyers would receive transcripts of the initial deposition
and would then send any additional questions to the designated deposition
taker to be covered on the supplemental deposition. The defendant can
stipulate that the depositions be available in all cases, and judges in
state and nonconsolidated federal cases can be asked to order plaintiffs
to comply with the coordinated plan.

A mega-case is a corporation's worst legal nightmare. It is impossible to
anticipate with any long-range accuracy and, it can bankrupt a healthy
company. But adequate early preparation and wise strategic
decision-making can significantly ease the impact and might well save the
company. (The National Law Journal, April 16, 2001)


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
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Information contained herein is obtained from sources believed to be
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Additional e-mail subscriptions for members of the same firm for the
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