/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/020102.mbx C L A S S A C T I O N R E P O R T E R Wednesday, January 2, 2002, Vol. 4, No. 1 Headlines ALLSTATE CORPORATION: EEOC To Combine Age Bias Suit With Federal Case BRIDGESTONE/FIRESTONE: South Carolina Judge Certifies Faulty Tire Suit GERMANY: Soldiers Exposed To Radiation In Service Might Sue Government HAWAII: Auditor Says Felix Care System Not Achieving Expected Results LIBERTY LIFE: State To Suspend License, Fine $1M For Racist Premiums MENORAH GARDENS: Grave Desecration Suit Gains Ground, Exec Kills Self NEW YORK: Court Orders AIDS Division To Improve Services For Victims RAFFLES TOWN: Denies Allegations in Members' Breach of Contract Suit SEAFOOD COMPANIES: Court Finds No Discrimination Against Alaska Workers SOUTH CAROLINA: Attorneys Seek One-Third of Sales Tax Suit Settlement TYSON FOODS INC.: Missouri Plant Operations Spur Potential Lawsuits Securities Fraud ACLN LTD.: Abraham Paskowitz Lodges Securities Suit in C.D. California ACLN LTD: Stull Stull Commences Securities Suit in C.D. California AVANTGO INC.: Milberg Weiss Commences Securities Suit in S.D. New York CORNING INC.: Milberg Weiss Initiates Securities Suit in W.D. New York DIGITALTHINK INC.: Milberg Weiss Commences Securities Suit in S.D. NY OPTICAL CABLE: Schiffrin Barroway Commences Securities Suit in W.D. VA SRI SURGICAL: Cauley Geller Commences Securities suit in M.D. Florida STARMEDIA NETWORKS: Cauley Geller Commences Securities Suit in S.D. NY WASHINGTON: Mulls Joining Securities Suits Against Enron Corporation ********* ALLSTATE CORPORATION: EEOC To Combine Age Bias Suit With Federal Case --------------------------------------------------------------------- The United States Equal Employment Opportunity Commission (EEOC) filed a lawsuit against Allstate Insurance Company yesterday and will seek to consolidate its case with a pending class action lawsuit filed by 29 current and former agents against the insurance company and Edward M. Liddy, its Chairman, President and CEO. Similar to the agents' case, the EEOC is charging the company with violating the Age Discrimination in Employment Act (ADEA), Title VII of the Civil Rights Act of 1964 and the Americans with Disabilities Act. Michael Lieder of Sprenger & Lang, one of the attorneys representing the agents, said in a statement, "We welcome the EEOC's involvement. It is gratifying that the agency charged with enforcing this country's anti-discrimination laws agrees with our position on a critical issue in the litigation." Both lawsuits arise out of the Company's decision, announced in November 1999, to terminate the employment status of about 6,400 of its sales agents. As part of its program, the Company presented all of the agents with a release, and informed them that if they signed it they could continue in its service as independent contractors. Agents who refused to sign the release had their employment terminated on June 30, 2000. Whether they signed the release or not, the agents were deprived of the valuable employee benefits they had been promised by the Company. The EEOC alleges that the Company's tying of the right to continue in its service as an independent contractor to execution of the release constituted illegal retaliation in violation of the federal anti- discrimination laws. The EEOC lawsuit seeks monetary damages and injunctive relief for the agents, more than 400 of whom filed charges of discrimination and retaliation against the Company with the agency after the termination program was announced. The agents' suit is more sweeping. Like the EEOC, the agents allege that the release was illegal under a variety of theories. In addition, they claim that the terminations violated their rights under the Employment Retirement Income Security Act (ERISA), the ADEA, and the common law. They allege that the Company implemented the program in an attempt to rid itself of the obligation to pay hundreds of millions of dollars in employee benefits each year and to eliminate a workforce in which 90% of its members were over the age of 40. The EEOC's filing is just the latest development in the litigation arising out of the Company's termination of the agents. It follows on the heels of last Thursday's announcement by AARP Foundation Litigation that two of their staff attorneys, Tom Osborne and Mary Ellen Signorille, have joined the agents' lawsuit as co-counsel to the plaintiffs and the class. On October 30, 2001, the agents moved for approval of their proposed class action. Briefing concerning that motion is pending. Gene Romero, the Lead Plaintiff in the class action lawsuit and the first of nearly 400 agents who filed complaints with the EEOC charging Allstate with age discrimination and retaliation stated, "I am delighted that EEOC Chair, Cari M. Dominguez has listened to us and is standing behind the Commission's determination that Allstate cynically violated the law in obtaining thousands of releases by means of coercion, intimidation and duress." The agents' complaints against the Company are not limited to the termination of their employment. Mr. Romero and 31 other plaintiffs filed a second class action lawsuit against the Company in federal district court in Philadelphia on December 20 (the same day that AARP announced its involvement in the disputes) alleging that the Company violated ERISA by reducing, and eventually eliminating, eligibility for early retirement benefits. Michael J. Wilson of Zevnik Horton, another lawyer representing the Romero plaintiffs, added that the second lawsuit "provides yet further evidence that Allstate executives spent the better part of the last decade trying to rid the company of the cost of providing the