/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/020311.mbx C L A S S A C T I O N R E P O R T E R Monday, March 11, 2002, Vol. 4, No. 49 Headlines CANADA: Ruling In Favor of Gay "Widows" To Affect Pension Plan Suit CAPITAL CONSULTANTS: Forges Agreement To Settle Retirement Plan Suit FOOD COMPANIES: Chicago Court Approves Settlement in Starlink Corn Suit HUNTER FAN: Voluntarily Recalls 100,000 Humidifiers For Fire Hazard INGALLS SHIPYARD: MI Federal Court Refuses To Certify Racial Bias Suit KRAFT FOODS: WI Dairy Farmers Push For Full Antitrust Suit Hearing LONGWELL ELECTRONICS: Recalls 2.5MM Power Cord Sets For Shock Hazard MCDONALD'S CORPORATION: Settles Suit Over Beef Flavor in French Fries RENT-A-CENTER INC.: Settling Sex Discrimination Suit for $47 Million RITALIN LITIGATION: CA Court Rejects Suit Over Use in ADHD Treatment SEARS ROEBUCK: Admits No Liability in Credit Card Privacy Suit in IL SHOE COMPANIES: Nike, Adidas Factories Still "Sweatshops," Report Says TRI-STATE CREMATORY: Judge Withdraws Due To Relatives Involved in Suit TRUDEAU CORPORATION: Recalls 20,000 Fondue Sets For Burn, Fire Hazard Securities Fraud ACTRADE FINANCIAL: Cohen Milstein Commences Securities Suit in S.D. NY ALLIED IRISH: Brian Felgoise Commences Securities Suit in S.D. NY BROCADE COMMUNICATIONS: Securities Suit Dismissed in S.D. New York COMPUTER ASSOCIATES: Cauley Geller Commences Securities Suit in E.D. NY CORNELL COMPANIES: Milberg Weiss Commences Securities Suit in S.D. TX CORNING INC.: Johnson Perkinson Commences Securities Suit in W.D. NY GLOBAL CROSSING: Schiffrin Barroway Lodges Securities Suit in W.D. NY GLOBAL CROSSING: Emerson Firm Commences Securities Suit in W.D. NY HANOVER COMPRESSOR: Schiffrin Barroway Lodges Securities Suit in TX IMCLONE SYSTEMS: Bernstein Liebhard Commences Securities Suits in NY IRVINE SENSORS: Rabin Peckel Commences Securities Suit in C.D. CA JP MORGAN: Johnson Perkinson Initiates Securities Suit in S.D. NY NTN COMMUNICATIONS: Sued For Rejecting Buyout Offer in California Court NVIDIA CORPORATION: Schiffrin Barroway Files Securities Suit in N.D. CA QWEST COMMUNICATIONS: Employees Files 401(k) Suit in Colorado Court SYMBOL TECHNOLOGIES: Wolf Haldenstein Files Securities Suit in E.D. NY TYCO INTERNATIONAL: Stull Stull Commences Securities Suit in S.D. NY WILLIAMS COMPANIES: Lockridge Grindal Commences Securities Suit in OK ********* CANADA: Ruling In Favor of Gay Partners To Affect Pension Plan Suit ------------------------------------------------------------------- A Quebec appeals court decision stating that the Quebec Pension plan discriminated against four surviving gay partners could greatly affect a class action seeking $440 million on behalf of an estimated 10,000 gays and lesbians whose partners died before the Canada Pension Plan began recognizing same-sex couples. The four surviving partners filed the suit to challenge provisions in the Quebec Pension plan, which was originally created by the federal government to assist widows in dire need. The plan was then extended to all widows in Canada, and finally to include men, according to 365Gay.com. In 1998, both Canada and Quebec amended the laws covering pensions to include surviving partners in same-sex relationships. However, they decided to pay only those gay survivors whose partners died after the law took effect. The plaintiffs then sued, saying the benefits should be effective from the date gays and lesbians were given civil rights in the Canadian Constitution, 1977. The appeals court ordered the government to roll back the date at which surviving partners could be considered "widows" to coincide with the constitutional protections. The back pensions owed plus interest could amount to over $100,000 for each of the surviving partners. CAPITAL CONSULTANTS: Forges Agreement To Settle Retirement Plan Suit -------------------------------------------------------------------- A settlement has been reached in the class action charging Capital Consultants Limited (CCL) with violations of the Employee Retirement Income Security Act (ERISA). The suit is said to be the largest ERISA fraud case in the nation's history. The plaintiffs in the suit allege that the firm concocted an elaborate fraud scheme, bilking thousands of people out of their retirement savings and depleting funds for health benefits. The US Department of Labor (DOL) had oversight over the Company and had been investigating it off and on for years. Despite the many red flags, the DOL failed to uncover the Company's scheme until it had lost more than $492 million in investors' money. The five class action settlements, which return nearly $16 million to 12 pension and health trusts represent the first major deal made between the trustees, the Department of Labor (DOL) and the plan participants in the ongoing litigation. In the settlements there is no admission of liability on the part of the trustees for the losses caused by the former investment firm. The payments will be made entirely by insurers, not the trustees themselves. "We are pleased with the terms of the settlement. Trustees are not professional investors. They are volunteers representing the financial interests of their trades, fellow employees and themselves," said Chrys Martin, lead class action defense counsel with Bullivant Houser Bailey PC. "If the DOL was unable to uncover the scheme, then it is unfair to expect that these volunteers possessed the expertise to do so." Rather than deplete the trusts' insurance funds to establish their innocence, the trustees agreed to an early settlement which would ensure that as much of the losses as possible be returned to participants. As part of the settlement agreement, 12 of the more than 90 trustees serving on two of the 13 trusts agreed to resign. The resignations, however, were not a result of unproven allegations regarding the receipt of any gifts or trips. Additionally, the settlement includes plan reforms, which reiterate the trustees' responsibilities under ERISA. Steve English, Bullivant partner and lead counsel for plaintiff investors in a related case, has indicated that the class action settlement will have a positive influence on the actions brought by the plaintiff investors against former Capital Consultants Chief Executive Officer Jeff Grayson and various accounting firms, law firms, and corporate entities. For more information, contact Kristen Siefkin of Lane Marketing by Phone: 503-221-0480 or by E-mail: kristen@lanemarketing.com FOOD COMPANIES: Chicago Court Approves Settlement in Starlink Corn Suit ----------------------------------------------------------------------- Chicago Federal Court Judge James Moran approved a $9 million in a class action lawsuit filed against six food companies by consumers who claimed their products contained genetically modified corn, which allegedly causes allergic reactions. The suit names as defendants: (1) Aventis CropScience USA Holdings, Inc., (2) Garst Seed Company, (3) Kraft Foods Company, (4) Azteca Foods, Inc., (5) Azteca Milling Company, and (6) Mission Foods Co. The suit focuses on the StarLink corn seed, which was created by Aventis. According to an Associated Press report, the seed was engineered to include the protein Cry9C, which is deadly to the European corn borer, a pest that damages crops. The seed was approved by the Environmental Protection Agency for use in animal feed but not for human consumption. Testing that led to the lawsuit began when an environmental group found StarLink corn in taco shells. Somehow, the StarLink corn had been mixed with regular corn in a number of cases. Under the approved settlement, the defendants will attach $6 million in coupons, each good for a dollar off, to packages of their products. Any portion of the $6 million not used by consumers through the coupons will be paid into a fund that will be used to support