/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/020220.mbx C L A S S A C T I O N R E P O R T E R Wednesday, February 20, 2002, Vol. 4, No. 36 Headlines CONTINENTAL AG: Cars Recalled For Part Causing Possible Brake Defect DYN CORPORATION: Colombians Sue Over Effects of Round Up Herbicide EMERY WORLDWIDE: Ex-Employees Sue After Losing Jobs in Airline Closure FORD MOTOR: Orders Recall of Defective 2002 Ranger Pickup Trucks GLOBAL CROSSING: Stull Stull Commences 401(k) Suit in C.D. California HONDA MOTOR: Recalling 4,600 Minivans In Japan Due To Seat Belt Defects LUCENT TECHNOLOGIES: Suit Still Pending Over Non-Y2K Compliant Products TENNESSEE: Court Approves $5M Settlement of TN Sales Tax Suit Securities Fraud ACTRADE FINANCIAL: Charles Piven Commences Securities Suit in S.D. NY BANK OF AMERICA: Lawyers in Stalled CA Suit To Oppose $490M Settlement ELAN CORPORATION: Bull Lifshitz Commences Securities Suit in S.D. NY ELAN CORPORATION: Chitwood Harley Commences Securities Suit in N.D. GA ENRON CORPORATION: UC General Counsel Expects "Substantial Recovery" ENTERASYS NETWORKS: Leo Desmond Files Securities Suit in New Hampshire EVEREX SYSTEMS: California Jury Absolves Official of Securities Fraud GLOBAL CROSSING: Brian Barry Commences Securities Suit in C.D. CA HA-LO INDUSTRIES: Schatz Nobel Commences Securities Suit in N.D. IL HOMESTORE.COM: Scott Scott Expands Class Period in California Suit IMCLONE SYSTEMS: Scott Scott Expands Class Period in Securities Suit INFONET SERVICES: Milberg Weiss Commences Securities Suit in C.D. CA INTERWAVE COMMUNICATIONS: Contemplating Response To Suit in S.D. NY JD EDWARDS: $15M Settlement Reached In Securities Act Violations Suit JP MORGAN: Glancy Binkow Commences Securities Suit in S.D. New York IRVINE SENSORS: Leo Desmond Lodges Securities Suit in C.D. California IRVINE SENSORS: Charles Piven Commences Securities Suit in C.D. CA JUNIPER NETWORKS: Leo Desmond Commences Securities Suit in N.D. CA LUCENT TECHNOLOGIES: Consolidated Suit's Possible Affects Uncertain MPOWER COMMUNICATIONS: Court Dismisses Suit For Securities Violations NATIONAL GOLF: Charles Piven Commences Securities Suit in C.D. CA NETSOLVE INC.: Settles Consolidated Securities Suit For $2.75M in Texas NETSOLVE INC.: Sued For Securities Act Violations in IPO in S.D. NY NETWORK ENGINES: NY Suit Could Harm Business Operations, Finances SPECTRALINK CORPORATION: Wolf Haldenstein Files Securities Suit in CO SPECTRALINK CORPORATION: Leo Desmond Commences Securities Suit in CO TYCO INTERNATIONAL: Rabin Peckel Initiates Securities Suit in S.D. NY ********* CONTINENTAL AG: Cars Recalled For Part Causing Possible Brake Defect -------------------------------------------------------------------- German auto-parts maker Continental AG instituted a recall that could cover around 60,000 to 70,000 cars after discovering a defective part that may affect vital brake efficiency. The cars may have been exported to other Latin American countries though it was initially thought they were distributed only to Brazil. The recall affects 22 models assembled in Brazil by major automakers General Motors, Ford, Volkswagen and Fiat. General Motors said that the recall would affect 23,800 of their cars, including the Corsa, Vectra, Zafira and Astra models, a Company spokesman revealed. He added that at least 1,000 of these were exported to Argentina and Mexico, according to a Reuters report. On the other hand, Ford exported 1,000 Fiesta, Ka and Courier vehicles to Argentina and Mexico. "The Company is still assessing what was actually sold to these countries," a Ford spokesman told Reuters. Some of the 6,140 cars subject to recall are still in the Company's stocks. A Volkswagen spokesman identified as part of the recall five of its car models, namely the Gol, Parati, Saveiro and Kombi models, while Fiat told Reuters that the recall affected 6,525 cars but they were all sold in Brazil. DYN CORPORATION: Colombians Sue Over Effects of Round Up Herbicide ------------------------------------------------------------------ Dyn Corporation faces a class action filed by Ecuatorian Indians along the Colombian border for harmful effects caused by the indiscriminate spraying of a herbicide called Round Up, according to EFE. The suit, filed by the Quichua San Francisco II community in Washington, alleges that Round Up, used for killing coca leaf and poppy crops on the Colombian border, is doing extensive harm to local inhabitants and the environment. Lucia Gallardo of advocacy group Ecological Action organization of Ecuador alleges the effects of the herbicide have impaired the health of the areas inhabitants, caused extensive crop damage, and affected domestic and wild animals in the area. She added that the herbicide Round Up is not accepted by the Environmental Protection Agency (EPA) and therefore should not be used in southern Colombia. Ms. Gallardo told EFE that Round Up "has caused continuous and severe pain and suffering to the plaintiffs." She further said that that the suit was accepted by the Court since US legislation requires that any spraying done abroad under the auspices or patronage of the United States meet standards set for spraying in the United States. The spraying is carried out under Plan Colombia, the partially US-funded anti-narcotics program underway in Colombia. EMERY WORLDWIDE: Ex-Employees Sue After Losing Jobs in Airline Closure ---------------------------------------------------------------------- Emery Worldwide Airlines faces a class action filed in US District Court in Dayton, Ohio by its former employees, saying the Company laid off 800 pilots and ground crew in August without giving the required 60-day notice, the Dayton Daily News reports. For years, employees have complained about the airline's safety, writing letters to Emery executives and the Federal Aviation Administration (FAA) officials. The Company's problems were compounded when one of its aircraft crash-landed after takeoff in February 2000 in Sacramento, California. The three crew-members on EW Flight 17 died. The National Transportation Safety Board ordered an investigation into the crash and scheduled a hearing in August 2001 in relation to the Company's use of contract maintenance and its oversight. The FAA also claimed that the Company committed more than 100 safety violations in a series of special inspections. However, the August hearing did not push through as the Company decided to ground its fleet, and the hearing has yet to be rescheduled. The airline also agreed to pay a $1 million fine and take steps to correct their systems and in the end, to resume operations. In December, the Company's parent, CNF, Inc. decided to merge three of its companies, Emery Worldwide, Menlo Logistics and Vector SCM, into a single operation, Menlo Worldwide, and decided not to resume operations. The suit alleges that the permanent suspension