/raid1/www/Hosts/bankrupt/CAR_Public/020131.mbx
C L A S S A C T I O N R E P O R T E R
Thursday, January 31, 2002, Vol. 4, No. 22
Headlines
CALIFORNIA: Officials To Improve Health Care Systems To Settle Suit
CALIFORNIA: Water District Faces Suit For Retirement Law Violations
EDY'S GRAND: Recalls 5,000 Cans of Ice Cream Over Undeclared Ingredient
EINSTEIN ACADEMY: Judge Blocks Enrollment Due To School Districts Suit
GREAT BRITAIN: Airlines Face $100M Claim Over Deep Vein Thrombosis
ID SOFTWARE: Insurer Asks For Release Due To Columbine Video Game Suit
MEDI-CAL LITIGATION: California Settles Suits Over Reimbursement Rates
MITSUBISHI MOTORS: Recalls 16T Trucks Due to Engine, Exhaust Problems
NEW YORK: Appeals Court Orders Railroad Employees' Suit Certified
RHODE ISLAND: Smoker's Suit For Part of Tobacco Settlement Dismissed
SCHWEGMANN MARKETS: Judge Awards $5.4M To Retirees For "Lost" Vouchers
SERVICE CORPORATION: Sued For Preferential Sales Practices In Florida
TYSON FOODS: Federal Court Sends Homeowners' Suit Back To State Court
WASHINGTON MUTUAL: Homeowners Sue For Violations of WA Consumer Act
Securities Fraud
APW LTD.: Marc Henzel Lodges Suit For Securities Act Violations in WI
DOLLAR GENERAL: Goodkind Labaton Commences Securities Suit in M.D. TN
FORD MOTOR: Lovell Stewart Commences Securities Suit in S.D. New York
GENCORP INC.: Faces Possible Securities Claims For Earnings Restatement
HA-LO INDUSTRIES: Schiffrin Barroway Lodges Securities Suit in N.D. IL
MCLEOD USA: Schiffrin Barroway Commences Securities Suit in N.D. Iowa
PDI INC.: Marc Henzel Initiates Securities Fraud Suit in New Jersey
SUPREMA SPECIALTIES: Marc Henzel Lodges Securities Suit in New Jersey
RHYTHMS NETCONNECTIONS: Bernstein Liebhard Files Securities Suit in CO
SAGENT TECHNOLOGY: Marc Henzel Commences Securities Suit in N.D. CA
SYNOPSYS INC.: Faces Securities Suits Over Merger With IKOS Systems
WILLIAMS COMPANIES: Milberg Weiss Commences Securities Suit in N.D. OK
*********
CALIFORNIA: Officials To Improve Health Care Systems To Settle Suit
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Officials of California's Department of Corrections will settle a class
action pending in San Francisco Federal Court accusing the State of
denying adequate medical care to its more than 100,000 prison inmates,
according to a Reuters report.
The suit was commenced last year after years of complaints about the
State's prison medical care system and its complacence in providing for
the inmates' medical needs. The suit alleged that California
authorities:
(1) did not hire enough medical staff;
(2) delayed treatment and medical tests;
(3) did not adequately screen incoming inmates; and
(4) lacked proper procedures for dealing with chronic illnesses
such as AIDS and diabetes.
Under the settlement, the California Department of Corrections will
implement several health-care improvements over the next few years, as
well as allow an independent medical panel to audit the State's
progress, Reuters reports. This includes placing registered nurses in
each prison's emergency clinic 24 hours a day beginning in 2003.
Prisoners are also expected to be assigned primary care physicians and
the prison system will develop standardized protocols for medical
treatments.
Don Specter, Director of the nonprofit Prison Law Office, told Reuters
they were happy with what they achieved, "The agreement calls for them
to overhaul the medical system in a way that is sensible and will
provide prisoners with a reasonable opportunity to get time."
Supervising Deputy California Attorney General John Appelbaum, who
represented the Corrections Department in the case, said the State
struck the deal to avoid protracted litigation. He said "Our office
feels this settlement is in the best interests of the state of
California and the Corrections Department.It is designed to ensure
inmates constitutionally adequate medical care and it implements a
comprehensive review and improvement of the prison medical system."
CALIFORNIA: Water District Faces Suit For Retirement Law Violations
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The Metropolitan Water District of Southern California faces a class
action filed by employees who allege the agency violated the Public
Employees Retirement Law, by not enrolling contract workers into the
California Public Employees Retirement System (CALPERS). The numerous
contract service providers who supplied the workers are also named as
defendants in the suit and are charged with committing unfair business
practices.
The suit was filed on behalf of individuals who worked for the water
district through private contract service providers and who did not
receive the same benefits and employment rights as other water district
employees. The action asks for compensation for benefits the contract
workers should have received.
For over 50 years the water district, a public agency, has contracted
with CALPERS to provide pension, retirement and other benefits to its
employees. The contract employees allege that the water district has
used private contract service providers to fill certain positions in
order to eliminate the cost of providing CALPERS benefits to those
employees.
The suit maintains that, although the contract service providers pay
the contract employees' salaries, in all other aspects the employees
are employed directly by the water district. The employees claim they
were interviewed and hired directly by water district personnel, who
then determined the workers' hours, assignments, tasks, evaluations,
promotions and terminations. Usually these contract employees worked at
the water district full-time over a period of years, and they allege
that the contract service providers were in reality payroll service
providers for the water district, rather than employers.
EDY'S GRAND: Recalls 5,000 Cans of Ice Cream Over Undeclared Ingredient
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Edy's Grand Ice Cream on Thursday recalled 5,000 cartons of Limited
Edition Girl Scouts Samoas Cookie Ice Cream because they may contain
peanuts.
The recalled cartons were distributed in Columbus, Ohio, and parts of
Georgia, Alabama, Mississippi, Tennessee and the Florida Panhandle. The
label of ingredients did not include peanuts.
People with an allergy or severe sensitivity to peanuts should not eat
the ice cream, the company said. There were no immediate reports of an
allergic reaction, the company said.
Only 1.75-quart size cartons with a code date of 48-18-42 09 20 AL on
the bottom are affected.
Edy's is working with the Food and Drug Administration and the Food
Allergy and Anaphylaxis Network to alert customers and investigate the
incident.