as-yet- undetermined charities or food research groups. The defendants have not released any comment on the settlement. HUNTER FAN: Voluntarily Recalls 100,000 Humidifiers For Fire Hazard ------------------------------------------------------------------- Hunter Fan Company is cooperating with the US Consumer Product Safety Commission (CPSC) by voluntarily recalling about 100,000 humidifiers. The motors in these humidifiers can overheat, posing a fire hazard. The Company has received nine reports of the humidifiers' motors overheating, including one incident involving minor property damage. No injuries have been reported. The recalled humidifiers have the following model numbers and date codes, which can be found on a label located on the back of the motor/switch housing: (1) Model 32500 CareFree - Size: 5 Gallon, Date Code: 15200 through 36500, 00101 through 36501 or 00102 through 06002, Light beige, made of plastic with a dark beige base, dark beige top vent and tinted water tank; (2) Model 33300 CareFree Plus - Size: 3 Gallon, Date Code: 15200 through 36500, 00101 through 36501, or 00102 through 06002, Light gray, made of plastic with dark gray top vent and dark gray base with a tinted water tank; (3) Model 33330 CareFree Plus - Size: 3.3 Gallon, Date Code: 15200 through 36500, 00101 through 36501, or 00102 through 06002, Light gray, made of plastic with dark gray top vent and dark gray base with a tinted water tank; (4) Model 33350 CareFree Plus - Size: 3.5 Gallon, Date Code: 15200 through 36500, 00101 through 36501, or 00102 through 06002, light gray, made of plastic with dark gray top vent and dark gray base with a tinted water tank; Discount, hardware and lighting stores, wholesale clubs, home Centers, catalogs and various online stores sold these humidifiers nationwide from August 2000 through February 2002 for between $50 and $120. For more information, contact the Company by Phone: 800-207-5982 or visit the firm's Web site: http://www.hunterfan.com INGALLS SHIPYARD: MI Federal Court Refuses To Certify Racial Bias Suit ---------------------------------------------------------------------- The US District Court in Biloxi, Mississippi refused to grant class certification and dropped two defendants in a lawsuit filed by workers of the Ingalls shipyard, in Pascagoula accusing the Company of racial discrimination. 11 current and former Company employees, and advocacy group, Ingalls Workers for Justice, filed the suit last year accusing the Company of failing to promote blacks and "the systematic steering of black workers to the filthiest, most unappealing and dangerous jobs." The workers have said graffiti in some parts of the yard includes racial slurs, references to the Ku Klux Klan and drawings of black people with nooses around their necks, according to Associated Press. Ingalls was once a part of Litton Industries, and was purchased by prominent aerospace company, Northrop Grumman Corporation. Judge Walter Gex dropped both Northrop Grumman and Litton from the suit, saying there was no evidence that either corporation was involved in "the alleged offending employment decisions." Attorney for the plaintiffs, Sandra Jaribu Hill, told AP that the plaintiffs will continue to pursue individual claims against Ingalls. KRAFT FOODS: WI Dairy Farmers Push For Full Antitrust Suit Hearing ------------------------------------------------------------------ The lawsuit accusing Kraft Foods, Inc. of manipulating the prices that dairy farmers paid for their milk deserves a full hearing, attorney for the plaintiffs, Thomas Dubbs, told the Wisconsin Supreme Court, according to the Gazette Extra! The suit alleges that the Company sold surplus cheese at a loss in order to reduce the minimum prices that the Agriculture Department requires cheesemakers to pay farmers for their milk. In 1999, a trial court ruled that a federal rule called the "filed rate doctrine" prevents such cases. The rule, created by US Supreme Court in 1922, prohibits antitrust suits from being filed in cases in which commercial rates or prices are set under the approval of the federal government. The State Court of Appeals later upheld the lower court's ruling. Mr. Dubbs asserts this ruling was incorrect, saying the filed rate doctrine should not apply because the USDA was not willing to take steps to prevent price manipulation from occurring. However, Company attorney Tefft Smith countered this, saying that Dane County Reserve Circuit Judge P. Charles Jones was correct. Judge Jones used the filed rate doctrine to dismiss the lawsuit against the Company because milk prices were lawfully established under a process created by the US Department of Agriculture, the Gazette Extra reports. Mr. Smith said dairy farmers could have sought an injunction to bar any alleged price manipulations, which the Company denied ever occurred. He also said they could have sought criminal prosecution of the Company. LONGWELL ELECTRONICS: Recalls 2.5MM Power Cord Sets For Shock Hazard --------------------------------------------------------------------- Longwell Electronics is cooperating with the US Consumer Product Safety Commission, (CPSC) by voluntarily recalling about 2.5 million power cord sets sold with inkjet printers from Hewlett-Packard Company. The connector can break, exposing electrical contacts and posing a shock hazard to consumers. The gray, two-wire power cord sets with a LS-7C connector were sold with the following HP printers: HP Deskjet 800 series and 900 series, HP Photosmart 1000 series, 1100 series, 1200 series, and 1300 series inkjet printers. The name "Longwell" is molded on the plug between the blades. Department, computer, office and electronic stores including Best Buy, CompUSA, Costco, Office Depot, Office Max, Staples and Wal-Mart stores sold the printers with the Longwell cord sets nationwide between April 2001 and February 2002 for between $100 and $400. For more information, contact Hewlett-Packard Corporation by Phone: 877-917-4378 anytime or visit the firm's Web site: http://www.hp.com MCDONALD'S CORPORATION: Settles Suit Over Beef Flavor in French Fries --------------------------------------------------------------------- McDonald's Corporation has agreed to pay $10 million to settle class actions brought in various states by hundreds of Hindus and vegetarians over the beef flavor in its French fries, the Seattle Times reports. The first suit was filed in Washington by Seattle attorney Harish Bharti, alleging the Company mislead customers who don't eat meat products by using beef tallow in its fries and hash browns after making a widely publicized 1990 pledge to cook them in vegetable oil. Suits in Illinois, Texas, California, New Jersey and Canada soon followed. Under the settlement, the Company will pay $10 million to various Hindu, vegetarian, kosher and children's charities and will publicly apologize for misleading consumers. The fast-food giant will also set up an advisory board to counsel the Company on vegetarian dietary issues and propose meatless menu items, the Seattle Times reports. Mr. Bharti told the Times an apology from the firm was very important. "Without an apology I wouldn't have thought of settling. An apology was more important to my clients than anything else," he said. The Company has also agreed to disclose the ingredients in its menu items. Mr. Bharti says, "I'm very proud of receiving the disclosure.In the long run, it's the best thing for the American consumer because McDonald's is a leader in the industry, and everybody else will have to follow. It's how the food industry will have to behave in the future." McDonald's has also agreed to publish its apology in newspapers after the settlement is completed. In a copy of the apology obtained by The Seattle Times, the Company acknowledges "mistakes were made in communicating to the public and customers about the