of its employees constituted a "plant closing" requiring a 60-day notice. According to the Dayton Daily News, the suit charges that the "reason for the layoffs was that the Federal Aviation Administration (FAA) unexpectedly informed EWA it needed to cease flight operations or the FAA would suspend its certificate." At the time of the layoffs, the lawsuit states, EWA said they "would be temporary and that if the issues with the FAA were resolved, employees could expect to be recalled." The suit also names CNF, Inc. as a defendant and seeks payment for 60 days' worth of wages and benefits to the permanently displaced Company employees. CNF Spokeswoman Nancy Colvert told the Daily News, "At this time we have not been served with anything.I can't comment on anything I haven't seen." FORD MOTOR: Orders Recall of Defective 2002 Ranger Pickup Trucks ---------------------------------------------------------------- Embattled Ford Motor Company, which has been plagued by design problems on various automobile products, has once more issued a "stop sale, stop demonstrating and delivery" order for its 2002 Ranger pickup trucks, ConsumerAffairs.com reports. The order was issued after the Company discovered problems in the truck's differential casing, which can be fixed only by replacing the entire rear axle assembly. Some 800 trucks currently on dealer lots and another 374 that have been sold are affected by the recall. The affected trucks have manual transmissions and the new FX4 design package, which is intended to give the vehicles a rugged, off-road look. Ford has been plagued with quality and safety problems, including premature failure of its popular 3.8-liter V6 engine, disastrous rollover problems affecting the Explorer and a number of flawed new- product launches. GLOBAL CROSSING: Stull Stull Commences 401(k) Suit in C.D. California --------------------------------------------------------------------- Stull Stull and Brody initiated a class action in the United States District Court for the Central District of California, Western Division on behalf of all participants and beneficiaries of the Global Crossing Employees' Retirement Savings Plan, a 401(k) plan operated and administered by Global Crossing, Ltd. The suit, which names as defendants the administrators and directors of the plan and the Company's directors, is filed on behalf of all current and former employees and any beneficiaries who are or were participants in the retirement plan at any time since September 28, 1999. The suit charges that defendants breached their fiduciary duties and Employee Retirement Income Security Act (ERISA) disclosure requirements by failing to disclose to plan participants that maintaining concentrated investments in Company stock was imprudent and exposed participants to unreasonable risks of loss and injury. As alleged in the suit, defendants encouraged their employees to invest their retirement monies in the Company's common stock, while defendants proceeded to sell their own Company stock reaping profits over $140 million. As further alleged, defendants failed to provide plaintiff and other plan participants with adequate information about the Company's true financial condition despite offering stock as a prudent plan investment. Specifically, defendants failed to disclose that: (1) the Company was experiencing declining demand for bandwidth; (2) its operating performance was artificially inflated through improper accounting for transactions with other telecom companies; (3) its efforts to provide managed network outsourcing services was failing; and (4) as the Company's liquidity position and revenues declined, so did its ability to service its large debt. For more information, contact Michael Braun by Phone: 888-388-4605 or by E-mail: info@secfraud.com HONDA MOTOR: Recalling 4,600 Minivans In Japan Due To Seat Belt Defects ----------------------------------------------------------------------- Automaker Honda Motors Co. is recalling more than 4,600 minivans currently in use in Japan due to seat belt defects, says Bloomberg. According to Honda, a total of 5,082 of the minivan Mobilio, which it introduced in December, will be covered by the recall. Of the 10,000 the automaker produced between December and January, some 4,635 Mobilios are now with customers, while the rest are still part of dealers' inventories. So far, no accidents have been reported as a result of the defect, the report says. LUCENT TECHNOLOGIES: Suit Still Pending Over Non-Y2K Compliant Products ----------------------------------------------------------------------- Lucent Technologies, Inc. faces three separate class actions based on claims that the Company sold products that were not Year 2000 compliant. One suit is pending in State Court in West Virginia, another in the US District Court for the Southern District of New York and another in the US District Court for the Southern District of California. The case in New York was filed in January 1999 and, after being dismissed, was re-filed in September 2000. The case in West Virginia was filed in April 1999 and the case in California was filed in June 1999, and amended in 2000 to include Avaya, Inc., which was spun-off from the Company in September 2000, as a defendant. The suits allege that the Company's products in question were designed and developed without considering the possible impact of the change in the calendar from December 31, 1999 to January 1, 2000. The complaints allege that the sale of these products violated statutory consumer protection laws and constituted breaches of implied warranties. A class has not been certified in any of the three cases and, to the extent a class is certified in any of the cases, the Company expects that class to constitute those enterprises that purchased the products in question. Although the Company believes that the outcome of these actions will not adversely affect its financial position, results of operations or cash flows, if these cases are not resolved in a timely manner, they will require expenditure of significant legal costs related to their defense. TENNESSEE: Court Approves $5M Settlement of TN Sales Tax Suit ------------------------------------------------------------- Chancellor Floyd Peete, Jr. of the Memphis Chancery Court granted approval to a settlement of a class action filed against the Covington Pike Toyota dealership which allegedly trained employees to cheat car buyers of as much as $2,000 each. The class action arose from a separate case charging the dealership with discrimination, as black employees alleged they were trained by management to tell customers they were receiving a free warranty, then double-tax them to absorb the cost, GoMemphis reports. The dealership has denied the allegations. However, the settlement terms have generated much criticism. Under the settlement, customers will get $1,200 