EINSTEIN ACADEMY: Judge Blocks Enrollment Due To School Districts Suit
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Pennsylvania State Court Judge John Walker barred The Einstein Academy
Charter School from enrolling local students until a new hearing date
was set in the class action filed by five Franklin County school
districts.
The suit challenges the legality of the cyber-school, which serves
2,400 students statewide and a few dozen in Franklin County and
educates students online in their homes through computer technology and
Internet access. The suit claims there is a controversy over the
"constitutionality of the charter school law, obligations of public
school districts to make payments to Einstein Academy and whether
Einstein Academy obtained a proper and lawful charter," according to
the Herald-Mail. The suit further states even if the charter school
law is valid, cyber-schools are not authorized and Einstein Academy
should cease operations.
The Herald-Mail further reports that attorneys for the school asked the
Court to dismiss the case for lack of jurisdiction or stay the case
pending resolution of a class-action case filed by the Pennsylvania
School Boards Association in a brief filed last week.
Judge Walker's temporary injunction prevents the school from soliciting
or enrolling students who would otherwise attend schools in the five
districts in the suit, namely:
(1) Chambersburg Area,
(2) Greencastle-Antrim,
(3) Tuscarora,
(4) Waynesboro Area and
(5) Shippensburg Area
The injunction will continue until either party requests a new hearing
date, and also enjoins the school from attempting to collect from the
school districts for any amounts they were previously billed or to
collect from the Secretary of Education.
GREAT BRITAIN: Airlines Face $100M Claim Over Deep Vein Thrombosis
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Britain's troubled airline industry faces a crisis this week when a
S100 million compensation claim for "economy class syndrome" is
expected to proceed. The lawyers acting for families of deep vein
thrombosis (DVT) victims confidently predict the High Court will rule
on Thursday this week that the airlines must defend a class action from
more than 200 passengers.
At the moment, the industry is facing a single test case from Lyn
Walcott of Essex, whose husband Nigel died after a British Airways
flight from Barbados to Gatwick. A decision to proceed with a "group
litigation order" against major airlines will pave the way for what
could be one of the biggest compensation bills to hit United Kingdom
(UK) transport.
Collins Solicitors argue there is a causal link between DVT, a
condition which can cause lethal blood clots, and long hours sitting in
cramped conditions on planes. The Watford-based firm, experts in
transport litigation, has 210 passengers, including 30 deaths, on
its books claiming to have contracted DVT from flying. Potential
payouts could reach $3 million for each death, with an estimated
US$ 100,000 for those whose lives have been destroyed after contracting
blood clots.
Gerda Goldinger, of Collins, which also has represented relatives of
victims of the Paddington rail disaster, said, "The legal issues are
common in each case. To minimize huge legal costs for everyone, we are
extremely confident that the cases will be grouped together ensuring a
cost-effective, sensible and speedy way for the claims to proceed."
If successful, the airlines will be required to surrender documents
detailing exactly how long they have known of DVT risks to passengers.
The case threatens to be hugely embarrassing for major airlines, which
are accused of being aware of the dangers for at least a decade but,
until recently, they failed to warn passengers adequately
of the risk.
Ruth Christoffersen, of Newport, South Wales, whose 28-year-old
daughter Emma died moments after a flight from Australia to Heathrow,
said, "The airlines must be made to pay. Emma, like many other
victims, knew nothing of the risks when she boarded that plane. She
had no idea she was putting her life in danger."
Lyn Walcott's husband Nigel, 40, complained of feeling unwell moments
after landing in the UK after a holiday in Barbados where they had
married only a year earlier. Within 24 hours, Nigel died
from a blood clot that had traveled to his lungs. She said, "Airlines
have to be made accountable for the well-being of passengers."
Meanwhile, new figures from the Aviation Health Institute claim at
least another 12 UK passengers died from DVT last year. So far, the
Institute has logged the deaths of 50 British air travelers, though it
believes there could be more than 500 related fatalities a year, the
majority of which occur weeks later when the link to DVT and air travel
is not recorded. The Government and the Civil Aviation Authority still
have no accurate idea how many people have been affected by flying
because no data is collected nationally from hospital casualty units.
Other data from the Institute suggests DVT is not restricted to long-
distance and economy class flights. Analysis of the 50 UK deaths
reveals that 26 percent died following short-haul flights and nearly a
quarter of the fatalities were business travelers and almost half were
under the age of 40.
ID SOFTWARE: Insurer Asks For Release Due To Columbine Video Game Suit
----------------------------------------------------------------------
Id Software, a video game company, faces another challenge as its
insurer is asking the US Federal Court to release it from its
obligations to the Company, which is being sued in a class action by
the family of a Columbine massacre victim, teacher Dave Sanders, the
Associated Press recently reported.
The Sanders family's lawsuit claims that violent video games influenced
teen gunmen Dylan Klebold and Eric Harris before they attacked
Columbine High School on April 20, 1999, killing 13 fellow students
before committing suicide. The Mesquite, Texas-based Company allegedly
manufactured and devised one or more of the video games cited in the
Sanders complaint.
Pennsylvania General Insurance Company claims that Id Software refused
to cooperate when PGIC asserted its right to defend Id in the Sanders
suit. Consequently, PGIC has asked the Court to declare that the
Company breached its contract of insurance, and that PGIC does not have
the duty to defend, indemnify or reimburse it in the Sanders class
action.
MEDI-CAL LITIGATION: California Settles Suits Over Reimbursement Rates
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California State has successfully forged agreements to settle three
class actions over Medi-Cal reimbursement rates, the oldest of which
was filed by the firm over eleven years ago. The law firm of Foley and
Lardner filed two of the lawsuits in California State Court and the
California Hospital Association filed the other suit in Federal Court.
Foley & Lardner filed their suits on behalf of all Medi-Cal hospitals
for the period of 1989 through 1992, and eight California counties
(Alameda, Contra Costa, Fresno, Kern, Monterey, Riverside, San
Bernardino and Santa Clara) from 1987 through the present. The
California Hospital Association's federal lawsuit, however, was brought
on behalf of all California hospitals for the period of 1992 through
the present.
Under the settlement, the State will pay California hospitals $175
million for old Medi-Cal claims and raise Medi-Cal reimbursement rates
for outpatient hospital care by 30 percent. This is the most
significant rate increase in California since 1985.