ingredients in our French fries and hash browns.Those mistakes included instances in which French fries and hash browns sold at US restaurants were improperly identified as `vegetarian.'" RENT-A-CENTER INC.: Settling Sex Discrimination Suit for $47 Million -------------------------------------------------------------------- Rent-A-Center, Inc. has agreed to settle a national multi-million dollar sex discrimination class action filed by more than 5,000 women and the United States Equal Employment Opportunity Commission (EEOC). The settlement covers two pending cases, one in the US District Court for the Southern District in East St. Louis, Illinois and the other in the US District Court for the Western District of Tennessee in Memphis, Tennessee. The settlement includes the payment of $47 million and an agreement on the part of the Company to make significant changes to its hiring, firing and promotions policies and to create and maintain a Human Resources Department, which had been dissolved when Renters Choice acquired Rent-A-Center in 1998. "The women of Rent-A-Center will finally obtain well-deserved justice," said Mary Anne Sedey of Sedey & Ray. "This settlement provides significant benefits for the women who brought this case of sex discrimination and creates genuine opportunities for all women at Rent- A-Center in the future." "This is an unprecedented settlement for an employment discrimination case," said attorney Jerome Schlichter, of Schlichter, Bogard & Denton. "It is particularly important that Rent-A-Center has agreed to vacate the previously agreed-upon settlement in the Bunch case, which would have cost the company less and could have eliminated the claims of the women we represent. This company, its culture and its environment have been changed forever." The settlement will supercede an earlier settlement in principle reached in a parallel lawsuit (Bunch et. al. v. Rent-A-Center) for $15 million. The attorneys in the suits, the EEOC and the National Organization Women for Foundation opposed that settlement as inadequate and unfair. Although the above case will be dismissed as a result of this new settlement, the plaintiffs in that case will be entitled to their portion of this new settlement. "The Commission is particularly pleased that this settlement will move Rent-A-Center closer to the goal of providing true equality of opportunity for women. Our duty as a federal law enforcement agency is to provide both compensation for victims and future opportunities that put women on a equal footing with men. This proposed settlement does both," said Donna L. Harper, Supervisory Trial Attorney for the US Equal Employment Opportunity Commission in St. Louis. The settlement announced today also includes these provisions: (1) the Company agrees to fill ten percent of job vacancies in the first 15 months following the settlement with women who were fired because of their sex since the 1998 acquisition of Rent- A-Center, or who were rejected as job applicants because of their sex; (2) the Company will set up, publicize and pay for a toll-free number to be used by women job applicants or employees to report discrimination. Human resources professionals hired by the Company will answer and respond to these calls. These individuals will be trained in legal and practical requirements of equal employment opportunity and nondiscrimination; (3) the Company will provide quarterly reports for four years that include: descriptions of new employment policies and training programs the Company implements; descriptions of any sex discrimination complaints for job applicants or employees; and statistical information by gender regarding hiring, promotion and termination of employees; (4) the Company will create a Human Resources Department with an experienced Human Resources Vice President who will report directly to Company CEO Mark Speese or President Mitch Fadel. The Vice President will enjoy the full support of the Company, including senior corporate management, and will be given the resources necessary to develop, implement and monitor policies that ensure equal employment opportunity for women job applicants and employees; (5) the Company will publicize its desire to recruit qualified and interested women for jobs in its stores and for promotion into all jobs at all levels; (6) the Company will hire and retain a neutral, agreed-upon, qualified, third-party consultant who will serve as a resource to the Human Resources Department and an employee ombudsman and will consult on its new employment policies, which will include written qualifications for hiring and promotion; (7) the Company will produce and show a videotape featuring CEO Mark Speese and President Mitch Fadel that spells out its commitment to nondiscrimination and includes messages that the company welcomes women, values their contributions and will ensure that women are on a level playing field for jobs and promotions. Mr. Speese and Mr. Fadel will indicate that they recognize that there have been allegations of sex discrimination at the Company, that they do not approve of discriminatory conduct based on sex, and that the company will not tolerate such conduct. They will also encourage employees to report sex discrimination. A court-appointed Special Master, who is compensated by the company, will decide disputes regarding sex discrimination; (8) the Company will seek qualified women to serve on its currently all-male Board of Directors; (9) the Company will develop effective equal employment opportunity training programs for all employees at all levels. These trainings will include, but not be limited to, presentations at annual meetings; and (10) the Company will notify in writing all women job applicants who were rejected since August 2000 of the settlement of the case, encouraging them to respond if they wish to work for the Company. The Court will determine attorneys' fees and costs to be paid out of the settlement fund, and the way in which the class members will receive their portion of the settlement. For more information, contact Gretchen Wright of Schlichter, Bogard and Dento by Phone: 202-371-1999. RITALIN LITIGATION: CA Court Rejects Suit Over Use in ADHD Treatment -------------------------------------------------------------------- California Superior Court Judge Charles Walsh dismissed the class action against Novartis Pharmaceutical Corporation and the American Psychiatric Association (APA) relating to its use of the drug Ritalin to treat attention deficit hyperactivity disorder (ADHD). The suit alleges that Novartis and the APA encouraged over-diagnosis of behavioral disorders in children to boost sales of the drug. The two entities allegedly promoted the belief that a large number of children need to take Ritalin for ADHD, Associated Press reports. Last year, Judge Walsh determined that the plaintiff's claim was insufficient and gave leave of 90 days to amend the suit. The plaintiffs failed to respond by the deadline and then requested the dismissal on February 6, lawyers for Novartis told AP. Similar suits against the Company and the APA were filed in Texas, Florida and Puerto Rico, but have been dismissed. Another suit dismissed in California has been appealed. SEARS ROEBUCK: Admits No Liability in Credit Card Privacy Suit in IL -------------------------------------------------------------------- Retail giant Sears Roebuck and Co. stands by its privacy policy prohibiting sharing consumer information with businesses outside the Sears corporate family, a Company spokeswoman stated in response to a class action filed by two women accusing the Company of giving their personal information to telemarketers, direct mail marketers and other vendors. The suit, pending in the Circuit Court of Cook County, Illinois, alleges the Company sold personal information from their Sears credit card