coupons, not cash, good toward the purchase of a new or used car, while the lawyers who brought the suit, Richard Fields, Saul Belz and Earle Schwarz get $1.3 million in legal fees, according to a GoMemphis report. Chancellor Peete said that he gave his final approval after he received only token objections from consumers. Lawyers on both sides argued it was a reasonable resolution and Chancellor Peete agreed after a brief hearing before a half-dozen car buyers who had questions but did not oppose it. Several customers belatedly voiced strong objections after the settlement was announced, resenting the fact that they would need to buy a new car to use the coupon. Although the face value of the settlement is $5 million, the dealership could end up paying much less if the coupons are not used. Former finance manager Tyrone King, who was among the three ex- employees who testified for the plaintiffs, told GoMemphis, "Nothing that I personally wanted to see happen, happened. I think the customers should have been refunded some money. I don't think a coupon means anything to them. Ninety percent of them can't even buy another car in two years anyway." Rep. Ed Bryant (R-Tenn) declined comment on the suit, but said that "Justice is there for the victim and the defendant and not just for the lawyers to make money." GoMemphis reports federal lawmakers may use outcomes such as this to provide fodder for reforms of the class-action system. Securities Fraud ACTRADE FINANCIAL: Charles Piven Commences Securities Suit in S.D. NY --------------------------------------------------------------------- The Law Offices Of Charles J. Piven, PA initiated a securities class action on behalf of shareholders who acquired Actrade Financial Technologies, Inc. (Nasdaq:ACRT) securities between March 11, 1999 through and including February 8, 2002, in the United States District Court for the Southern District of New York, against the Company and certain of its officers and directors. The action charges that defendants violated the federal securities laws by issuing a series of materially false and misleading statements to the market throughout the class period which statements had the effect of artificially inflating the market price of the Company's securities. For further details, contact Charles J. Piven by Mail: The World Trade Center-Baltimore, 401 East Pratt Street, Suite 2525, Baltimore, Maryland 21202 by Phone: 410-986-0036 or by E-mail: hoffman@pivenlaw.com BANK OF AMERICA: Lawyers in Stalled CA Suit To Oppose $490M Settlement ---------------------------------------------------------------------- Lawyers in a stalled class action pending against Bank of America in California state courts plan to oppose the Company's proposed settlement of more than a dozen class actions over the NationsBank merger for $490 million, forged last week. Steven Sidener, a partner of Gold Bennett Cera & Sidener, told the Recorder "There are questions about whether or not our state law claims were adequately represented." Gold Bennett, along with Milberg Weiss Bershad Hynes and Lerach, appealed the stay to the Eighth Circuit US Court of Appeals but lost. Last month, they filed a writ with the US Supreme Court asking the court to lift the stay of the suit. Reed Kathrein, a Milberg partner, stated "We've been completely blocked from pursuing the action.We may object to the settlement." She told the Recorder that the settlement amount accepted by the plaintiffs' lawyers were "particularly troubling", saying it was a fraction of the several billion dollars in damages originally alleged. The planned opposition to the settlement could mean that the settling lawyers headed by law firm Cotchett, Pitre, Simon & McCarthy will have to wait a while longer for a payday. Cotchett partner Bruce Simon said the firm is pleased with the settlement and doubts it can be held up. "This was seriously litigated for years," Simon said, adding that BofA was facing an April 8 trial date. "We would seriously doubt it would be subject to any challenge." ELAN CORPORATION: Bull Lifshitz Commences Securities Suit in S.D. NY -------------------------------------------------------------------- Bull and Lifshitz LLP initiated a securities class action against Elan Corporation PLC (NYSE:ELN) for purchasers of the Company's stock during the period of April 23, 2001 and January 30, 2002, in the United States District Court for the Southern District of New York. The suit alleges that defendants violated the federal securities laws, including Sections 10(b) and 20a of the Securities Exchange Act of 1934, by issuing materially false and misleading information concerning the Company's financial condition and prospects. For more information, contact Peter D. Bull or Joshua Lifshitz by Phone: 212-213-6222 by Fax: 212-213-9405 by E-mail: counsel@nyclasslaw.com or visit the firm's Web site: http://www.nyclasslaw.com. ELAN CORPORATION: Chitwood Harley Commences Securities Suit in N.D. GA ---------------------------------------------------------------------- Chitwood and Harley initiated a securities class action in the United States District Court for the Northern District of Georgia, Gainesville Division, on behalf of all persons who purchased Elan Corporation PLC (NYSE: "ELN") American Depository Receipts (ADRs) between April 23, 2001 and January 29, 2002, inclusive. The complaint charges the Company and certain of its officers and directors with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The complaint alleges that during the class period, defendants misled their investors by issuing false and misleading statements and failing to disclose material facts about the Company's business. The defendants allegedly misrepresented the truth about Elan's improper accounting practices that artificially inflated its reported revenues (resulting in the artificial inflation of the asset side of its balance sheet). As a result, class members paid more for Company ADRs than they would have if the truth had been disclosed. On January 30, 2002, The Wall Street Journal raised questions about how the Company has been accounting for drug-development joint ventures with other companies. According to the article, the Company would invest in a partner company, which would then return the "investment" to it in the form of a technology-licensing fee. The Company then would report the fee as revenue. This revelation stunned the market, causing the value of the Company's ADRs to plummet 16% from the prior day's closing. On February 4, 2002, Elan announced that its earnings for the fourth quarter of 2001 would drop 84% and that its profits for fiscal year 2001 would fall well short of estimates. In the wake of this announcement, Company ADRs plunged again, losing over 50% of their value in a single day of trading. For more information, contact Krissi Temple or Martin D. Chitwood by Mail 2900 