pension and other benefits, which had been promised to thousands of its insurance agents and which had been held out as a means of inducing them to spend tens or hundreds of thousands of dollars from their own pockets to invest in developing a book of business." For more information, contact Michael D. Lieder by Phone: 202-265-8010 or Michael J. Wilson by Phone: 202-824-0950 or Thomas Osborne by Phone: 202-434-2066 BRIDGESTONE/FIRESTONE: South Carolina Judge Certifies Faulty Tire Suit ---------------------------------------------------------------------- A South Carolina Circuit Court judge has allowed South Carolina residents to join a faulty tire class action against Bridgestone/Firestone Inc. and Ford Motor Co, according to an Associated Press report. Judge Larry Patterson granted class action status to the lawsuit brought by Greenville attorney David Michael Parham, charging the two companies of negligence and carelessness in producing and distributing tires that went on Ford vehicles. The ruling made South Carolinians who bought Ford vehicles equipped with ATX, ATXII or Wilderness AT tires eligible to join the lawsuit. The suit was commenced after federal regulators linked at least 271 deaths and more than 800 injuries to accidents involving the Company's popular sports utility vehicle, the Ford Explorer, which used Firestone Tires. Firestone recalled 6.5 million tires in August 2000 and another 13 million tires in May. Mr. Parham welcomed the decision, saying "A class is the most economical and efficient mechanism for adjudicating these claims." He said he will meet with Judge Patterson and defense attorneys within 30 days to discuss how to notify tire and vehicle owners in South Carolina. GERMANY: Soldiers Exposed To Radiation In Service Might Sue Government ---------------------------------------------------------------------- The German government could face a potential class action from members of the German military who developed cancer from working on radar equipment. A recent story in the German weekly magazine Stern revealed that most of these persons suspected of dying as a consequence of radiation exposure had developed leukemia, lymph tumors or testicular cancer. Stern also said that lawyers representing at least 700 of those claiming disability or their survivors will file a class action lawsuit in January seeking damages of up to 600,000 German marks per case. The German Defense Ministry is still actively investigating the claims made by 1,868 former or still active members of the military. Ulrich Birkenheier, who was named special representative by the Defense Ministry to oversee the controversial issue, told Reuters Health that of those 1,868 cases, decisions have been reached in 143. Of the 143 decisions, only five soldiers were found to have developed cancer after working on radioactive equipment. These soldiers or their survivors will be eligible for increased pension benefits. However, the other 138 soldiers did not suffer disabilities from working on radar equipment. Mr. Birkenheier said that the soldiers were potentially exposed to x- rays after being involved in the repair and maintenance of radar transmitting devices from 1956, when the former West German Army was established, through the end of the 1970s. He added that the government made changes in radar maintenance in the late 1970s. Of the 1,868 cases under jurisdiction of the German Defense Ministry, some 1,486 were members of the former West German Army, or Bundeswehr, and 382 were members of the former East German Army, Mr. Birkenheier said. Of the total 1,868 cases, all are men and 293 have already died. Mr. Birkenheier said that around 25% of all deaths in Germany are cancer-related. However, he acknowledged that only about half of these people would have worked in radar maintenance before greater safeguards were instituted in the late 1970s. HAWAII: Auditor Says Felix Care System Not Achieving Expected Results --------------------------------------------------------------------- The system of care Hawaii has created to provide educational and mental health services to disabled children as required by a federal consent decree, called the Felix consent decree, "has not achieved the expected results." This was the conclusion of State Auditor Marion Higa in a recently released report, according to the Associated Press. The 1994 Felix consent decree was the result of a federal class action lawsuit filed in 1993 by special-needs student Jennifer Felix and six other children. "The system of care focused more on procedural compliance rather than on a system to effectively help the children," Ms. Higa said. "In addition, the system is largely based on treatments that cannot demonstrate effectiveness." The release of the report came one day after the Joint Senate-House Investigative Committee released its final report, which said that despite good intentions to improve special education and health services for Hawaiian children with mental disabilities, the decree "has also released a Pandora's box of unintended consequences." The legislative committee placed the blame for the failure to achieve results on: (1) the unclear requirements for compliance; (2) the extraordinary powers granted certain administrators without any apparent oversight; and (3) the court's blocking the Legislature's access to information in order to fully understand the Felix consent decree programs and their funding. Ms. Higa, whose agency comes under the legislative branch, worked closely with the legislative committee's six-month investigation. Her follow-up and management audit of the consent decree also found that the Departments of Health and Education do not provide a full picture of costs