accounts without their consent and charges the Company with invasion of privacy. The suit names Memberworks, Inc., a direct mail marketer, as one of the vendors the Company sold the data to. A Company spokeswoman told ChicagoBusiness.com that she had not seen the lawsuit and could not comment. She added that MemberWorks, which sold health and dental discount programs, is a "licensee" of Sears and falls under the Company's family of businesses. SHOE COMPANIES: Nike, Adidas Factories Still "Sweatshops," Report Says ---------------------------------------------------------------------- Sportwear companies Nike, Inc. and Adidas-Salomon are still not doing enough to remedy the working conditions in their factories in Indonesia, a report from an Australia-based advocacy group states. The sportswear companies have been widely criticized by advocacy and rights groups over the condition of their Asian factory workers. The report, commissioned by the Oxfam Community Aid Abroad, was conducted between July 2001 and January 2002, and is based on the accounts of 35 workers from four factories producing for both companies in West Java. According to Reuters, the report says that while the Companies have instituted reforms to answer to international pressure, these were not enough. "Our feeling is that changes have occurred but they still fall well short of pulling workers out of poverty or providing them with safe conditions or protecting their rights to have unions which we see as the key issues," Timothy Connor, author of the report, "We Are Not Machines," told Reuters in a telephone interview. He added, "There have been improvements in terms of a reduction in sexual harassment, the availability of sick leave and a reduction in the level of humiliation against workers but they are still shouted at when they work too slowly." He adds that most of the Nike and Adidas factories operating in Indonesia are mainly owned by Taiwanese and Koreans. Company executives were not immediately available for comment, Reuters stated. TRI-STATE CREMATORY: Judge Withdraws Due To Relatives Involved in Suit ---------------------------------------------------------------------- Walker County Superior Court Judge William Ralph Hill recused himself from the litigation against owners of the Tri-State Crematory, after the defendant's attorney asserted that two of the judges may have family members who were sent to the crematory, the Atlanta Journal Constitution reports. Attorney Ken Poston, who is defending Tri-state's owner Ray Brent Marsh from charges of grave desecration and fraud, filed a motion earlier asking the four judges in the Lookout Mountain Judicial Circuit to recuse themselves. Mr. Poston alleged that two of the judges may have family members who were sent to the crematory, while the other two judges are related to attorneys suing the Marsh family for damages. Judge Hill's son, Larry Hill, is heading up a class action suit filed by multiple families of deceased people sent to the crematory, after authorities discovered that the crematory failed to cremate the bodies sent to them. Instead, the crematory dumped the bodies on its grounds. Investigators have recovered 339 bodies around the crematory since they found the first in mid-February. The discovery spurred many class actions against the crematory and the funeral homes that sent bodies to it. The Atlanta Journal-Constitution reports that the case now involves three states. Attorney Charlie Graddick recently filed a federal lawsuit in Mobile, Alabama. Graddick says he represents relatives of Joseph Patrick Rice, who died two years ago. The suit accuses Tri-State Crematory of acting with "depravity" in discarding corpses into "pits, vaults, sheds or wooded areas" on the property. Tennessee authorities have said they plan to file charges against Mr. Marsh on Monday. TRUDEAU CORPORATION: Recalls 20,000 Fondue Sets For Burn, Fire Hazard --------------------------------------------------------------------- Trudeau Corporation is cooperating with the US Consumer Product Safety Commission (CPSC) by voluntarily recalling about 20,000 fondue sets. The plastic ring with handles that is attached to the upper rim of the fondue pot can crack during normal heating or cooling, posing burn and fire hazards to consumers. The Company has received 30 reports of plastic rings breaking, including one report of a consumer who was burned on the hand and reported fire damage to a rug. The recalled fondue pots are blue or white metal and have a black plastic ring that is attached to the upper rim of the fondue pot. The plastic ring includes two handles that allow for safe usage of the fondue pot. The fondue pot sits on a black, four-legged stand, which houses the burner. The fondue sets were sold under the brand names "Distinction by Trudeau" and "Trudeau Fondue Set." Retail stores nationwide, including Target, sold the fondue sets from October 2001 through January 2002 for between $20 and $40. For more information, contact the Company by Phone: 800-465-8909 or visit the firm's Web site: http://www.trudeaucorp.com Securities Fraud ACTRADE FINANCIAL: Cohen Milstein Commences Securities Suit in S.D. NY ---------------------------------------------------------------------- Cohen, Milstein, Hausfeld & Toll, PLLC initiated a securities class action in the United States District Court for the Southern District of New York, on behalf of purchasers of the stock of Actrade Financial Technologies, Ltd. (NYSE:ACRT) during the period March 11, 1999 through and including February 8, 2002. 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 during the class period. Throughout the class period, the Company issued press releases announcing record quarterly results and describing its business as providing trade financing and business-to-business financing solutions. In addition, the Company, in its fiscal year 2000 and 2001 Annual Report filed with the SEC on Form 10-K405, represented that its loans were covered by insurance and surety bonds, which minimized the Company's risk on the loans. The representations in the press releases and annual reports were, according to the allegations of the complaint, materially false and misleading because the Company had loaned over $10 million to individuals, not businesses, who used the proceeds personally. In addition, according to the complaint, defendants are alleged to have failed to disclose to their insurers and sureties the nature of the personal loans and, as a result, the Company was jeopardizing its ability to collect under the policies and surety bonds in the case of default. On February 11, 2002, Barron's published an article detailing the Company's questionable lending practices and its alleged misrepresentations and omissions to insurers and sureties. The article recounts a $6.3 million loan-default by an individual that the Company was attempting to recruit as a broker, and which an insurer and surety refused to cover on his default because they allegedly were led to believe by the Company that the loan was for a business purpose when in fact the individual pocketed the funds. In reaction to the Barron's article, Company stock price plummeted by 45%, falling to $13.75 per share on February 11, 2002, from a $24.89 per share close on February 8, 2002. For more information, contact Andrew N. Friedman or Mary Ann Fink by Phone: 888-240-0775 or 202-408-4600 by E-mail: mfink@cmht.com or afriedman@cmht.com or visit the firm's Web site: http://www.cmht.com ALLIED IRISH: Brian Felgoise Commences Securities Suit in S.D. NY ----------------------------------------------------------------- Law Offices of Brian M. Felgoise, PC initiated a securities class action on behalf of shareholders who acquired Allied Irish Banks, PLC (NYSE:AIB) securities between January 1, 2001 and February 6, 2002, inclusive, in United States District