Further action is pending to force the federal government to pay its
share of the settlement, which could mean another $175 million for the
plaintiffs. Although the State will make its share of the $350 million
payment without waiting for the federal government's share, the parties
have agreed to continue to press the federal government to pay its
portion of the settlement. The Courts are expected to approve the
modification.
The tentative agreement called for a $350 million payment for prior
allegedly low reimbursement rates to be split evenly between the state
and federal governments. Implementation of the agreement, reached last
year under the supervision of Los Angeles Superior Court Judges Peter
D. Lichtman and Owen Kwong, was delayed because of a dispute with the
federal government over its share of the payment.
The Federal Court Judge, the Honorable Stephen V. Wilson recently
issued an order to show cause, requiring the responsible federal agency
to appear in his Court on February 25 to show cause as to why it has
not agreed to pay its share of the settlement.
The two state cases' lead counsel, Los Angeles based Foley & Lardner
partner, Robert Leventhal, is cautiously optimistic. "Having resolved
the issues between the State of California and the plaintiffs, the
parties are well positioned to bring appropriate legal action to force
the federal government to pay its share," he said in a statement.
"After more than ten years, the eight counties that were the first
plaintiffs to file suit are particularly relieved to have the matter
resolved, at least at the state level," said Denise Rios Rodriguez, a
partner in Foley & Lardner's Los Angeles office. "As most of these
county facilities are `safety net' hospitals, we feel they are
especially worthy of a timely and equitable settlement."
The rate increase will be implemented retroactively as of July 1, 2001.
This new rate will be further increased by 3.3 percent per year for the
next three years. The federal government has agreed to pay its share of
these rate increases. Governor Gray Davis has authorized this
settlement to provide these critical payments to California hospitals
without waiting for federal approval of the settlement.
For more information, contact Robert Leventhal or Laura Roberts by
Phone: 1-310-975-7734 or 1-312-755-2586 or by E-mail:
RLeventhal@foleylaw.com or LRoberts@foleylaw.com
MITSUBISHI MOTORS: Recalls 16T Trucks Due to Engine, Exhaust Problems
---------------------------------------------------------------------
Japan's Mitsubishi Motors Corp. is recalling three truck models.
Mitsubishi spokesman, Ran Koike, says two have engine shaft defects,
while the third model has an exhaust system that allows the emission of
too much nitrogen oxide, says Bloomberg.
Quoting a statement from Japan's Ministry of Land, Infrastructure and
Transport, the report said that about 16,209 trucks will be recalled,
at a cost of approximately JPY1 billion.
NEW YORK: Appeals Court Orders Railroad Employees' Suit Certified
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A New York appellate court ordered the trial court to grant class
certification in a class action brought against New York-based Metro-
North Commuter Railroad Company by its African-American employees, who
claim that the company violated Title VII of the federal Civil Rights
Act of 1964 as a result of racial discrimination in promotion and
disciplinary actions.
The class, numbering roughly 1,300 employees, consists of all African-
Americans who were employed at the Company between 1985 and 1996. The
Company provides commuter rail transportation between New York City and
its northern suburbs. The employees allege that the company's practice
of delegating authority to department supervisors for employment
decisions led to racial discrimination in disciplinary actions and
promotions.
The suit cites instances in which white employees were promoted over
the African-American employees who trained them. In addition, the suit
cited statistics showing that African-Americans are not well
represented in management positions and occupy only 15% of all skilled
positions in Metro-North.
RHODE ISLAND: Smoker's Suit For Part of Tobacco Settlement Dismissed
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A Boston federal appeals court recently upheld a lower court's
dismissal of a lawsuit by a Rhode Island smoker who claimed she is
entitled to compensation under the landmark tobacco settlement, the
Associated Press reported recently.
The 1st US Circuit Court of Appeals upheld the District Court's
decision dismissing the case of Blanche E. Greenless. She sued Rhode
Island Governor Lincoln C. Almond, claiming that after states recovered
their costs for paying for smokers' care, as mandated by the
settlement, individual members of the class action lawsuit should
receive the remainder of the settlement.
The Appeals Court, in agreement with the Federal District Court,
rejected Ms. Greenless' appeal, ruling that she is not entitled to
compensation under the terms of the settlement.
SCHWEGMANN MARKETS: Judge Awards $5.4M To Retirees For "Lost" Vouchers
----------------------------------------------------------------------
A federal judge in New Orleans recently awarded nearly $5.4 million to
a group of Schwegmann Giant Super Market (Schwegmann Markets) retirees
to compensate for food vouchers they should have continued receiving
once the Company was sold, The Times-Picayune reported recently.
Judge Carl Barbier recently rendered his final judgment in the case,
awarding the group of 205 retired Schwegmann supervisors enough money
to cover the cash equivalent of the vouchers they should have received,
plus interest payments dating back to March 1997, when the food
vouchers were discontinued. A trial was held in July 2001, and Judge
Barbier ruled in favor of the retirees the following month.
The retired workers sued Schwegmann Markets, John F. Schwegmann and the
Company's insurer, United States Fidelity and Guaranty Insurance
Company (USF&G).
The food vouchers were the crux of a federal class-action lawsuit filed
by former Schwegmann supervisors, who said the food vouchers
constituted a retirement benefit covered by the Employment Retirement
Income Security Act (ERISA). Attorneys for the retirees argued that
the food vouchers were part of an ERISA plan and the retirees qualified
to continue receiving the vouchers, or their cash equivalent, until
death. After a two-day trial, Judge Barbier ruled that the food
vouchers were part of a protected retirement plan and that USF&G is
liable under the terms of the insurance policy.
A lawyer representing USF&G said the Company will appeal the decision
to the 5th US Court of Appeals. "I don't think the facts on the law
find that it's a plan as defined by ERISA," said Attorney Howard
Kaplan. Although an appeal will delay any payments the retirees will
receive for another year or more, said Nancy Picard, one of the lawyers
who represented the workers, the retirees already feel vindicated.
They had worked at Schwegmann for many years and felt they were part of
a family and would be taken care of because that is what they were
told, she said.