of complying with the consent decree and lack adequate financial management infrastructure to support the compliance effort. "Costs reported by the department are intermingled with other programs; are inaccurate; and suffer from a lack of transparency," she added. In May 2000, US District Judge David Ezra found the State in contempt for failing to implement the required system of care. He told the state that he would name a receiver to take over the system if all state public schools were not in compliance with the Felix consent decree by March 31, 2001. The Department of Education responded that it generally agreed with Ms. Higa's recommendations, which it said would aid the implementation of sound fiscal and program management practices. The Department of Health generally agreed with the recommendations, but said her report did not reflect the changes already made. Recently Hawaii has made substantial progress in meeting Judge Ezra's requirement for compliance based on service testing. At a November 30, 2001 hearing, he complimented the state for its commitment to demonstrating results for the Felix class children, said Health Director Bruce Anderson. "Given these significant events, and given the purpose of reporting on follow-up activities, it is disappointing that this was not included in the report," Mr. Anderson said. LIBERTY LIFE: State To Suspend License, Fine $1M For Racist Premiums -------------------------------------------------------------------- The State of South Carolina has moved to suspend the operating license of Liberty Life Insurance Co. for a year for the Company's allegedly "race-based pricing," in which blacks are charged more than whites for low cost life insurance policies, a Reuters report stated. Aside from the suspension, the state also moved to fine the insurer $2 million for the practices. Liberty Life is the latest to be charged with the practice, which was widespread until the 1960s, especially in the southern states. The policies, which typically cost only a few dollars a week, were paid in cash to insurance agents who went door to door. The Company did not dispute that some African American customers were charged more for their premiums. However, the "race-distinct" premiums were based on different life expectancies, which in turn vary by race, a Company spokesman asserted. The Company started an internal investigation into the issue last year and started a program designed to provide "fair value" to its customers, but a state judge in a related class-action lawsuit had prevented the company from implementing that program until the lawsuit was resolved. MENORAH GARDENS: Grave Desecration Suit Gains Ground, Exec Kills Self --------------------------------------------------------------------- The class action against Menorah Gardens Cemetery filed by family members whose dead relatives were allegedly desecrated by the Cemetery gained momentum as state inspectors revealed that they had investigated the Cemetery relating to similar claims three years ago. The state comptroller's office found evidence three years ago that bodies were buried in the wrong places at the cemetery, according to a Palm Beach interactive report. The office, which regulates cemetery operations, said the Company promised the problems would be resolved. The agency didn't follow up on allegations by its own inspectors that state laws may have been violated, records show. Inspectors had said that the cemetery's owner needed to do something right away. The suit also had a chilling repercussion as an executive of the Cemetery's owner, Service Corporation International, committed suicide, apparently by inhaling carbon monoxide inside his parents' garage. Palm Beach County officers found Peter Hartmann, 45, Wednesday night slumped over the wheel of a company car parked with the motor running in the garage of his parents' home in Boca Raton, north of Miami. Detective John Carney said Mr. Hartmann left a handwritten note, the contents of which have not been disclosed. Mr. Hartmann's wife, Susan, told authorities her husband had been under considerable stress as a result of the investigation into misdeeds at Menorah Gardens and had mentioned the possibility of suicide two days earlier, but assured her he would not do that, a sheriff's office report said. Mr. Hartmann's name, according to Ervin Gonzalez, attorney for several plaintiffs, appears on memos and other documents related to the alleged irregularities. Although Mr. Hartmann was a leading player in the case, he was only following the orders of higher-ups, Gonzalez said. Memos written by Hartmann, who had been in the funeral business since 1991, reveal widespread problems in some sections of the cemetery, lawsuit documents reveal. NEW YORK: Court Orders AIDS Division To Improve Services For Victims -------------------------------------------------------------------- Judge Sterling Johnson Jr. of Federal District Court ruled recently that New York City's Division of AIDS Services and Income Support is required to issue dated receipts noting the time of requests for assistance made by people infected with HIV, according to a copy of the ruling, the New York Times Abstracts recently reported. Judge Johnson's intervention stems from a 1995 class action lawsuit brought by Housing Works, an AIDS advocacy group that over the years has challenged various AIDS-related city policies. The requirement for a dated receipt is particularly beneficial to people living with AIDS, Mr. Armen Merjian said. "Many people with AIDS also suffer from dementia. The dated receipt will help hold the city accountable for the time frame. It will serve as tangible proof that the city can't just evade by saying that it has no record of an application, which is part of the bureaucratic hell they have long subjected our clients to." RAFFLES TOWN: Denies Allegations in Members' Breach of Contract Suit -------------------------------------------------------------------- The Raffles Town Club vehemently denied the allegations in a class action filed by members of the club in Singapore High Court, saying that the Company made misleading statements in its prospectus regarding the club's exclusivity. 