Court for the Southern District of New York, against the Company and certain key officers and directors. The suit 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 more information, contact Brian M. Felgoise by Mail: 230 South Broad Street, Suite 404, Philadelphia, Pennsylvania, 19102 by Phone: 215-735-6810 or by E-mail: BrianFLaw@yahoo.com BROCADE COMMUNICATIONS: Securities Suit Dismissed in S.D. New York ------------------------------------------------------------------ The US District Court for the Southern District of New York dismissed without prejudice the consolidated securities class action pending against Brocade Communications Systems, Inc. (Nasdaq: BRCD) and its officers and directors for alleged securities violations. The suit, filed on behalf of purchasers of the Company's stock between May 24,1999 and July 17,2001, inclusive, alleges that defendants violated the federal securities laws by selling the Company's common stock pursuant to the May 24, 1999 IPO without disclosing to investors that some of the underwriters in the offering had solicited and received excessive and undisclosed commissions from certain investors. "We have always maintained that these charges are unfounded, and we are pleased that the Court agreed with us and dismissed this unwarranted lawsuit," said Ron Epstein, Brocade Vice President and General Counsel. COMPUTER ASSOCIATES: Cauley Geller Commences Securities Suit in E.D. NY ----------------------------------------------------------------------- Cauley Geller Bowman & Coates, LLP initiated a securities class action in the United States District Court for the Eastern District of New York on behalf of purchasers of Computer Associates International, Inc. (NYSE: CA) common stock during the period between May 28, 1999 and February 25, 2002, inclusive. The suit charges defendants with violating 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, the complaint alleges that: (1) beginning prior to May 1999, the Company falsely indicated that it had penetrated the distributed systems market when, in fact it was giving away its distributed system software free, or at nominal additional cost, to customers who were also extending mainframe software licenses, and attributed large portions of the resulting revenue to the non-mainframe products; (2) beginning prior to May 1999, and ending in October 2000, when the Company extended a license during its term, it recognized revenue for the entire new license. Until June 2000, when the Company began using new auditors, it did not "back out" the revenue from the unexpired portion of the old license, double- counting the revenue. After June 2000, the Company began backing out this figure in an obscure line item - but never disclosed that this caused revenue to be overstated by more than one hundred million dollars each quarter prior to June 2000; and (3) defendants, in order to hide a severe drop in revenue as measured by generally accepted accounting principles (GAAP), announced a "new business model," which they represented involved offering more flexible licensing terms to customers. In fact, the "new business model" was a cover to institute new, non- GAAP compliant accounting (which the Company calls "pro forma, pro rata"), and to obscure the fact that the switch from long-term licenses to flexible subscriptions was not a proactive move, but a symptom of the obsolescence of the Company's main product line. While the stated goal of the "new business model" was to provide customers more flexible terms, the real purpose was to cover up the fact that the Company could no longer get many of their mainframe customers to purchase the long-term licenses of mainframe software which have been its mainstay. After the announcement of the "new business model" in October 2000, the Company issued press releases heralding moderate growth, through the GAAP figures showed a revenue decrease of nearly sixty percent. The "pro forma, pro rata" method counted revenue from old license sales in current and future periods, using old revenues to buttress the current, deteriorating sales. Defendants have allegedly attempted to have their cake and eat it, too. In a strong economy, the Company recognized all the revenue from its sales immediately, even double- counting some revenue, and showing impressive numbers. Now, in a sagging economy, they have obscured the real loss of sales by changing to a method of accounting so back-loaded that it does not conform to GAAP. The "pro forma, pro rata" method also did not make the distinctions between product and service revenue required by GAAP, obscuring the distinction and further hiding the deterioration in sales. The Company has continued to report its GAAP figures, as it is required by the Securities and Exchange Commission to do. Incredibly, defendants have falsely stated that the GAAP figures are not reflective of the Company's financial position, and that the "pro forma, pro rata" figures do accurately reflect the Company's financial position. The Company's true condition, however, is shown by the conduct of defendants during the class period. After announcing the "new business model" but before reporting under it for the first time, and contrary to the Company's representations that the rosy picture created by the "pro forma, pro rata" figures was an accurate portrayal of the Company's position, the defendants engineered a clandestine, firm-wide layoff, hiding the terminations as individual performance-based firings. They fired possibly as many as a thousand employees with no severance package, and continue to deny that the firings were a layoff, even though executives involved in the layoff have confirmed it to the New York Times (as reported on March 20, 2001). More recently, the Company was forced to withdraw a planned debt offering after Moody's questioned the quality of the Company's credit. As a result, the Company admits, it was forced to draw down $600 million on one credit line to pay another. The desperate cost-cutting by secret layoff, use of its new unrecognized accounting just when its revenue has dropped sharply, and the use of credit lines to service existing debt, demonstrate that defendants are keenly aware of the precarious financial condition of the Company, and have deliberately misled the investing public. The misleading picture the Company has presented has not gone unquestioned. On February 22, 2002, the Company confirmed that it was aware that both the Securities Exchange Commission and the Federal Bureau of Investigation were investigating the Company's accounting for civil, and in the case of the FBI, criminal violations. News of the criminal and civil probes, which began to surface on February 20, caused investors to flee the stock, which fell from a February 19 closing price of $25.31 to a February 22 close of $15.99, a drop of 36.8%. For more information, contact Jackie Addison, Sue Null or Shelly Nicholson by Mail: P.O. Box 25438, Little Rock, AR 72221-5438 by Phone: 888-551-9944 by E-mail: info@classlawyer.com or visit the firm's Web site: http://www.classlawyer.com CORNELL COMPANIES: Milberg Weiss Commences Securities Suit in S.D. TX --------------------------------------------------------------------- Milberg Weiss Bershad Hynes and Lerach LLP initiated a securities class action in the United States District Court for the Southern District of Texas on behalf of purchasers of Cornell Companies, Inc. (NYSE:CRN) common stock during the period between March 6, 2001 and March 5, 2002. The suit charges the Company and certain of its officers and directors with violations of the Securities Exchange Act of 1934. The suit alleges that during the class period, defendants issued favorable but false financial statements and made false and misleading statements about the Company's business. As a result of these false statements, the Company's