Promenade II, 1230 Peachtree St., NE Atlanta, Georgia by Phone: 888-873-3999 (toll-free) or by E-mail: mkt@classlaw.com or visit the firm's Web site: http://www.classlaw.com. ENRON CORPORATION: UC General Counsel Expects "Substantial Recovery" -------------------------------------------------------------------- The general counsel of University of California, earlier awarded the lead plaintiff position in the 401(k) class action against Enron Corporation, is hopeful that the plaintiffs can make a "substantial recovery" of assets from the fallen energy giant and accounting firm Arthur Andersen LLP, the Washington Times reports. James Holst, attorney for UC, told the Times, "We take up this responsibility with the deepest sense of obligation not only to the UC family of employees, retirees and students, but to the millions of Americans who invested in good faith with Enron.We look forward to working closely with all of the plaintiffs to vigorously pursue this litigation with the shared goal of securing substantial recovery for all shareholders." Last week, Houston Federal Judge Melinda Harmon chose the University of California as lead plaintiff in the suit, over the state employee retirement plans of California, New York City, Ohio, Georgia, Florida and Washington. The plans lost an approximate total of $145 million, when Enron Corporation stock price plunged and the Company filed the nation's biggest bankruptcy. UC officials told the Times Judge Harmon named the system as lead plaintiff due to the size of its losses and its ability as a single organization to efficiently coordinate litigation that could take years to conclude. Mr. Holst contends. "This lawsuit is a rare and extraordinary legal step for the university, but it is warranted by the extreme and unique circumstances surrounding Enron's collapse and the damage that collapse has caused so many." Mr. Holst will be working closely with high-profile law firm Milberg Weiss Bershad Hynes & Lerach, which specializes in securities class actions. ENTERASYS NETWORKS: Leo Desmond Files Securities Suit in New Hampshire ---------------------------------------------------------------------- The Law Offices of Leo W. Desmond commenced a securities class action on behalf of shareholders who acquired Enterasys Networks, Inc. (NYSE:ETS) securities between September 26, 2001 and February 1, 2002, inclusive in the US District Court in New Hampshire. It is alleged that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10(b)(5) promulgated thereunder, by issuing a series of materially false and misleading statements to the market throughout the class period which statements had the effect of artificially inflating the market price of the Company's securities. For more information, contact Leo W. Desmond by Mail: 2161 Palm Beach Lakes Blvd., Suite 204, West Palm Beach, Florida 33409 by Phone: 888-337-6663 by E-mail: Info@SecuritiesAttorney.com or visit the firm's Web site: http://www.SecuritiesAttorney.com. EVEREX SYSTEMS: California Jury Absolves Official of Securities Fraud --------------------------------------------------------------------- The United States District Court for the Northern District of California acquitted a former official of defunct computer manufacturer Everex Systems, Inc. of allegations that he issued fraudulent financial statements before the Company went bankrupt. The suit is one of the few securities class actions to go to trial and is believed to be the first such class action to go to a jury in the district since Apple Computer Inc. was hit in 1991 with a $100 million verdict for misleading shareholders, according to the Recorder. The decision was an upset for the plaintiffs. Robert Varian, counsel for the defendant, stated "We were concerned that jurors wouldn't be able to focus on the evidence in a particular case and would be carried away by everything else going on." He told the Recorder the publicity over "accounting irregularities and companies going bankrupt and cooking their books along the way played into the plaintiffs case." He was glad, however, that the verdict showed that "despite the current environment you can try a case to a smart jury and count on them to render a verdict based on the law." There has been no comment from the plaintiffs over the decision. GLOBAL CROSSING: Brian Barry Commences Securities Suit in C.D. CA ----------------------------------------------------------------- The Law Office of Brian Barry initiated a securities class action in the United States District Court for the Central District of California on behalf of all persons who purchased securities of Global Crossing, Ltd. (NYSE: GX) between January 2, 2001 and October 4, 2001 inclusive. The suit charges the Company and certain of its officers and directors with violations of federal securities laws. Among other things, plaintiff claims that defendants' material omissions and the dissemination of materially false and misleading statements regarding the nature of Global Crossing's financial statements caused its stock price to become artificially inflated, inflicting enormous damages on investors. For more information, contact Brian Barry or Jill Levine by Mail: 1801 Avenue of the Stars, Suite 307, Los Angeles, California 90067 by Phone: 310-788-0831 or by E-mail: Bribarry1@yahoo.com or JillLevine1@yahoo.com HA-LO INDUSTRIES: Schatz Nobel Commences Securities Suit in N.D. IL ------------------------------------------------------------------- Schatz and Nobel PC initiated a securities class action in the United States District Court for the Northern District of Illinois, Eastern Division, on behalf of all persons who purchased stock of HA-LO Industries Inc. (formerly NYSE: HMK) (now OTC Bulletin Board: HMLOQ) between February 18, 1999 and November 23, 2001, inclusive. The suit alleges that four senior officers of the Company, a marketing company that filed for bankruptcy protection on July 30, 2001, misled the investing public during the class period by violating generally accepted accounting principles and improperly recognizing revenue. Specifically, the suit alleges that a HA-LO subsidiary was engaged in improper accounting practices, and that the Company was employing improper accounting practices in order to mask the deteriorating condition of its business, all of which caused its reported revenue to be overstated. Ultimately, on November 23, 2001, the Company announced that it would be restating its financial statements for fiscal years 1998, 1999, and 2000, and possibly the first quarter of 2001. According to the Company, the total amount of the restatement could be as high as $15 million. For more information, contact Andrew M. Schatz, Patrick A. Klingman, Wayne T. Boulton or Nancy A. Kulesa by Phone: 800-797-5499 by E-mail: sn06106@aol.com or visit the firm's Website: http://www.snlaw.net. HOMESTORE.COM: Scott Scott Expands Class Period in California Suit ------------------------------------------------------------------ Scott + Scott, LLC expanded the class period in the securities class action pending in the United States District Court for the Central District of California on behalf of purchasers of Homestore.com, Inc. (Nasdaq: HOMS) of common stock during the period between July 20, 2000 and December 21, 2001, inclusive, to include purchasers from May 4, 2000 and December 21,2001. The amended suit alleges that defendants violated Section 10(b) and 20(a) of the Securities and Exchange Act of l934 by issuing a series of materially false and misleading statements about the Company's financial results for 2000 and the first three quarters of 2001. More specifically, on December 21, 2001, after the close of the market, the Company admitted that its past accounting for its prior results was inaccurate, and that it would have to restate certain of its financial statements. On this news, the Company's shares were halted. On January 2, 2002, defendants admitted that the Company's revenue for 2001 had been overstated by as much as $95 million. The Company stated that an internal investigation revealed that between $54 million and $95 million of barter transactions during the first three quarters of 2001 were booked incorrectly as advertising transactions. The restatement could amount to as much as 27 percent of the Company's revenue during the first three quarters of 2001. Finally, on February 13, 2002, the Company announced that it will restate its previously-reported financial results for the year 2000. The amended suit alleges that, as a result of these false and misleading statements, the price of the Company's common stock was artificially inflated throughout the class period, causing plaintiff and other members of the class to suffer damages. For further details, contact David R. Scott or Neil Rothstein by Phone: 800-404-7770 by E-mail: drscott@scott-scott.com or nrothstein@scott-scott.com or visit the firm's Web site: http://www.scott-scott.com IMCLONE SYSTEMS: Scott Scott Expands Class Period in Securities Suit -------------------------------------------------------------------- Scott + Scott, LLC expanded the class period in the securities class action pending in the United States District Court for the Southern District of New York on behalf of purchasers of ImClone Systems (Nasdaq: IMCL) of common stock during the period between June 28, 2001 and December 28, 2001, inclusive, to include purchasers from May 14, 2001 and January 9, 2002. The suit names as defendants the Company and: (1) Samuel D. Waksal, (2) Harlan W. Waksal, (3) Robert F. Goldhammer, (4) John Mendelsohn, (5) William R. Miller, (6) Paul B. Kopperl, (7) David M. Kies and (8) Richard Barth 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. Throughout the class period, defendants issued multiple press releases highlighting the successful progress of its "Fast-Track" application to the US Food and Drug Administration (FDA) for approval of IMC-C225, its blockbuster drug used for the treatment of colorectal cancer and also known as Erbitux, and the positive impact that the drug's approval would have on the Company's revenues. As alleged in the suit, these statements were materially false and misleading because, among other things: (i) defendants failed to comply with the FDA's requirements for filing the "Fast Track" application for approval of Erbitux; and (ii) as such, defendants knew, or should have known, that their deficient application would be rejected and would thus negatively impact the Company's future earnings. The suit further alleges that defendants filed their application, despite lacking the skill and expertise to make a proper filing, in order to convince Bristol-Myers Squibb Co. to purchase at least $1 billion in Company stock, of which approximately $150 million was tendered by Company insiders, including the individual defendants, and to persuade Bristol-Myers to make an additional $1 billion cash investment in the Company. On December 28, 2001, the Company disclosed that the FDA had refused to accept its deficient and defective application for approval of Erbitux, confirming almost two weeks of speculation that had already driven down the price of Company stock by 21%, from a class period high of $73.83 per share on December 5, 2001 to $55.25 per share at the close of regular trading on December 28, 2001. Immediately following this shocking revelation, however, Company shares dropped precipitously, falling $5.25 per share in after hours trading, or 9.5%, to close that session at $50 per share. The price of its stock has since continued to fall sharply. For more details, contact David R. Scott or Neil Rothstein by Phone: 800-404-7770 by E-mail: scottlaw@scott-scott.com or nrothstein@scott-scott.com or visit the firm's Web site: http://www.scott-scott.com INFONET SERVICES: Milberg Weiss Commences Securities Suit in C.D. CA -------------------------------------------------------------------- Milberg Weiss Bershad Hynes and Lerach LLP initiated a securities class action in the United States District Court for the Central District of California on behalf of purchasers of Infonet Services Corporation (NYSE:IN) securities during the period between December 16, 1999 and July 31, 2001, including those who purchased their shares pursuant to the December 16, 1999 Initial Public Offering (IPO). The complaint charges the Company and certain of its officers and directors with violations of the Securities Exchange Act of 1934. The suit further asserts that from December 16, 1999 through July 31, 2001, the Company saw its stock price soar from its IPO price of $21 per share to as high as $32.93 per share as it misrepresented the true status of its AT&T-Unisource Communications Services N.V. (AUCS) business, concealing the fact that: (1) the Company would be required to migrate the customer before offering new services, which required, among other things, reconnecting each customer to a new platform, a time- consuming, complicated and expensive process; (2) the complexity of migration (from company "X" to Infonet) caused massive disruption to the Company's ability to "upsell" its new products; and (3) the Company's AUCS business required massive upgrades, both in its financial data and billing systems, preventing the Company from billing its customers on a monthly basis and delaying the recognition of material revenue for 1-2 years until the upgrades could be completed. The individual defendants knew that disclosure of these problems with its AUCS business would devastate the Company's chances of going public which allowed it to raise $1.1 billion in its December 16, 1999 IPO. The Company's top executives were determined to conceal the news of the problems associated with its AUCS business. As a result of the defendants' false statements/omissions, Company stock traded at inflated levels during the class period, increasing to as high as $32.93 on March 3, 2000. The Company's shares began to fall as defendants partially revealed the status of its AUCS business, tumbling to $3.55 on August 1, 2001. For more information, contact William Lerach or Darren Robbins by Phone: 800-449-4900 or visit the firm's Web site: http://www.milberg.com INTERWAVE COMMUNICATIONS: Contemplating Response To Suit in S.D. NY -------------------------------------------------------------------- Interwave Communications, Inc. vows to vigorously defend itself against the securities class action pending in the United States District Court for the Southern District of New York against the Company, certain investment bank underwriters for its initial public offering (IPO), and three of its officers. The suit alleges undisclosed and improper practices by the underwriters concerning the allocation of the Company's IPO shares, in violation of the federal securities laws, and seeks unspecified damages on behalf of persons who purchased the Company's stock during the period from January 28, 2000 through December 6, 2000. Other actions have been filed making similar allegations regarding the IPOs of more than 300 other companies. All of these lawsuits have been coordinated for pretrial purposes as In re Initial Public Offering Securities Litigation, Civil Action No. 21-MC-92. The case and coordinated cases have been stayed pursuant to the Court's order. On December 27, 2001, the Company accepted service of the summons and complaint on behalf of the Company and the named officer defendants and informed plaintiffs' counsel that it would answer or move for dismissal when the Court so orders. Interwave believes it has meritorious defenses to the claims. However, the Company is unable to predict the outcome of the litigation and does not expect it to be resolved in the near future. The Company also warned that an adverse outcome could have a material adverse effect on its financial position, business and results of operations. JD EDWARDS: $15M Settlement Reached In Securities Act Violations Suit --------------------------------------------------------------------- JD Edwards and Company will settle for $15 million a securities class action alleging the Company's executives issued false and misleading statements that artificially inflated its stock price, the Rocky Mountain News reports. The suit alleges the Company's officers hid problems with their core product line, while engaging in "massive insider trading", selling huge portions of their personally held common stock in the market. Some executives received as much as $49 a share within weeks of the stock's nose-dive late that year. The fairness hearing for the settlement is scheduled for next month. If approved, the average distribution per share to eligible class members is estimated at 88 cents, before plaintiff attorney fees and expenses. JP MORGAN: Glancy Binkow Commences Securities Suit in S.D. New York ------------------------------------------------------------------- Glancy & Binkow LLP initiated a securities class action in the United States District Court for the Southern District of New York on behalf of all persons who purchased securities of JP Morgan Chase and Co., Inc. between November 28, 2001 and January 28, 2002, inclusive. The suit charges the Company with violations of federal securities laws. Among other things, plaintiff claims that defendant's material omissions and the dissemination of materially false and misleading statements caused the Company's stock price to become artificially inflated, inflicting enormous damages on investors. More specifically, on the first day of the class period, the Company recklessly issued a public statement, which did not fully disclose its risk and loss exposure related to its transactions and dealings with the Enron Corporation, the company notorious for its financial collapse. At the time, JP Morgan listed its total exposure in this regard at approximately $900 million. The Company later announced that, in fact, its total Enron related exposure was actually about $2.6 billion, or almost three times the earlier figure. Shortly thereafter, JP Morgan wrote down $1.13 billion in non-performing assets, specifically related to losses generated by its dealings with Enron. For more information, contact Michael Goldberg or Lionel Z. Glancy by Mail: 1801 Avenue of the Stars, Suite 311, Los Angeles, California 90067 by Phone: 310-201-9150 or 888-773-9224 or by E-mail: info@glancylaw.com. IRVINE SENSORS: Leo Desmond Lodges Securities Suit in C.D. California --------------------------------------------------------------------- The Law Offices of Leo W. Desmond commenced a securities class action on behalf of shareholders who acquired Irvine Sensors Corporation (Nasdaq:IRSN) securities between January 6, 2000 and September 15, 2001, inclusive, in the US District Court for the Central District of California. It is alleged that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10(b)(5) promulgated thereunder, by issuing a series of materially false and misleading statements to the market throughout the class period which statements had the effect of artificially inflating the market price of the Company's securities. For more information, contact Leo W. Desmond by Mail: 2161 Palm Beach Lakes Blvd., Suite 204, West Palm Beach, Florida 33409 by Phone: 888-337-6663 by E-mail: Info@SecuritiesAttorney.com or visit the firm's Web site: http://www.SecuritiesAttorney.com. IRVINE SENSORS: Charles Piven Commences Securities Suit in C.D. CA ------------------------------------------------------------------ The Law Offices Of Charles J. Piven, PA initiated a securities class action on behalf of shareholders who acquired Irvine Sensors Corporation (Nasdaq:IRSN) securities between January 6, 2000 through and including September 15, 2001, in the United States District Court for the Central District of California, Southern Division, against the Company and certain of its officers and directors. The action charges that defendants violated the federal securities laws by issuing a series of materially false and misleading statements to the market throughout the class period which statements had the effect of artificially inflating the market price of Irvine Sensors' securities. For more information, contact Charles J. Piven, PA by Mail: The World Trade Center-Baltimore, 401 East Pratt Street, Suite 2525, Baltimore, Maryland 21202 by Phone: 410-986-0036 or by E-mail: hoffman@pivenlaw.com JUNIPER NETWORKS: Leo Desmond Commences Securities Suit in N.D. CA ------------------------------------------------------------------ The Law Offices of Leo W. Desmond initiated a securities class action on behalf of shareholders who acquired Juniper Networks, Inc. (Nasdaq:JNPR) securities between April 12, 2001 and June 7, 2001, inclusive, in the US District Court for the Northern District of California. It is alleged that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10(b)(5) promulgated thereunder, by issuing a series of materially false and misleading statements to the market throughout the class period which statements had the effect of artificially inflating the market price of the Company's securities. For more details, contact Leo W. Desmond by Mail: 2161 Palm Beach Lakes Blvd., Suite 204, West Palm Beach, Florida 33409 by Phone: 888-337-6663 by E-mail: Info@SecuritiesAttorney.com or visit the firm's Web site: http://www.SecuritiesAttorney.com. LUCENT TECHNOLOGIES: Consolidated Suit's Possible Affects Uncertain ------------------------------------------------------------------- Lucent Technologies, Inc. still faces a consolidated securities class action filed in the US District Court for New Jersey alleging violations of the federal securities laws. The consolidated suit arose from several suits filed in January 2000, alleging that shareholders were injured by reason of certain alleged false and misleading statements made by Lucent in violation of the federal securities laws. These suits were filed on behalf of the Company's stockholders who bought stock between October 26, 1999 and January 6, 2000. Another three suits were commenced in November 2000 as a result of the facts disclosed in the Company's announcement on November 21, 2000 that it had identified a revenue recognition issue affecting its financial results for the fourth quarter of fiscal 2000. The three suits were filed on behalf of purchasers of the Company's common stock during the period from October 10, 2000 (the date Lucent originally reported these financial results) through November 21, 2000. These suits were later consolidated with the first class actions, and plaintiffs filed an amended complaint to include purported class members who purchased Company stock up to November 21, 2000. The Company has filed a motion to dismiss the consolidated action, but a class has not yet been certified in the consolidated actions. The Company stated that as the suit is in its early stages, an outcome cannot yet be predicted. As a result, there can be no assurance that these cases will not have a material adverse effect on the Company's financial position, results of operations or cash flows. MPOWER COMMUNICATIONS: Court Dismisses Suit For Securities Violations --------------------------------------------------------------------- The United States District Court for the Western District of New York dismissed the class action pending against Mpower Holding Corporation, (Nasdaq: MPWR) since September 2000 for federal securities violations. The Court ruled that the complaint failed to allege that Mpower made any material misstatements or omissions. In addition, the Court did not grant the plaintiffs the right to re-plead or re-file the complaint. "We are extremely pleased that for the second time in three months, the courts have granted our motion to dismiss, and that both baseless lawsuits brought against our company have been thrown out," said Rolla P. Huff, Mpower Communications Chief Executive Officer. The Company is the parent of Mpower Communications, a provider of broadband high-speed Internet access and telephone services to business customers. NATIONAL GOLF: Charles Piven Commences Securities Suit in C.D. CA ----------------------------------------------------------------- The Law Offices of Charles J. Piven, PA initiated a securities class action has been commenced on behalf of shareholders who acquired National Golf Properties, Inc. (NYSE:TEE) securities between April 1, 1999 and November 14, 2001 (including all purchases in or pursuant to the Company's May 17, 2001 secondary offering. The suit is pending in the United States District Court for the Central District of California against National Golf and certain of its officers and directors. The action charges that defendants violated the federal securities laws by issuing a series of materially false and misleading statements to the market throughout the class period which statements had the effect of artificially inflating the market price of the Company's securities. For further details, contact Charles J. Piven, PA by Mail: The World Trade Center-Baltimore, 401 East Pratt Street, Suite 2525, Baltimore, Maryland 21202 by Phone: 410-986-0036 by E-mail: hoffman@pivenlaw.com or visit the firm's Web site: http://www.pivenlaw.com NETSOLVE INC.: Settles Consolidated Securities Suit For $2.75M in Texas ----------------------------------------------------------------------- Netsolve, Inc. reached a $ 2.75 million settlement for a consolidated securities class action commenced in February 2001 against the Company and certain of its officers in the United States District Court for the Western District of Texas, Austin Division. The suit, filed on behalf of purchasers of the Company's common stock between April 18, 2000 and August 18, 2000, alleges that the defendants engaged in a fraudulent scheme by issuing false and materially misleading statements regarding the Company's business during the class period. The Company moved to dismiss the complaint in March 2001 for failing to state a claim under which relief could be granted and for failing to comply with the pleading requirements of the Private Securities Litigation Reform Act of 1995, 15 USC ss 78u-4 et seq. On August 15, 2001, the court granted this motion in part and denied it in part. The Court dismissed claims against one Netsolve officer and dismissed certain of the theories under which plaintiffs alleged liability against the Company. However, the court let stand certain of the stated claims against the Company and certain of its officers. In December 2001, the Company and individual defendants reached an agreement, under which the plaintiff class will receive $2,750,000 in connection with the settlement, all of which will be funded by the Netsolve's insurance carrier. The settlement is subject to the Court's approval. A hearing on the settlement has not yet been scheduled. NETSOLVE INC.: Sued For Securities Act Violations in IPO in S.D. NY ------------------------------------------------------------------- Netsolve, Inc. faces a securities class action commenced in December 2001 against the Company, certain of its officers and underwriters of its initial public offering in the United States District Court for the Southern District of New York. The suit, filed on behalf of the Company's common stock between September 29, 1999 and December 6, 2000, alleges that the defendants failed to properly disclose certain commissions, discounts and purported tie-in arrangements related to Netsolve's initial public offering. Plaintiff alleges claims under Sections 11 and 15 of the Securities Act against the Company, and plaintiff alleges claims under Section 11 and 12 of Securities Act, and Section 10 (b) of the Exchange Act, against the Company's underwriters. This case has been coordinated for pre-trial purposes with over 300 other cases alleging similar claims against other underwriters and companies. In re Initial Public Offering Securities Litigation, 21 MC 92 (SAS). It is not feasible to predict or determine the final outcome of this proceeding, and if the outcome were to be unfavorable, the Company's business, finances, condition, cash flow and results of operations could be materially adversely affected. NETWORK ENGINES: NY Suit Could Harm Business Operations, Finances ----------------------------------------------------------------- Network Engines, Inc. revealed that the securities class action pending against it in the United States District Court for the Southern District of New York, might have a negative impact on its financial position and operations. The suit, filed on behalf of purchasers of the Company's securities between July 13, 2000 and December 6, 2000, inclusive, names as defendants the Company and: (1) Lawrence A. Genovesi, CEO, President, Chairman and Chief Technology Officer, (2) Douglas G. Bryant, CFO and director, (3) FleetBoston Robertson Stephens Inc., (4) Credit Suisse First Boston Corp., (5) Goldman, Sachs & Co., (6) Lehman Brothers Inc. and (7) Salomon Smith Barney 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 a disclosure to the Securities and Exchange Commission, the Company stated that it was unable to predict the effects of the suit on its financial condition and business and cannot assure that the claim will not result in substantial monetary damages in excess of its insurance coverage. SPECTRALINK CORPORATION: Wolf Haldenstein Files Securities Suit in CO --------------------------------------------------------------------- Wolf Haldenstein Adler Freeman & Herz LLP lodged a securities class action in the United States District Court for the District of Colorado, on behalf of purchasers of the common stock of Spectralink Corporation (NASDAQ: SLNK) between July 19, 2001 and January 11, 2002, inclusive, against the Company, and certain of its officers. The suit alleges that defendants violated the federal securities laws by issuing materially false and misleading statements throughout the class period that had the effect of artificially inflating the market price of the Company's securities. Specifically, the complaint alleges that throughout the class period, the defendants made highly positive statements regarding the Company's financial results. It represented that its growth was strong and that it was increasing its market share and would continue to do so in the future. Unbeknownst to investors, however, the Company was suffering from declining sales as its business began to be affected by negative market forces. In addition, the Company was becoming increasingly reliant on end-of-the-quarter sales to meet its sales forecasts. Finally, some of the Company's customers were experiencing financial difficulty and it was highly unlikely that they would be able to complete anticipated sales, thereby causing the Company to suffer a decline in its revenues. At the time that the Company was being adversely affected by the aforementioned factors, but prior to any disclosure to the market, certain officers and senior executives sold more than $13.7 million worth of their personally-held common stock to the unsuspecting public. For more information, contact Fred Taylor Isquith, Gustavo Bruckner, Michael Miske, George Peters or Derek Behnke by Mail: 270 Madison Avenue, New York, New York 10016 by Phone: 800-575-0735 by E-mail: classmember@whafh.com or visit the firm's Web site: http://www.whafh.com.All e-mail correspondence should make reference to Spectralink. SPECTRALINK CORPORATION: Leo Desmond Commences Securities Suit in CO -------------------------------------------------------------------- The Law Offices of Leo W. Desmond initiated a securities class action on behalf of shareholders who acquired SpectraLink Corporation (Nasdaq:SLNK) securities between July 19, 2001 and January 11, 2002, inclusive, in the United States District Court in Colorado. The suit alleges that the defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10(b)(5) promulgated thereunder, by issuing a series of materially false and misleading statements to the market throughout the class period which statements had the effect of artificially inflating the market price of the Company's securities. For further details, contact Leo W. Desmond by Mail: 2161 Palm Beach Lakes Blvd., Suite 204, West Palm Beach, Florida 33409 by Phone: 888-337-6663 by E-mail: Info@SecuritiesAttorney.com or visit the firm's Website: http://www.SecuritiesAttorney.com. TYCO INTERNATIONAL: Rabin Peckel Initiates Securities Suit in S.D. NY --------------------------------------------------------------------- Rabin and Peckel LLP commenced a securities class action in the United States District Court for the Southern District of New York on behalf of all persons or entities who purchased Tyco International, Ltd. common stock (NYSE:TYC) between December 13, 1999 and February 4, 2002, both dates inclusive. The suit names as defendants the Company, Dennis Kozlowski and Mark Swartz. The suit alleges that defendants violated Section 10(b) and 20(a) of the Securities and Exchange Act of 1934 by issuing a series of false and misleading statements, and omissions of material fact during the class period concerning the Company's financial statements as a result of improper accounting. In particular, it is alleged that the Company failed to disclose that it had acquired over 700 companies since 1999, totaling approximately $8 billion. It is also alleged that the Company failed to disclose the impact of new accounting rules, and classifying nearly all of its acquisition costs as goodwill. Mr. Kozlowski and Mr. Swartz returned over $100 million in stock to the Company to cover up their stock activity. The Company also paid another director $20 million for his part in its recent acquisition of CIT Group, Inc. Further, as a result of these false and misleading statements the price of the Company's common stock was artificially inflated throughout the class period causing plaintiff and the other members of the class to suffer damages. For further details, contact Eric Belfi or Maurice Pesso by Phone: 800-497-8076 or 212-682-1818 by Fax: 212-682-1892 by E-mail: email@rabinlaw.com or visit the firm's Web site: http://www.rabinlaw.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 publication in any form (including e-mail forwarding, electronic re- mailing and photocopying) is strictly prohibited without prior written permission of the publishers. 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