4,895 club members filed the suit, which is possibly the largest in the country's history, saying that that certain parts of the prospectus led them to understand that membership in the club would be limited, and that members would get to enjoy full use of club facilities. The plaintiffs thought that the club, which is at the junction of Whitley and Dunearn roads, would limit the number of members because, they said, the prospectus made certain claims: (1) the club would be `without peer in terms of size, facilities and sheer opulence'; (2) there would be `a limited number of exclusive individual founder-member memberships;' The members argued that the club's alleged promise of `exclusivity' was not delivered because it had accepted 19,000 members, and not the 5,000 to 7,000 that they had previously thought the club would take in. They also alleged that the club's facilities, such as the number of parking lots, were not adequate to support a membership of that size. Each of the members had paid $28,000 between 1996 and 1997 to join. The price of the club membership has since fallen to about $9,000. The plaintiffs filed the suit after the membership figure surfaced in a court battle for control over the club earlier this year. After the case was settled out of court in April, the club was bought over by two investors, and is now under a new management. In its defense, the club has denied that the prospectus said or implied that `Raffles Town Club members will enjoy unparalleled privileges and facilities' and argued that it cannot know how members would interpret the prospectus. The club also rejected the claim that it had breached a contract with its members when it could not fulfill what it had set out in the prospectus. SEAFOOD COMPANIES: Court Finds No Discrimination Against Alaska Workers ----------------------------------------------------------------------- The 9th US Circuit Court of Appeals recently upheld a judge's finding that two seafood companies did not discriminate against Filipino and Alaska Native salmon cannery workers in Alaska. The ruling may mark the end of the 27-year-old case, which prompted the US Congress to rewrite civil rights laws, the Associated Press recently reported. Ten workers filed the original lawsuit, later made a class action, against the Seattle-based Wards Cove Packing Company and Dole Food Company, contending they were paid less than their white counterparts, given lesser living quarters and meals and generally were victims of race-based job discrimination. Seattle attorney Abraham Arditi, representing the 2,000 workers who signed on to the class action lawsuit, said he had not yet decided whether to seek a review by the US Supreme Court. "We are going to look very carefully at whether we have any options," he said. "We don't have anything to celebrate with this decision," said Michael Woo, a Board member for the Northwest Labor and Employment Law Office, a Seattle group which has supported the lawsuit since the beginning. "I don't know whether we will go further with the legal action. We may be banging our heads against the wall," Mr. Woo said. Douglas Fryer, representing Wards Cove, said the decision was not a surprise, in part because US District Court Judge Justin Quackenbush had ruled for the company in 1999. The Appeals Court indicated that they "did not like some of the evidence of race in the case and how race labels were used," but they ultimately concluded that there was no discrimination that violated federal law. The plaintiffs in the case said their treatment at the canneries violated Title VII of the landmark Civil Rights Act of 1964, which bars employment discrimination, among other things. Minority workers testified that they were stuck in low-paying canning jobs without chance for advancement, that they were fed meals that rarely varied from fish stew, and they sometimes had only two showers to share among 45 people. The case has ricocheted through more than a half-dozen appeals with thousands of pages of arguments that have been studied by more than two dozen federal judges. The companies almost always have prevailed. In 1983, Judge Quackenbush ruled that the companies did not willfully discriminate against non-whites. Six years later, the US Supreme Court ruled 5-4 that to prove discrimination, workers had to do more than show numerical imbalance among the races in different jobs. Dissenting Justice John Paul Stevens wrote that the claims "bear an unsettling resemblance to aspects of a plantation economy." In the 1991 Civil Rights Act, Congress effectively reversed the court, restoring an easier-to-prove discrimination standard. However, in the negotiations over the legislation, the Senate accepted a provision by Frank Murkowski, R-Alaska, that barred its application to the Wards Cove case. President Clinton and others pushed legislation to repeal the Wards Cove exemption, but the effort failed every time. In 1994, the Supreme Court declined to hear a court case with the same goal. In the recently heard appeal by a three-judge panel of the Ninth Circuit, only a few issues remained regarding alleged unintentional discrimination and its impact on minority workers. In their unanimous opinion, Judges Betty Fletcher, Cynthia Holcomb Hall and A. Wallace Tashima wrote that "this last appeal turns on whether the district court's finding and conclusions on three narrow issues, the final shreds left after the dismissal of much more meaningful claims were clearly erroneous. We conclude that they were not." SOUTH CAROLINA: Attorneys Seek One-Third of Sales Tax Suit Settlement --------------------------------------------------------------------- Attorneys for some of South Carolina's oldest residents want one-third of a multimillion-dollar settlement for a class-action sales tax lawsuit, Associated Press recently reported. Attorney General Charles Condon said such a fee to the attorneys would shortchange the plaintiffs. The State Budget and Control Board agreed to a settlement of $7.5 million, after retired state Chief Justice Bruce Littlejohn sued South Carolina and retailers. Mr. Littlejohn contended that up to 56,000 people 85 years of age and older had paid the normal five percent state sales tax instead of the four percent rate that was supposed to be given to the elderly. As a result, senior citizens who paid too much in state sales tax between August 1, 1998 and July 31, 2001, can apply for a refund. Further, retailers must post signs in their stores telling such eligible senior patrons that they are entitled to the tax break. Attorneys Richard Harpootlian and Cam Lewis told Circuit Judge Thomas Cooper that the settlement, along with the effects of future savings for seniors during the next three years, adds up to $15 million. The two Columbia attorneys said they are entitled to $5 million in legal fees because their work netted a "fair figure." As individuals, "it would have been impossible for these people to get their justice," Mr. Lewis said. "That's why we took this class action on." Republicans have criticized the settlement, complaining about how the lawsuit was handled, including the potential legal fees for Mr. Harpootlian, State Democratic Party Chairman. Attorney General Condon, who is running for the GOP gubernatorial nomination, asked Judge Cooper to pay the two attorneys based on the hours they worked instead of a percentage of the settlement. "The amount of hours and work that went into this case is minimal," Mr. Condon said. "I want to ensure that seniors are not shortchanged through the payment of excessive and exorbitant attorneys' fees." Mr. Lewis estimated that he and Mr. Hartpoolian spent about $90,000 to litigate the case and contact eligible seniors about their refunds. Claim forms were published in newspapers and 48,000 seniors were mailed information about the settlement, Mr. Lewis said, but "anthrax has people not opening their mail fast." Lead plaintiff, Mr. Littlejohn, said that he agreed to a contract giving his attorneys a third of the settlement. He asked the state to take into account that the attorneys' fees would be split among the two lawyers, who would have to pay their staffs, as well as state and federal taxes. Judge Cooper said, "I practiced law for 33 years, and I know the lawyer is the last to get paid." A quick decision is not expected. TYSON FOODS INC.: Missouri Plant Operations Spur Potential Lawsuits ------------------------------------------------------------------- Lawsuits against poultry giant Tyson Foods, Inc. are on the rise, according to an Associated Press report. The Company faces a class action relating to alleged pollution from their plant operations in Noel, Missouri and is likely to face a similar pollution complaint due to their plant in Sedalia, Missouri. A group of Oklahoma waterfront owners filed a class action lawsuit alleging that pollution from the Company's chicken plant in Noel, Missouri, was hurting their property values. The Company has called these charges "unfounded" and said it "intends to vigorously defend the case." The Company could also be indicted for alleged violations of the Clean Water Act. The US attorney's office for the Western District of Missouri recently advised the Arkansas-based company of an impending indictment for alleged violations at its plant near Sedalia, Missouri, according to the company's annual report to the Securities and Exchange Commission. Under the Clean Water Act, it is illegal to discharge any pollutant from a point source into navigable waters unless a permit is obtained under the law. The report did not indicate the specific violations, but it said that the Company "is presently discussing the possible resolution of the matter." Company spokesman Ed Nicholson did not comment specifically on the possible indictment, but told the Chattanooga Times Free Press that protecting water quality is "something that we devote resources and a lot of attention to." Ken Midkiff, director of the Sierra Club's national clean water campaign based in Columbia, Missouri, said that an indictment would not surprise him, because authorities raided the Company plant near Sedalia some months ago and confiscated files. "The only thing perhaps a bit surprising is it took so long," Mr. Midkiff said. Securities Fraud ---------------- ACLN LTD.: Abraham Paskowitz Lodges Securities Suit in C.D. California ---------------------------------------------------------------------- Abraham & Paskowitz initiated a securities class action lawsuit on behalf of all purchasers of the securities of ACLN, Ltd. (NYSE: ASW) between September 30, 2000 and December 20, 2001, inclusive. The suit is pending in the United States District Court, Central District of California, against the Company and: (1) Joseph Bisschops, (2) Aldo Labiad, (3) Christian Payne, (4) Michael Doherty, (5) Earl Gould, and (6) Charles Brock The suit 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 materially false and