stock traded as high as $18.40. Defendants took advantage of this artificial inflation, selling 3.4 million shares of the Company's stock for proceeds of over $48 million in a November 2001 secondary offering. On February 6, 2002, Bloomberg ran an article on the Company which stated in part, "Cornell Cos., which operates 69 prisons in 13 states and the District of Columbia, said it will review the accounting of an August real estate transaction involving 11 properties. Its shares fell as much as 63 percent. The company received a letter Thursday from auditor Arthur Andersen LLP that raised concern about the transaction, said Larry Stein of FRB Weber Shandwick, a firm that handles public relations for Cornell. The Andersen review was part of a year-end audit." Upon these disclosures, company stock dropped to as low as $6.50 before closing at $9.96 on February 6, 2002, some 45% below the class period high of $18.40. On March 6, 2002, the Company issued a press release entitled, "Cornell Companies Inc. to Restate Its Financials for Year Ended December 31, 2000 and Subsequent Quarters." On this news, the Company's shares plummeted once again by more than 10%. For more information, contact William Lerach by Phone: 800/449-4900 by E-mail: wsl@milberg.com or visit the firm's Web site: http://www.milberg.com CORNING INC.: Johnson Perkinson Commences Securities Suit in W.D. NY -------------------------------------------------------------------- Johnson & Perkinson initiated a securities class action in the US District Court for the Western District of New York on behalf of all persons or entities who purchased securities of Corning, Inc. (NYSE: GLW) between September 27, 2000 through July 10, 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 knew that disclosure of the weakening of demand for the Company's products, accumulation of obsolete inventory, risks of an acquisition planned by the Company, and the inadequate basis for the Company's growth projections would derail the planned $4.4 billion common stock and zero-coupon convertible bond offering that they had announced on September 27, 2000. The Company's top executives determined to knowingly conceal adverse information about the company's operations and prospects. The resulting false and misleading statements and omissions in the Company's prospectus/registration statement and other public statements during the class period were intended to allow, and did allow, the Company to successfully complete the multibillion-dollar public offering on November 6, 2001. For more information, contact Dennis J. Johnson or Jacob B. Perkinson by Mail: 1690 Williston Road, South Burlington, Vermont 05403 by Phone: 877-266-2133 or by E-mail: JPLAW@adelphia.net. GLOBAL CROSSING: Schiffrin Barroway Lodges Securities Suit in W.D. NY --------------------------------------------------------------------- Schiffrin and Barroway LLP initiated a securities class action against Global Crossing, Ltd. (NYSE:GX) (OTCBB:GBLXQ) claiming that the Company misled investors about its business and financial condition, in the US District Court for the Western District of New York on behalf of all investors who bought Company securities between February 14, 1999 and October 4, 2001. The suit alleges that the Company, during the class period, issued false and misleading statements, press releases, and SEC filings concerning its financial condition, as well as its ability to generate sufficient cash revenue from new revenue sources considering the failing market for broadband access. Prior to the disclosure of the Company's true financial condition, the individual defendants and other insiders sold holdings of common stock for proceeds of more than $149 million. In addition, during the class period defendants caused the Company to sell notes on favorable terms to itself, which generated $1 billion in investor capital. On October 4, 2001, the Company announced that cash revenues in the third quarter would be approximately $1.2 billion, $400 million less than the $1.6 billion expected by analysts and forecast several times earlier in the year by defendants. In addition, the Company and the defendants stated that they expected recurring adjusted EBITDA to be "significantly less than $100 million" compared to forecasts of $400 million made several times earlier in the year. Following this series of announcements, Company share priced plummeted nearly 50% to $1.07 per share on extremely heavy trading volume. Subsequently, with its stock trading at well under a dollar per share of common stock, the Company filed for Chapter 11 Bankruptcy protection on January 28, 2002 after becoming unable to service its debt. For more information, contact the Shareholder Relations Manager by Phone: 888-299-7706 (toll free) or 610-822-2221 by E-mail: info@sbclasslaw.com or visit the firm's Web site: http://www.sbclasslaw.com GLOBAL CROSSING: Emerson Firm Commences Securities Suit in W.D. NY ------------------------------------------------------------------ The Emerson Firm initiated a securities class action in the United States District Court for the Western District of New York on behalf of purchasers of Global Crossing, LTD. (NYSE:GX) (OTCBB:GBLXQ) common stock during the period between April 28, 1999 and October 4, 2001, inclusive. The suit charges certain of the Company's officers and directors violated the Securities Exchange Act of 1934. The suit charges that during the class period, defendants issued false and misleading statements, press releases, and SEC filings concerning the Company's financial condition, as well as its ability to generate sufficient cash revenue from new revenue sources considering the failing market for broadband access. Prior to the disclosure of the Company's true financial condition, the individual defendants and other insiders sold holdings of the Company's common stock for proceeds of more than $149 million. In addition, during the class period defendants caused the Company to sell notes on favorable terms to itself, which generated $1 billion in investor capital. On October 4, 2001, the Company announced that cash revenues in the third quarter would be approximately $1.2 billion, $400 million less than the $1.6 billion expected by analysts and forecast several times earlier in the year by defendants. In addition, the Company and the defendants stated that they expected recurring adjusted EBITDA to be "significantly less than $1000 million" compared to forecasts of $400 million made several times earlier in the year. Following this series of announcements, the Company's share price plummeted nearly 50% to $1.07 per share on extremely heavy trading volume. Subsequently, with its stock trading at well under a dollar per share of common stock, the Company filed for Chapter 11 Bankruptcy protection on January 28, 2002 after becoming unable to service its debt. For more information, contact Anne Bond by Phone: 501-907-2555 or by E- mail: jge@emersonfirm.com HANOVER COMPRESSOR: Schiffrin Barroway Lodges Securities Suit in TX ------------------------------------------------------------------- Schiffrin & Barroway, LLP expanded the class period in the securities class action to include as members of the class all purchasers of the common stock of Hanover Compressor Company (NYSE: HC) from May 15, 2000 through January 28, 2002, inclusive. Recently, the Company announced that it would restate its financial results for the year ended December 31, 2000 and the nine months ended September 30, 2001 to reflect changes in the Company's accounting treatment for certain transactions. The suit, pending in the United States District Court for the Southern District of Texas, Houston Division, alleges that certain of the Company's officers and directors violated the Securities Exchange Act of 1934. The complaint charges that during the relevant time