Roughly 205 retirees are part of the class action suit, according to
Ms. Picard. How much money each person will receive in the lump sum
payout is based on several factors, such as their age at the time the
voucher program was discontinued and their life expectancy. Starting
in 1985, every Schwegmann retiree who was 60 or older, had worked for
the Company 20 years and had spent at least one year as a supervisor
would receive $216 in food vouchers each month until death. Many of
the employees qualifying for the vouchers had worked without the
benefit of a pension or 401(k) plan during much of their careers.
With the sale in February 1997, however, of the Schwegmann Markets
business by John Schwegmann to investment firm Kohlberg & Company, the
retirees were informed they no longer would receive the monthly food
vouchers, that the food voucher program had ended. Kohlberg filed for
bankruptcy protection in 1999 and shut down the grocery chain.
The food vouchers had been around for many years, and many of the
workers counted on them as retirement income, but the voucher
program had never been put in writing. John Schwegmann contended the
vouchers were a gratuity, like the watches and steak knives he handed
out over the years at retirement dinners he staged for Company
supervisors.
Judge Barbier, nonetheless, ruled that even if the agreement was not in
writing, the food vouchers constituted a retirement plan governed by
the Employment Retirement Income Security Act, which was designed to
protect workers by broadly interpreting pension benefits. Judge
Barbier based his decision on several factors, including:
(1) The fact that the partnership that owned and operated
Schwegmann grocery stores deducted the cost of the food
vouchers as a business expense under the "retirement plans"
category on its tax returns;
(2) The fact that the company also issued form 1099R to the
recipients, the Internal Revenue Service form for reporting
retirement income;
(3) The fact that pension plans are subject to minimum vesting
standards, requiring that an employee work for a minimum
amount of time to qualify for the benefit.
The Schwegmann grocery vouchers were treated in just such a similar
manner as they weren't just given when a person left the Company, but
when they retired at a specific age.
Judge Barbier awarded the retirees slightly more than $5.1 million in
payments fpr the vouchers, plus $267,032.71 in interest payments. He
ruled that USF&G is responsible for 95.12 percent of both the benefit
payments and the interest payments. That percentage takes into account
the $250,000 self-insured retention policy, akin to a deductible, that
John Schwegmann is responsible for paying as part of the policy.
The insurance company would have to pay the $5.4 million amount into a
trust account for the benefit of the retirees, regardless of whether
John Schwegmann pays the $250,000 first.
Finally, Ms. Picard and the other lawyer who represented the retirees,
Ed Newman, must submit bills for their attorney's fees accumulated over
the past three years, which Judge Barbier had previously ruled should
be paid by USF&G.
SERVICE CORPORATION: Sued For Preferential Sales Practices In Florida
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Beleaguered funeral company Service Corporation International faces
another class action in Florida Federal Court accusing the Company of
giving preferential treatment to Jewish customers in their marketing
practices. The Company already faces a class action alleging it
desecrated graves and mishandled bodies in its Menorah Gardens
cemeteries in Broward and Palm Beach.
The suit accuses the Company of providing Jewish customers with zero
interest financing on pre-purchased funeral plans to the exclusion of
others. The plaintiffs in the suit are either black or Hispanic
residents in Broward, Palm Beach and Miami-Dade counties who purchased
a funeral contract from the Company between 1991 and 1999 with interest
rates between 5.9% and 12.5%.
The suit labeled the Company's alleged preferential lending to Jewish
customers as "discriminatory." The principal evidence in the suit is a
memo from a Company executive at its Houston headquarters discussing
offering the zero interest financing for customers of the Jewish
cemeteries.
Attorney for the plaintiffs, Herman Russomanno, told the Florida Sun-
Sentinel, "All people should be treated the same.Why would they have
such an offensive practice?"
The Company acknowledged that it offered the preferential financing at
both Menorah Gardens locations but denied such policies extend beyond
South Florida to its nationwide network of cemeteries and funeral
homes, according to the Florida Sun-Sentinel. Company attorney Barry
Davidson stated that the zero percent financing is common among
companies vying for business among the sizeable Jewish clientele and is
not unigue to the Company alone. Mr. Davidson however declined to
comment on why Jewish customers receive that treatment.
SCI attorney Barry Davidson was quick to draw a line between the
discrimination allegations and the desecration case.
"One has nothing to do with the other," he said.
The zero percent financing, he said, is common among companies vying
for business among Jewish clientele and is not unique to SCI. But
Davidson didn't want to comment on why the Jewish customers receive
that treatment.
Mr. Davidson also added that other customers could receive the zero
percent interest deal if they asked. "The way they get there is they
ask for it, they negotiate, they bargain for it." Angela Mason,
another lawyer for the plaintiffs, countered that Jewish customers
don't have to ask for the deal and are never rejected, therefore, the
terms discriminate against everyone else, according to a Sun-Sentinel
report.
Mr. Davidson also rejected claims that the discrimination and
desecration suits were related, "One has nothing to do with the other."
TYSON FOODS: Federal Court Sends Homeowners' Suit Back To State Court
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The United States District Court for the Northern District of Oklahoma
recently remanded to state court a class action that accuses Tyson
Foods of polluting Grand Lake in Oklahoma, the Associated Press
recently reported. The lawsuit, filed on behalf of lakefront property
owners, alleges that the Company has discharged millions of gallons of
wastewater from its processing plant near Noel, Missouri, directly into
the Elk River, which flows from Missouri across the border into
Oklahoma and Grand Lake.
The suit also claims the Company is liable for waste suspected of
leaching into Grand Lake after being used as fertilizer by farmers who
have contracts to grow chickens for Tyson. Overall, the pollution from
the various sources has brought foul odors, poultry remains, oil slicks
and scum to the shoreline, the lawsuit on behalf of the property owners
alleges.
The Federal Court remanded the case to Mayes County District Court,
where the lawsuit originated, said attorney Chuck Shipley, whose Tulsa,
Oklahoma firm represents the property owners.
WASHINGTON MUTUAL: Homeowners Sue For Violations of WA Consumer Act
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Washington Mutual, Inc. faces a nationwide class action filed by a
group of Seattle, Washington homeowners alleging that the Company
improperly services their mortgages.
The suit charges the Company with:
(1) losing mortgage payments;
(2) failing to timely post mortgage payments;
(3) failing to properly post mortgage payments;
(4) failing to properly draft electronic mortgage payments and
(5) failing to maintain accurate account records.