misleading statements to the market. Beginning on September 30, 2000, and continuing throughout the class period, defendants issued multiple press releases and filed quarterly and annual reports with the SEC, which highlighted the Company's growth and strong financial performance. As alleged in the suit, these statements were materially false and misleading because they failed to describe the true state of financial affairs at the Company. Specifically, defendants: (i) failed to make adequate disclosures concerning the ownership and disposition of shares controlled by insiders; (ii) emphasized the importance of owning its own shipping vessel, the Sea Atef when, in truth and in fact, the Sea Atef was owned by other undisclosed persons and entities; and (iii) failed to disclose adverse business factors which led it to cancel the purchase of two shipping vessels it claimed it needed for its expanding business. The truth about many of these statements finally came to light on December 20, 2001, in an article published by Herb Greenberg on The Street.com. In response to the questions raised in Greenberg's article, shares of the Company plunged 64%, falling $16.71 to close at $9.40 per share. For more information, contact Laurence Paskowitz or Jeffrey Abraham by Mail: One Pennsylvania Plaza, Suite 1910 New York, NY, 10119-0165 by Phone: (800) 938-0015 by E-mail: classattorney@aol.com or visit the firm's Website: http://www.classactionsonline.com ACLN LTD: Stull Stull Commences Securities Suit in C.D. California ------------------------------------------------------------------ Stull Stull Brody initiated a securities class action in the United States District Court for the Central District of California on behalf of those who purchased or otherwise acquired the securities of ACLN, Ltd. (NYSE:ASW) between September 30, 2000 and December 20, 2001, inclusive. The complaint alleges that the Company and certain of its officers and directors, violated federal securities laws by, among other things, issuing false and misleading statements regarding the Company's ownership of key assets and its financial condition, including discrepancies in its publicly reported earnings and the ownership and disposition of millions of the Company's shares. The truth regarding these events was brought to light by the efforts of an investigative financial journalist. Upon this revelation, the price of the Company's stock plunged over 60% in one day. For more information, contact Stull Stull & Brody by Phone: 888-388- 4605 by E-mail: info@secfraud.com or visit the firm's Website: http://www.secfraud.com AVANTGO INC.: Milberg Weiss Commences Securities Suit in S.D. New York ---------------------------------------------------------------------- Milberg Weiss Bershad Hynes and Lerach LLP initiated a securities class action on behalf of purchasers of the securities of AvantGo Inc. (Nasdaq:AVGO) between September 27, 2000 and December 6, 2000, inclusive. The suit is pending in the United States District Court, Southern District of New York against the Company and: (1) Richard Owen, CEO, Director, (2) David Cooper, CFO, (3) Felix Lin, Chairman, (4) Credit Suisse First Boston Corp., (5) Merrill Lynch, Pierce, Fenner & Smith Inc. and (6) FleetBoston Robertson Stephens Inc. The suit 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. In September 2000, the Company commenced an initial public offering of 5,500,000 of its shares of common stock at an offering price of $12 per share. In connection therewith, the Company filed a registration statement, which incorporated a prospectus with the SEC. The suit further alleges that the prospectus was materially false and misleading because it failed to disclose, among other things, that: (i) the Company 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 shares issued in connection with the IPO; and (ii) the underwriter defendants had entered into agreements with customers whereby the underwriter defendants agreed to allocate shares to those customers in the IPO in exchange for which the customers agreed to purchase additional shares in the aftermarket at pre-determined prices For more information, contact Steven G. Schulman or Samuel H. Rudman by Mail: One Pennsylvania Plaza, 49th fl. New York, NY, 10119-0165 by Phone: 800-320-5081 or visit the firm's Website: http://www.milberg.com CORNING INC.: Milberg Weiss Initiates Securities Suit in W.D. New York ---------------------------------------------------------------------- Milberg Weiss Bershad Hynes & Lerach LLP commenced a securities class action on behalf of purchasers of the common stock or zero coupon convertible debentures of Corning, Inc. (NASDAQ: GLW) pursuant to a prospectus dated November 3, 2000. The action is pending in the United States District Court, Western District of New York against the Company and: (1) Roger A. Ackerman, (2) Katherine A. Asbeck and (3) James B. Flaws The suit alleges that defendants violated Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 by issuing a materially false and misleading registration statement and prospectus in connection with the Company's offering of common stock and debentures in November 2000. Specifically, the complaint alleges that the prospectus was materially false and misleading, among other reasons, because: (i) it stated that demand for the Company's products was robust; (ii) it omitted to disclose that the Company was amassing hundreds of millions of dollars of obsolete inventory that would have to be written-off; and (iii) given the foregoing, the projection of 25% earnings growth in 2001, contained in the prospectus, was lacking in a reasonable basis at all times. In July 2001, the Company announced it was taking a $5.1 billion charge primarily related to two recent acquisitions, that it would also write- off $300 million in excess and obsolete inventory, and that it would cut 1,000 jobs and close three plants. On July 25, 2001, the Company reported a massive second-quarter loss of $4.76 billion, or $5.13 per share. Company shares closed that day at $13.77, down 80% from the offering price. For further details, contact Steven G. Schulman or Samuel H. Rudman by Mail: One Pennsylvania Plaza, 49th fl. New York, NY, 10119-0165 by Phone: 800-320-5081 by E-mail: corningcase@milbergNY.com or visit the firm's Website: http://www.milberg.com DIGITALTHINK INC.: Milberg Weiss Commences Securities Suit in S.D. NY --------------------------------------------------------------------- Milberg Weiss Bershad Hynes and Lerach LLP initiated a securities class action on behalf of purchasers of the securities of DigitalThink, Inc (NASDAQ: DTHK) between February 24, 2000 and December 6, 2000 inclusive. The suit is pending in the United States District Court, Southern District of New York against the Company and: (1) Peter J. Goettner, CEO, Chairman of the Board, (2) Michael W. Pope, CFO, (3) Credit Suisse First Boston Corporation and (4) FleetBoston Robertson Stephens Inc. The suit 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. In February 2000, the Company commenced an initial public offering of 4,400,000 of its shares of common stock at an offering price of $14 per share, In connection therewith, the Company filed a registration statement, which incorporated a prospectus with the SEC. The suit further 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 they allocated to those investors material portions of the restricted number of shares issued in connection with the IPO; and (ii) the underwriter defendants had entered into agreements with customers whereby they agreed to allocate shares to those customers in the IPO in exchange for which the customers agreed to purchase additional shares in the aftermarket at pre-determined prices. For more information, contact Steven G. Schulman or Samuel H. Rudman by Mail: One Pennsylvania Plaza, 49th fl. New York, NY, 10119-0165 by Phone: 800-320-5081 or visit the firm's Website: http://www.milberg.com OPTICAL CABLE: Schiffrin Barroway Commences Securities Suit in W.D. VA ---------------------------------------------------------------------- Schiffrin and Barroway LLP initiated a securities class action in the United States District Court for the Western District of Virginia on behalf of all purchasers of the common stock of Optical Cable Corporation (Nasdaq: OCCF) from July 31, 2000 through October 8, 2001, inclusive. The suit charges the Company and Robert Kopstein, the Company's President, Chief Executive Officer and controlling shareholder with issuing materially false and misleading statements concerning the Company's financial condition. The suit alleges that during the class period, defendants issued to the investing public false and misleading information that materially misstated the Company's condition and prospects, and failed to disclose material information necessary to make its prior statements not misleading. Specifically, the suit alleges that the defendants made numerous positive statements as to the Company's business and financial health prior to and during the class period yet failed to disclose to the investing public Mr. Kopstein's use of his stock as collateral for margin loans with various brokerage accounts he maintained to speculate in technology stocks. Given his control of 96% of the Company's common stock, his use of his stock as collateral created a significant risk that large numbers of these shares could be seized and sold on the open market by brokerage firms to cover Mr. Kopstein's trading losses. According to the complaint, Mr. Kopstein had been cautioned by at least one brokerage firm not to speculate by borrowing money against his stock to invest in other technology company securities. His speculation in other technology companies' securities led to the margin calls which then resulted in significant losses to the plaintiffs when the brokerage firms seized Mr. Kopstein's stock and dumped millions of shares on the market at the same time, resulting in the severe depression of the Company's stock price. For further details, contact Marc A. Topaz or Stuart L. Berman by Mail: Three Bala Plaza East, Suite 400, Bala Cynwyd, PA 19004 by Phone: 1- 888-299-7706 (toll free) or 1-610-667-7706 by E-mail: info@sbclasslaw.com SRI SURGICAL: Cauley Geller Commences Securities suit in M.D. Florida --------------------------------------------------------------------- Cauley Geller Bowman & Coates, LLP initiated a securities class action in the United States District Court for the Middle District of Florida, Tampa Division on behalf of purchasers of SRI Surgical Express Incorporated (Nasdaq:STRC) common stock during the period between July 23, 2001 and November 27, 2001, inclusive. The suit charges the Company and certain of its officers and directors with issuing a series of material misrepresentations to the market before and during the class period, thereby artificially inflating the price of the Company's common stock. Specifically, the suit alleges that defendants issued a series of press releases touting the Company's new customer contracts such as the HealthTrust Purchasing Group contract announced on May 1, 2001, as well as "record" financial results for the third quarter of fiscal year 2001. In response, the price of the Company's stock soared to over $41 per share in September 2001, and the Company was named to the Forbes magazine list of the best small companies in the country. The suit also states