period, defendants issued false and misleading statements, press releases, and SEC filings concerning the Company's financial condition. These statements had the effect of artificially inflating the price per share of the Company's common stock and other securities. For more information, 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 by E-mail: info@sbclasslaw.com or visit the firm's Web site: http://www.sbclasslaw.com IMCLONE SYSTEMS: Bernstein Liebhard Commences Securities Suits in NY -------------------------------------------------------------------- Bernstein Liebhard and Lifshitz LLP initiated a securities class action on behalf of all persons who acquired ImClone Systems, Inc. (NASDAQ: IMCL) securities between May 12, 2001 and January 4, 2002, inclusive, in the United States District Court for the Southern District of New York. Named as defendants in the complaint are the Company, Samuel D. Waksal, and Harlan W. Waksal. The suit alleges that defendants made materially false and misleading statements about the efficacy of Erbitux, the Company's new "blockbuster" drug for the treatment of cancer and the progress of its application for the Food and Drug Administration's (FDA) approval of Erbitux. Among other things, defendants misrepresented during the class period that its Phase II test results for Erbitux were strongly confirmatory of its primary endpoint (tumor regression). The foregoing representations were materially misleading because, among other things, ImClone had failed to document that patients in the Phase II test had failed to experience tumor regression after chemotherapy (which was a requirement of the Phase II protocol). In reliance on the truth and accuracy of defendants' public statements, Company shares traded as high as $75.45 per share during the class period. On December 28, 2001, the Company shocked the market by issuing a press release that disclosed that the FDA had rejected its filing of a Biologics License Application (BLA) for Erbitux. The first trading day after the issuance of the press release, on December 31, 2001, Company shares plummeted $11.15, or 20%, to $44.10. On January 4, 2002, the Cancer Letter revealed the true contents of the FDA's December 28, 2001 letter to the Company, including the fact that the FDA repeatedly informed the Company about the problems with the clinical trials during the class period. After these additional facts were disclosed, the Company fell further to open on January 7, 2002 at $34.96 per share. 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 by E-mail: at IMCL@bernlieb.com or visit the firm's Web site: http://www.bernlieb.com IRVINE SENSORS: Rabin Peckel Commences Securities Suit in C.D. CA ----------------------------------------------------------------- Rabin and Peckel LLP initiated a securities class action in the United States District Court for the Central District of California Southern Division, on behalf of all persons or entities who purchased Irvine Sensors Corporation common stock (Nasdaq:IRSN) between January 6, 2000 and September 15, 2001, both dates inclusive. The suit alleges that the Company, a high-tech research and development firm, along with certain of its officers and directors, violated federal securities laws by, among other things, repeatedly maintaining throughout the class period that Silicon Film Technologies, Inc., a majority-owned Company subsidiary, was near the completion of its Electronic Film System or "EFS-1." The EFS-1 is a device which would interface with a conventional camera to enable the camera to take digital pictures, all the while knowing that the EFS-1 was suffering from serious and insurmountable technical design flaws. On September 15, 2001, after nearly two years of touting the EFS-1 technology, the Company abruptly announced that SFI had suspended operations and was considering bankruptcy, essentially ending the EFS-1 project. This news caused the Company's stock price to plummet from a class period high of $14 a share to a low of 12 cents. According to the complaint, due to defendants' deceptive and illegal conduct, the Company's stock price of ISC was artificially high throughout the class period, causing plaintiff and the other class members to purchase their Company securities at inflated prices. For more information, contact Eric Belfi or Maurice Pesso by Mail: 275 Madison Avenue, New York, NY 10016 by Phone: 800-497-8076 or 212-682- 1818 by Fax: 212-682-1892 or by E-mail: email@rabinlaw.com. JP MORGAN: Johnson Perkinson Initiates Securities Suit in S.D. NY ----------------------------------------------------------------- Johnson & Perkinson commenced a securities class action in the US District Court for the Southern District of New York on behalf of a all persons or entities who purchased securities of J.P. Morgan Chase & Co., (NYSE: JPM) between October 17, 2001 and January 28, 2002, inclusive. The suit charges the Company with violations of federal securities laws, and claims that defendant's material omissions and the dissemination of materially false and misleading financial statements and other public statements caused Company stock price to be artificially inflated, inflicting enormous damages on investors. More specifically, the Company failed to timely reserve for and/or write off receivables due from Enron, the collectability of which was doubtful. The Company then recklessly issued a public statement materially understating its risk and loss exposure related to Enron, the company notorious for its financial collapse. The Company thereafter wrote down $1.13 billion in non-performing assets, specifically related to losses generated by its dealings with Enron. For more information, contact Dennis J. Johnson or Jacob B. Perkinson by Mail: 1690 Williston Road, South Burlington, Vermont 05403 by Phone: 888-256-0890 or by E-mail: JPLAW@adelphia.net. NTN COMMUNICATIONS: Sued For Rejecting Buyout Offer in California Court ----------------------------------------------------------------------- Broadcast company NTN Communications faces a securities class action pending in San Diego Superior Court, over its rejection of a buyout offer from an undisclosed company two weeks ago, SignOnSanDiego reports. The suit charges the Company and several of its directors and executives of breaching their fiduciary duty by failing to try to negotiate a higher offer from the prospective buyer. The suit was commenced after the Company announced on February 22, that it would reject the offer from a "well-capitalized" public company because its Board of Directors believed the Company could create more value to shareholders on its own. Stanley Kinsey, the Company's Chief Executive Officer, said in a conference call that the lawsuit is without merit and the Company plans to fight it. NVIDIA CORPORATION: Schiffrin Barroway Files Securities Suit in N.D. CA ----------------------------------------------------------------------- Schiffrin & Barroway, LLP initiated a securities class action in the US District Court for the Northern District of California, charging NVIDIA Corporation (Nasdaq:NVDA) with misleading shareholders about its business and financial condition. The suit seeks damages for violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of all investors who bought Company securities between February 15, 2000 through February 14, 2002. The suit charges the Company and certain of its officers and directors with issuing false and misleading statements concerning its business and financial condition. Specifically, the suit alleges that as part of their effort to boost the price of Company stock, defendants misrepresented its true prospects in an effort to conceal the Company's improper acts until they were able to sell at least $66 million worth of their own stock. In order to overstate revenues and assets in its 4th Quarter 2000, 1st to 3rd Quarter 2001, the Company violated generally accepted accounting principles and SEC rules by engaging in an illegal accounting scheme. This scheme had the effect of dramatically overstating revenues and assets. Then, on February 14, 2002 (after the close of the market), the Company partially admitted that its past accounting for its prior results may be inaccurate in a press release entitled, "NVIDIA Corporation Conducting Review of Certain Transactions at the Request of the SEC." On this news the company's shares plummeted the following day. 