The allegations in the complaint primarily relate to problems arising
after the Company obtained the loan servicing portfolios of other banks
like PNC Mortgage and Fleet Mortgage. Its acquisitions increased its
servicing portfolio from about $150 billion, as of March 2000, to over
$450 billion, as of March 2001.
The plaintiffs allege that the Company's mistakes result in poor
customer service in which borrowers spend untold hours attempting to
correct the Company's errors, improper fees paid by borrowers for which
they are not reimbursed, and erroneous negative reports to credit
bureaus. The complaint asserts claims for breach of contract and for
violations of Washington's consumer protection act.
For further details, contact Robert S. Green or Jenelle Welling of
Green Fauth & Jigarjian, LLP by Phone: 415-477-6700 or visit the firm's
Website: http://www.classcounsel.com
Securities Fraud
APW LTD.: Marc Henzel Lodges Suit For Securities Act Violations in WI
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The Law Office of Marc S. Henzel initiated a securities class action in
the United States District Court, Eastern District of Wisconsin, on
behalf of purchasers of the securities of APW, Ltd. (NYSE: APW) between
September 26, 2000 and March 20, 2001, inclusive. The action is pending
against the Company and officers Richard G. Sim and William P.
Albrecht.
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. Specifically, throughout the class period, defendants
repeatedly issued statements indicating that, among other things, the
Company was growing at a rapid pace, due, in significant part, to
strong demand for its product offerings by its customers.
The suit alleges that these statements were materially false and
misleading because, among other things, they failed to disclose or
misrepresented that:
(1) in fact, the Company was experiencing decreased demand for its
products as its primary customers were substantially
decreasing their orders;
(2) due to the declining demand, the Company's customers were
overstocked with products and, accordingly, would be
decreasing their orders in the future while they worked down
their bloated inventories; and
(3) in response to these negative factors, APW was attempting to
slash costs and, in this regard, had started to reduce its
workforce.
In March 2001, defendants finally disclosed this information and
reported that the Company's sales growth had slowed dramatically and
reported a loss of $0.15 per share, compared to analysts' expectations
of a $0.27 per share profit. Defendants also disclosed that the
Company's reduced performance, combined with other factors, caused it
to be in breach of certain covenants in its credit agreement.
In response to this announcement, the price of the Company's common
stock dropped from $20.65 per share on March 20, 2001, to close at
$7.39 per share on March 21, 2001. Prior to this disclosure, defendant
Albrecht was able to sell shares of his personally-held stock for gross
proceeds of more than $1.7 million and the Company was able to complete
its acquisition of Mayville Metal Products, which was partially paid
for using the Company's stock as currency.
For more information, contact Marc S. Henzel by Mail: 273 Montgomery
Ave., Suite 202 Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or
888-643-6735 by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or
visit the firm's Website: http://members.aol.com/mhenzel182
DOLLAR GENERAL: Goodkind Labaton Commences Securities Suit in M.D. TN
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Goodkind Labaton Rudoff & Sucharow LLP initiated a securities class
action in the United States District Court in the Middle District of
Tennessee, Nashville Division on behalf of all persons who, during the
period of June 15, 1999 through January 8, 2002, purchased or otherwise
acquired Dollar General Corporation common stock pursuant to the its
direct stock purchase plan, through which shares were offered by a
registration statement and prospectus declared effective June 15, 1999.
The suit asserts claims pursuant to Section 27(a)(3)(i) of the Private
Securities Litigation Reform Act (PSLRA) and Section 15 USC 77z-
1(a)(3)(i) of the Securities Act of 1933 against the Company, and
certain of its directors who signed the registration statement
The suit charges the defendants with violations of Sections 11 and 15
of the Securities Act. The suit alleges that the plaintiff and other
proposed class members elected to receive Company stock instead of cash
dividends pursuant to the stock plan, and that the registration
statement filed in connection with the issuance of shares pursuant to
the stock plan contained and incorporated false and misleading
information regarding the Company's financial results. The suit
further alleges that these false and misleading statements remained
uncorrected until a partial disclosure was made on April 30, 2001 when
the Company stated that it had become aware of certain "accounting
irregularities."
Another action is also pending in the United States District Court,
Middle District of Tennessee, Nashville Division. The consolidated
suit has been brought on behalf of all persons who purchased the
Company's publicly traded securities on the open market during the
period May 12, 1998 through September 21, 2001. On July 20, 2001, the
Court designated certain lead plaintiffs in the consolidated action,
and on January 14, 2002, the Company General announced it had reached
an agreement to settle the consolidated action.
By order dated January 17, 2002, this suit was joined with the
consolidated action. Plaintiff in this action is moving to oppose
consolidation. In the event the Court grants that application, and this
action is not consolidated with the consolidated action, plaintiff
intends to move for designation as lead plaintiff.
For more details, contact Jonathan M. Plasse or Henry Young by Mail:
100 Park Avenue, 12th Floor, New York, NY 10017-5563 by Phone:
212-907-0700 by E-mail: jplasse@glrslaw.com or hyoung@glrslaw.com or
visit the firm's Website: http://www.glrslaw.com
FORD MOTOR: Lovell Stewart Commences Securities Suit in S.D. New York
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Lovell & Stewart, LLP initiated a securities class action on behalf of
all persons who purchased or otherwise acquired the common stock of
Ford Motor Company (NYSE: "F"), between December 1, 1999 through
January 12, 2002, inclusive, in the US District Court for the Southern
District of New York.
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 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.
The suit alleges that the Company's representations were rendered false
and misleading by the Company's failure to disclose:
(1) that the Company's management purposely had made and failed to
hedge large commitments to purchase platinum, palladium,
rhodium or similar commodities at very high prices;
(2) that the declines in the prices of such commodities during the
class period (which, to outward appearances, were favoring the
Company's business) were not helping the Company and, on the
contrary, were hurting its business and prospects,
(3) that these large unhedged purchase commitments had placed the
Company at a disadvantage to, for example, General Motors,
and/or
(4) that the large unhedged purchase commitments by the Company's
management were exposing it to potentially in excess of $1
billion in losses from price declines that would have been
favorable to the Company.
The suit further alleges that defendants made false and misleading
statements to conceal top management's errors and speculation, and the
Company's true financial and competitive position. Only after
defendants Jacques Nasser and Henry D.G. Wallace had departed the
employment of Ford, did defendants, on January 11, 2002, belatedly
disclose the foregoing material adverse facts in the Company's "write-
off" of one billion dollars of charges (or losses) relating to such
unhedged commodity exposure.
For more information, contact Christopher Lovell by Mail: 500 Fifth
Avenue, New York, New York 10110 by Phone: 212-608-1900 or by E-mail:
sklovell@aol.com
GENCORP INC.: Faces Possible Securities Claims For Earnings Restatement
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SecuritiesSleuth.com is investigating possible violations of federal
securities laws by technology-based manufacturer GenCorp, Inc.
(NYSE:GY). GenCorp is a technology-based manufacturer with leading
positions in the aerospace and defense, pharmaceutical fine chemicals
and automotive industries. However, the stock is apparently not well
known to individual investors, as institutions hold 67% of its shares
outstanding.
According to an article posted on the SecuritiesSleuth website, plans
were in place for the company to release its fourth quarter earnings on
January 22nd, before the market opened, with a "webcast" of its
conference call scheduled for 10:00 AM PST. However, instead of an
earnings release, at 8:30 AM on Tuesday January 22nd, the Company
announced that it would reschedule the release of its fourth quarter
earnings pending "a review of its previously reported unaudited results
for fiscal year 2001." The release further explained that the review
would include "an examination of the accounting for balance sheet
items, and expenses incurred, at two GDX Automotive manufacturing
plants in North America."
According to its most recent 10-Q Report to the SEC, at the end of
2000, the Company acquired the "Draftex International Car Body Seals
Division (Draftex) for cash consideration of approximately $209
million. The purchase price is preliminary and will be adjusted to
reflect certain working capital adjustments provided for in the
purchase agreement and currently under negotiation with the seller."
This 10-Q goes on to state, "Negotiations with the seller have not been
settled and have been placed into arbitration for resolution. The final
allocation of the purchase price is expected to be made in late 2001
after arbitrated negotiations have been settled and the exit plan has
been finalized." SecuritiesSleuth.com alleges that it is possible that
the outcome of these negotiations have a direct relationship to the
impending restatement of the Company's interim results.
Tuesday's press release states, "preliminary information suggests that
the review will result in a revision of the Company's previously
reported 2001 quarterly results that could be material. The Company
further informed investors that previously issued reports and guidance
concerning the Company's operating results for 2001 should be
disregarded pending the outcome of the review."
For inquiries, email SecuritiesSleuth.com: Sleuth@napeague.com
HA-LO INDUSTRIES: Schiffrin Barroway Lodges Securities Suit in N.D. IL
----------------------------------------------------------------------
Schiffrin & Barroway, LLP initiated a securities class action in the
United States District Court for the Northern District of Illinois,
Eastern Division, on behalf of all purchasers of the common stock of
HA-LO Industries Inc., (formerly NYSE: HMK) from February 18, 1999 and
November 23, 2001, inclusive.
The complaint charges the Company and certain of its officers and
directors with issuing false and misleading statements concerning its
business and financial condition. Specifically, the complaint charges
that throughout the class period, defendants issued press releases
reporting the Company's quarterly and year-end financial performance,
and filed reports confirming such performance with the United States
Securities and Exchange Commission. These reports positively portrayed
the Company's performance during the class period.
These statements, as alleged in the complaint, were materially false
and misleading because the Company had, throughout the class period,
improperly recognized revenues, thereby inflating its reported sales
and earnings.
In November 2001, the Company issued a press release announcing the
restatement of its previously filed financial statements for the period
1998 to 2000, and that the Company "may also restate its first quarter
2001 Form 10-Q." According to the press release, the restatement will
have the effect of decreasing the Company's reported class period
pretax income by a total of $15 million, including $1.2 million if the
restatement includes the first quarter of 2001.
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:
888-299-7706 (toll free) or 610-667-7706 or by E-mail:
info@sbclasslaw.com
MCLEOD USA: Schiffrin Barroway Commences Securities Suit in N.D. Iowa
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Schiffrin & Barroway, LLP initiated a securities class action in the US
District Court for the Northern District of Iowa, alleging that
McLeodUSA, Inc. (Nasdaq:MCLD) misled shareholders about its business
and financial condition. The suit seeks damages for violations of
Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Sections
10(b) and 20(a) of the Securities Exchange Act of 1934, on behalf of
all investors who bought McLeodUSA, Inc. securities between January 30,
2001 and December 3, 2001.
The suit alleges that the Company issued a series of materially false
and misleading statements regarding its business, operations and
financial statements that failed to disclose:
(1) that the Company was failing to timely and properly recognize
hundreds of millions of dollars in impairment losses in
connection with certain acquisitions, such as Splitrock
Services, Inc. and Caprock Communications Corporation;
(2) that the Company did not have the funds necessary to complete
its National network and that it would soon have to abandon
its plans to finish the network; and
(3) that the Company was unable to service its substantial debt
and lacked the financial flexibility necessary to avoid a
restructuring.
During the class period, prior to the disclosure of the true facts
about the Company, the Company purchased Intelispan for $40 million in
stock
For more information, contact Marc A. Topaz or Stuart L. Berman by
Phone: (888) 299-7706 (toll free) or (610) 822-2221 by E-mail:
info@sbclasslaw.com or visit the firm's Website:
http://www.sbclasslaw.com
PDI INC.: Marc Henzel Initiates Securities Fraud Suit in New Jersey
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The Law Offices of Marc S. Henzel commenced a securities class action
on behalf of purchasers of the securities of PDI Inc. (NASDAQ: PDII)
between May 22, 2001 and November 12, 2001 inclusive, in the United
States District Court for the District of New Jersey against the
Company and:
(1) Charles C. Saldarini (CEO and Co-Chairman) and
(2) Bernard C. Boyle (CFO)
The suit charges that defendants violated Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934, and Rule 10b-5 promulgated
thereunder, by issuing a series of materially false and misleading
statements to the market between May 22, 2001 and November 12, 2001.
For example, as alleged in the complaint, on May 22, 2001 the Company
held a conference call regarding a previously announced agreement with
Novartis AG, under which the Company would market and sell Novartis'
Lotensin and Lotrel, two hypertension medications. During the
conference call, defendants represented that they expect the Novartis
contract to add $0.25 per share to the Company's fourth quarter of 2001
results.
That statement was, according to the complaint, materially false and
misleading because defendants knew, or were reckless in not knowing,
that the Company's marketing program would not be fully underway until
well into the fourth quarter and that therefore, the agreement could
not contribute materially to its fourth quarter of 2001 performance.
In addition, according to the complaint, the Company materially misled
the investing public to the true impact that the introduction of
generic competition for Ceftin, a drug that the Company was
distributing under contract with GlaxoSmithKline PLC, would have on its
business. In particular, the suit alleges that defendants represented,
in an August 23, 2001 conference call, that the Company expected Ceftin
to contribute $0.30-$0.40 earnings per share to the fourth quarter of
2001, even if a generic form of Ceftin was introduced during that time.
According to the complaint, the statements were materially false and
misleading because defendants knew, or were reckless in not knowing,
that Ceftin could not contribute $0.30 per share to fourth quarter 2001
earnings.
In November 2001, the Company issued a press release announcing a net
loss of $17.3 million, or $1.24 for the third quarter of 2001,
including a $24 million charge as reserves for expenses associated with
the Ceftin contract, which the Company announced would be terminated
shortly. In addition, the Company announced that the Lotensin program
will be completed late in the fourth quarter and would not contribute
materially to its 2001 earnings.
On November 13, 2001, defendants held a conference call revealing that
Ceftin would not contribute any profit to the fourth quarter of 2001.
In reaction to the news, the price of Company stock plummeted from a
$29 per share close on November 12, 2001 to close at $18.35 per share,
a drop of 35%.
For more information, contact Marc S. Henzel by Mail: 273 Montgomery
Ave., Suite 202 Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or
888-643-6735 by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or
visit the firm's Website: http://members.aol.com/mhenzel182
SUPREMA SPECIALTIES: Marc Henzel Lodges Securities Suit in New Jersey
---------------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a securities class action
in the United States District Court for the District of New Jersey on
behalf of all persons or entities who purchased Suprema Specialties,
Inc. (Nasdaq: CHEZ) during the period from August 15, 2001 through and
including December 21, 2001, inclusive.
The suit charges defendants with violations of Sections 10(b) and 20(a)
of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated
thereunder. Additionally, the suit alleges a violation of Section 11 of
the Securities Act of 1933, on behalf of those investors who purchased
Company stock pursuant to its secondary offering of November 8, 2001.
The suit alleges, among other things, that throughout the class period,
defendants knowingly or recklessly disseminated materially false and
misleading statements regarding the Company's financial condition. On
December 21, 2001 the Company announced the resignation of defendant
Venechanos, its CFO and disclosed that it had launched an investigation
into its prior reported financial results. In response to this report
the Nasdaq halted trading of Company stock.
These statements, among others, are alleged to have been materially
deceptive:
(1) August 15, 2001, press release announcing the Company's 2001
year end financial results,
(2) 2001 Form 10-K filed with the SEC on September 28, 2001,
(3) the Company's registration statement filed with the SEC on
November 6, 2001 for the public offering of over 4 million
shares of stock at $12.75 of which 500,000 shares were sold
by, among others, defendants Cocchiola and Venechanos;
(4) the Company's Form 10-Q for its first quarter ended September
30, 2001
In each of its SEC filing, the Company assured the public that its
financials were in conformity with generally accepted accounting
principles (GAAP). The suit alleges that the Company's financial
statements were not in conformity with GAAP and that defendants'
misrepresentations caused the price of Company common stock to be
artificially inflated throughout the class period.
For more information, contact Marc S. Henzel by Mail: 273 Montgomery
Ave., Suite 202 Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or
888-643-6735 by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or
visit the firm's Website: http://members.aol.com/mhenzel182
RHYTHMS NETCONNECTIONS: Bernstein Liebhard Files Securities Suit in CO
----------------------------------------------------------------------
Bernstein Liebhard and Lifshitz LLP initiated a securities class action
on behalf of all persons who acquired Rhythms NetConnections, Inc.
(NASDAQ: RTHMQ) securities between January 6, 2000 and April 2, 2001,
inclusive, in the United States District Court for the District of
Colorado against:
(1) Catherine M. Hapka,
(2) Steve Stringer,
(3) Scott C. Chandler, and
(4) John W. Braukman
The suit charges that defendants violated Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934, and Rule 10b-5 promulgated
thereunder, by issuing a series of materially false and misleading
statements to the market between January 6, 2000 and April 2, 2001.
Throughout the class period, the Company portrayed itself as a fast-
growing and expanding provider of DSL services and repeatedly
represented that it could continue to expand its broadband network
throughout the United States and reassured investors that it was
financially able to continue this expansion.
As alleged in the suit, defendants' statements issued throughout the
class period were materially false and misleading when made as they
failed to disclose adverse facts which were then known to defendants or
recklessly disregarded by them:
(i) that the Company lacked the financial resources necessary to
execute its business plan of a bull national network
expansion;
(ii) that the Company's efforts to scale back its expansion plans
were not meeting with success as the Company was unable to
generate the necessary financing;
(iii) that the Company was not well-funded or well-positioned to
continue its growth, as its expenses, including its ongoing
debt payment obligations, were far outpacing its revenues and
rapidly depleting its cash reserves;
(iv) that the Company did not have adequate cash reserves and was
not sufficiently "stable" and "financially strong" that it
would be able to fund its operational needs into the first
quarter of 2002, as defendants repeatedly promised investors -
defendants were not even able to keep the Company running
through 2001, as it had earlier guaranteed; and
(v) that without the influx of additional capital, the Company
would be forced to seek bankruptcy protection, which would
render its common stock worthless.
While in possession of the true facts about the Company and its
business, the individual defendants and other Company insiders
collectively sold 600,000 shares of common stock for gross proceeds in
excess of $16 million, of which over $12.6 million alone was received
by defendant Hapka, and the Company raised hundreds of millions of
dollars in preferred stock sales and debt issuances.
For more information, contact Ms. Linda Flood, Director of Shareholder
Relations by Mail: 10 East 40th Street, New York, New York 10016 by
Phone: (800) 217-1522 or 212-779-1414 or by E-mail: RTHMQ@bernlieb.com
SAGENT TECHNOLOGY: Marc Henzel Commences Securities Suit in N.D. CA
-------------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a securities class action
in the United States District Court for the Northern District of
California on behalf of purchasers of Sagent Technology, Inc. (Nasdaq:
SGNTE) publicly traded securities during the period between May 11,
2001 and November 28, 2001.
The suit charges the Company and certain of its officers and directors
with violations of the Securities Exchange Act of 1934, and alleges
that during the class period, defendants caused Company shares to trade
at artificially inflated levels through the issuance of false and
misleading financial statements. As a result of this inflation, the
Company was able to complete a private placement offering of 9.1
million shares, raising net proceeds of $16.8 million on August 1,
2001.
In November 2001, just months after this offering was completed, the
Company revealed that its 3rd Quarter results, and possibly other
quarters, were false when issued. The stock dropped below $.70 per
share on this news. Then, on November 28, 2001, after the market
closed, defendants revealed that the Company's 1st to 3rd quarter
results had been materially misstated and would have to be restated.
For more information, contact Marc S. Henzel by Mail: 273 Montgomery
Ave., Suite 202 Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or
888-643-6735 by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or
visit the firm's Website: http://members.aol.com/mhenzel182
SYNOPSYS INC.: Faces Securities Suits Over Merger With IKOS Systems
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Software company Synopsis, Inc. faces two class actions in Delaware and
California state courts, alleging federal securities violations
relating to its mergers with IKOS Systems, Inc. and Mentor Graphics,
Inc. Both suits were commenced in December 2001.
The first suit was filed by IKOS stockholder, Scott Petler, in
California Superior Court in Santa Clara County, California against
IKOS, the members of IKOS' Board of Directors, the Company and its
Chairman and Chief Executive Officer Aart de Geus. The suit alleged
that the members of the IKOS board breached their fiduciary duties in
connection with the merger agreement and that the Company and Dr. de
Geus aided and abetted those alleged breaches of fiduciary duties.
Another IKOS stockholder, Ernest Hack, filed the second suit in the
Court of Chancery of the State of Delaware against IKOS, the IKOS
directors and the Company. While not identified as such in the caption
of the complaint, the body of the complaint also describes Mentor
Graphics as a defendant. The suit alleges that the members of IKOS'
Board failed to properly consider and act upon Mentor Graphics' offer
to acquire IKOS. The suit also alleges that IKOS failed to solicit
offers before entering the merger agreement.
The suit alleges that, as a result of the foregoing among other things,
the members of IKOS' board breached their fiduciary duties. The lawsuit
alleges that the Company aided and abetted the IKOS board in the
alleged breach of their fiduciary duties.
The plaintiffs in this action have proposed its consolidation with
certain other purported class actions pending in the Chancery Court
against IKOS and its Board, actions in which the Company is not
named as a defendant. No date has been set for trial in this matter.
The Company believes that these lawsuits are without merit and intends
to vigorously contest each lawsuit.
WILLIAMS COMPANIES: Milberg Weiss Commences Securities Suit in N.D. OK
----------------------------------------------------------------------
Milberg Weiss Bershad Hynes & Lerach LLP initiated a securities class
action on behalf of purchasers of the common stock of Williams
Companies, Inc. (NYSE:WMB) and/or Williams Communications Group, Inc.
(NYSE:WCG) between July 24, 2000 and January 29, 2002, inclusive, in
the United States District Court for the Northern District of Oklahoma
against the two companies and:
(1) Keith E. Bailey,
(2) Howard E. Janzen and
(3) Scott E. Schubert
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 a series of material misrepresentations to the
market between July 24, 2000 and January 29, 2002, thereby artificially
inflating the price of both Companies' common stock. Specifically, the
complaint alleges that both Companies issued a series of statements
concerning their businesses, financial results and operations which
failed to disclose:
(i) that the spin-off of WCG from WMB was not in the best
interests of both WMB and WCG shareholders as the primary
motivation for the spin-off of WCG was to allow WMB to shore
up its balance sheet so that it could then issue more stock
and/or debt to acquire companies using its common stock as
currency and protect its debt rating;
(ii) that WCG was operating at levels well below company-sponsored
expectations, such that revenue projections were overstated,
and costs and expenses were understated, and also such that,
in an effort to control costs, defendants would soon have to
take actions which would have a further adverse impact on
WCG's profitability;
(iii) that approximately $2 billion of WCG debt that was guaranteed
for payment by WMB around the time of the spin-off was
improperly footnoted by WMB as a mere contingent obligation of
WMB, which was materially false and misleading because the
declining financial condition of WCG made it increasingly
certain that WMB would be forced to pay on such guaranties,
for which it did not adequately reserve;
(iv) that WCG's assets were permanently impaired and had to be
written-off and that WCG avoided taking such write-offs on its
own books through the series of financial machinations
described in the complaint;
(v) that WMB was carrying on its financial statements receivables
from WCG that were impaired, not collectible and should have
been written-off in whole or in substantial part. Rather than
writing off these impaired assets, which amounted to tens of
millions of dollars, WMB agreed to extend up to $100 million
of WCG's receivables with an outstanding balance due on March
31, 2001, to March 15, 2002; and
(vi) that the sale and leaseback of WCG's office properties in or
about September of 2001 was a non-arm's-length transaction at
an inflated value for the properties whose motive and intent
was to funnel monies to WCG and avoid forcing WMB to perform
its guaranties and thereby adversely affect its results and
debt ratings.
On January 29,2002, as alleged in the complaint, the Company shocked
the market by announcing that it would be delaying the release of its
2001 earnings "pending an internal assessment of William's contingent
obligations to Williams Communications." According to the press
release, WMB "expects to be able to estimate the financial effect, if
any, regarding its ultimate obligation related to WCG's $1.4 billion
debt and network lease agreement covering assets that cost $750
million."
In response to WMB's shocking announcement, as alleged in the
complaint, the price of WMB common stock, which was already
substantially eroded from its prior year's high, declined sharply,
falling from approximately $24 per share to as low as $18.70 per share
and the already depressed WCG common stock declined to as low as $1.30
per share.
For more information, contact Steven G. Schulman or Samuel H. Rudman by
Phone: (800)320-5081 by E-mail: williamscase@milbergNY.com or visit the
firm's Website: http://www.milberg.com
*********
S U B S C R I P T I O N I N F O R M A T I O N
Class Action Reporter is a daily newsletter, co-published by
Bankruptcy Creditors' Service, Inc., 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
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