that, unbeknownst to the investing public who purchased Company stock during the class period at artificially inflated prices, the Company's business and financial conditions were rapidly deteriorating. Indeed, on November 27, 2001, defendants revealed that the Company's previously issued financial statements for the third quarter of 2001 were false and that its revenues and earnings were actually $1,034,000 and $262,000 less, respectively, than previously reported, and $.04 less per diluted share. As alleged in the complaint, these "newly" issued results did not meet analysts' estimates. In addition, the Company revealed that the outlook for the fourth quarter was far worse than investors had been led to believe. Defendants reported for the first time that the "pricing impact of new group purchasing organization arrangements on existing hospital customers," among other previously undisclosed problems detailed in the complaint, contributed to the third quarter shortfall and expected fourth quarter 2001 shortfall. According to the complaint, in response to the news that the Company would not meet third or fourth quarter analyst estimates and had improperly recognized revenue in the third quarter of 2001, stock plunged over 40%, closing at $14.63 on November 28, 2001, on unusually high volume of 2.7 million shares. The impact of defendants' improper accounting practices was devastating to the Company's investors. For more information, contact Jackie Addison, Sue Null or Shelly Nicholson by Mail: P.O. Box 25438, Little Rock, AR 72221-5438 by Phone: 1-888-551-9944 or by E-mail: info@classlawyer.com STARMEDIA NETWORKS: Cauley Geller Commences Securities Suit in S.D. NY ---------------------------------------------------------------------- Cauley Geller Bowman & Coates, LLP initiated a securities class action in the United States District Court for the Southern District of New York on behalf of purchasers of StarMedia Networks Inc. (Nasdaq:STRM) securities during the period between April 11, 2000 and November 19, 2001, inclusive against the Company, Fernando J. Espuelas, CEO and Chairman, and Steven J. Heller, Chief Financial Officer. The complaint charges that the 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 the market between April 11, 2000 and November 19, 2001 concerning the Company's financial performance. The suit alleges that the Company reported artificially inflated financial results in press releases and filing made with the SEC by improperly recognizing revenue in violation of generally accepted accounting principles (GAAP). Specifically, the complaint alleges that two of the Company's primary subsidiaries, AdNet S.A. de C.V. and StarMedia Mexico, S.A. de C.V., had engaged in improper accounting practices which had the effect of materially overstating the Company's reported revenues and earnings by at least $10 million. In November 2001, as alleged in the complaint, the Company issued a press release announcing that based on the "preliminary" results of an internal investigation into its accounting practices, it expects to restate its financial statements for the fiscal year 200 and the first two quarters of 2001 and that those financial statements should not be relied upon. The Company further reported that its Chief Financial Office had "resigned." Immediately following the announcement of the restatement, the NASDAQ Stock Market halted trading in the Company's stock, pending the receipt of additional information from the Company. Company stock last traded at $0.38 per share, which is 98.5% less that the Class Period high of $25.50, reached on April 11, 2000. For more information, contact Jackie Addison, Sue Null or Shelly Nicholson by Mail: P.O. Box 25438, Little Rock, AR 72221-5438 by Phone: 1-888-551-9944 or by E-mail: info@classlawyer.com WASHINGTON: Mulls Joining Securities Suits Against Enron Corporation -------------------------------------------------------------------- The State of Washington will join one of several class action suits against bankrupt energy giant Enron Corporation (NYSE: ENE), though precisely what role the state will play may not be clear for months, according to a Seattle Times report. The State Investment Board, which manages pension funds and other assets, voted last week to join Ohio and Georgia in their planned suit against the energy company. The board, which manages $54 billion in assets, at one time had $12 million in the Company's stock and $112 million in the Company's bonds in its portfolio. The stock was worth less than $1 million when it was sold, executive director James Parker said, and the bonds are now worth about $20 million. The Company's financial collapse and subsequent bankruptcy filing have caused its stock to lose nearly all its value. Dozens of shareholder lawsuits seek to recover some of what was lost. The multiple Enron suits eventually will be consolidated, Mr. Parker said, with one chosen as the lead case by whichever court assumes jurisdiction. If the Ohio- Georgia-Washington suit is chosen, the states would become co-lead plaintiffs, giving them more say in how the case is prosecuted or settled. "You can just sign up as a member of the class and take what happens as it comes, or you can seek to be a little more active," he said, adding that Arizona also was considering joining. He added that the investment board, working through the Attorney General's Office, also is weighing whether to intervene in the Company's bankruptcy case. ********* 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, Aurora Fatima Antonio and Lyndsey Resnick, Editors. Copyright 2002. 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. 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