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 Web site: http://www.sbclasslaw.com QWEST COMMUNICATIONS: Employees Files 401(k) Suit in Colorado Court ------------------------------------------------------------------- Qwest Communications International faces two class actions in Denver, Colorado Federal Court charging the Company with mismanaging its employees savings and investment plan, Reuters reports. The suit alleges that the Company failed to disclose that keeping a high percentage of the plan in Company stock was imprudent and "exposed participants to unreasonable risk of loss and injury." In the plan, participants can contribute between one and 16 percent of their base pay, with the Company matching 81% of employee contribution up to 6% of their pay. The money the Company puts in the plan has been in shares and participants could not sell the Company-contributed shares until they reached 55, according to the lawsuit. The Company has been under pressure recently, negotiating with its banks to amend a $4 billion credit pact, Reuters reports. On Tuesday, Moody's Investors Service downgraded the Company's $25 billion in debt to a notch above "junk" status. SYMBOL TECHNOLOGIES: Wolf Haldenstein Files Securities Suit in E.D. NY ---------------------------------------------------------------------- Wolf Haldenstein Adler Freeman & Herz LLP initiated a securities class action in the United States District Court for the Eastern District of New York, on behalf of purchasers of the common stock of Symbol Technologies, Inc. (NYSE:SBL) between October 19, 2000 and February 13, 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 suit alleges that defendants engaged in conduct which effectively increased the Company's reported revenue and profits: (1) the Company booked as profit in the third quarter 2000 a one- time royalty payment in excess of $10 million, enabling it to make its third quarter projections; (2) the Company used expenses associated with its acquisition of Telxon to mask the fact that its sales were declining; and (3) the Company booked as having shipped in the first quarter of 2001 more than $40 million in inventory that included side provisions allowing customers to delay payments or return merchandise, or included products that "never left the warehouse." The Company subsequently had a second-quarter 2001 inventory write-down of $67.1 million after tax. On February 13, 2002, Newsday, Inc. reported that the Company had engaged in the above-described accounting practices, received an inquiry letter from the Securities and Exchange Commission, and had hired accounting and consulting firm KPMG to review its sales process. The next day, the Company announced it was lowering its outlook for 2002 earnings and that its Chief Executive Officer would retire in May 2002. In response to the Newsday article and the Company's announcements, the price of Company stock plunged more than 53% from an opening price of $14.15 on February 14, 2002 to a low of $6.60 on February 15, 2002 on unusually heavy trading volume. Form 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 SBL. TYCO INTERNATIONAL: Stull Stull Commences Securities Suit in S.D. NY -------------------------------------------------------------------- Stull Stull and Brody initiated a securities class action in the United States District Court for the Southern District of New York, against Tyco International, Ltd. (NYSE:TYC) on behalf of individuals who purchased the Company's common stock between February 5, 1999 and February 4, 2002, inclusive against the Company, its CEO, L. Dennis Kozlowski and its CFO, Mark H. Swartz. The suit alleges that defendants violated sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and SEC Rule 10b-5 promulgated thereunder, by failing to disclose hundreds of acquisitions during the class period which improperly inflated reported revenue and earnings. For more information, contact Tzivia Brody by Mail: 6 East, 45th Street, New York NY 10017 by Phone: 800-337-4983 by Fax: 212-490-2022 or by E-mail: SSBNY@aol.com WILLIAMS COMPANIES: Lockridge Grindal Commences Securities Suit in OK --------------------------------------------------------------------- Lockridge Grindal Nauen PLLP initiated a securities class action in the United States District Court for the Northern District of Oklahoma on behalf of purchasers of Williams Companies, Inc. (NYSE:WMB) and Williams Communications Group, Inc. (NYSE:WCG) (collectively "Williams") common stock during the period between July 24, 2000 through January 29, 2002, inclusive. The suit names as defendants both companies and certain of its officers and directors, including: (1) Keith E. Bailey, (2) Howard E. Janzen, and (3) Scott E. Schubert The suit charges that defendants violated the Securities Exchange Act of 1934 by issuing a series of materially false and misleading statements to the market in press releases and public filings during the class period with respect to the Company's financial condition. Additionally, the suit alleges that the Company and the individual defendants, as officers and/or directors, failed to disclose material information regarding the spin-off of Williams Group from Williams Co., the accounting and financial impact of the contingent liabilities retained by Williams Co., and the nature of the assets and liabilities of Williams Group. More specifically, the suit alleges that Williams failed to disclose that: (i) the spin-off of Williams Group from Williams Co. was adverse to the interests of Company shareholders because the primary motivation for the spin-off was to allow Williams Co. to artificially strengthen its balance sheet to enable it to protect its debt rating while acquiring more companies using Williams Co. common stock as currency; (ii) Williams Group was operating well below expectations and was overstating revenue projections while understating costs and expenses; (iii) while Williams Co.'s guaranteed payment of $2 billion in Williams Group debt became increasingly likely due to Williams Group's declining financial condition, Williams Co. failed to adequately reserve for the debt and labeled it as a mere contingent obligation; and (iv) rather than write off tens of millions of dollars in permanently impaired Williams Group debt, Williams Co. agreed to extend up to $100 million of Williams Group's receivables. The Company's false and misleading statements had the effect of artificially inflating the price per share of Company common stock. On January 29, 2002, Williams Co. announced in a press release that it was delaying the release of its 2001 earnings pending an internal investigation of the financial effect of its obligation to Williams Group regarding Williams Group's $1.4 billion debt. This announcement and the subsequent discovery of the Company's questionable financial dealings and misrepresentations led to a dramatic drop in its stock price resulting in substantial losses to its shareholders. For more information, contact Karen M. Hanson by Mail: 100 Washington Avenue South Suite 2200 Minneapolis, MN 55401 by Phone: 612-339-6900 or by E-mail: kmhanson@locklaw.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. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The CAR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *