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/raid1/www/Hosts/bankrupt/CAR_Public/010813.mbx C L A S S A C T I O N R E P O R T E R Monday, August 13, 2001, Vol. 3, No. 157 Headlines AMYLIN PHARMACEUTICALS: Milberg Weiss Files Lawsuit in S.D. CA AUDI OF AMERICA: Recalls Fuel Gauges for Second Time CHRONIMED INC: Berman DeValerio Files MN Securities Suit DIGITAL RIVER: Schiffrin & Barroway File Lawsuit in S.D. NY DRUGSTORE.COM INC: Finkelstein Thompson Files Suit in S.D. NY EQUINIX INC: Milberg Weiss Files Securities Suit in S.D. NY EQUINIX INC: Cauley Geller Files Securities Suit in S.D. NY INNER CITY: McCallion & Associates File Shareholder Suit in NY MATRIXONE INC: Milberg Weiss Files Securities Suit in S.D. NY MATRIXONE INC: Cauley Geller Files Securities Suit in S.D. NY NETSILICON INC: Charles Priven Files Securities Lawsuit SCHERING-PLOUGH: PAL Suit Disputes Efficacy, Deceptive Ads SCIQUEST.COM INC: Milberg Weiss Sues Investment Banks TRANSMETA CORPORATION: Berman deValerio Files CA Fraud Suit US WIRELESS: Berman DeValerio Files CA Securities Suit VICINITY CORPORATION: Milberg Weiss Files NY Securities Suit ***** AMYLIN PHARMACEUTICALS: Milberg Weiss Files Lawsuit in S.D. CA -------------------------------------------------------------- Milberg Weiss (http://www.milberg.com/amylin/)filed a class action in the United States District Court for the Southern District of California on behalf of purchasers of Amylin Pharmaceuticals, Inc. (NASDAQ:AMLN - news) stock during the period between February 8, 2000 and July 25, 2001. Persons who wish to serve as lead plaintiff must move the Court no later than 60 days from today. The complaint charges Amylin and its Chief Executive Officer with violations of the Securities Exchange Act of 1934. Amylin is engaged in the discovery, development and commercialization of potential drug candidates for the treatment of metabolic disorders. On July 25, 2001, the Food and Drug Administration released medical and statistical reviews regarding Amylin's diabetes drug pramlintide acetate (SYMLIN) prior to an FDA Advisory Committee Meeting scheduled for July 26, 2001. This review cited major concerns regarding the safety and lack of efficacy of SYMLIN. The review stated there were major adverse events upon treatment with SYMLIN and an alarming number of patients that had life altering events relating to hypoglycemia (low blood glucose level), including major trauma, accidents and death, many of which apparently were concealed from the safety database, making this database unreliable to the FDA. The complaint alleges this hypoglycemic side effect was particularly surprising to the FDA and investors, as the Company all along had claimed that one advantage of SYMLIN over insulin was that it did not increase the risk of hypoglycemia. >From an efficacy standpoint, the medical review stated that the clinical trials deviated from good medical practice because during the studies a constant insulin dose was maintained in the patient, and therefore, the data provided little insight to which patients, if any, would benefit from SYMLIN or how it should be used. The public announcements and statements made during the Class Period were materially false and misleading when issued in that they falsely portrayed Amylin as a growing, successful, well-managed, law-abiding, well-controlled company, and a leader of its industry, and that it had a highly effective drug, SYMLIN. These public announcements and statements did not make full, complete and timely disclosure of Amylin's fraudulent illegal practices and failed to correct false and misleading statements made prior to July 25, 2001, in that they failed to disclose the following material adverse information: (a) Amylin had been concealing materially negative information from the FDA which would render FDA approval of SYMLIN impossible; (b) the actual study showed that SYMLIN was causing a four- fold increase in hypoglycemia-related events in patients as compared to a placebo; (c) in Type 1 diabetics, SYMLIN was reducing the patients' ability to recognize hypoglycemia; (d) contrary to the Company's repeated statements that SYMLIN had no additional risk for hypoglycemia, SYMLIN was showing that it did create additional risk; (e) the treatment and control arms of the SYMLIN study were manipulated in order to create the appearance of SYMLIN's efficacy, and SYMLIN's purported efficacy was not based on a full battery of applicable statistical analyses/tests, including factoring in the variances in doses; and (f) the results of the SYMLIN study actually favored treatment with insulin alone. For more information on this action, contact William Lerach of Milberg Weiss Bershad Hynes & Lerach LLP, 800/449-4900, wsl@milberg.com. AUDI OF AMERICA: Recalls Fuel Gauges for Second Time ---------------------------------------------------- One year after a failed recall and a class action suit filed by two Pennsylvania law firms, Audi of America, Inc. has issued a second recall campaign to fix fuel gauge malfunctions in certain 1998, 1999, and 2000 Audi A-6 Quattro models. More than 68,000 vehicles are affected. The Ambler-based law firm of Kimmel & Silverman, P.C., which specializes in automobile lemon law, and the Philadelphia-based firm of Berger and Montague filed papers last year in the Court of Common Pleas, Montgomery County. According to court papers, Audi Quattro owners found their cars running out of gas despite the fact that their fuel gauge read at least half full. Last year, an Audi corporate representative and certified mechanic admitted tank sensors are the culprit and revealed in deposition testimony that a repair has yet been devised to effectively repair the problem. Less than two weeks after the case was filed, Audi issued an initial recall and replaced fuel gauge components in 32,000 vehicles. In a letter written to Kenneth Weinstein of the National Highway Traffic and Safety Administration (NHTSA), Audi's Director of Technical Service, Kip Kriigel, admitted that in some states, the recall proved to be unsuccessful. "Audi has found the rate of malfunction of the Recall parts in the United States has varied from region to region. In some states, the rate was found to be higher than in other states." Kriigel attributed the problem to elemental sulfur, "a highly reactive substance which was not detected by tests currently employed in the petroleum industry." Kriigel wrote that "tests conducted by Audi have confirmed that the operation of the vehicle with fuel containing even as little as one part elemental sulfur could cause recall Parts to malfunction." Kriigel said Audi will correct the problem with a second recall by installing fuel sensors composed of gold, silver and a small amount of nickel. Audi is planning to install this alloy in the 32,000 cars originally recalled; plus 11,000 vehicles which never received the recalled part; and 25,084 vehicles manufactured with the recalled part. "It appears that Audi has finally resolved the problem after recognizing last year's unsuccessful first attempt," says Consumer advocate and attorney Craig Thor Kimmel, managing partner of Kimmel & Silverman. The letter indicated that Audi owners will be notified of the second recall this summer. As of the date of this release, there is no recall information on Audi or NHTSA's websites. Prior to their most recent announcement, Audi had suggested drivers measure the distance driven in their Quattros between fill-ups, rather than rely on their gas gauge. For more information on the Audi A-6 Quattro recall, consumers can call Audi customer service at 1-800-822-2834. Owners and lessees of 1998, 1999, and 2000 Quattro models who have experienced similar problems can also log onto www.lemonlaw.com or call Kimmel & Silverman at 1-800-Lemon-Law (800-536-6652) for more information. CHRONIMED INC: Berman DeValerio Files MN Securities Suit -------------------------------------------------------- A securities class action accuses Chronimed Inc. (Nasdaq: CHMD) with issuing false and misleading information to shareholders, according to the law firm of Berman DeValerio Pease Tabacco Burt & Pucillo. The lawsuit was filed June 28 in the United States District Court for the District of Minnesota and is filed as 01-CV-1175 dsd/jmm. The case is pending before the Hon. David S. Doty. It seeks damages for violations of federal securities laws on behalf of all investors who bought Chronimed stock between October 27, 1999 and June 13, 2001. Berman DeValerio has represented investors in class actions for nearly two decades. To review the complaint and learn more about becoming a lead plaintiff, visit our Website at www.bermanesq.com. The complaint accuses Chronimed, a Minnetonka-based pharmaceutical and patient management services company, of issuing false and misleading financial statements to the investing public during the Class Period. Throughout that period, the company said it had consistently favorable quarterly results, including several quarters of record revenues. But on June 14, 2001, the company announced that it intended to restate its results for the fiscal year ended June 30, 2000 and for the three subsequent quarters because it had overstated its overall revenue, earnings and accounts receivable during those periods. Chronimed said that the computer accounting system at its StatScript retail pharmacy chain allowed certain prescriptions to be recorded as revenue more than once. The company said it believed the adjustments would be material and suspended its previous guidance on financial performance. The Nasdaq National Stock Market quickly halted all trading in Chronimed stock following the announcement, which contradicted much of the information the company had provided to the market during the period covered by the complaint. When trading resumed on June 22, 2001, the value of Chronimed's stock fell to a close of $4.75 a share, 49 percent less than the $9.35 a share it had traded for at the time of the halt. Persons who purchased Chronimed common stock during the period of October 27, 1999 through June 13, 2001 may wish to apply to be lead plaintiff in this action and file a motion with the court no later than August 14, 2001. For more information, contact Chauncey D. Steele IV, Esq. or Jeffrey C. Block, Esq. of Berman DeValerio Pease Tabacco Burt & Pucillo at One Liberty Square, Boston, MA 02109, law@bermanesq.com, (800) 516-9926. DIGITAL RIVER: Schiffrin & Barroway File Lawsuit in S.D. NY ----------------------------------------------------------- The law firm of Schiffrin & Barroway, LLP filed a class action lawsuit in the United States District Court for the Southern District of New York, located at 500 Pearl Street, New York, NY 10007 on behalf of all purchasers of the common stock of Digital River, Inc. (Nasdaq: DRIV) from August 11, 1998 through December 6, 2000, inclusive against the following defendants: * Digital River * FleetBoston Robertson Stephens * Bear Stearns & Co., Inc., and * Credit Suisse First Boston Corporation. Robertson Stephens, Bear Stearns and Credit Suisse are referred to herein as the "Underwriter Defendants". On or about August 11, 1998, Digital River commenced an initial public offering of 3,000,000 of its shares of common stock at an offering price of $8.50 per share. In connection therewith, Digital River filed a registration statement, which incorporated a prospectus, with the SEC. The complaint alleges that the Prospectus was materially false and misleading because it failed to disclose, among other things, that: (i) The Underwriter Defendants had solicited and received excessive and undisclosed commissions from certain investors in exchange for which the Underwriter Defendants allocated to those investors material portions of the restricted number of Digital River shares issued in connection with the Digital River IPO; and (ii) the Underwriter Defendants had entered into agreements with customers whereby The Underwriter Defendants agreed to allocate Digital River shares to those customers in the Digital River IPO in exchange for which the customers agreed to purchase additional Digital River shares in the aftermarket at pre- determined prices. Members of the class described above may, not later than October 8, 2001, move the Court to serve as lead plaintiff of the class. For more information, contact Schiffrin & Barroway, LLP (Marc A. Topaz, Esq. or Stuart L. Berman, Esq.) at Three Bala Plaza East, Suite 400, Bala Cynwyd, PA 19004, toll free at 1-888-299-7706 or 1-610-667-7706, or via e-mail at info@sbclasslaw.com. DRUGSTORE.COM INC: Finkelstein Thompson Files Suit in S.D. NY ------------------------------------------------------------- On July 23, 2001, Finkelstein, Thompson & Loughran filed a class action lawsuit in the United States District Court for the Southern District of New York on behalf of purchasers of the securities of drugstore.com, Inc., (Nasdaq: DSCM) certain of its officers, and its underwriters who are accused of illegally misleading investors. The class action, captioned Exelbert v. drugstore.com, Inc. and Morgan Stanley, seeks damages under federal securities laws for anyone who bought drugstore.com stock between July 27, 1999 and December 6, 2000, inclusive. The complaint charges defendants with violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The complaint alleges that the Prospectus was materially false and misleading because it contained material misrepresentations and omissions about: (i) Morgan Stanley's agreements with customers whereby Morgan Stanley had solicited and received excessive and undisclosed commissions in exchange for an allocation of drugstore.com shares issued in connection with the initial public offering; and (ii) Morgan Stanley had entered into agreements with customers whereby Morgan Stanley would allocate drugstore.com shares issued in connection with the initial public offering in exchange for which the customers agreed to purchase additional drugstore.com shares in the aftermarket at pre-determined prices. Investors who purchased drugstore.com securities during the class period may apply to be lead plaintiff in this action. For more information, contact Andrew J. Morganti with Finkelstein, Thompson & Loughran, toll-free at 888-333-4409, or at 202-337- 8000. You may learn more about Finkelstein, Thompson & Loughran at http://www.ftllaw.com. EQUINIX INC: Milberg Weiss Files Securities Suit in S.D. NY ----------------------------------------------------------- The law firm of Milberg Weiss Bershad Hynes & Lerach LLP announces that a class action lawsuit was filed on August 8, 2001, on behalf of purchasers of the securities of Equinix, Inc. (NASDAQ: EQIX) between August 10, 2000 and December 6, 2000, inclusive. A copy of the complaint filed in this action is available from the Court, or can be viewed on Milberg Weiss' website at: http://www.milberg.com/equinix/ The action is pending in the United States District Court, Southern District of New York, located at 500 Pearl Street, New York, NY 10007, against the following defendants: * Equinix * Goldman Sachs & Co. * Salomon Smith Barney * Lehman Brothers, Inc. * Peter F. Van Camp * Albert M. Avery, IV and * Philip J. Koen. The complaint alleges violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. On or about August 10, 2000, Equinix commenced an initial public offering of 20,000,000 of its shares of common stock at an offering price of $12 per share. In connection therewith, Equinix filed a registration statement, which incorporated a prospectus, with the SEC. The complaint further alleges that the Prospectus was materially false and misleading because it failed to disclose, among other things, that: (i) Goldman Sachs, Smith Barney and Lehman had solicited and received excessive and undisclosed commissions from certain investors in exchange for which Goldman Sachs, Smith Barney and Lehman allocated to those investors material portions of the restricted number of Equinix shares issued in connection with the Equinix IPO; and (ii) Goldman Sachs, Smith Barney and Lehman had entered into agreements with customers whereby Goldman Sachs, Smith Barney and Lehman agreed to allocate Equinix shares to those customers in the Equinix IPO in exchange for which the customers agreed to purchase additional Equinix shares in the aftermarket at pre- determined prices. As alleged in the complaint, the SEC is investigating underwriting practices in connection with several other initial public offerings. Investors who bought the securities of Equinix between August 10, 2000 and December 6, 2000 may, no later than September 28, 2001, request court appointment as lead plaintiff. For more information, contact attorneys Steven G. Schulman or Samuel H. Rudman of Milberg Weiss Bershad Hynes & Lerach LLP, One Pennsylvania Plaza, 49th fl., New York, NY, 10119-0165, Phone number: (800) 320-5081, Email: Equinixcase@milbergNY.com, Website: http://www.milberg.com. EQUINIX INC: Cauley Geller Files Securities Suit in S.D. NY ----------------------------------------------------------- The Law Firm of Cauley Geller Bowman & Coates, LLP filed a class action in the United States District Court for the Southern District of New York on behalf of purchasers of Equinix, Inc. (Nasdaq: EQIX) securities during the period between August 10, 2000 and December 6, 2000, inclusive. A copy of the complaint filed in this action is available from the Court, or can be viewed on the firm's website at http://www.classlawyer.com/pr/equinix.pdf. The complaint charges defendants * Equinix * Goldman Sachs & Co. * Salomon Smith Barney Inc. * Lehman Brothers, Inc. * Peter F. Van Camp * Albert M. Avery, IV and * Philip J. Koen with violations of Sections 11, 12(a) (2) and 15 of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. On or about August 10, 2000, Equinix commenced an initial public offering of 20 million of its shares of common stock at an offering price of $12.00 per share. In connection therewith, Equinix filed a registration statement, which incorporated a prospectus, with the SEC. The complaint further alleges that the Prospectus was materially false and misleading because it failed to disclose, among other things, that (i) the Underwriter Defendants (Goldman Sachs, Smith Barney and Lehman) had solicited and received excessive and undisclosed commissions from certain investors in exchange for which the Underwriter Defendants allocated to those investors material portions of the restricted number of Equinix shares issued in connection with the Equinix IPO; and (ii) the Underwriter Defendants had entered into agreements with customers whereby the Underwriter Defendants agreed to allocate Equinix shares to those customers in the Equinix IPO in exchange for which the customers agreed to purchase additional Equinix shares in the aftermarket at pre-determined prices. Persons who bought the securities of Equinix between August 10, 2000 and December 6, 2000, inclusive, may, no later than September 28, 2001 request court appointment as lead plaintiff. For more information, contact Jackie Addison, Sue Null or Charlie Gastineau of the Client Relations Department of Cauley Geller Bowman & Coates, LLP, P.O. Box 25438, Little Rock, AR 72221-5438, Toll Free: 1-888-551-9944, E-mail: info@classlawyer.com. INNER CITY: McCallion & Associates File Shareholder Suit in NY -------------------------------------------------------------- Attorneys for a group of minority shareholders in Inner City Broadcasting filed a suit today in New York State Supreme Court against Inner City Broadcasting and Percy E. Sutton, the majority shareholder. Sutton's son, Pierre, who is the President of the Company, is also named as a defendant. The complaint alleges minority shareholders, including named Plaintiffs John Edmonds and David Lampell, have been denied their corporate shareholder rights, including their right to vote, the holding of annual meetings, the conduct of a corporate accounting, as well as their right to their fair share of the Company's profits. According to the shareholders' attorney, Kenneth F. McCallion, the complaint also alleges that Percy E. Sutton and his son Pierre Sutton have breached their fiduciary responsibility by engaging in numerous transactions in their role as majority shareholders that were not in the best interest of the shareholders. The Complaint also alleges failure to abide by a 1999 Agreement with the New York State Attorney General to provide independently audited financial statements to the shareholders. For more information on this case, contact Susan W. Hynes of McCallion & Associates LLP, New York, 646/366-0883. MATRIXONE INC: Milberg Weiss Files Securities Suit in S.D. NY ------------------------------------------------------------- The law firm of Milberg Weiss Bershad Hynes & Lerach LLP filed a class action lawsuit August 8, 2001, on behalf of purchasers of the securities of MatrixOne, Inc., (NASDAQ: MONE - news) between February 29, 2000 and December 6, 2000, inclusive. A copy of the complaint filed in this action is available from the Court, or can be viewed on Milberg Weiss' website at: http://www.milberg.com/matrixone/ The action is pending against defendants MatrixOne, Goldman Sachs & Co, Mark F. O'Connell and Maurice L. Castonguay, and is pending in the United States District Court, Southern District of New York, located at 500 Pearl Street, New York, NY 10007. The complaint alleges violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. On or about February 29, 2000 MatrixOne commenced an initial public offering of 5,000,000 of its shares of common stock at an offering price of $25.00 per share. In connection therewith, MatrixOne filed a registration statement, which incorporated a prospectus, with the SEC. The complaint further alleges that the Prospectus was materially false and misleading because it failed to disclose, among other things, that: (i) Goldman Sachs had solicited and received excessive and undisclosed commissions from certain investors in exchange for which Goldman Sachs allocated to those investors material portions of the restricted number of MatrixOne shares issued in connection with the MatrixOne IPO; and (ii) Goldman Sachs had entered into agreements with customers whereby Goldman Sachs agreed to allocate MatrixOne shares to those customers in the MatrixOne IPO in exchange for which the customers agreed to purchase additional MatrixOne shares in the aftermarket at pre-determined prices. Purchasers of the securities of MatrixOne between February 29, 2000 and December 6, 2000 may, no later than September 24, 2001 request court appointment as lead plaintiff. For more information, contact Steven G. Schulman or Samuel H. Rudman of Milberg Weiss Bershad Hynes & Lerach LLP, One Pennsylvania Plaza, 49th fl., New York, NY, 10119-0165, Phone number: (800) 320-5081, Email: matrixonecase@milbergNY.com, Website: http://www.milberg.com. MATRIXONE INC: Cauley Geller Files Securities Suit in S.D. NY ------------------------------------------------------------- The Law Firm of Cauley Geller Bowman & Coates, LLP announced a class action has been filed in the United States District Court for the Southern District of New York on behalf of purchasers of MatrixOne, Inc. (Nasdaq: MONE) securities during the period between February 29, 2000 and December 6, 2000, inclusive. A copy of the complaint filed in this action is available from the Court, or can be viewed on the firm's website at http://www.classlawyer.com/pr/matrixone.pdf. The complaint charges defendants MatrixOne, Goldman Sachs & Co., Mark F. O'Connell and Maurice L. Castonguay with violations of Sections 11, 12(a) (2) and 15 of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. On or about February 29, 2000, MatrixOne commenced an initial public offering of 5 million of its shares of common stock at an offering price of $25.00 per share. In connection therewith, MatrixOne filed a registration statement, which incorporated a prospectus, with the SEC. The complaint further alleges that the Prospectus was materially false and misleading because it failed to disclose, among other things, that (i) Goldman Sachs had solicited and received excessive and undisclosed commissions from certain investors in exchange for which Goldman Sachs allocated to those investors material portions of the restricted number of MatrixOne shares issued in connection with the MatrixOne IPO; and (ii) Goldman Sachs had entered into agreements with customers whereby Goldman Sachs agreed to allocate MatrixOne shares to those customers in the MatrixOne IPO in exchange for which the customers agreed to purchase additional MatrixOne shares in the aftermarket at pre-determined prices. Persons who bought the securities of MatrixOne between February 29, 2000 and December 6, 2000, inclusive, may, no later than September 24, 2001 request court appointment as lead plaintiff. For more information, contact Jackie Addison, Sue Null or Charlie Gastineau of the Client Relations Department of Cauley Geller Bowman & Coates, LLP, P.O. Box 25438, Little Rock, AR 72221-5438, Toll Free: 1-888-551-9944, E-mail: info@classlawyer.com. NETSILICON INC: Charles Priven Files Securities Lawsuit ------------------------------------------------------- Law Offices Of Charles J. Piven, P.A. filed private securities actions requesting class action status on behalf of purchasers of the following securities during the following periods: Class Period NETsilicon, INC. (NASDAQ: NSIL - news) 09/15/99-12/06/00 PREVIEW SYSTEMS, INC. (NASDAQ: PRVW - news) 12/07/99-12/06/00 NUANCE COMMUNICATIONS, INC. (NASDAQ: NUAN - news) 04/12/00-12/06/00 DIGITAL RIVER, INC. (NASDAQ: DRIV - news) 08/11/98-12/06/00 No class has yet been certified in the above actions. For more information, contact the Law Offices Of Charles J. Piven, P.A. at The World Trade Center-Baltimore, 401 East Pratt Street, Suite 2525, Baltimore, Maryland 21202, by email at pivenlaw1@erols.com or by calling 410/986-0036. SCHERING-PLOUGH: PAL Suit Disputes Efficacy, Deceptive Ads ---------------------------------------------------------- The Boston-based Prescription Access Litigation project (PAL) announced today the filing of a class action lawsuit in New Jersey against Schering-Plough Corp. (NYSE: SGP) for deceptive advertising and overpricing of Claritin, America's most widely prescribed allergy drug. Plaintiffs allege that Schering-Plough has engaged in a campaign of misrepresentation that has artificially increased the demand and price for the drug - a drug that Schering-Plough's own studies have shown to be effective for only 50% of its users. The lawsuit was announced at a National Press Club Newsmaker news conference. The complaint, filed in state Superior Court in New Jersey, alleges that Schering-Plough's direct-to-consumer ads falsely depict the benefits of its drug, Claritin, and fail to disclose the limited efficacy of Claritin products, which also include Claritin-D, Claritin-D 24 Hour, Claritin Syrup, and Claritin Reditabs. The lawsuit alleges that Schering-Plough's campaign of deceptive, unfair advertising has turned it into the top-selling antihistamine in the U.S., with annual sales of over $2 billion. Last year, Schering-Plough spent $111 million on direct-to- consumer ads promoting the allergy drug, according to PAL's lawsuit, which says the ads consistently make a false promise: that Claritin works for everyone. In fact, medical research indicates that Claritin fails to provide allergy relief roughly half the time, and performs only slightly better than a placebo, i.e., a sugar pill. "This is not a mere oversight," said attorney Stephen Rosenfeld, consumer advocate and PAL spokesman. "We believe Schering-Plough has deliberately left out any information about the drug's efficacy, instead serving up glowing ads to push this product in America's living rooms. This suit alleges that the ads are misleading, incomplete, and designed to fool the public into paying top-dollar for a drug that often as not, just doesn't work. We see this as one of the most egregious examples of inflating the price of a drug beyond its worth." PAL (www.prescriptionaccesslitigation.org) was formed earlier this year on behalf of consumer groups to combat the tactics drug companies use to maintain artificially high prices for prescription drugs. The Claritin litigation is the fourth filed by PAL since April against pharmaceutical companies. The newest PAL lawsuit notes that during the class period, about $10 billion was spent in the US for Claritin products; a substantial portion of which, the complaint alleges, is directly attributable to Schering-Plough's unlawful conduct. "This is a case about a pharmaceutical company's direct-to- consumer advertising, and how that advertising distorted the market. We allege that Schering-Plough induced Americans to spend billions of dollars on Claritin in the belief that it would bring complete allergy relief for each user. And our complaint further alleges that that belief sprang from the false claims in Claritin ads and the absence in the ads of information about Claritin's true level of efficacy and that inflated sales and prices throughout the market," noted a PAL lead attorney, Thomas M. Sobol. "Deliberate concealment and false promises are at the heart of the New Jersey Consumer Fraud Act." Plaintiffs in the actions, members of the PAL coalition, include Citizen Action New York, Citizen Action New Jersey, and Health Action New Mexico, as well as individual users of the drug. The plaintiffs are represented by: New York-based Milberg Weiss Bershad Hynes & Lerach LLP (www.milberg.com); Carey & Danis, LLC of St. Louis (www.careydanis.com); and Lieff, Cabraser, Heimann & Bernstein, LLP of San Francisco (www.lchb.com). In April, PAL filed six lawsuits alleging that Bristol-Myers Squibb illegally kept a generic version of BuSpar, an anti- anxiety drug, off the market. In May, PAL filed lawsuits against AstraZeneca and Barr Laboratories alleging price collusion over tamoxifen, a breast cancer drug that is the most widely prescribed anti-cancer drug in the world. In June, PAL filed suits alleging that Schering-Plough, Upsher-Smith Labs & American Home Products entered into illegal agreements to maintain artificially high prices of K- Dur20, potassium supplement that is the fourth most prescribed drug among the elderly. The Prescription Access Litigation Project was organized by Community Catalyst (www.communitycatalyst.org), a Boston-based nonprofit organization. PAL, comprised of more than 50 consumer advocacy and senior citizen groups in 25 states, was formed earlier this year to target pharmaceutical companies whose unfair market conduct has pushed the cost of prescription drugs beyond the reach of many U.S. consumers. SCIQUEST.COM INC: Milberg Weiss Sues Investment Banks ----------------------------------------------------- The law firm of Milberg Weiss Bershad Hynes & Lerach LLP filed a class action lawsuit on August 9, 2001 on behalf of purchasers of the securities of SciQuest.com, Inc. (NASDAQ:SQST) between November 19, 1999 and December 6, 2000, inclusive. A copy of the complaint filed in this action is available from the Court, or can be viewed on Milberg Weiss' website at: http://www.milberg.com/sciquest/ The action is pending in the United States District Court for the Southern District of New York, located at 500 Pearl Street, New York, NY 10007, against the following defendants: * BancBoston Robertson Stephens, Inc. * Credit Suisse First Boston Corp. * Goldman Sachs & Co., Inc. and * Merrill Lynch, Pierce, Fenner & Smith Incorporated. The complaint alleges violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. On or about November 19, 1999 SciQuest.com commenced an initial public offering of 7,500,000 of its shares of common stock at an offering price of $16 per share. In connection therewith, SciQuest.com filed a registration statement, which incorporated a prospectus, with the SEC. The complaint further alleges that the Prospectus was materially false and misleading because it failed to disclose, among other things, that: (i) defendants had solicited and received excessive and undisclosed commissions from certain investors in exchange for which defendants allocated to those investors material portions of the restricted number of SciQuest.com shares issued in connection with the SciQuest.com IPO; and (ii) defendants had entered into agreements with customers whereby defendants agreed to allocate SciQuest.com shares to those customers in the SciQuest.com IPO in exchange for which the customers agreed to purchase additional SciQuest.com shares in the aftermarket at pre-determined prices. As alleged in the complaint, the SEC is investigating underwriting practices in connection with several other initial public offerings. Persons who bought the securities of SciQuest.com between November 19, 1999 and December 6, 2000 may, no later than October 8, 2001, request court appointment as lead plaintiff in this action. For more information, contact Steven G. Schulman or Samuel H. Rudman of Milberg Weiss Bershad Hynes & Lerach LLP, 800/320-5081, sciquestcase@milbergNY.com, http://www.milberg.com. TRANSMETA CORPORATION: Berman deValerio Files CA Fraud Suit ----------------------------------------------------------- Shareholders are pursuing a federal class action against Transmeta Corporation (Nasdaq: TMTA) claiming the company misled investors about its main product, according to the law firm of Berman DeValerio Pease Tabacco Burt & Pucillo. The suit was filed in the United States District Court for the Northern District of California as c0120690 (pvt) and is pending before Chief Magistrate Judge Patricia V. Trumbull. It seeks damages for violations of federal securities laws on behalf of all investors who bought Transmeta stock between November 7, 2000 and June 20, 2001. Berman DeValerio has represented investors in class actions for nearly two decades. To review the complaint and learn more about becoming a lead plaintiff, visit the Website at www.bermanesq.com. The complaint accuses Transmeta and several of its top officers with issuing false and misleading statements about its principal product, the Crusoe line of microprocessors. According to the lawsuit, the defendants made juiced-up claims about a breakthrough technology that enabled the Crusoe chips to consume less energy while delivering high performance to mobile Internet computers. The company made these claims in documents related to its November 7, 2000 initial public offering and throughout the Class Period. The false statements powered Transmeta stock to a high of $50.875 per share and enabled five of the defendants to sell 829,500 shares of their Transmeta stock for more than $10.5 million in May 2001. But only weeks after those sales took place, Transmeta said its results for the second quarter of 2001 would be worse than projected and that it would be forced to take a multimillion- dollar inventory charge because of defective and outdated products. The technological revolution was in fact an illusion - Crusoe chips had significantly sacrificed performance to extend battery life. After the company's announcement, Transmeta stock plummeted to $5.12 a share before closing at $5.36 a share, 89% off its Class Period high. Persons who purchased Transmeta common stock during the period of November 7, 2000 through June 20, 2001 may wish to apply to be lead plaintiff in this action and file a motion with the court no later than August 24, 2001. For more information, contact Leslie R. Stern, Esq., Qadir Wahid or Jeffrey C. Block, Esq., at One Liberty Square, Boston, MA 02109, (800) 516-9926 or Jennifer S. Abrams, Esq. at 425 California Street, Suite 2025, San Francisco, CA 94104, (415) 433-3200, law@bermanesq.com. US WIRELESS: Berman DeValerio Files CA Securities Suit ------------------------------------------------------ A securities class action pending before a federal court in California charges U.S. Wireless Corporation (Nasdaq: USWC) with defrauding investors, the law firm of Berman DeValerio Pease Tabacco Burt & Pucillo said. The class action was filed July 17 in the United States District Court for the Northern District of California as c01-2715-jcs. It seeks damages for violations of federal securities laws on behalf of all investors who bought U.S. Wireless stock between July 14, 1998 and May 25, 2001. Berman DeValerio has represented investors in class actions for nearly two decades. To review the complaint and learn more about becoming a lead plaintiff, visit our Website at www.bermanesq.com. The class action charges San Ramon-based U.S. Wireless and its former chief executive officer, Oliver Hilsenrath, with issuing false and misleading financial statements and news releases about the company's earnings, and covering up certain party-related transactions. According to the complaint, the company failed to disclose transactions that should have been made public under both Generally Accepted Accounting Principles and U.S. Securities and Exchange Commission (SEC) regulations. The transactions at issue were payments of cash, stock and stock options to outside vendors affiliated with Hilsenrath. In a news release issued July 10, 2001, U.S. Wireless said it would be forced to restate its fiscal 2000 filings. The company said the restatement, among other things, would increase the net loss for that year to $17.7 million from $11.5 million. In its announcement, U.S. Wireless said the decision to restate was made as a result of an investigation that found "improper transactions. The company also said it had "terminated Mr. Hilsenrath's employment for cause," and had asked him to resign his board seat. U.S. Wireless said in another statement that an audit committee investigation had uncovered "irregularities" related to the payments and that the company believed the transactions "were not disclosed as required" in SEC filings. The Nasdaq Stock Market suspended trading of U.S. Wireless stock on May 29. During the Class Period, the company's stock traded as high as $46.625 per share. When Nasdaq halted trading, shares were trading at $2.91. Persons who purchased U.S. Wireless common stock during the period of July 14, 1998 through May 25, 2001 may wish to apply to be lead plaintiff in this action and file a motion with the court no later than September 10, 2001. For more information, contact Leslie R. Stern, Esq. or Jeffrey C. Block, Esq. at Berman DeValerio Pease Tabacco Burt & Pucillo, One Liberty Square, Boston, MA 02109, (800) 516-9926 or Jennifer S. Abrams, Esq. at 425 California Street, Suite 2025, San Francisco, CA 94104, (415) 433-3200, law@bermanesq.com. VICINITY CORPORATION: Milberg Weiss Files NY Securities Suit ------------------------------------------------------------ The law firm of Milberg Weiss Bershad Hynes & Lerach LLP filed a class action lawsuit August 9, 2001 on behalf of purchasers of the securities of Vicinity Corporation (NASDAQ:VCNT) between February 8, 2000 and December 6, 2000, inclusive. A copy of the complaint filed in this action is available from the Court, or can be viewed on Milberg Weiss' website at: http://www.milberg.com/vicinity/ The action is pending in the United States District Court, Southern District of New York, located at 500 Pearl Street, New York, NY against defendants Vicinity, Bear Stearns & Co., Inc., Emerick M. Woods and David Seltzer. The complaint alleges violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. On or about February 8, 2000, Vicinity commenced an initial public offering of 7,000,000 of its shares of common stock at an offering price of $17.00 per share. In connection therewith, Vicinity filed a registration statement, which incorporated a prospectus, with the SEC. The complaint further alleges that the Prospectus was materially false and misleading because it failed to disclose, among other things, that: (i) Bear Stearns had solicited and received excessive and undisclosed commissions from certain investors in exchange for which Bear Stearns allocated to those investors material portions of the restricted number of Vicinity shares issued in connection with the Vicinity IPO; and (ii) Bear Stearns had entered into agreements with customers whereby Bear Stearns agreed to allocate Vicinity shares to those customers in the Vicinity IPO in exchange for which the customers agreed to purchase additional Vicinity shares in the aftermarket at pre-determined prices. Persons who bought the securities of Vicinity between February 8, 2000 and December 6, 2000, may, no later than October 8, 2001, request court appointment as lead plaintiff. For more information, contact Steven G. Schulman or Samuel H. Rudman of Milberg Weiss Bershad Hynes & Lerach LLP at One Pennsylvania Plaza, 49th fl., New York, NY, 10119-0165. ********* 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., Trenton, New Jersey, and Beard Group, Inc., Washington, D.C. Enid Sterling, Larri-Nil Veloso and Lyndsey Resnick, Editors. Copyright 2001. All rights reserved. ISSN 1525-2272. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The CAR subscription rate is $575 for six months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. 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